Open Approaches to Innovation

Wernick, Alina

doi:10.1007/978-3-030-72257-9_3

Alina Wernick⁴

Part of the book series: Munich Studies on Innovation and Competition ((MSIC,volume 15))

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Abstract

This Chapter distinguishes three open approaches to innovation: The Market Correction Model, the Open Innovation Theory, and User and Open Collaborative Innovation and reviews how they explain the motivations behind giving voluntary access to intellectual property. What qualifies as “openness” differs dramatically between the three theories. On this basis, the open models and the licensing practices they represent are placed on a continuum that ranges from restricted to indiscriminate access. The impact on innovation and competition of each level of openness is analysed. Mechanisms that are based on indiscriminate licensing, such as patent pledges, patent pools, and open viral patenting, are evaluated in more detail concerning their legal foundations, legal bindingness, and incentives to employ them. The chapter identifies the scope of incentives to engage in open licensing and arrives at the conclusion of them being insufficient to resolve all the market failures that hinder follow-on innovation.

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Notes

1.
See Merges, "Contracting into liability rules," 1295, 1298, 1392-1393; Barnett, "Property as Process," 431-433, 455-456.
2.
For OI theory, see Chesbrough, Open Innovation, 43-62; for UOCI theory, see genrally von Hippel, Democratizing Innovation; Baldwin and von Hippel, "Modeling a Paradigm Shift." The concept of open innovation has already been subject to considerable debate in the originating research community; see, for example, Linus Dahlander and David M. Gann, "How Open Is Innovation?," Research Policy 39, no. 6 (2010): 699-700; Aard J. Groen and Jonathan D. Linton, "Is Open Innovation a Field of Study or a Communication Barrier to Theory Development?," Technovation 30, no. 11 (2010) 2-9; Georg von Krogh, "Is Open Innovation a Field of Study or a Communication Barrier to Theory Development? Commentary," Technovation 31, no. 7 (2011) 286; Eric von Hippel, "Comment on ‘Is Open Innovation a Field of Study or a Communication Barrier to Theory Development?’," Technovation 30, no. 11 (2010): 555; Harold A. Linstone, Technovation 30, no. 11 (2010) 556; Anthony di Benedetto, "Comment on 'Is Open Innovation a Field of Study or a Communication Barrier to Theory Development?'," Technovation 30, no. 11-12 (2010): 557; Henry Chesbrough and Marcel Bogers, "Explicating Open Innovation : Clarifying an Emerging Paradigm for Understanding Innovation," in New Frontiers in Open Innovation, ed. Henry Chesbrough, Wim Vanhaverbeke, and Joel West (New York: Oxford University Press, 2014), 24.
3.
Ikujiro Nonaka, "Foreword : Open Innovation and Knowledge Creation," in New Frontiers in Open Innovation, ed. Henry Chesbrough, Wim Vanhaverbeke, and Joel West (New York: Oxford University Press, 2014), i.
4.
Dahlander and Gann, "How Open Is Innovation?," 703.
5.
Eelko K. R. E. Huizingh, "Open Innovation : State of the Art and Future Perspectives," Technovation 31, no. 1 (2011): 3-4; Georg von Krogh, "Is Open Innovation a Field of Study or a Communication Barrier to Theory Development? Commentary," Technovation 31, no. 7 (2011): 286; Eric von Hippel, "Comment on ‘Is Open Innovation a Field of Study or a Communication Barrier to Theory Development?’," Technovation 30, no. 11 (2010): 555.
6.
Dahlander and Gann, "How Open Is Innovation?," 702.
7.
Mattioli, "Communities of Innovation," 108, 116, 118; Merges, "Contracting into Liability Rules," 1295, 1298, 1392-1393; Barnett, "Property as Process," 431-433, 455-456.
8.
Coase, "Problem of Social Cost," 12, 15; Merges, "Contracting into Liability Rules," 1318-1323; Barnett, "Property as Process," 411.
9.
See Mancur Olson, Logic of Collective Action (Cambridge, MA: Harvard University Press, 1971); Elinor Ostrom, Governing the Commons : The Evolution of Institutions for Collective Action (New York: Cambridge University Press, 2008). Olson argues that individual actors can unite into a group in order to pursue a goal that promotes their collective self-interest, but such a collective action would be subject to inefficiencies due to free-riding on the contributions of others. Olson, Logic of Collective Action, 1-3. Collective action is thus subject to the prisoners’ dilemma: Actors may not unite to produce a public good because they expect that others will free-ride on it. Russell Hardin, Collective Action (Baltimore: John Hopkins University Press, 1982), 17, 30. Collective action has a greater chance of succeeding when a group is relatively small or when additional incentives to those offered by achieving the group’s goal are offered to individual actors. Olson, Logic of Collective Action, 1-3. However, Ostrom argues that, with regard to common pool resources (CPRs), the free-rider problems associated with the tragedy of the commons—namely the prisoner’s dilemma of collective action—can be resolved, and the use of a resource can be sustainable. Common pool resources are qualified as being rival and non-excludable. They may be scarce renewable resources that are produced by nature, such as fishing grounds, or be man-made, such as irrigation canals. When subject to repeated interactions, individual actors who are interested in consuming a CPR may come to cooperate with the aim of developing rules and institutions that enable sustainable management of the resource in question. These rules that govern such collective action will be based on local information concerning resources, and adherence to such rules will monitored by the members of the group in question. Such arrangements represent institutional alternatives to private companies or public governments. Ostrom, Governing the Commons, 2-7, 30-32, 39-40. See also Yochai Benkler, "Between Spanish Huertas and the Open Road : A Tale of Two Commons," in Governing Knowledge Commons, ed. Brett M. Frischmann, Michael J. Madison, and Katherine J. Strandburg (New York: Oxford University Press, 2014), 91.
10.
Merges, "Contracting into Liability Rules," 1318-1323.
11.
Calabresi and Melamed, "Property Rules, Liability Rules, and Inalienability," 1092-1093; Merges, "Contracting into Liability Rules," 1318-1323.
12.
Merges, "Contracting into Liability Rules," 1307.
13.
Ibid, 1293-1295, 1302-1303, 1319, 1323-1327, 1392.
14.
Merges, "New Dynamism in the Public Domain," University of Chicago Law Review 71, no. 1 (2004): 188, 192-193.
15.
Barnett, "Property as Process," 384, 387-389, 410. Note that Barnett is agnostic with respect to overprotection problems’ factual hindering effect on cumulative innovation.
16.
Ibid, 387.
17.
Ibid, 384, 388-389, 446, 453.
18.
Ibid, 384, 430-432, 434-437, 439-442, 453.
19.
Ibid, 431-432; Barnett, "Anti-Commons Revisited," 130.
20.
Shapiro, "Navigating the Patent Thicket," 122, 126, 134.
21.
Merges, "Contracting into Liability Rules," 1321 and fn 76.
22.
Barnett, "Property as Process," 390, 413, 433.
23.
Ibid, 432 [italics removed].
24.
Ibid, 390, 413.
25.
Barnett, "Anti-Commons Revisited," 130.
26.
Barnett, "Property as Process," 411-412.
27.
Ibid, 390-391, 433.
28.
Barnett, "Anti-Commons Revisited," 150-151.
29.
Merges, "Contracting into Liability Rules," 1295-1296; Barnett, "Property as Process," 422–423.
30.
Barnett, "Property as Process," 402-405. See also Barnett, "Illusion of the Commons," Berkeley Technology Law Journal 25, no. 5 (2010), 1811, 1805; Merges, "New Dynamism in the Public Domain," 186, 192. The relevance of a complementary source of revenue as an incentive is also in the context of UOCI, see Sect. 3.1.3.3.
31.
Barnett, "Anti-Commons Revisited," 130, 141.
32.
Barnett, "Property as Process," 414.
33.
Merges, "Contracting into Liability Rules," 1391.
34.
Barnett, "Property as Process," 417–418.
35.
Shapiro, "Navigating the Patent Thicket," 126.
36.
Barnett, "Anti-Commons Revisited," 139–140.
37.
Mattioli, "Communities of Innovation," 150.
38.
See Olivia Solon, "Google Spends Millions on Acedemic Research to Influence Opinion, Says Watchdog," The Guardian, last modified 7 July 2017, accessed 31 December 2018 https://www.theguardian.com/technology/2017/jul/13/google-millions-academic-research-influence-opinion; "Google Academics Inc.," Google Transparency Project, last modified 11 July 2017, accessed 10 October 2017 http://googletransparencyproject.org/articles/google-academics-inc.
39.
Barnett, "Property as Process," 391, 411, 431, 434–437, 441–442, 456.
40.
See Katherine J. Strandburg, "Evolving Innovation Paradigms and the Global Intellectual Property Regime," Connecticut Law Review 41, no. 3 (2009), 912-920, proposing WIPO to take a more active role of accommodating UOCI type of innovation under the TRIPS system.
41.
See Barnett, "Anti-Commons Revisited," 142-147. See also Barnett, "Has the Academy Led Patent Law Astray?," Berkeley Technology Law Journal 5, no. 4 (2017): 8-28, 41. For the discussion on the empirical inconclusiveness of overprotection problems, see Sect. 2.3.2.8.
42.
See Barnett "Anti-Commons Revisited," 147-182.
43.
First, the patent litigation in respect of critical upstream patents in those industries, namely the Wright patent in aviation and the Fleming patent in radio, did not yield to the issuance of an effective injunctive reliefs, which meant that follow-on innovators could continue to develop these technologies further. Second, even when the injunction was granted, its effect was weakened by World War I and a compulsory liability rule in favour of the government and its contractors. Finally, the government was involved in the formation of the patent pools after the war. However, the manner in which the government was involved can also be considered to represent a hold-out situation. Ibid, 172-182. For a critical account on the government’s position in the aviation industry patent litigation and pooling, see Ron D. Katznelson and John Howells, "Myth of the Early Aviation Patent Hold-up—How a US Government Monopsony Commandeered Pioneer Airplane Patents," Industrial & Corporate Change 24, no. 1 (2015) 1, 64; See also John Howells and Ron D. Katznelson, "Coordination of Independently-Owned Vacuum Tube Patents in the Early Radio Alleged Patent 'Thicket'," SSRN, 25. Cf. Merges, "Case of Blocking Patents," 84-87, in which the author addresses the Fleming patent as a blocking patent scenario that was resolved by the government. Barnett presents two other examples of cross-licensing efforts, namely the Selten patent in the early automotive industry and “cracking” patents in petroleum refining. The litigation in the former did not result in the imposition of injunctive relief during the proceedings. However, in both industries, litigation was followed by patent pooling or cross-licensing efforts. See Barnett, "Anti-Commons Revisited," 151-160.
44.
Mattioli, "Communities of Innovation," 120-133, 151, addressing the Medicines Patent Pool, the Pool for Open Innovation Against Neglected Tropical Diseases, the SNP Consortium, and the Manufacturer’s Aircraft Association.
45.
Merges, "Contracting into Liability Rules," 1391.
46.
Mattioli, "Communities of Innovation," 133-141, 148-149, in which the author discusses the Open Invention Network, the Bessemer Association, and the historical case of the Mines of Cornwall. The Open Invention Network represents a defensive patent pool for open-source software against software patent litigation.
47.
Ibid, 142-147, 148-150, discussing the Eco-Patent Commons and the Green Exchange.
48.
Ibid, 151-155.
49.
Ibid, 151-154. Both Merges and Barnett speak in favour of strong property rights as enablers of self-correcting initiatives and oppose compulsory licensing; see Merges, "Contracting into Liability Rules." 1299, 1322, 1392-1393; Jonathan M. Barnett, "Intellectual Property as a Law of Organization," California Law Review 84, (2011): 832; Barnett "Has the Academy Led Patent Law Astray?," 4. Yet, unlike Barnett and similarly to Mattioli, Merges presumes that, due to the problems encountered in collective action, the employment of private-ordering mechanisms, such as patent pools, would require government facilitation. Merges, "Contracting into Liability Rules," 1356, 1391. However, it should be noted that Merges compares the benefits of contracting into liability rules to those of statutory licenses. However, statutory licenses represent a much wider intervention in the property rule than compulsory licenses to patents under Art. 31 TRIPS. Furthermore, following the broad MCM, private lobbying may lead to the establishment of a compulsory liability rule.
50.
Barnett, "Property as Process," 411, 431; See Coase, "Problem of Social Cost," 2, 5-6, 8, 12, 15.; Merges, "Contracting into Liability Rules," 1392.
51.
Henry Chesbrough, "Open Innovation : A New Paradigm for Understanding Industrial Innovation," in Open Innovation: Researching a New Paradigm, ed. Henry Chesbrough, Wim Vanhaverbeke, and Joel West (New York: Oxford University Press, 2006), 1. Chesbrough was certainly not the first to address the use of external knowledge for the benefit of a firm or the interest in sharing internally developed knowledge with competitors, as such innovative practices had already been documented to have occurred in the 19^th century; see Robert C. Allen, "Collective Invention," Journal of Economic Behavior & Organization 4, no. 1 (1983): 2; Alessandro Nuvolari, "Collective Invention During the British Industrial Revolution : The Case of the Cornish Pumping Engine," Cambridge Journal of Economics 28, no. 3 (2004) 351-359; Andrew Hargadon, "Retooling R&D : Technology Brokering and the Pursuit of Innovation," Ivey Business Journal 68, no. 2 (2003).
52.
Huizingh, "Open Innovation," 3. For a review of management research predating the concept of open innovation, see Paul Trott and Dap Hartmann, "Why 'Open Innovation' Is Old Wine in New Bottles," International Journal of Innovation Management 13, no. 4 (2009): 715-727; who criticizes Chesbrough for repackaging well-known ideas and Dahlander and Gann, "How Open Is Innovation?," 700-701 and the literature referenced therein. For a response to Trott and Hartmann, see Chesbrough and Bogers, "Explicating Open Innovation," 22-23. Nevertheless, the integration of inbound and outbound innovation processes, Huizingh, "Open Innovation," 3, and the emphasis on the latter as an opportunity for commercialization were considered novel in management research. Julien Pénin, Caroline Hussler, and Thierry Burger-Helmchen, "New Shapes and New Stakes : A Portrait of Open Innovation as a Promising Phenomenon," Journal of Innovation Economics & Management 2011, no. 7 (2011): 14.
53.
Chesbrough and Bogers, "Explicating Open Innovation," 17.
54.
Open Innovation, 29-30; "Open Innovation," 2, 5.
55.
Open Innovation, 155, 159.
56.
Henry Chesbrough and Roya Ghafele, "Open Innovation and Intellectual Property : A Two-Sided Market Perspective," in New Frontiers in Open Innovation, ed. Henry Chesbrough, Wim Vanhaverbeke, and Joel West (New York: Oxford University Press, 2014), 195.
57.
Chesbrough, Open Innovation, 34, 57.
58.
Trott and Hartmann, "Why 'Open Innovation' Is Old Wine in New Bottles," 728. For a further detailed critique, see ibid, 717-729. For a response, see Chesbrough and Bogers, "Explicating Open Innovation," 22-23. Only certain industries, such as nuclear and military, appear to closely resemble the closed innovation model. Oliver Gassmann, "Opening up the Innovation Process : Towards an Agenda," R&D Management 36, no. 3(2006): 224. The critiques of the closed innovation paradigm are also valid from the perspective of the core principles of patent law, which include the objective to disseminate technological innovations. A firm that operates following the closed innovation paradigm would only use patents to protect itself from imitation. In addition, closed innovation would assume the existence of a far scarcer knowledge landscape than either the incentive or prospect theory.
59.
Chesbrough, Open Innovation, 34-40. Talented professionals are also becoming decreasingly committed to single companies throughout the courses of their entire careers. Dahlander and Gann, "How Open Is Innovation?," 699.
60.
Arora, Fosfuri, and Gambardella, Markets of Technology, 6-10, 17-89.
61.
Dahlander and Gann, "How Open Is Innovation?," 699.
62.
Pénin, Hussler, and Burger-Helmchen, "New Shapes and New Stakes," 12; Gassmann, "Opening up the Innovation Process," 224, using the term “Technology intensity”.
63.
Arora, Fosfuri, and Gambardella, Markets of Technology, 7-9. For a review of the development of markets for technology in the complex technological fields of chemical processing, software, biotechnology, and semiconductors, see ibid, 45-89. In addition, for examples of specialization from life sciences and consumer products, see Chesbrough and Ghafele, "Open Innovation and Intellectual Property," 196.
64.
Gassmann, "Opening up the Innovation Process," 224, using the term “Technology fusion”.
65.
Dahlander and Gann, "How Open Is Innovation?," 699; Gassmann, "Opening up the Innovation Process," 223; Pénin, Hussler, and Burger-Helmchen, "New Shapes and New Stakes," 16.
66.
Chesbrough, Open Innovation, 40-41, 43-51.
67.
Ibid, 34-40.
68.
Ibid, 51
69.
Chesbrough, Open Innovation, 155.
70.
Chesbrough and Bogers, "Explicating Open Innovation," 17.
71.
Chesbrough, "Open Innovation," 1.
72.
Chesbrough and Bogers, "Explicating Open Innovation," 16–17.
73.
Ibid, 17.
74.
Frank Piller and Joel West, "Firms, Users, and Innovation : An Interactive Model of Coupled Open Innovation," in New Frontiers in Open Innovation, ed. Henry Chesbrough, Wim Vanhaverbeke, and Joel West (New York: Oxford University Press, 2014), 31.
75.
“Open Innovation is a paradigm that assumes that firms can and should use external ideas as well as internal ideas and internal and external paths to market as they look to advance their technology” [emphasis added], Chesbrough, "Open Innovation," 1.
76.
Open Innovation, 63-91; "Open Innovation," 1-2.
77.
Nonaka, "Foreword," ii. The departure from the firm-centric view is also reflected in the recent definition of open innovation as a “distributed innovation process, based on purposively managed knowledge flows across organizational boundaries, using pecuniary and non-pecuniary mechanisms in line with the organization’s business model” [emphasis added], Henry Chesbrough and Marcel Bogers, "Explicating Open Innovation : Clarifying an Emerging Paradigm for Understanding Innovation," 17.
78.
See Hanns Ullrich, "Open Innovation, the Patent Exclusivity and Knowhow Secrecy," in Droit, Économie et Valeurs: Hommage à Bernard Remiche, ed. Alexia Autenne, Vincent Cassiers, and Alain Strowel (Brussels: Éditions Larcier, 2015), 203.
79.
Martin Curley and Bror Salmelin, Open Innovation 2.0 : The New Mode of Digital Innovation for Prosperity and Sustainability (Cham: Springer, 2018), 48.
80.
Gassman and Enkel define the coupled process as “coupling the outside-in and inside-out processes by working in alliances with complementary partners in which give and take is crucial for success”. Gassmann, "Opening up the Innovation Process," 6. Inter-organizational collaboration in the coupled process represents a new focus of interest in research on Chesbrough’s concept of open innovation. See Piller and West, "Firms, Users, and Innovation," 36-49.
81.
On the IP law questions that arise from coupled open innovation, see generally Arina Gorbatyuk, Geertrui Van Overwalle, and Esther van Zimmeren, "Intellectual Property Ownership in Coupled Open Innovation Processes," IIC - International Review of Intellectual Property and Competition Law 47, no. 3 (2016); Ullrich, "Open Innovation, the Patent Exclusivity and Knowhow Secrecy,"; Alina Wernick, "Defining Trade Secrets in Multilateral Research Collaboration," in Sopimaton menettely elinkeinotoiminnassa verkkotalouden aikana, ed. Rainer; Oesch and Hannes Kankaanpää (Helsinki: Lakimiesliiton Kustannus, 2012). On policy perspectives concerning coupled open innovation, see generally European Commission, Open Innovation, Open Science, Open to the World - a Vision for Europe (Luxembourg: Publications Office of the European Union, 2016); Koenraad Debackere et al. Boosting Open Innovation and Knowledge Transfer in the European Union, Independent Expert Group Report on Open Innovation and Knowledge Transfer - Study (Luxembourg: Publication Office of the European Union, 2014).
82.
Chesbrough, Open Innovation, 155.
83.
Chesbrough "Open Innovation," 4.
84.
Dahlander and Gann, "How Open Is Innovation?," 704–705. Gassmann and Enkel use the definitions “outside-in process” and “inside-out process”. Their terminology refers to knowledge flows in open innovation in general, not limited to IP, see Gassmann, "Opening up the Innovation Process," 6. Cf. Fig. 3.2.
85.
Pénin, Hussler, and Burger-Helmchen, "New Shapes and New Stakes," 18–19.
86.
Arora, Fosfuri, and Gambardella, Markets of Technology, 170-171.
87.
Ibid, 170-176, 117 and fns 3, 178.
88.
Timothy S. Simcoe, "Open Standards and Intellectual Property Rights," in Open Innovation: Researching a New Paradigm, ed. Henry Chesbrough, Wim Vanhaverbeke, and Joel West (New York: Oxford University Press, 2006), 165.
89.
Arora, Fosfuri, and Gambardella, Markets of Technology, 175.
90.
Turner, "Nonmanufacturing Patent Owner," 183.
91.
Arora, Fosfuri, and Gambardella, Markets of Technology, 178.
92.
Ibid, 170.
93.
Ibid, 178-179.
94.
Ibid, 192-193, 195.
95.
Ibid, 251.
96.
Ibid, 195.
97.
Chesbrough, "Open Innovation," 10.
98.
Chesbrough and Ghafele, "Open Innovation and Intellectual Property," 194; Chesbrough, Open Innovation, 53. in which a company’s own technology is assumed to fill in the gaps of an external technology, suggesting the use of external technology in larger proportion.
99.
Chesbrough, Open Innovation, 41, 53, 57. A hallmark example of a business model that leverages licensing IP is the active licensing scheme that IBM uses for its hardware. Ibid, 92-112.
100.
Rec. 4 TTBER.
101.
Arora, Fosfuri, and Gambardella, Markets of Technology, 251.
102.
Moreover, the findings of legal research on IP have been considered unhelpful for this research objective; see Chesbrough and Ghafele, "Open Innovation and Intellectual Property," 191-193.
103.
Ibid, 191.
104.
For example, while discussing the relevance of stronger IP rights for OI, West is unclear as to whether the strength lies in the wider scope of entitlement or the manner in which the entitlement is enforced. Joel West, "Policy Challenges of Open, Cumulative, and User Innovation," Washington University Journal of Law & Policy 30, no. 1 (2009): 25-29. Cf. West, "Does Appropriability Enable or Retard Open Innovation?," 117-118, discussing the effect of enforceability of IP on viability of IP-based business models.
105.
Huizingh, "Open Innovation," 3-4.
106.
See generally Sect. 2.1, discussing the economic justifications behind patent protection.
107.
Barnett, "Intellectual Property as a Law of Organization," 856.
108.
Ibid, 789, 792-794, 811, 813, 819-821, 856-857. see also David J. Teece, "Profiting from Technological Innovation : Implications for Integration, Collaboration, Licensing and Public Policy," Research Policy 15, no. 6 (1986): 301, 304; Jonathan M. Barnett, "Why Is Everyone Afraid of IP Licensing," Harvard Journal of Law & Technology 30 (2017): 137.
109.
Barnett, "Intellectual Property as a Law of Organization," 818-819, 832, 856.
110.
Joel West, "Does Appropriability Enable or Retard Open Innovation?," in Open Innovation: Researching a New Paradigm, ed. Henry Chesbrough, Wim Vanhaverbeke, and Joel West (New York: Oxford University Press, 2006), 130. Similarly, "Policy Challenges of Open, Cumulative, and User Innovation." Washington University Journal of Law & Policy 30, no. 1 (2009): 40, in which the author acknowledges the trade-off between incentivizing both initial and cumulative innovation.
111.
See Arora, Fosfuri, and Gambardella, Markets of Technology, 192-193, 195
112.
Henry Chesbrough and Wim Vanhaverbeke, Open Innovation and Public Policy in Europe (Brussels: Science|Business Publishing, 2011), 14.
113.
See Fig. 3.2. In more recent research, Chesbrough and Ghafele address the issue of companies that only consider licensing a technology when its holder threatens them with an infringement action; the authors consider this practice of unlicensed use to be detrimental to the emergence of technology markets. Chesbrough and Ghafele, "Open Innovation and Intellectual Property," 206.
114.
Chesbrough, Open Innovation, 53.
115.
Trott and Hartmann, "Why 'Open Innovation' Is Old Wine in New Bottles," 727-728.
116.
Observations have been made concerning the limiting impact of software patents on access to and reuse of open-source software. Stuart J. H. Graham and David C. Mowery, "Use of Intellectual Property in Software : Implications for Open Innovation," in Open Innovation: Researching a New Paradigm, ed. Henry Chesbrough, Wim Vanhaverbeke, and Joel West (New York: Oxford University Press, 2006), 197. Patent ambushes and other offensive practices in the context of de jure standard setting have also been addressed: Timothy S. Simcoe, "Open Standards and Intellectual Property Rights," in Open Innovation: Researching a New Paradigm, ed. Henry Chesbrough, Wim Vanhaverbeke, and Joel West (New York: Oxford University Press, 2006), 177; Joel West, "Does Appropriability Enable or Retard Open Innovation?," in Open Innovation: Researching a New Paradigm, ed. Henry Chesbrough, Wim Vanhaverbeke, and Joel West (New York: Oxford University Press, 2006), 122. See also Chesbrough and Ghafele, "Open Innovation and Intellectual Property," 199, who refer to Rambus’ patent ambush. However, the “aggressive patenting” strategies of SMEs, even when exercised in accordance with incentive theories, have also been viewed as being potentially detrimental to successful standard-setting processes and the implementation of such standards. Simcoe, "Open Standards and Intellectual Property Rights," 180. As is the case with monetary incentives to license, excessive royalties are not considered to be a problem under open innovation; however, the avoidance of royalty stacking has been mentioned as one of the benefits of a patent pool; see Chesbrough and Ghafele, "Open Innovation and Intellectual Property," 203.
117.
Chesbrough and Ghafele, "Open Innovation and Intellectual Property," 197-201.
118.
Debackere, et al., Boosting Open Innovation and Knowledge Transfer, 28.
119.
Chesbrough and Ghafele, "Open Innovation and Intellectual Property," 201-204; Wim Vanhaverbeke and Myriam Cloodt, "Theories of the Firm and Open Innovation," in New Frontiers in Open Innovation, ed. Henry Chesbrough, Wim Vanhaverbeke, and Joel West (New York: Oxford University Press, 2014), 263-264; Nadine Roijakkers, Andy Zynga, and Caroline Bishop, "Getting Help from Innomediaries : What Can Innovators Do to Increase Value in External Knowledge Searches?," in New Frontiers in Open Innovation, ed. Henry Chesbrough, Wim Vanhaverbeke, and Joel West (New York: Oxford University Press, 2014), 242-254, discussing innomediaries that offer wide variety of services beseides technology transfer.
120.
Chesbrough and Ghafele, "Open Innovation and Intellectual Property" 204-206. See also Vanhaverbeke and Cloodt, "Theories of the Firm and Open Innovation," 276.
121.
David J. Teece, Gary Pisano, and Amy Shuen, "Dynamic Capabilities and Strategic Management," Strategic Management Journal 18, no. 7 (1997): 509; André Spithoven, Bart Clarysse, and Mirjam Knockaert, "Building Absorptive Capacity to Organise Inbound Open Innovation in Traditional Industries," Technovation 30, no. 2 (2010) 131; Nari Lee, "Exclusion and Coordination in Collaborative Innovation and Patent Law," International Journal of Intellectual Property Management 3, no. 1 (2009) 90.
122.
Chesbrough and Ghafele, "Open Innovation and Intellectual Property," 206.
123.
Fiona Murray and Siobhán O'Mahony, "Exploring the Foundations of Cumulative Innovation : Implications for Organization Science," Organization Science 18, no. 6 (2007):1017; Philipp Herzog, Open and Closed Innovation : Different Cultures for Different Strategies (Wiesbaden: Gabler, 2011).
124.
See generally Baldwin and von Hippel, "Modeling a Paradigm Shift,"; Yochai Benkler, "Coase's Penguin, or, Linux and 'the Nature of the Firm'," Yale Law Journal 112, no. 3 (2002); Dietmar Harhoff, Joachim Henkel, and Eric von Hippel, "Profiting from Voluntary Information Spillovers : How Users Benefit by Freely Revealing Their Innovations," Research Policy 32, no. 10 (2003); von Hippel, Democratizing Innovation; von Hippel, "Comment."; Eric von Hippel, Free Innovation (Cambridge, MA: MIT Press, 2016); von Hippel and von Krogh, "Free Revealing."; Piller and West, "Firms, Users, and Innovation."
125.
Concepts used in the relevant literature involve “user innovation communities” von Hippel, Democratizing Innovation, 7. “open source innovation communities” ibid, 11. “innovation communities”, ibid.; “free innovation”, Free Innovation, 1; “private-collective innovation model” von Hippel and von Krogh, "Free Revealing" 302-303; "Open Source Software and the “Private-Collective” Innovation Model : Issues for Organization Science," Organization Science 14, no. 2 (2003): 213; “open design”, Christina Raasch, Cornelius Herstatt, and Kerstin Balka, "On the Open Design of Tangible Goods," R&D Management 39, no. 4 (2009), 29; “peer production”, Benkler, "Coase's Penguin, or, Linux and 'the Nature of the Firm'," 403; “open source innovation”, James Boyle, "Open Source Innovation : Patent Injunctions, and the Public Interest," Duke Law & Technology Review 11 (2012): 32; “open innovation communities”, Clark D. Asay, "Enabling Patentless Innovation," Maryland Law Review 74, no. 3 (2015): 435; “open source software” and “open patenting” Mariateresa Maggiolino and Maria Lillà Montagnani, "From Open Source Software to Open Patenting - What's New in the Realm of Openness," IIC - International Review of Intellectual Property and Competition Law 42, no. 7 (2011) 804; “user-centered and community-centered Open Innovation”, Geertrui Van Overwalle, "Inventing Inclusive Patents : From Old to New Open Innovation," in Kritika: Essays on Intellectual Property, ed. Peter Drahos, Gustavo Ghidini, and Hanns Ullrich (Cheltenham: Edward Elgar Publishing, 2015), 219; “the maker movement”, Dale Dougherty, "The maker movement." Innovations: Technology, Governance, Globalization 7, no. 3 (2012): 11; Natalia Lukaszewicz, "Patent Use Exception for User-Generated Inventions : The Maker Movement Meets Patent Law" (Doctoral Dissertation, Ludwig-Maximilians-Universität, 2015), 10.
126.
Baldwin and von Hippel, "Modeling a Paradigm Shift," 1402.
127.
Chesbrough and Bogers, "Explicating Open Innovation," 21.
128.
Baldwin and von Hippel, "Modeling a Paradigm Shift," 1403.
129.
von Hippel, Democratizing Innovation, 2; Baldwin and von Hippel, "Modeling a Paradigm Shift," 1400, 1402-1403.
130.
von Hippel, Democratizing Innovation, 31, 74-75.
131.
Ibid, 4-7, 32-60.
132.
Free Innovation, 1, 38, 144.
133.
Democratizing Innovation, 93; Boyle, "Open Source Innovation," 32, 52; Benkler, "Coase's Penguin, or, Linux and 'the Nature of the Firm'," 383.
134.
von Hippel, Democratizing Innovation, 13; Benkler, "Coase's Penguin, or, Linux and 'the Nature of the Firm'," 383.
135.
von Hippel, Democratizing Innovation, 10.
136.
Ibid, 11.
137.
Boyle, "Open Source Innovation," 32; Asay, "Enabling Patentless Innovation," 436, 462-466; Benkler, "Coase's Penguin, or, Linux and 'the Nature of the Firm'," 378-379.
138.
Joel West and Karim R. Lakhani, "Getting Clear About Communities in Open Innovation," Industry & Innovation 15, no. 2 (2008): 224.
139.
Boyle, "Open Source Innovation," 52, 64. Transparency enables better allocation of creative human capital, as interested participants may self-select to participate in a community. Benkler, "Coase's Penguin, or, Linux and 'the Nature of the Firm'," 405-406, 412-415, 422.
140.
von Hippel, Democratizing Innovation, 96.
141.
Baldwin and von Hippel, "Modeling a Paradigm Shift," 1407.
142.
See ibid, 1404-1405; von Hippel, Free Innovation, 40-41.
143.
See generally von Hippel and von Krogh, "Open Source Software and the “Private-Collective” Innovation Model."; Eric von Hippel, "Innovation by User Communities : Learning from Open-Source Software," MIT Sloan Management Review, last modified 15 July 2001, accessed 31 December 2018 https://sloanreview.mit.edu/article/innovation-by-user-communities-learning-from-opensource-software/.
144.
Allen has reported on the practice of the free revealing of information concerning furnace design improvements between competitors in the iron industry in mid-19^th-century England. Allen, "Collective Invention," 1. Similar findings exist regarding the free revealing of steam engine innovations and improvements in 19^th-century England; see Nuvolari, "Collective Invention During the British Industrial Revolution." These findings can also be considered to showcase the tradition of engaging in OI by utilizing externally developed knowledge. Huizingh, "Open Innovation," 2; Van Overwalle, "Inventing Inclusive Patents," 221.
145.
User innovation (which does not always involve users who are organized into a community) has occurred, inter alia, in the context of scientific instruments, see Eric von Hippel, "Dominant Role of Users in the Scientific Instrument Innovation Process," Research Policy 5, no. 3 (1976).; semiconductors, see "Dominant Role of the User in Semiconductor and Electronic Subassembly Process Innovation," IEEE Transactions on Engineering Management EM-24, no. 2 (1977); skateboarding, snowboarding and windsurfing equipment, see Sonali Shah, Sources and Patterns of Innovation in a Consumer Products Field : Innovations in Sporting Equipment, Sloan Working Paper No. 4105 (Cambridge, MA: Sloan School of Management, 2000): 2; kitesurfing, see Robert Tietz et al., "Process of User-Innovation : A Case Study on User Innovation in a Consumer Goods Setting," International Journal of Product Development 2, no. 4 (2005): 1741; sailboats, see Christina Raasch, Cornelius Herstatt, and Phillip Lock, "Dynamics of User Innovation : Drivers and Impediments of Innovation Activities," International Journal of Innovation Management 12, no. 3 (2008), 377; and free space optics, see Johan Söderberg, "Free Space Optics in the Czech Wireless Community : Shedding Some Light on the Role of Normativity for User-Initiated Innovations," Science, Technology, & Human Values 36, no. 4 (2010). The possibilities of UOCI in terms of further expanding to physical products depend on the development and diffusion of technologies for mass customization. von Hippel, Free Innovation, 47-48.
146.
See, for example, Piller and West, "Firms, Users, and Innovation," 31, table 2.1.
147.
Baldwin and von Hippel, "Modeling a Paradigm Shift." 1403, 1410-1412. It has also been referred to as the “private investment model” by Eric von Hippel and Georg von Krogh, "Open Source Software and the “Private-Collective” Innovation Model," 212.
148.
Baldwin and von Hippel, "Modeling a Paradigm Shift," 1413.
149.
von Hippel and von Krogh, " Open Source Software and the “Private-Collective” Innovation Model," 212-213.
150.
Baldwin and von Hippel, "Modeling a Paradigm Shift," 1409; von Hippel, Free Innovation, 11.
151.
Benkler, "Coase's Penguin, or, Linux and 'the Nature of the Firm'," 381, 402-403.
152.
Katherine J. Strandburg, "Users as Innovators : Implications for Patent Doctrine," University of Colorado Law Review 79, no. 46 (2008), 467, 539.
153.
Baldwin and von Hippel, "Modeling a Paradigm Shift," 1399-1401; Asay, "Enabling Patentless Innovation," 443. User and open collaborative innovation is not aligned with any of the economic justifications for patent protection; see ibid, 439-446. Furthermore, UOCI questions Olson’s collective action model, which presumes that collective innovation efforts that are intended to produce a public good are dependent on the incentivizing effect of governmental subsidies. von Hippel and von Krogh, "Open Source Software and the “Private-Collective” Innovation Model," 213, 215. See also Olson, Logic of Collective Action, 1-3.
154.
Van Overwalle, "Inventing Inclusive Patents," 224; von Hippel, Free Innovation, 144.
155.
Baldwin and von Hippel, "Modeling a Paradigm Shift," 1400.
156.
Free revealing requires that “all existing and potential intellectual property rights to that information are voluntarily given up by that innovator and all interested parties are given access to it - the information becomes a public good.” Harhoff, Henkel, and von Hippel, "Profiting from Voluntary Information Spillovers," 1753.
157.
See Harhoff, Henkel, and von Hippel, "Profiting from Voluntary Information Spillovers," 1753; von Hippel, Democratizing Innovation, 9. However, cf. ibid, 80.
158.
Harhoff, Henkel, and von Hippel, "Profiting from Voluntary Information Spillovers," 1754.
159.
This type of openness is further discussed Sect. 3.2.7.
160.
Carol M. Rose, "Comedy of the Commons : Commerce, Custom and Inherently Public Property," University of Chicago Law Review 53, no. 3 (1986): 721 using the term “unlimited commons”; Charlotte Hess and Elinor Ostrom, "Ideas, Artifacts, and Facilities : Information as a Common Pool Resource," Law and Contemporary Problems 66 (2003): 121-122.
161.
See Sect. 3.2.5.
162.
Séverine Dusollier, "Sharing Access to Intellectual Property through Private Ordering," Chicago-Kent Law Review 82, no. 3 (2007): 1407-1410.
163.
Ibid, 1409.
164.
See "GNU General Public License. Version 3," FSF, last modified 18 November 2016, accessed 22 March 2017 https://www.gnu.org/licenses/gpl-3.0.html; Richard M. Stallman, Free Software, Free Society : Selected Essays of Richard M. Stallman, 2nd ed. (Boston: Free Software Foundation, 2010), 22-23, 93-95.
165.
I consider the term “open viral” more suitable than “open source” or “copyleft”. Open-source software licenses do not need to feature a viral clause. Séverine Dusollier, "Commons as a Reverse Intellectual Propery - from Exclusivity to Inclusivity," in Concepts of Property in Intellectual Property Law, ed. Helena R. Howe and Jonathan Griffiths (New York: Cambridge University Press, 2013), 238; Janet Hope, "Open Source Genetics : Conceptual Framework," in Gene Patents and Collaborative Licensing Models, ed. Geertrui Van Overwalle (Cambridge: Cambridge University Press, 2009), 178. The term copyleft is in turn a concept that is closely related to copyright and bears an ideological connotation; See Free Software Foundation, "What Is Copyleft?," FSF, last modified 15 December 2018, accessed 31 December 2018 https://www.gnu.org/licenses/copyleft.en.html. This type of access is further discussed Sect. 3.2.6.
166.
von Hippel, Democratizing Innovation, 7, 9, 77.
167.
Harhoff, Henkel, and von Hippel, "Profiting from Voluntary Information Spillovers," 1754. However, in practice, some UOCI products, such as free software, are not precluded from being sold, as long as the buyer remains free to copy and modify the software. Stallman, Free Software, Free Society, 5.
168.
Harhoff, Henkel, and von Hippel, "Profiting from Voluntary Information Spillovers," 1758.
169.
Benkler, "Between Spanish Huertas and the Open Road," 73. von Hippel’s seminal work on user innovation is titled Democratizing Innovation. For example, the free software movement, as initiated by Richard Stallmann, emerged as a counter-reaction to the exclusive copyright regime that protects software, which hindered the UOCI practices of the developer community. Hence, it also strived to re-establish the culture of free revealing that was prevalent among software developers before software became subject to copyright protection or constrained access on the basis of secrecy. Stallman, Free Software, Free Society, 9-12. “‘Free software’ means software that respects users’ freedom and community. Roughly, it means that the users have the freedom to run, copy, distribute, study, change and improve the software. Thus, ‘free software’ is a matter of liberty, not price. To understand the concept, you should think of ‘free’ as in ‘free speech,’ not as in ‘free beer’.” Free Software Foundation, "What Is Free Software? - the Free Software Definition," FSF, last modified 15 December 2018, accessed 25 December 2018 http://www.gnu.org/philosophy/free-sw.html. As an another example, the ethos of open-source movement is characterized by Maggiolino and Montagnani as follows: “Based on the idea that the more a culture embraces knowledge, the more democratic, just and fair it is, nowadays Open Source can be deemed as a spontaneous and compounded cultural movement that uses the internet to promote the aggregation and sharing of contents in order to allow people, not only take advantage of knowledge, but also to modify it in order to create new, diverse and improved contents to be aggregated and shared in turn”, Maggiolino and Montagnani, "From Open Source Software to Open Patenting - What's New in the Realm of Openness," 808.
170.
Benkler, "Coase's Penguin, or, Linux and 'the Nature of the Firm'," 445-446. See also ch 5 “Why Software Should Not Have Owners” in Stallman, Free Software, Free Society, 37-41.
171.
von Hippel and von Krogh, "Open Source Software and the “Private-Collective” Innovation Model," 215-216; "Free Revealing," 303-304. A similar observation has also been made in the context of the MCM; See Merges, "New Dynamism in the Public Domain," 186; Barnett, "Property as Process," 402-404; Barnett, "Illusion of the Commons," 1756-1757, 1814.
172.
In contrast, the MCM presumes that free revealing and open viral licensing are motivated by an interest in precluding anti-commons problems with regard to future follow-on innovations. Merges, "New Dynamism in the Public Domain," 192, 200, 201.
173.
Alexander Hars and Shaosong Ou, "Working for Free? Motivations for Participating in Open-Source Projects," International Journal of Electronic Commerce 6, no. 3 (2002): 34-35; Jeffrey A. Roberts, Il-Horn Hann, and Sandra A. Slaughter, "Understanding the Motivations, Participation, and Performance of Open Source Software Developers : A Longitudinal Study of the Apache Projects," Management Science 52, no. 7 (2006): 984, 996-997.
174.
Karim R. Lakhani and Robert G. Wolf, "Why Hackers Do What They Do : Understanding Motivation and Effort in Free/Open Source Software Projects," in Perspectives on Free and Open Source Software, ed. Joseph Feller, et al. (Cambridge, MA: MIT Press, 2005), 18; Roberts, Hann, and Slaughter, "Longitudinal Study of the Apache Projects," 995.
175.
Allen, "Collective Invention," 17.
176.
Harhoff, Henkel, and von Hippel, "Profiting from Voluntary Information Spillovers," 1755; von Hippel and von Krogh, "Free Revealing," 299-300.
177.
von Hippel and von Krogh, "Open Source Software and the “Private-Collective” Innovation Model," 297-298.
178.
Baldwin and von Hippel, "Modeling a Paradigm Shift," 1400, 1402; von Hippel, Democratizing Innovation, 2.
179.
Eric Raymond, "Cathedral and the Bazaar," Knowledge, Technology & Policy 12, no. 3 (1999): 29, 38; Hars and Ou, "Working for Free?," 29.
180.
von Hippel, Democratizing Innovation, 7, 60-61.
181.
Lakhani and Wolf, "Why Hackers Do What They Do," 18.
182.
Hars and Ou, "Working for Free?," 28.
183.
Lakhani and Wolf, "Why Hackers Do What They Do," 5-6, 18; Hars and Ou, "Working for Free?," 28. For companies, engaging in the practice of free revealing may stem from the obligations imposed by open viral licenses. Joachim Henkel, "Selective Revealing in Open Innovation Processes : The Case of Embedded Linux," Research Policy 35, no. 7 (2006): 962.
184.
von Hippel, Democratizing Innovation, 7, 60-61.
185.
Allen, "Collective Invention," 17; Raymond, "Cathedral and the Bazaar," 40; Josh Lerner and Jean Tirole, "Some Simple Economics of Open Source," Journal of Industrial Economics 50, no. 2 (2002): 213; Henkel, "Selective Revealing in Open Innovation Processes," 962.
186.
Hars and Ou, "Working for Free?," 29, 32.
187.
Raymond, "Cathedral and the Bazaar," 40; Lerner and Tirole, "Some Simple Economics of Open Source," 21-214; Hars and Ou, "Working for Free?," 29.
188.
Lerner and Tirole, "Some Simple Economics of Open Source," 215-216.
189.
Raymond, "Cathedral and the Bazaar," 29-30, 40-41, 44. Support for development was confirmed to be one of the main motivations for companies to engage in UOCI. Henkel, "Selective Revealing in Open Innovation Processes." 962. Open-source development is characterized by Linus’ law: “Given enough eyeballs, all bugs are shallow”. Raymond, "Cathedral and the Bazaar," 29. However, the reputation of the superiority of open-source software development in terms of identifying bugs was damaged by the Heartbleed scandal, in which an undiscovered bug in a piece of open-source software left thousands of web-servers exposed to attacks for two years. Steven J. Vaughan-Nichols, "Heartbleed : Open Source's Worst Hour," ZDNet, last modified 14 April 2014, accessed 6 September 2017 http://www.zdnet.com/article/heartbleed-open-sources-worst-hour/; Alex Hern, "Heartbleed : Developer Who Introduced the Error Regrets 'Oversight'," The Guardian, last modified 11 April 2014, accessed 31 December 2018 https://www.theguardian.com/technology/2014/apr/11/heartbleed-developer-error-regrets-oversight. The incident spurred discussion of the underfinancing of open-source software development. Christina Warren, "Heartbleed Exposes a Problem with Open Source, but It's Not What You Think," Mashable, last modified 15 April 2014, accessed 31 December 2018 http://mashable.com/2014/04/14/heartbleed-open-source/#qWz_PitJ1iqm.
190.
Allen, "Collective Invention," 21; Nuvolari, "Collective Invention During the British Industrial Revolution," 361.
191.
Van Overwalle, "Inventing Inclusive Patents," 222.
192.
Josh Lerner and Jean Tirole, "Economics of Technology Sharing : Open Source and Beyond," Journal of Economic Perspectives 19, no. 2 (2005): 106.
193.
Lerner and Tirole, "Some Simple Economics of Open Source," 224-225; Hars and Ou, "Working for Free?," 29. The best known examples of this are firms that specialize in the development of FOSS, such as IBM and RedHat. Lerner and Tirole, "Some Simple Economics of Open Source," 198; Benkler, "Coase's Penguin, or, Linux and 'the Nature of the Firm'," 425-426.
194.
Merges, "New Dynamism in the Public Domain," 193.
195.
Matthias Stuermer, Sebastian Spaeth, and Georg von Krogh, "Extending Private-Collective Innovation : A Case Study," R&D Management 39, no. 2 (2009): 181-182.
196.
Harhoff, Henkel, and von Hippel, "Profiting from Voluntary Information Spillovers," 1757; von Hippel, Democratizing Innovation, 86; von Hippel and von Krogh, "Free Revealing," 301.
197.
von Hippel and von Krogh, "Free Revealing," 301.
198.
See Lerner and Tirole, "Some Simple Economics of Open Source," 225-226.
199.
Nikolaus Franke and Sonali Shah, "How Communities Support Innovative Activities : Exploration of Assistance and Sharing among End-Users," Research Policy 32 (2003): 170-171; Baldwin and von Hippel, "Modeling a Paradigm Shift."; Shah, Sources and Patterns of Innovation in a Consumer Products Field, 1401, 1403.
200.
Henkel, "Selective Revealing in Open Innovation Processes," 953. Companies may also reveal a part of their proprietary, IP-protected assets when faced with a demand to do so from customers. In such situations, free revealing or open licensing may create a competitive advantage. Joachim Henkel, Simone Schöberl and Oliver Alexy. "The Emergence of Openness: How and Why Firms adopt Slective Revealing in Open Innovation” Research Policy 43 no. 5 (2014): 888.
201.
Jason Schultz and Jennifer Urban, M., "Protecting Open Innovation : The Defensive Patent License as a New Approach to Patent Threats, Transaction Costs, and Tactical Disarmament," Harvard Journal of Law & Technology 26, no. 1 (2012): 3-4, 10-14.
202.
Asay, "Enabling Patentless Innovation," 434, 461.
203.
See Baldwin and von Hippel, "Modeling a Paradigm Shift," 1414.
204.
Lerner and Tirole, "Economics of Technology Sharing," 113; Schultz and Urban, "Protecting Open Innovation, " 3, 7, 53, 57-58.
205.
Boyle, "Open Source Innovation," 32, 54.
206.
Asay, "Enabling Patentless Innovation," 438, 457, 467.
207.
PAEs are reported to prefer litigating against the few downstream multicomponent-producing companies because doing so involves fewer transaction costs than targeting component manufacturers. Furthermore, litigation against multicomponent producers offers advantages when it comes to the calculation of damages on the basis of an expensive end-product. Moreover, foregoing licensing to the producers of components maintains the possibility of suing a multicomponent producer, as the exhaustion principle does not apply. Lemley and Melamed, "Missing the Forest for the Trolls," 2131 and fn 62, 2164 and fn 197,. However, so-called “bottom-feeder trolls” prefer to sue smaller companies, who may agree to pay royalties as a result of the fear of litigation. Ibid, 2164, 2176.
208.
Schultz and Urban, "Protecting Open Innovation," 8-9.
209.
Baldwin and von Hippel, "Modeling a Paradigm Shift," 1409.
210.
See Schultz and Urban, "Protecting Open Innovation," 26-37.
211.
Asay, "Enabling Patentless Innovation," 436, 462-466.
212.
See Sara Boettinger and Dan L. Burk, "Open Source Patenting," Journal of International Biotechnology Law 1 (2004), 221, 261; Reto M. Hilty, "Individual, Multiple and Collective Ownership : What Impact on Competition?," in Individualism and Collectiveness in Intellectual Property Law, ed. Jan Rosén (Cheltenham: Edward Elgar Publishing, 2012), 28-30, 42; Hope, "Open Source Genetics," 179; "Open Source Genomics. Symposium on Bioinformatics and Intellectual Property Law," Boston University Journal of Science & Technology Law 8, no. 1 (2002): 249-262 (comments by Dan Burk); Van Overwalle, "Inventing Inclusive Patents," 219-225. Cf. "Open Source Genomics. Symposium on Bioinformatics and Intellectual Property Law," Boston University Journal of Science & Technology Law 8, no. 1 (2002): 265 (comments by Josh Lerner).
213.
Hope, "Open Source Genetics," 185-189; Dianne Nicol and Janet Hope, "Cooperative Strategies for Facilitating Use of Patented Inventions in Biotechnology," Law in Context 24, no. 1 (2006) 102-105, in which the authors mention, inter alia, developmental support and testing, the freedom to customize, reputational gains, enhancement of competition by substitution, the development of complementary products, and price reductions due to increased competition.
214.
Nicole Ziegler, Oliver Gassmann, and Sascha Friesike, "Why Do Firms Give Away Their Patents for Free?," World Patent Information 37 (2014): 21-22.
215.
Ibid, 21-23.
216.
Lerner and Tirole, "Some Simple Economics of Open Source," 231.
217.
Baldwin and von Hippel, "Modeling a Paradigm Shift," 1408-1409.
218.
Ibid, 1403, 1409.
219.
Ibid, 1408.
220.
Harhoff, Henkel, and von Hippel, "Profiting from Voluntary Information Spillovers," 1756.
221.
von Hippel, Free Innovation, 41, 45.
222.
Jeroen P. J. de Jong et al., "Market Failure in the Diffusion of Consumer-Developed Innovations : Patterns in Finland," Research Policy 44, no. 10 (2015): 1863; von Hippel, Eric, et al., "Market Failure in the Peer-to-Peer Diffusion of User Innovations: The Case of Off-Label Drug Discoveries, " Science and Public Policy 44, no. 1 (2017): 121, 124.
223.
See Krauspenhaar, Liability Rules in Patent Law, 23, 26-31.
224.
The different preferences of the MCM and UOCI with regard to sufficient levels of openness can be traced to their theoretical backgrounds. The MCM relies on Olson’s theory of collective action and Elinor Ostrom’s research on governing common property resources, which, being rival, can be sustainably managed by a group of a limited size. See Merges, "Contracting into Liability Rules," 1295-1296; Barnett, "Property as Process," 422–423; Benkler, "Between Spanish Huertas and the Open Road," 91-92. The UOCI, in turn, draws from Carol Rose’s theory on open-access commons, in which a resource is presumed to be non-excludable in general. Rose, "Comedy of the Commons,” 721.
225.
See Epstein and Kuhlik, "Is There a Biomedical Anticommons?," 55-56.
226.
See Sect. 3.1.3.4.
227.
For an exception, see Van Overwalle, "Inventing Inclusive Patents," 209-224, discussing OI and UOCI.
228.
Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1394.
229.
Van Overwalle, "Inventing Inclusive Patents," 225-229. “New open innovation is characterized by universal openness, pointing to a regime where technology and inventions are open for use for all, where everyone is free to use and improve the invention without prior permission, and where access to and use of technical improvements is fostered and warranted for all.” Ibid, 228.
230.
Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1411-1412.
231.
Hilty has emphasized the importance of neutrality of of the law regard to the patent holder’s choices to engage in more exclusive or inclusive exercise of her rights conferred by a patent. Hilty, "Open Approaches," in Kommunikation: Festschrift für Rolf H. Weber zum 60. Geburtstag, ed. Rolf Sethe and Rolf Weber (Bern: Stämpfli, 2011), 108; Hilty, "Individual, Multiple and Collective Ownership," 44.
232.
The categories of “restricted use” and “semi-open use”, as well as the logic of categorization, rely on the framework advanced by Van Overwalle. Similarly, the qualifications of “sustainable”, “universal”, and “conditional” access, which are further discussed in greater detail, are attributed to her. Geertrui Van Overwalle, "Individualism, Collectivism and Openness in Patent Law : From Exclusion to Inclusion through Licensing," in Individualism and Collectiveness in Intellectual Property Law, ed. Jan Rosén (Cheltenham: Edward Elgar Publishing, 2012), 105-108. See also Van Overwalle; "Inventing Inclusive Patents," 226-229.
233.
See Hilty, "Individual, Multiple and Collective Ownership," 42. For a debate on the categorisation of individual, multiple, and collective ownership of IP, see generally ibid; Alexander Peukert, "Individual, Multiple and Collective Ownership of Intellectual Property Rights - Which Impact on Exclusivity?," in Structure of Intellectual Property: Can One Size Fit All?, ed. Annette Kur and Vytautas Mizaras (Cheltenham: Edward Elgar Publishing, 2011); Geertrui Van Overwalle, "Individualism, Collectivism and Openness in Patent Law : From Exclusion to Inclusion through Licensing."
234.
Van Overwalle, "Exclusive Ownership Versus Open Commons," 144.
235.
See Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1407-1408.
236.
Ibid, 1393-1394. Private ordering may also be used to expand the scope of IPRs to material that belongs to the public domain or is subject to exceptions and limitations. Ibid.; Reto M. Hilty, IP and Private Ordering, Research Paper No. 16-15 (Munich: Max Planck Institute for Innovation & Competition, 2016), 7-8.
237.
Ullrich, "Open Innovation, the Patent Exclusivity and Knowhow Secrecy," 296, 299, 307.
238.
Hilty, "Individual, Multiple and Collective Ownership," 42.
239.
Ullrich, "Open Innovation, the Patent Exclusivity and Knowhow Secrecy," 307.
240.
Van Overwalle, "Inventing Inclusive Patents," 224, 227.
241.
Ibid, 229.
242.
Hilty, "Individual, Multiple and Collective Ownership," 42.
243.
See ibid, 33, 42.
244.
Schultz and Urban, "Protecting Open Innovation," 25, to whom the term “longevity” is also to be attributed. Cf. Van Overwalle, "Inventing Inclusive Patents," 229 labelling longevity as subcategory of sustainability.
245.
Van Overwalle, "Inventing Inclusive Patents," 228. However, the author considers the viral effect to be a subcategory of sustainability.
246.
Van Overwalle, "Exclusive Ownership Versus Open Commons," 151.
247.
Hope, "Open Source Genetics," 181.
248.
For a detailed discussion see Sect. 3.1.4 note 648.
249.
For research on the commons in the context of IPRs as well as other knowledge resources, see, for example, Dusollier, "Commons as a Reverse Intellectual Property."; Van Overwalle, "Exclusive Ownership Versus Open Commons."; Brett M. Frischmann, Michael J. Madison, and Katherine J. Strandburg, Governing Knowledge Commons (New York: Oxford University Press, 2014).
250.
A patent holder who seeks to create an exploitative hold-up situation is actually willing to license a patent, but only under conditions that overreward him.
251.
It must be noted that, due to patent law’s disclosure requirement, even offensively exercised patents are more open to follow-on innovators than inventions that are kept secret. Hilty, "Individual, Multiple and Collective Ownership," 27-28. The effect of mandatory disclosure may foster follow-on innovations that improve upon an original patent. However, protecting an initial invention as a trade secret is more favourable to cumulative innovators who independently develop the same solution.
252.
Of the companies’ patents, almost 40 percent are neither used internally nor licensed, of which 26 percent serve the objective of blocking competitors, while 13 percent are regarded as “sleeping patents” that are merely sitting on the shelf. Salvatore Torrisi et al., "Used, Blocking and Sleeping Patents : Empirical Evidence from a Large-Scale Inventor Survey," Research Policy 45, no. 7 (2016): 1381. The study does not distinguish defensive patents from patents acquired in pursuit of an offensive-anticompetitive strategy. It also does not measure the proportion of unused patents that are subject for litigation.
253.
Chesbrough, Open Innovation, 34, 41, 53, 57.
254.
Rec. 4 TTBER.
255.
Paola Giuri et al., "Inventors and Invention Processes in Europe : Results from the PatVal-EUSurvey," Research Policy 36, no. 8 (2007): 1118.
256.
Van Overwalle, "Individualism, Collectivism and Openness in Patent Law," 75.
257.
Cf. Ullrich, "Open Innovation, the Patent Exclusivity and Knowhow Secrecy," 298-299.
258.
Van Overwalle, "Exclusive Ownership Versus Open Commons," 141.
259.
Similarly, Van Overwalle, "Inventing Inclusive Patents," 218.
260.
Van Overwalle, "Individualism, Collectivism and Openness in Patent Law," 75.
261.
On prospect theory see Sect. 2.1.3.
262.
On transaction cost problems see Sect. 2.3.2.3.
263.
Shapiro, "Navigating the Patent Thicket," 127, which also describes different forms of cross-licensing agreements. In addition, cross-licensing may used as means to settle patent disputes. Ibid, 128, 130, 142.
264.
Ibid, 123.
265.
Peter C. Grindley and David J. Teece, "Managing Intellectual Capital : Licensing and Cross-Licensing in Semiconductors and Electronics," California Management Review 39, no. 2 (1997): 9-10, 32.
266.
Ibid, 32. An SME with a relevant complementary patent to a widely distributed product or an entrant with relevant technology may have a strong position in cross-licensing negotiations against a large company. Ibid.
267.
Lemley, "Intellectual Property Rights and Standard-Setting Organizations," 1950.
268.
See rec. 4 TTBER.
269.
Ibid, Art. 2, Art. 4; TTBER Guidelines (2014), para 40. The precondition of this exception is that a licensing agreement allows for exploitation of a patent; an agreement to block the development of competing technology is not covered by the block exception, see ibid, para 59.
270.
See Commission Regulation (EU) No 1217/2010 of December 2010 on the Application of Article 101 (3) of the Treaty on the Functioning of the European Union to Certain Categories of Research and Development Agreements, 2010 O.J. (L355); Guidelines on the applicability of Article 101 of TFEU to horizontal co-operation agreements, paras 111-149.
271.
For detailed discussion on the MCM see Sect. 3.1.1.2.
272.
Shapiro, "Navigating the Patent Thicket," 130, 133; Cf. Merges, "Contracting into Liability Rules," 1354.
273.
TTBER Guidelines (2014), para 196.
274.
Ibid, paras 54, 57.
275.
See Van Overwalle, "Individualism, Collectivism and Openness in Patent Law," 105. Similarly: Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1410. An example from the field of copyright would be Creative Commons licenses that distinguish between commercial and non-commercial uses. Ibid.
276.
Van Overwalle, "Individualism, Collectivism and Openness in Patent Law," 75.
277.
Mariateresa Maggiolino and Maria Lillà Montagnani, Pledges and Covenants : The Keys to Unlock Patents, Legal Studies Research Paper No. 2615061 (Milan: Bocconi University, 2015), 1.
278.
The interests in fostering follow-on innovation and public interest are also recognized by Ziegler et al. See Ziegler, Gassmann, and Friesike, "Why Do Firms Give Away Their Patents for Free?," 22-23.
279.
See Amy Kapczynski et al., "Addressing Global Health Inequities : An Open Licensing Approach for University Innovations," Berkeley Technology Law Journal 20, no. 2 (2005): 1046-1052.
280.
For example, under the Medicines Patent Pool, those pharmaceutical companies and research organizations that hold patents for HIV, hepatitis, and tuberculosis medicines grant licenses to generic companies who commit to making such medicines available in low and middle-income countries. Medicines Patent Pool, "What We Do," Medicines Patent Pool, last modified n.d., accessed 31 December 2018 https://medicinespatentpool.org/what-we-do/. Despite its name, the Medicines Patent Pool is structured as a clearing house. Van Overwalle, "Exclusive Ownership Versus Open Commons," 149.
281.
For example, Merck’s patent policy supports follow-on innovation more directly, as it allows for royalty-free licensing of its patents for R&D and manufacturing activities for the purpose of addressing “public health needs for [neglected tropical diseases] in the least developed countries”, in addition to their commercialization in such countries. "Public Policy Statement : Social Licensing Approach for Research Development Parnershios for Neglected Tropical Diseases (Ntds)," Merck, last modified January 2014, accessed 22 March 2017 https://www.merck.com/about/views-and-positions/Public-Policy-Statement-Social-Licensing-Approach-for%20Research-Develop.pdf. In the same vein, Kapczynski has proposed a license for neglected diseases that would allow researchers to continue R&D concerning such diseases, even if the university that owns a relevant patent licenses it exclusively to a company. See Kapczynski et al., "Addressing Global Health Inequities," 1119-1112.
282.
Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1410.
283.
However, they may also be viewed as a special type of pro-bono OI for markets in which the patent holder has no interest in operating. Finally, they may also represent government-induced MCMs. For example, the Medicines Patent Pool does not represent a pure MCM initiative, as it is supported by the United Nations. Medicines Patent Pool, "What We Do".
284.
Maggiolino and Montagnani, "From Open Source Software to Open Patenting - What's New in the Realm of Openness," 821-822. As an example, Nokia committed to not enforcing its patents against the Linux Kernel. Patent Commons Project, "Nokia's Legally Binding Commitment Not to Assert Nokia Patents against the Linux Kernel," Linux Foundation, last modified 2005, accessed 29 March 2017 http://www.patentcommons.org/commons/pledgesearch.php?displaypledge=27&titlecopy=&contributor_id=&searchSubmit=Find. Red Hat also undertook not to enforce its patent against FOSS that may read on claims of any patents it owns. "Red Hat's Statement of Position and Promise," Linux Foundation, last modified 2002, accessed 29 March 2017 http://www.patentcommons.org/commons/pledgesearch.php?displaypledge=29&titlecopy=&contributor_id=&searchSubmit=Find.
285.
"Commons : Protecting and Supporting Innovation," Linux Foundation, last modified accessed 29 March 2017 http://www.patentcommons.org/about/the_commons.php.
286.
Maggiolino and Montagnani, "From Open Source Software to Open Patenting - What's New in the Realm of Openness," 824-825.
287.
See Roya Ghafele and Robert D. O´Brien, "Open Innovation for Sustainability : Lessons from the Greenxchange Experience," Munich Personal RePEc Archive, last modified 3 August 2012, accessed 29 March 2017 https://mpra.ub.uni-muenchen.de/40440/1/MPRA_paper_40440.pdf.
288.
Ibid, 4-5. Its standardised licenses included options for licensing in favour of commercialization, both in return for and without a royalty payment, as well as licencing only for non-profit research purposes. Ibid.
289.
Ibid, 6-9.
290.
"Google Starter Program," Google, last modified accessed 22 March 2017 http://static.googleusercontent.com/media/www.google.com/fi//patents/licensing/doc/patent-starter-program-announcement.pdf. Only start-ups with revenues between 500 000 and 20 000 000 US dollars were eligible to participate. "Google Starter Program".
291.
"Google Patent Starter Program FAQs," Google, last modified accessed 23 March 2017 https://static.googleusercontent.com/media/www.google.com/fi//patents/licensing/doc/patent-starter-program-faqs.pdf.
292.
"Google Starter Program". Upon withdrawal from the LOT Network, ownership of the patents that were transferred as a part of the program would revert back to Google. "Google Patent Starter Program FAQs".
293.
"How LOT Works," LOT Network, last modified n.d., accessed 31 December 2018 https://lotnet.com/how-lot-works/.
294.
"Asana, Canon, Dropbox, Google, Newegg and Sap Announce Formation of New Cooperative Patent-Licensing Agreement," LOT Network, last modified n.d., accessed 27 March 2017 http://lotnet.com/asana-canon-dropbox-google-newegg-and-sap-announce-formation-of-new-cooperative-patent-licensing-agreement/.
295.
"Frequently Asked Questions," LOT Network, last modified n.d., accessed 23 March 2017 http://lotnet.com/faq/.
296.
The Patent Starter Program was preceded by Google’s patent-buying initiative. Allen Lo, "Announcing the Patent Purchase Promotion," Google Public Policy Blog, last modified 27 April 2015, accessed 22 March 2017 https://publicpolicy.googleblog.com/2015/04/announcing-patent-purchase-promotion.html; Kevin A. Rieffel, "Why Google Wins by Giving Away Patents to ‘Startups’ Willing to Join the Lot Network," IPWatchdog, last modified 2 August 2015, accessed 22 March 2017 http://www.ipwatchdog.com/2015/08/02/why-google-wins-by-giving-away-patents-to-startups-willing-to-join-the-lot-network/id=60162/?utm_source=Website+Subscribers+%28RSS%29&utm_campaign=d45c17ec76-Daily_RSS_Feed_LexisNexis_Webinar&utm_medium=email&utm_term=0_98774de295-d45c17ec76-84018561.
297.
Rieffel, "Why Google Wins"; "Google Starter Program".
298.
Brad Smith, "Protecting Innovation in the Cloud," Microsoft Official Blog, last modified 2 August 2017, accessed 22 March 2018 https://blogs.microsoft.com/blog/2017/02/08/protecting-innovation-cloud/#sm.0001e1v6nzzl5drztfz21n1swya4o. The customers will also receive wide indemnification coverage and reassurance that, upon Microsoft’s transfer of its patents to NPEs, they cannot be asserted against customers.
299.
Barry Sookman, "Feeling Safer under Microsoft's Cloud Patent Shield? Don't.," Register, last modified 3 March 2017, accessed 22 March 2017 https://www.theregister.co.uk/2017/03/03/feeling_safer_under_microsofts_cloud_patent_shield_dont/; Erich Andersen, "Microsoft Azure IP Advantage : A Closer Look at the 'Patent Pick'," Microsoft On the Issues, last modified 16 February 2017, accessed 22 March 2017 https://blogs.microsoft.com/on-the-issues/2017/02/16/microsoft-azure-ip-advantage-closer-look-patent-pick/#sm.0001e1v6nzzl5drztfz21n1swya4o; Sookman, "Feeling Safer".
300.
Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1409.
301.
Van Overwalle, "Individualism, Collectivism and Openness in Patent Law," 105.
302.
Reto M. Hilty, "Individual, Multiple and Collective Ownership : What Impact on Competition?," 42.
303.
Annette Kur, "Openness in Trademark Law: A Viable Paradigm?" In Innovation, Competition and Collaboration, edited by Dana Beldiman, (Cheltenham, Edward Elgar 2015), 69.
304.
Geertrui Van Overwalle, "Individualism, Collectivism and Openness in Patent Law : From Exclusion to Inclusion through Licensing," 90-91, 111-112.
305.
Ibid, 113.
306.
See Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1409-1410.
307.
Van Overwalle, "Individualism, Collectivism and Openness in Patent Law," 112.
308.
"GNU General Public License".
309.
Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1399. Open-source licences sans a viral effect that are merely intended to ensure the availability of proprietary source code have no relevance in the context of patent law, which requires disclosure of inventions. Boettinger and Burk, "Open Source Patenting," 224.
310.
Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1401.
311.
Van Overwalle, "Exclusive Ownership Versus Open Commons," 143.
312.
Hilty, "Individual, Multiple and Collective Ownership," 28-30. Consequently, the open viral constellation effect can also be characterized as “collective ownership”. ibid, 30.
313.
Ibid, 33. Courts have found FOSS licenses to be enforceable. For a discussion on the efficiency of open viral patent licensing solutions to prevent hold-up problems see Sect. 3.3.5.4.
314.
Ibid, 33.
315.
Michal S. Gal, "Viral Open Source : Competition vs. Synergy," Journal of Competition Law & Economics 8, no. 3 (2012): 471.
316.
Ibid, 482-487, 505. See also Ullrich, "Open Innovation, the Patent Exclusivity and Knowhow Secrecy," 301; Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1414; Sara Boettinger and Brian D. Wright, "Open Source in Biotechnology : Open Questions," Innovations: Technology, Governance, Globalization 1, no. 4 (2006): 50; Rochelle Cooper Dreyfuss, "Does IP Need IP - Accommodating Intellectual Production Outside the Intellectual Property Paradigm," Cardozo Law Review 31, no. 5 (2010): 1472-1472.
317.
Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1396.
318.
Niva Elkin-Koren, "What Contracts Cannot Do : The Limits of Private Ordering in Facilitating a Creative Commons," Fordham Law Review 74, no. 2 (2005): 398-399, 421; Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1412-1413, 1434. In some contexts, open viral licenses have been employed to create a viral effect for modifications of knowledge resources that are not subject to IPRs. Ibid, 1393-1394, 1413.
319.
Maxine Lambrecht, "Fencing the Commons to Protect It from Appropriation? The Dilemma of Copyleft Licences" (paper presented at the 3rd IASC Thematic Conference on Knowledge Commons, Paris, October 20-21 2016). See also Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1425-1427.
320.
Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1394.
321.
Ibid, 1402.
322.
For example, motivated by an interest in fostering generic manufacturing in the least developed and low-income countries, GlaxoSmithKline announced a patent policy of not filing patents for its medicinal products in particular countries. Catherine Saez, "GSK Eases IP Rights for Poorest Countries, Considers Patent Pooling for Cancer," Intellectual Property Watch, last modified 31 March 2016, accessed 22 March 2017 https://www.ip-watch.org/2016/03/31/gsk-eases-ip-rights-for-poorest-countries-considers-patent-pooling-for-cancer/.
323.
Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1402, 1407.
324.
Rebecca S Eisenberg, "Noncompliance, Nonenforcement, Nonproblem? Rethinking the Anticommons in Biomedical Research," Houston Law Review 45, no. 4 (2008): 1098. see also R. Polk Wagner, "Information Wants to Be Free : Intellectual Property and the Mythologies of Control," Columbia Law Review 103, no. 4 (2003): 1010-1011.
325.
Tim Wu, "Tolerated Use," Columbia Journal of Law & the Arts 31, no. 4 (2008): 630-632 in which the author discusses non-enforcement of copyrighted works.
326.
Walsh, Arora, and Cohen, "Effects Research Tool Patenting and Licensing and Biomedical Innovation," 325, 331, 334.
327.
Ibid, 331, 334; Heller and Eisenberg, "Can Patents Deter Innovation?," 700-701; Eisenberg, "Noncompliance, Nonenforcement, Nonproblem?," 1093-1098; Katherine J. Strandburg, "User Innovator Community Norms : At the Boundary between Acedemic and Industry Research," Fordham Law Review 77 (2009), 2250, 2253.
328.
Strandburg, "User Innovator Community Norms," 2254.
329.
Walsh, Arora, and Cohen, "Effects Research Tool Patenting and Licensing and Biomedical Innovation," 331.
330.
Colleen Chien, "Opening the Patent System : Diffusionary Levers in Patent Law," Southern California Law Review 89 (2016): 842.
331.
Walsh, Arora, and Cohen, "Effects Research Tool Patenting and Licensing and Biomedical Innovation," 286, 324-328.
332.
Ibid, 334.
333.
The research community in the biotechnology field has been reported to engage in “using technology without a license (i.e. infringement), sometimes under an informal and typically self-proclaimed research exemption”. Ibid.
334.
Eisenberg, "Noncompliance, Nonenforcement, Nonproblem?," 1098.
335.
Chien has also addressed the problem of the longevity associated with the non-enforcement; see Chien, "Opening the Patent System," 842.
336.
See also Ullrich, "Protecting Technology," 307.
337.
For a discussion on the interaction of defensive and offensive patent strtegies, see Sect. 2.3.1.1–2.3.1.3.
338.
See Chien, "Opening the Patent System," 842.
339.
See Arora, Fosfuri, and Gambardella, Markets of Technology, 178-179, 192-193, 195.
340.
Guidelines on the applicability of Article 101 of TFEU to horizontal co-operation agreements, para 285.
341.
By the term unilateral, I refer to a situation in which a patent holder makes a pledge to grant access to a previously unidentified group of users. Cf. Jorge L. Contreras, "Patent Pledges," Arizona State Law Journal 47, no. 3 (2015): 565, in which the term “unilateral” is used with another meaning.
342.
Maggiolino and Montagnani, Pledges and Covenants, 7-8.
343.
Jorge L Contreras, "Introduction," in Patent Pledges: Global Perspectives on Patent Law’s Private Ordering Frontier, ed. Jorge L. Contreras and Meredith Jacob (Cheltenham: Edward Elgar Publishing, 2017), 2.
344.
Torsten Körber, Standardessentielle Patente, FRAND-Verpflichtungen und Kartellrecht : Eine Analyse unter besonderer Berücksichtigung der deutschen 'Orange-Book-Standard'-Rechtsprechung (Baden-Baden: Nomos, 2013), 195. The interest in setting an interoperability standard contributes to willingness to license, particularly for vertically integrated companies, and sometimes incentivises commitments to license royalty-free. Contreras, "Patent Pledges," 576-577.
345.
Guidelines on the applicability of Article 101 of TFEU to horizontal co-operation agreements, para 285.
346.
Ibid, paras 285, 287.
347.
Contreras "Patent Pledges," 544-545, 551-552.
348.
Ibid, 544-545, 552-553.
349.
Elon Musk, "All Our Patent Are Belong to You," Tesla, last modified 12 June 2014, accessed 29 July 2017 https://www.tesla.com/blog/all-our-patent-are-belong-you.
350.
Contreras, "Patent Pledges," 583-584.
351.
Musk, "All Our Patent Are Belong to You".
352.
"Patent Pledge," Tesla, last modified 12 June 2014, accessed https://www.tesla.com/about/legal#patent-pledge.
353.
James E. Bessen, "History Backs up Tesla’s Patent Sharing," Harvard Business Review, last modified 13 June 2014, accessed 31 December 2018 http://www.hbs.edu/faculty/conferences/2014-strategy-research/Documents/History%20Backs%20Up%20Teslas%20Patent%20Sharing.pdf.
354.
Van Overwalle, "Inventing Inclusive Patents," 264. Similarly, see Contreras, "Patent Pledges," 583-586.
355.
Sam Frizell, "Toyota Wants Everyone to Know How It Made Its Hydrogen-Powered Car," Time, last modified 5 January 2015, accessed 31 December 2018 http://time.com/3654899/toyota-mirai-patents-hydrogen-power/.
356.
See von Hippel and von Krogh, "Free Revealing," 303-304.
357.
Contreras, "Patent Pledges," 583-584.
358.
John Cangany and Chris Danowski, "Ford Opens Portfolio of Patented Technologies to Competitiors to Accelerate Industry-Wide Electrified Vehicle Development," Ford Motor, last modified 28 May 2015, accessed 29 July 2017 https://media.ford.com/content/fordmedia/fna/us/en/news/2015/05/28/ford-opens-portfolio-of-patented-technologies-to-competitors-to-.html. The initiative appears to involve licensing in accordance with the open innovation model.
359.
Contreras, "Patent Pledges," 580.
360.
Patent pledges may be used, for example, for defensive purposes; see generally Schultz and Urban, "Protecting Open Innovation," 30-33.
361.
Contreras, "Patent Pledges," 587, 590 who discusses the pledge-based Eco-Patent Commons as an example. See also Wayne Balta, "Welcome to the Eco-Patent Commons," Corporate Eco Forum, last modified 9 June 2015, accessed 1 August 2017 http://www.corporateecoforum.com/welcome-to-the-eco-patent-commons/. on companies’ goals to contribute to the Eco-Patent Commons.
362.
Contreras, "Patent Pledges," 590-591. Contreras, "Patent Pledges," 590-591.
363.
See Wu, "Tolerated Use," 633-634 who describes an instrument that is similar to a pledge in copyright.
364.
Maggiolino and Montagnani, Pledges and Covenants, 5, fn 20; Van Overwalle, "Inventing Inclusive Patents," 263-264.
365.
Maggiolino and Montagnani, Pledges and Covenants, 5, fn 20.
366.
Claudia Tapia, Industrial Property Rights, Technical Standards and Licensing Practices (FRAND) in the Telecommunications Industry (Cologne: Carl Haymanns Verlag, 2010), at 47. With their IP terms, SSOs seek to balance the need to ensure access to SEPs against the need to make the terms sufficiently attractive for SEP holders to agree to. Farrell et al., "Standard Setting, Patents, and Hold-Up," 608-610, 624-644. On the different forms of FRAND commitments made to SSOs, see Contreras, "Patent Pledges," 566.
367.
Catharina Maracke and Axel Metzger, "Voluntary Patent Pledges : Enforcement in Germany," in Patent Pledges. Global Perspectives on Patent Law’s Private Ordering Frontier, ed. Jorge L. Contreras and Meredith Jacob (Cheltenham: Edward Elgar Publishing, 2017), 146.
368.
See Guidelines on the applicability of Article 101 of TFEU to horizontal co-operation agreements, para 285. See also Sect. 8.6.3 on transferability of FRAND obligations.
369.
For an in-depth analysis, see, for example, Tapia, Industrial Property Rights; Körber, Standardessentielle Patente, FRAND-Verpflichtungen und Kartellrecht; Reto M. Hilty and Peter R. Slowinski, "Standardessentielle Patente - Perspektiven außerhalb des Kartellrechts," Gewerblicher Rechtsschutz und Urheberrecht Internationaler Teil 64, no. 9 (2015); Maracke and Metzger, "Voluntary Patent Pledges."
370.
Peter Picht, "ECJ Rules on Standard-Essential Patents : Thoughts and Issues Post-Huawei," European Competition Law Review 37, no. 6 (2016): 371 fn 58 with reference to LG Mannheim, GRUR-RR 2009, 222.
371.
Microsoft Corp. v. Motorola Inc, 696 F.3d 872, 884 (9th Cir. 2012); see also Microsoft Corp. v. Motorola Inc., 904 F.Supp.2d 1109, 1115 (W.D. Wash 2012).
372.
Contreras, "Patent Pledges," 516. However, the use of pledged patents may be subject to equitable principles. See Jorge L. Contreras, "Market Reliance Theory for FRAND Commitments and Other Patent Pledges," Utah Law Review 2015, no. 2 (2015): 517-521; Duane R. Valz, "Unilateral Patent Pledges : Motivations and Key Principles," in Patent Pledges: Global Perspectives on Patent Law’s Private Ordering Frontier, ed. Jorge L. Contreras and Meredith Jacob (Cheltenham: Edward Elgar Publishing, 2017), 54. For compulsory liability rules that rely on equitable principles see Sects. 7.3–7.4.
373.
Krauspenhaar, Liability Rules in Patent Law. 30
374.
Contreras, "Patent Pledges." 597-598
375.
In the case of electric vehicles, Tesla’s incentives to maintain openness may be reduced in the event that electric cars supplant vehicles that operate on gasoline. Bessen, "Tesla’s Patent Sharing".
376.
Krauspenhaar, Liability Rules in Patent Law, 30.
377.
Unwired Planet International Ltd v. Huawei Technologies Co Ltd, [2017] EWHC 2988 (Pat) [2017] RPC 19, paras 122, 132, 139.
378.
Ibid, para 143. An injunction should be granted against an implementer who refuses to license under FRAND conditions. Ibid. This suggests the introduction of a “conditional injunction”. Peter Picht, "Unwired Planet v. Huawei : A Seminal SEP/FRAND Decision from the UK," Journal of Intellectual Property Law & Practice 12, no. 10 (2017): 578.
379.
J Birss’ argument rests on the presumption that FRAND undertaking has “substantive legal effect” on the grounds that it represents “an objective standard.” “Thus there is no need for contract law to go as far as creating a power to compel parties to enter into FRAND licences against their will because patent law already has the tools available to give legal effect to the FRAND undertaking.” Unwired Planet v. Huawei [2017] EWHC 2988 (Pat) [2017] RPC 19, para 143.
380.
See Hilty and Slowinski, "Standardessentielle Patente," 790-791; Picht, "Unwired Planet v. Huawei," 577.
381.
§ 23 (1), § 23(5) PatG. The term that corresponds to the license of right in German is Lizenzbereitschaft. However, the PatG only refers to an option to declare the willingness to license. The term “license of right” has been used in some countries to refer to compulsory licensing mechanisms, such as in the already abolished section 86 of the Patents Act 1970 of India. Patents Act 1970, No. 39, § 86, Acts of the Parliament 1970 (Ind.); UNCTAD-ICTSD, Resource Book on TRIPS and Development (Cambridge: Cambridge University Press, 2005), 462; N. S. Gopalakrishnan and Madhuri Anand, "Compulsory License under Indian Patent Law," in Compulsory Licensing: Practical Experiences and Ways Forward, ed. Reto M. Hilty and Kung-Chung Liu (Heidelberg: Springer Verlag, 2015), 19; Cf. Patents Act 1970, No. 39, § 86, Acts of the Parliament 1970, as amended up to the Patents (Amendment) Act, 2005, WIPO Lex https://wipolex.wipo.int/en/text/295102 (Ind.).
382.
Krauspenhaar, Liability Rules in Patent Law, 20, 27; Ilja Rudyk, License of Right, Compulsory Licensing and the Value of Exclusivity, Discussion Paper No. 415 (Munich: Governance and the Efficiency of Economic Systems, 2012), 1. The submission of the declaration is inadmissible as long as there is an entry in the Register regarding the grant of an exclusive license (§ 30 (4) PatG) or an application for such an entry is pending before the German Patent and Trade Mark Office (§ 23(2) PatG).
383.
PatG § 23(1). The patent holder may enjoy this fee reduction only after the third year from the date of filing (§ 17 PatG). Krauspenhaar, Liability Rules in Patent Law, 101.
384.
Franz Hacker, "§ 23," in Patentgesetz, ed. Alfred Keukenschrijver and Rudolf Busse (Berlin: De Gruyter, 2016), at 7.
385.
President of the EPO, Proposals for the Level of Renewal Fees for European Patents with Unitary Effect, SC/4/15 (Munich: EPO, 2015), IV, Art. 46.
386.
See generally Kumiko Imai, "Desirable Financial Policies and Fee Systems for Industrial Property Rights," IIP Bulletin 18 (2009). For a broader overview of the objectives of § 23 PatG, see Krauspenhaar, Liability Rules in Patent Law, 104-106.
387.
Patents Act 1977 c. 37, §§ 46-47 (Eng.); Patents Act No. 1 of 1992, Arts. 68-69 (Ir.). http://www.irishstatutebook.ie/eli/1992/act/1/enacted/en/html; ”Codice della proprietà industriale, a norma dellàrticolo 15 della legge 12 dicembre 2002, n. 273” [Industrial Property Code], Art. 80, Decreto Legislativo 10 febbraio 2005, n. 30, G.U. 4 March, 2005, n. 52 – Supplemento Ordinario n. 28. (It.); Ley 24/2015, de 24 de julio, de Patentes, Arts. 87-89, B.O.E. 1985, 117 (Sp.).
388.
Christoph Klamp, "License of Right : A Possibility to Reduce Maintenance Fees," Dennemeyer & Associates, last modified 2015, accessed 23 February 2016 http://www.dennemeyer.com/fileadmin/user_upload/White_papers/PDFs/Licence-of-Right-Possibility-to-Reduce-Maintenance-Fees.pdf.
389.
"Annual Patent Fees Guide : France," RenewalsDesk, last modified n.d., accessed 23 February 2016 http://www.renewalsdesk.com/knowledge-base/france-patent-annual-fees-guide/; Loi n 2005-842 du 26 juillet 2005 pour la confiance et la modernatisation de l’économie, [Law 2005-842 of 26 July on the Modernization of the Economy] Journal Officiel de la République Française, [J.O] [Official Gazette of France], 27 July 2005, 12160; Klamp, "License of Right". For a comparison of the license of right systems in Germany, the UK, and France (prior to abolishment), see Krauspenhaar, Liability Rules in Patent Law, 127-133; Imai, "Desirable Financial Policies," 27-28.
390.
"China Patent Law Amendment : Further Promote the Protection and Use of Patent," Chinese National Intellectual Property Administration, last modified 16 December 2015, accessed 23 February 2016 http://english.sipo.gov.cn/news/official/201512/t20151216_1218049.html; Nathan Wakelin-King, "China to Amend Its Patent Law," Dezan Shira & Associates, last modified 18 December 2015, accessed 25 December 2018 http://www.china-briefing.com/news/2015/12/18/china-to-amend-its-patent-law.html; “China: Draft Amendments to Patent Law released for comment.” EPO. Last modified 8 January 2019. Accessed 20 July 2019 https://www.epo.org/searching-for-patents/helpful-resources/asian/asia-updates/2019/20190108.html.
391.
The rules governing the licenses of right for unitary patents are established by Art. 8 and Art. 9.1 (c) of the Regulation (EU) No 1257/2012 of the European Parliament and of the Council of 17 December 2012 Implementing Enhanced Cooperation in the Area of the Creation of Unitary Patent Protection. 2012 O.J. (L 361) 1 [hereinafter Regulation 1257/2012], which were further clarified by the European Patent Organization’s (the EPO) decisions on adopting the Rules relating to Unitary Patent Protection and the Rules relating to Fees for Unitary Patent Protection. The EPO’s rules will enter into force simultaneously with the UPC Agreement. Art. 2; Art. 18.12 of the Regulation No 1275/2012; Decision of the Select Committee of the Administrative Council of 15 December 2015 Adopting the Rules Relating to Fees for Unitary Patent Protection, European Patent Organization Official Journal A40 SC/D 2/15, (2015); Decision of the Select Committee of the Administrative Council of 15 December 2015 Adopting the Rules Relating to Unitary Patent Protection, European Patent Organization Official Journal A39 SC/D 1/15, (2015).
392.
Imai, "Desirable Financial Policies," 26; Krauspenhaar, Liability Rules in Patent Law, 133.
393.
Van Overwalle, "Inventing Inclusive Patents," 237.
394.
Rudyk, License of Right, Compulsory Licensing and the Value of Exclusivity, 25.
395.
§ 23 (2) PatG.
396.
§ 23 (1) PatG.
397.
§ 23 (3) PatG.
398.
§ 23 (3) PatG.
399.
Hacker, "§ 23," at 14; Lizenzbereitschaftserklärung I, BPatG, 12 January 1994, GRUR 1994, 605, 605-606.
400.
Lizenzbereitschaftserklärung II, BPatG, 20 March 1996, GRUR 1996, 477, 477; Ingo Rinken, "§ 23," in Patentgesetz mit Europäischem Patentübereinkommen: Kommentar, ed. Rainer Schulte. 10th ed. (Cologne: Wolters Kluwer, 2017), 18; Rüdiger Rogge and Helga Kober-Dehm, "§ 23," in Patentgesetz, ed. Georg Benkard, 11th ed. (Munich: C. H. Beck, 2015), § 23 at 8.
401.
BPatG, 28 March 2017, 7 W (pat) 22/15, GRUR 2017, 1025, 1026.
402.
Mehrfachkontaktanordnung, LG Düsseldorf, 13 June 2001, InstGe 1, 33, para 4; Rogge and Kober-Dehm "§ 23," para 11; Peter Mes, Patentgesetz, Gebrauchmustergesetz, 4th ed. (Munich: C. H. Beck, 2015), at 9-10.
403.
Krauspenhaar, Liability Rules in Patent Law, 102-103; Cf. Lizenzbereitschaftserklärung II, GRUR 1996, 477, in which the court refers to the formation of a contract by means of notifying the patent holder.
404.
Krauspenhaar, Liability Rules in Patent Law, 27.
405.
§ 23 (4) PatG. For a review of the criteria used in the determination of reasonable compensation, see Krauspenhaar, Liability Rules in Patent Law, 103-104. The determination of remuneration by the Patent Division is subject to a fee of 60 euros and, subject to the DPMA’s discretion, compensation for the costs of oral hearing and the taking of evidence. § 20 (4), § 62 PatG; "Information Concerning Costs, Fees and Expenses of the German Patent and Trade Mark Office and of the Federal Patent Court," German Patent and Trade Mark Office, last modified July 2016, accessed 31 December 2018 https://www.dpma.de/docs/english/formulare/allg_eng/2/a9510_1.pdf.
406.
LG Mannheim, 29 June 1955, GRUR 1956, 412; Mes, Patentgesetz, Gebrauchmustergesetz, § 23 at 18; Krauspenhaar, Liability Rules in Patent Law, 103.
407.
Krauspenhaar, Liability Rules in Patent Law, 103.
408.
Mehrfachkontaktanordnung, InstGe 1, 33; Krauspenhaar, Liability Rules in Patent Law, 107; Rogge and Kober-Dehm, "§ 23," at 11.
409.
Krauspenhaar, Liability Rules in Patent Law, 107.
410.
Mehrfachkontaktanordnung, InstGe 1, 33; Krauspenhaar, Liability Rules in Patent Law, 107; Rogge and Kober-Dehm, "§ 23," at 11; Mes, Patentgesetz, Gebrauchmustergesetz, § 23 at 12.
411.
Mes, Patentgesetz, Gebrauchmustergesetz, § 23 at 12.
412.
§ 23 (4) PatG.
413.
The withdrawal will take effect upon filing a written notice with the Patent Office (§ 23(7) PatG). The question of whether a patentee has received a substantively valid notification of the use of an invention is to be evaluated in civil courts. GRUR 2017, 1025.
414.
§ 23 (7) PatG.
415.
See for example "Patent Pledge," Tesla.
416.
Art. 8 (1) Regulation 1257/2012. Licenses of right cannot concern applications for unitary patents. Cf. § 23 (6) PatG.
417.
Rec. 15 Regulation 1257/2012.
418.
Art. 9 (1) (c) Regulation 1257/2012.
419.
Decision of the Select Committee of the Administrative Council of 15 December 2015 Adopting the Rules Relating to Fees for Unitary Patent Protection; Rule 12; Decision of the Select Committee of the Administrative Council of 15 December 2015 Adopting the Rules Relating to Unitary Patent Protection. Rule 12 (1); EPO, Unitary Patent Guide. Obtaining, Maintaining and Managing Unitary Patents 1st ed. (Munich: EPO, 2017), 29-32.
420.
§ 23 (1) PatG.
421.
The possible national procedural rules concerning making a licence of right declaration will not complement Art. 8 of Regulation No 1275/2012, as the EPO is the recipient of the statement.
422.
Van Overwalle, "Inventing Inclusive Patents," 237.
423.
Art. 32(1)(h)UPCA; Decision of the Select Committee of the Administrative Council of 15 December 2015 Adopting the Rules Relating to Fees for Unitary Patent Protection, Rule 12, explanatory note, para 15.
424.
Decision of the Select Committee of the Administrative Council of 15 December 2015 Adopting the Rules Relating to Fees for Unitary Patent Protection, Rule 12, explanatory note, para 15.
425.
"Preliminary Set of Provisions for the Rules of Procedure ('Rules') of the Unified Patent Court," Unified Patent Court, last modified 19 October 2015, accessed 27 December 2018 https://www.unified-patent-court.org/news/draft-rules-procedure-updated-march-2017, Rule 80 (1)(c).
426.
Preparatory Committee for the Unified Patent Court. Rules on Court Fees and Recoverable Costs. Final - Subject to Legal Scrubbing. Unified Patent Court, Last modified 25 February 2017. Accessed 10 July 2019. https://www.unified-patent-court.org/sites/default/files/agreed_and_final_r370_subject_to_legal_scrubbing_to_secretariat.pdf, 7-8; "Preliminary Set of Provisions", rule 80 (3).
427.
"Preliminary Set of Provisions", Rule 80 (2), Rule 132.
428.
See § 23.4 PatG; Preparatory Committee for the Unified Patent Court. Rules on Court Fees and Recoverable Costs, 4. For unitary patents, the request for compensation will be subject to a fixed fee of 11 000 euros. Appeals concerning the determination of the compensation are subject to a fee of 11 000 euros and an additional, value-based fee. Ibid, 2, 7, 10.
429.
Decision of the Select Committee of the Administrative Council of 15 December 2015 Adopting the Rules Relating to Unitary Patent Protection, Rule 12 (2).
430.
Rudyk, License of Right, Compulsory Licensing and the Value of Exclusivity, 2-3; Krauspenhaar, Liability Rules in Patent Law, 108.
431.
Rudyk, License of Right, Compulsory Licensing and the Value of Exclusivity, 3.
432.
Ibid, 20, 24. In a study conducted in Japan, the respondents indicated that they would approve a license of right-system, if hypothetically introduced in Japanese patent law, for various reasons: In cases when patents are not being used (37.7 percent), for increasing the opportunities in terms of finding licensees (37.3 percent), for the purposes of cost reduction (36 percent), and upon perceived expense of renewal costs (15.6 percent). In contrast, the respondents, who were drawn from universities, research institutions, and companies, reported that they would forego using the instrument due to the necessity of protecting their patents (47.7 percent), the elimination of the option to select licensees (28.2 percent), and due to existing licensing commitments or joint ownership of patents (21.9 percent). Imai, "Desirable Financial Policies," 30-31. Krauspenhaar also found the need to prevent free riding to be the critical reason for the instrument not being employed. Krauspenhaar, Liability Rules in Patent Law, 124. Imai also found that a concern regarding becoming subject to unfair licensing terms was present both among patent owners and possible users. The former were also wary of a potential hold-out risk, while the latter raised concerns over enclosure by dependent patents Imai, "Desirable Financial Policies," 32.
433.
Rudyk, License of Right, Compulsory Licensing and the Value of Exclusivity, 16.
434.
Krauspenhaar, Liability Rules in Patent Law, 119, 125.
435.
Ibid, 120, 124.
436.
Ibid, 123-124.
437.
Rudyk, License of Right, Compulsory Licensing and the Value of Exclusivity, 24-26.
438.
Krauspenhaar, Liability Rules in Patent Law, 132.
439.
George A. Akerlof, "Market for 'Lemons' : Quality Uncertainty and the Market Mechanism," Quarterly Journal of Economics 84, no. 3 (1970) 489-490.
440.
Rudyk, License of Right, Compulsory Licensing and the Value of Exclusivity, 23, 26. Similarly, Krauspenhaar, Liability Rules in Patent Law, 123, 125.
441.
Rudyk, License of Right, Compulsory Licensing and the Value of Exclusivity, 24. Cf. Krauspenhaar, Liability Rules in Patent Law, 125.
442.
Krauspenhaar, Liability Rules in Patent Law, 133.
443.
Van Overwalle, "Inventing Inclusive Patents," 237.
444.
Rudyk, License of Right, Compulsory Licensing and the Value of Exclusivity, 25, 28.
445.
President of the EPO, Adjusted Proposals for the Level of Renewal Fees for European Patents with Unitary Effect, SC/18/15 (Munich: EPO, 2015), III, Art. 21.
446.
See Krauspenhaar, Liability Rules in Patent Law, 120, 124.
447.
President of the EPO, Proposals for the Level of Renewal Fees for European Patents with Unitary Effect, IV, Art. 48.
448.
Imai, "Desirable Financial Policies," 32; Krauspenhaar, Liability Rules in Patent Law, 133.
449.
Brigit Verbeure et al., "Patent Pools and Diagnostic Testing," Trends in Biotechnology 24, no. 3 (2006): 115. Similarly, Shapiro, "Navigating the Patent Thicket," 127; Birgit Verbeure, "Patent Pooling for Gene-Based Diagnostic Testing : Conceptual Framework," in Gene Patents and Collaborative Licensing Models, ed. Geertrui Van Overwalle (Cambridge: Cambridge University Press, 2009), 5; TTBER Guidelines (2014), para 244; Van Overwalle, "Patent Pools and Clearinghouses in the Life Sciences," 312.
450.
Krauspenhaar, Liability Rules in Patent Law, 27.
451.
Merges, "Contracting into Liability Rules," 1342.
452.
Krauspenhaar, Liability Rules in Patent Law, 27-28. Patent pools that only license to members represent a restricted form of openness, discussed under Sect. 3.2.3.
453.
Adam Mossoff, "Rise and Fall of the First American Patent Thicket : The Sewing Machine War of the 1850s," Arizona Law Review 53 (2011): 211.
454.
Merges, "Contracting into Liability Rules," 1342-1352; TTBER Guidelines (2014), para 244. For an overview of different patent pool administration models, see Verbeure, 7-9.
455.
Jonathan M. Barnett, "From Patent Thickets to Patent Networks : The Legal Infrastructure of the Digital Economy," Jurimetrics 55, no. 1 (2014): 13.
456.
Shapiro, "Navigating the Patent Thicket," 127, 134.
457.
Barnett, "From Patent Thickets to Patent Networks," 19-20.
458.
Verbeure et al., "Patent Pools and Diagnostic Testing," 116.
459.
TTBER Guidelines (2014), para 245. The most famous example of a standard-related patent pool is MPEG LA, which pools technologies that belong to the MPEG-2 standard. Yuzuki Nagakoshi and Katsuya Tamai, "Licensing Organizations and the Formation of Patent Pools in the Age of Digital Broadcasting," Gewerblicher Rechtsschutz und Urheberrecht Internationaler Teil 64, no. 9 (2015): 795.
460.
TTBER Guidelines (2014), para 56.
461.
Hanns Ullrich, "Gene Patents and Clearing Models : Some Comments from a Competition Law Perspective," in Gene Patents and Collaborative Licensing Models, ed. Geertrui Van Overwalle (Cambridge: Cambridge University Press, 2009), 341.
462.
For example, Heyers identifies three different patent-related contracts: agreements that set up a patent pool and determine the content of its patent portfolio; licensing arrangements between the patent holders who join the patent pool; and, finally, licensing agreement(s) between the pool and the third parties. Johannes Heyers, "Effiziente Patentpoolkonstitution - zugleich ein Beitrag zum sog. More Economic Approach," Gewerblicher Rechtsschutz und Urheberrecht Internationaler Teil 60, no. 3 (2011): 217. However, the licensing terms for pool members may also be incorporated in the agreement that established a pool. Furthermore, technology transfer to third parties typically occurs on the basis of standardised bilateral licensing agreements. Verbeure, "Patent Pooling for Gene-Based Diagnostic Testing," 5.
463.
See Sect. 3.1.1.1. However, especially in relation to patent pools that are set up to promote public policy, participants may have non-pecuniary motivations. Ziegler, Gassmann, and Friesike, "Why Do Firms Give Away Their Patents for Free?."; Van Overwalle, "Patent Pools and Clearinghouses in the Life Sciences," 324-325. I do not discuss the incentives to join such pools, as they are often government-initiated. Ibid. Furthermore, they typically represent semi-open constellations, discussed Sect. 3.2.4.
464.
Merges, "Contracting into Liability Rules," 1340; Heyers, "Effiziente Patentpoolkonstitution," 216; TTBER Guidelines (2014), para 245; DOJ and FTC, Antitrust Guidelines for the Licensing of Intellectual Property (Washington, DC: DOJ and FTC, 2017), § 5.5; Nagakoshi and Tamai, "Licensing Organizations and the Formation of Patent Pools," 799; Erik Hovenkamp and Herbert Hovenkamp, "Patent Pools and Related Technology Sharing," in Cambridge Handbook of Antitrust, Intellectual Property, and High Tech, ed. Roger D. Blair and Daniel Sokol (Cambridge: Cambridge University Press, 2017), 364. First, instead of the individual valuation and negotiation of each license that are presupposed by the property rule, a patent pool licenses the pooled technologies on the basis of predetermined, regularized license rates. Merges, "Contracting into Liability Rules," 1328, 1340, 1342. Pool members usually divide the royalties collected by the patent pool on the basis of predetermined formulas, which address factors such as the number of licensed patents, the ages thereof, and the number of licensees. However, patent pools may also license technology royalty-free. Merges, "Contracting into Liability Rules," 1353; Michael Mattioli, "Power and Governance in Patent Pools," Harvard Journal of Law & Technology 27, no. 2 (2014): 446-449, 451-454, 461-465. Early patent pools also offered fixed royalty rates to their members on the basis of, for example, products sold downstream or a share of the royalty revenue. Some patent pools also pay dividends to patent holders. It is only in rare cases that patent pools feature a collective evaluation mechanism that allows for more democratic involvement of patent holders. Mattioli, "Power and Governance in Patent Pools," 440, 443, 463-465.
465.
Heyers, "Effiziente Patentpoolkonstitution," 216; DOJ and FTC, Antitrust Enforcement, 84-85; DOJ and FTC, Antitrust Guidelines for the Licensing of Intellectual Property (2017), § 5.5. Larger patent pools are more likely to have a unit focused on litigation. Josh Lerner, Jean Tirole, and Marcin Strojwas, Cooperative Marketing Agreements between Competitors : Evidence from Patent Pools, Working Paper No. 9680 (Cambridge, MA: National Bureau of Economic Research, 2003), 3.
466.
Heyers, "Effiziente Patentpoolkonstitution," 216.
467.
Robert P. Merges and Michael Mattioli, "Measuring the Costs and Benefits of Patent Pools," Ohio State Law Journal 78, no. 2 (2016): 281, 298, 303-313, 324, 346.
468.
Shapiro, "Navigating the Patent Thicket," 123; DOJ and FTC, Antitrust Enforcement, 84; DOJ and FTC, Antitrust Guidelines for the Licensing of Intellectual Property (2017), § 5.5.
469.
Shapiro, "Navigating the Patent Thicket," 134; TTBER Guidelines (2014), para 245.
470.
Shapiro, "Navigating the Patent Thicket," 123; Heyers, "Effiziente Patentpoolkonstitution," 217.
471.
Shapiro, "Navigating the Patent Thicket," 123-124; Heyers, "Effiziente Patentpoolkonstitution," 216, 222; TTBER Guidelines (2014), para 245.
472.
Barnett, "From Patent Thickets to Patent Networks," 10.
473.
François Lévêque and Yann Ménière, "Patent Pool Formation : Timing Matters," Information Economics & Policy 23, no. 3 (2011): 243.
474.
Krauspenhaar, Liability Rules in Patent Law, 139.
475.
Verbeure, "Patent Pooling for Gene-Based Diagnostic Testing," 9.
476.
Hovenkamp and Hovenkamp, "Patent Pools and Related Technology Sharing," 358.
477.
Nagakoshi and Tamai, "Licensing Organizations and the Formation of Patent Pools," 800.
478.
Keyvan Vakili, "Collaborative Promotion of Technology Standards and the Impact on Innovation, Industry Structure, and Organizational Capabilities : Evidence from Modern Patent Pools," Organization Science 27, no. 6 (2016): 32, 35. The effect has been confirmed in relation to standard-related patent pools.
479.
TTBER Guidelines (2014), para 245.
480.
Barnett, "From Patent Thickets to Patent Networks," 1, 19-20, 30, 45-46. Similarly, see also Antitrust Enforcement, 71, 85; Heyers, "Effiziente Patentpoolkonstitution," 214; DOJ and FTC, Antitrust Guidelines for the Licensing of Intellectual Property (2017), § 5.5.
481.
Heyers, "Effiziente Patentpoolkonstitution." 213-215, 217; Herbert Hovenkamp et al., IP and Antitrust : An Analysis of Antitrust Principles Applied to Intellectual Property Law, vol. 1 (New York: Wolters Kluwer, 2017), 372-273.
482.
See Amol M. Joshi and Atul Nerkar, "When Do Strategic Alliances Inhibit Innovation by Firms? Evidence from Patent Pools in the Global Optical Disc Industry," Strategic Management Journal 32, no. 11 (2011); Ryan Lampe and Petra Moser, "Do Patent Pools Encourage Innovation? Evidence from the Nineteenth-Century Sewing Machine Industry," Journal of Economic History 70, no. 4 (2010): 898; Thomas Jeitschko, D. and Nanyun Zhang, "Adverse Effects of Patent Pooling on Product Development and Commercialization," B.E. Journal of Theoretical Economics 14, no. 1 (2014):27.
483.
TTBER Guidelines (2014), paras 246, 254, 259.
484.
DOJ and FTC, Antitrust Guidelines for the Licensing of Intellectual Property (2017), § 5.5-5.6.
485.
Hovenkamp and Hovenkamp, "Patent Pools and Related Technology Sharing," 359.
486.
See 28 C.F.R. § 50.6.
487.
TTBER Guidelines (2014, para 247.
488.
TTBER Guidelines (2014), para 261.
489.
Ibid, para 248. In addition, the Commission considers the openness of a pool, participation in its creation, the selection of the pooled technology, the involvement of independent experts in the process, a pool’s operations, the existence of an independent dispute-resolution process, and the establishment of safeguards against the sharing of sensitive information upon reviewing a patent pool’s compliance with Art. 101 (1) TFEU. Ibid, paras 248, 249, 256-260.
490.
Shapiro, "Navigating the Patent Thicket," 119-120.
491.
TTBER Guidelines (2014), para 252.
492.
Ibid, para 261.
493.
Trevor Cook, "New EU Guidelines on Technology Transfer Agreements," Journal of Intellectual Property Rights 19 (2014): 231.
494.
TTBER Guidelines (2014), paras 246, 253, 255.
495.
Ibid, para 255.
496.
The European Commission acknowledges that pooling may also yield an efficient outcome when the included technologies are partially substitutable, such as in a situation in which licensees find it necessary to incorporate both of the technological alternatives in their products. Ibid, para 254. Distinguishing complements from substitutes may also prove difficult due to differences between licensees and the variety of downstream applications. Hovenkamp and Hovenkamp, 363, 367. For a discussion of the relevance of the division between complementary and substitute patents, see Heyers, "Effiziente Patentpoolkonstitution," 219-222, 225; Krauspenhaar, Liability Rules in Patent Law, 147-149.
497.
TTBER Guidelines (2014), para 262.
498.
Ibid, paras 263.
499.
Ibid, paras 264-265. These conditions have also been referred to as “the second safe harbour” for patent pools. Steven Anderman and John Kallaugher, Technology Transfer and the New EU Competition Rules : Intellectual Property Licensing after Modernisation (New York: Oxford University Press, 2006), 9.45.
500.
TTBER Guidelines (2014), para 266.
501.
Ibid, paras 267 b)
502.
Ibid, paras 269.
503.
Ibid, paras 267 c) and d)
504.
However, a patent pool that does not form a private liability rule in a certain context can still have procompetitive effects. Hovenkamp and Hovenkamp, "Patent Pools and Related Technology Sharing," 369-372.
505.
TTBER Guidelines (2014), paras 268-269. However, when a pool holds a dominant position on a market, its licensees should be treated equally, irrespective of their contributions to the patent pool. Ibid, para 269.
506.
Ibid, para 271.
507.
Nagakoshi and Tamai, "Licensing Organizations and the Formation of Patent Pools," 799.
508.
Merges, "Contracting into Liability Rules," 1324-1325, 1327.
509.
Nagakoshi and Tamai, "Licensing Organizations and the Formation of Patent Pools," 799.
510.
Ibid.
511.
Krauspenhaar, Liability Rules in Patent Law, 142.
512.
Jay Pil Choi and Heiko Gerlach, "Patent Pools, Litigation, and Innovation," RAND Journal of Economics 46, no. 3 (2015): 517.
513.
TTBER Guidelines (2014), para 272.
514.
Anne Layne-Farrar and Josh Lerner, "To Join or Not to Join : Examining Patent Pool Participation and Rent Sharing Rules," International Journal of Industrial Organization 29, no. 2 (2011): 300.
515.
Nagakoshi and Tamai, "Licensing Organizations and the Formation of Patent Pools," 797, 799.
516.
Barnett, "From Patent Thickets to Patent Networks," 40-41; Nagakoshi and Tamai, "Licensing Organizations and the Formation of Patent Pools," 797. In addition, an administrator may need to take into consideration the licensing rates of patent pools for other technologies that downstream users employ. Barnett, "From Patent Thickets to Patent Networks," 40-41.
517.
Hovenkamp and Hovenkamp, "Patent Pools and Related Technology Sharing," 366.
518.
Barnett, "From Patent Thickets to Patent Networks," 1, 45-46.
519.
See Layne-Farrar and Lerner, "To Join or Not to Join," 295. Similarly, Reiko Aoki and Sadao Nagaoka, Consortium Standard and Patent Pools, Discussion Paper No. D04-32 (Tokyo: Institute of Economic Research, Hitotsubashi University, 2005), 18; Nagakoshi and Tamai, "Licensing Organizations and the Formation of Patent Pools," 800.
520.
Michael Mattioli, "Patent Pool Outsiders," Berkeley Technology Law Journal 33, no. 1 (2017): 10.
521.
See Akerlof, "Market for 'Lemons' : Quality Uncertainty and the Market Mechanism," 489-490. See also Geertrui Van Overwalle, "Turning Patent Swords into Shares," Science 330 (2010): 1631.
522.
Henry Delcamp, "Value of Patents in Pools and Its Implications for Competition," Criterion Journal on Innovation 1, no. 1 (2016): 161-162, 177.
523.
Mattioli, "Patent Pool Outsiders," 9-10, 16.
524.
Krauspenhaar, Liability Rules in Patent Law, 142.
525.
Mattioli, "Patent Pool Outsiders," 32, 36, 45, 46. In the same vein, patent holders in the biotechnology sector reportedly prefer bilateral licensing to patent pooling. Van Overwalle, "Patent Pools and Clearinghouses in the Life Sciences," 331-332.
526.
Nagakoshi and Tamai, "Licensing Organizations and the Formation of Patent Pools," 797.
527.
Mattioli, "Patent Pool Outsiders," 8-9, 17, 62-63, 65.
528.
Ibid, 7, 50.
529.
Barnett, "Property as Process," 431-433, 455-456.
530.
Mattioli, "Patent Pool Outsiders," 7-8, 22-23, 27-30; see also Barnett, "Property as Process," 390-391, 412-413, 432.
531.
Mattioli, "Patent Pool Outsiders," 30-33, 64.
532.
eBay, 126 S. Ct. 1837, 1839, 1841; Mattioli, "Patent Pool Outsiders," 30. His research outcomes hence illustrate bargaining in the shadow of a liability rule. See Mark A. Lemley, "Contracting around Liability Rules," California Law Review 100, no. 2 (2012), 484.
533.
Aoki and Nagaoka, Consortium Standard and Patent Pools, 17.
534.
Layne-Farrar and Lerner, "To Join or Not to Join," 300.
535.
Nicol and Hope, "Cooperative Strategies," 92-93; Jane Nielsen, Dianne Nicol, and John Liddicoat, "Sharing the Burden in Australian Drug Discovery and Development of Collaborative Trends in Translational Research," Intellectual Property Quarterly 2014, no. 3 (2014), 190, 196, 198, 208; Van Overwalle, "Patent Pools and Clearinghouses in the Life Sciences," 331. The scarcity of patent pools in the biotechnology sector may be explained with reference to the importance of tacit knowledge in the R&D processes that are conducted in this sector. Patent pooling in fields such as biotechnology and pharmaceuticals promotes spillovers, which may decrease downstream product differentiation and have undesirable effects on social welfare. Jeitschko and Zhang, "Adverse Effects of Patent Pooling," 48-49.
536.
Verbeure et al., "Patent Pools and Diagnostic Testing," 119; Alexander Lee, "Examining the Viability of Patent Pools for the Growing Nanotechnology Patent Thicket," Nanotechnology Law & Business 3 (2006): 326-327.
537.
Barnett, "From Patent Thickets to Patent Networks," 10, fn 30.
538.
Krauspenhaar, Liability Rules in Patent Law, 157.
539.
See Barnett, "Property as Process," 417-418.
540.
Barnett, "From Patent Thickets to Patent Networks," 10, fn 30; Verbeure et al., "Patent Pools and Diagnostic Testing," 119.
541.
Barnett, "From Patent Thickets to Patent Networks," 10, fn 30.
542.
"Clearinghouse," Oxford University Press, last modified n.d., accessed 9 October 2014 http://www.oxforddictionaries.com/us/definition/american_english/clearinghouse; James G. Cannon, Clearing-Houses : Their History, Methods and Administration (New York: D. Appleton and Company, 1908), 1-2, 11; Anatole F. Krattinger, "Financing the Bioindustry and Facilitating Biotechnology Transfer," IP Strategy Today 8 (2004): 20; van Zimmeren et al., "Clearing House for Diagnostic Testing," 353; Editors of Encyclopaedia Britannica, "Clearinghouse," Encyclopedia Britannica, last modified 16 December 2014, accessed 9 October 2014 http://www.britannica.com/EBchecked/topic/120846/clearinghouse.
543.
Cannon, Clearing-Houses, 1-2, 11-12.
544.
Oxford Dictionaries, "Clearinghouse".
545.
Krattinger, "Financing the Bioindustry," 20.
546.
See Merges, "Contracting into Liability Rules," 1328-1340; Gregory Graff and David Zilberman, "Intellectual Property Clearinghouse for Agricultural Biotechnology." Nature Biotechnology 19, no. 12 (2001), 1179; Esther van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics : Conceptual Framework," in Gene Patents and Collaborative Licensing Models, ed. Geertrui Van Overwalle (Cambridge: Cambridge University Press), 79, 83-100.
547.
See genenerally Gregory Graff and David Zilberman, "Towards an Intellectual Property Clearinghouse for Agricultural Biotechnology," IP Strategy Today 3, no. 1 (2001): "Intellectual Property Clearinghouse for Agricultural Biotechnology," Nature Biotechnology 19 (2001); Krattinger, "Financing the Bioindustry."; Lori Sheremeta and Richard E. Gold, "Creating a Patent Clearinghouse in Canada : A Solution to Problems of Equity and Access," Health Law Review 11, no. 3 (2003); Geertrui Van Overwalle et al., "Models for Facilitating Access to Patents on Genetic Inventions," Nature Reviews Genetics 7 (2005); van Zimmeren et al., "Clearing House for Diagnostic Testing."; van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics."; Michael Spence, "Comment on the Conceptual Framework for a Clearinghouse Mechanism," in Gene Patents and Collaborative Licensing Models, ed. Geertrui Van Overwalle (Cambridge: Cambridge University Press); Nicol and Hope, "Cooperative Strategies."; Edson Beas Rodrigues Jr, General Exception Clauses of the TRIPS Agreement : Promoting Sustainable Development (New York: Cambridge University Press, 2012), 195-197; Kourtney Baltzer, "Clearinghouse : The Solution to Clearing up Confusion in Gene Patent Licensing," Harvard Journal of Law & Technology 24, no. 2 (2011). For an early account of a patent clearing house outside of the biotechnology sector, see Carl A. Kukkonen, "Use of a Patent Licensing Center as an Intermediary for Facilitating the Licensing of Commecially Viable, Unused Patents," Virginia Journal of Law and Technology 3, no. 10 (1998).
548.
Merges, "Contracting into Liability Rules," 1295-1296, 1308-1316, 1327-1340, referring to “Collective Rights Organizations”, Barnett, "Anti-Commons Revisited," 130, referring to “third-party intermediaries”.
549.
See Krauspenhaar, Liability Rules in Patent Law, 159; Esther van Zimmeren, "IP Coordination Models : Revealing Some of the 'Magic' Behind Patent Pools and Clearinghouses," in User Generated Law: Re-Constructing Intellectual Property Law in a Knowledge Society, ed. Thomas Riis (Cheltenham: Edward Elgar Publishing, 2016), 139; Chesbrough and Ghafele, "Open Innovation and Intellectual Property," 201-204; Nadine Roijakkers, Andy Zynga, and Caroline Bishop, "Getting Help from Innomediaries : What Can Innovators Do to Increase Value in External Knowledge Searches?," 242-243, 247-255.
550.
Reiko Aoki and Aaron Schiff, "Promoting Access to Intellectual Property : Patent Pools, Copyright Collectives, and Clearinghouses," R&D Management 38, no. 2 (2008): 195. Similarly, see van Zimmeren, "IP Coordination Models," 137.
551.
Aoki and Schiff, "Promoting Access to Intellectual Property," 196.
552.
van Zimmeren et al., "Clearing House for Diagnostic Testing," 353.
553.
Ibid, 353-354. See also Nicol and Hope, "Cooperative Strategies," 93. In practice, a clearing house may evolve from one type into another over time. Ibid, 99; van Zimmeren, "IP Coordination Models," 138. Furthermore, clearing houses may adopt certain characteristics of patent pools, and vice versa. Van Overwalle, "Patent Pools and Clearinghouses in the Life Sciences," 325-326.
554.
van Zimmeren et al., "Clearing House for Diagnostic Testing," 353-354.
555.
Graff and Zilberman, "Clearinghouse for Agricultural Biotechnology," 4.
556.
van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics," 71.
557.
Krattinger, "Financing the Bioindustry," 21; van Zimmeren et al., "Clearing House for Diagnostic Testing," 353; van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics," 71-73; Graff and Zilberman, "Clearinghouse for Agricultural Biotechnology," 6. See also Reiko Aoki and Aaron Schiff, "Promoting Access to Intellectual Property", 197 In turn, a technology clearing house may transmit information concerning licensees’ needs. Baltzer, "Clearinghouse," 534.
558.
Graff and Zilberman, "Clearinghouse for Agricultural Biotechnology," 6.
559.
See Kukkonen, "Use of a Patent Licensing Center," 2-3.
560.
Van Overwalle, "Patent Pools and Clearinghouses in the Life Sciences," 318-319; Michael A. Kock and Floris ten Have, "‘International Licensing Platform—Vegetables’ : Prototype of a Patent Clearing House in the Life Science Industry," Journal of Intellectual Property Law & Practice 11, no. 7 (2016): 506-507.
561.
van Zimmeren et al., "Clearing House for Diagnostic Testing," 353-354.
562.
Ibid, 353. An example of such an open-access clearing house would be the SNP Consortium. See van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics," 75-76; Nicol and Hope, "Cooperative Strategies," 102.
563.
See van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics," 75 in which the author discusses the Eco-Patent Commons as an example of open access clearing house.
564.
Ibid, 76, 79. Creative Commons licenses represent a famous standardised licenses clearing house initiative, see van Zimmeren et al., "Clearing House for Diagnostic Testing," 354; van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics," 78.
565.
Van Overwalle, "Patent Pools and Clearinghouses in the Life Sciences," 320-322. Van Overwalle also considers the Science Commons’ GreenXchange Project and Enza Zaden’s e-licensing platforms to represent standardised licenses clearing houses, but both of these initiatives are already inactive.
566.
Ibid, 321; "Licensors," Librassay, last modified n.d., accessed 28 October 2017 https://www.librassay.com/LicensorMatrix.aspx. The licensors are predominantly research instututions. Ibid.
567.
"Frequently Asked Questions," Syngenta, last modified accessed 28 October 2017 https://www3.syngenta.com/how-we-do-it/corporate-responsibility/frequently-asked-questions/our-business-faq.
568.
Ibid.
569.
Cf. Van Overwalle, "Patent Pools and Clearinghouses in the Life Sciences," 328.
570.
van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics.", 80.
571.
Merges, "Contracting into Liability Rules," 1328-1335; van Zimmeren et al., "Clearing House for Diagnostic Testing," 354; van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics," 80.
572.
Krauspenhaar, Liability Rules in Patent Law, 30; Van Overwalle, "Patent Pools and Clearinghouses in the Life Sciences," 322.
573.
Sheremeta and Gold, "Creating a Patent Clearinghouse in Canada," 19; van Zimmeren et al., "Clearing House for Diagnostic Testing," 354; van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics," 80.
574.
Graff and Zilberman, "Intellectual Property Clearinghouse."; van Zimmeren et al., "Clearing House for Diagnostic Testing," 353-354; van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics," 80; Aoki and Schiff, "Third-Party Clearinghouses and Intellectual Property Licensing," 4, 11; van Zimmeren, "IP Coordination Models," 139.
575.
van Zimmeren et al., "Clearing House for Diagnostic Testing," 353-354; van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics," 80; van Zimmeren, "IP Coordination Models," 139.
576.
Krauspenhaar, Liability Rules in Patent Law, 29-30; Cf. Van Overwalle, "Individualism, Collectivism and Openness in Patent Law," 102; "Patent Pools and Clearinghouses in the Life Sciences," 328, in which the author also considers standardised licensing pools to represent a form of private liability rules.
577.
Aoki and Schiff, "Promoting Access to Intellectual Property," 194-196.
578.
Van Overwalle, "Individualism, Collectivism and Openness in Patent Law," 104.
579.
van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics," 105.
580.
Aoki and Schiff, "Promoting Access to Intellectual Property," 195-196.
581.
Cf. Geertrui Van Overwalle, "Designing Models to Plear Patent Thickets in Genetics," in Working within the Boundaries of Intellectual Property: Innovation Policy for the Knowledge Society, ed. Rochelle C. Dreyfuss, Harry First, and Diane L. Zimmerman (Oxford: Oxford University Press, 2010), 319-320.
582.
On the different governance constellations of royalty collection clearinghouses, see van Zimmeren et al., "Clearing House for Diagnostic Testing," 355; Van Overwalle, "Patent Pools and Clearinghouses in the Life Sciences," 325; "Patent Thickets in Genetics," 321-322; Krauspenhaar, Liability Rules in Patent Law, 163-164. On the importance of the independence of a clearing house in terms of its economic efficiency, see Aoki and Schiff, "Promoting Access to Intellectual Property," 199.
583.
Graff and Zilberman, "Intellectual Property Clearinghouse," 1179-1180; Sheremeta and Gold, "Creating a Patent Clearinghouse in Canada," 19; Nicol and Hope, "Cooperative Strategies," 95; Aoki and Schiff, "Promoting Access to Intellectual Property," 197; Baltzer, "Clearinghouse," 533; van Zimmeren et al., "Clearing House for Diagnostic Testing.", 356.
584.
van Zimmeren and others, 356.
585.
Graff and Zilberman, "Intellectual Property Clearinghouse," 1179-1180; Krauspenhaar, Liability Rules in Patent Law, 165.
586.
van Zimmeren et al., "Clearing House for Diagnostic Testing," 356; Aoki and Schiff, "Promoting Access to Intellectual Property," 199, in which the authors condition the effect on complementarity of technology; Krauspenhaar, Liability Rules in Patent Law, 156.
587.
Nicol and Hope, "Cooperative Strategies," 95; Aoki and Schiff, "Third-Party Clearinghouses and Intellectual Property Licensing", 9.
588.
van Zimmeren et al., "Clearing House for Diagnostic Testing," 356; Reiko Aoki and Aron Schiff, Collective Rights Organizations and Investment in Upstream R&D Investment, Discussion Paper No. 457 (Tokyo: Institute of Economic Research, Hitotsubashi University, 2009): 3-4.
589.
Aoki and Schiff, Collective Rights Organizations and Investment, 27; "Third-Party Clearinghouses and Intellectual Property Licensing," 11.
590.
Aoki and Schiff "Promoting Access to Intellectual Property," 197, on benefits in negotiations and technology transfer.
591.
Ibid, 202.
592.
Krauspenhaar, Liability Rules in Patent Law, 159.
593.
Graff and Zilberman, "Intellectual Property Clearinghouse.", 1180.
594.
Aoki and Schiff, "Promoting Access to Intellectual Property," 199.
595.
van Zimmeren, "IP Coordination Models," 138.
596.
Aoki and Schiff, "Promoting Access to Intellectual Property," 199.
597.
van Zimmeren, et al., "Clearing House for Diagnostic Testing," 354. Similarly, see Van Overwalle, "Exclusive Ownership Versus Open Commons," 146. See Merges, "Contracting into Liability Rules," 1327-1332 on the importance of repeated interactions for the emergence of collective rights organizations.
598.
Aoki and Schiff, "Promoting Access to Intellectual Property," 200; Aoki and Schiff "Third-Party Clearinghouses and Intellectual Property Licensing," 3. In the event that the royalty collection clearinghouse for patents would evolve into a system that is equivalent to a copyright collection society, they would no longer face the problem of gaining revenue from a two-sided market, as they would instead seek to maximize the patent holders’ royalty rates; see Aoki and Schiff "Promoting Access to Intellectual Property," 199-200.
599.
Aoki and Schiff, "Promoting Access to Intellectual Property," 200.
600.
van Zimmeren, "IP Coordination Models," 125-126.
601.
Similarly, see Anne Kelley, "Practicing in the Patent Marketplace," University of Chicago Law Review 78 (2011): 123.
602.
van Zimmeren et al., "Clearing House for Diagnostic Testing," 356. However, the costs of founding a royalty collection clearing house may still be lower than those associated with the establishment of a patent pool. Krauspenhaar, Liability Rules in Patent Law, 160.
603.
Graff and Zilberman, "Towards an Intellectual Property Clearinghouse," 8.
604.
Barnett, "Anti-Commons Revisited," 130.
605.
Merges, "Contracting into Liability Rules," 1391.
606.
The reasons for this are due to the differences between patent law and copyright law’s objects of protection, the frequency of the use of patented inventions, the investments required to produce them, and the availability of substitutes; see van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics," 109-113; Michael Spence, "Comment on the Conceptual Framework for a Clearinghouse Mechanism," 166-167.
607.
Esther van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics : Conceptual Framework," 82.
608.
Sheremeta and Gold, "Creating a Patent Clearinghouse in Canada," 19; van Zimmeren and others, 356
609.
van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics," 102.
610.
Ibid, 82.
611.
Ibid, 110.
612.
Akerlof, "Market for 'Lemons' : Quality Uncertainty and the Market Mechanism." 489-490; Van Overwalle, "Patent Thickets in Genetics," 319.
613.
van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics," 82, 109; Michael Spence, "Comment on the Conceptual Framework for a Clearinghouse Mechanism," 166; Krauspenhaar, Liability Rules in Patent Law, 160.
614.
Nicol and Hope, "Cooperative Strategies," 95; Spence, " Comment on the Conceptual Framework for a Clearinghouse Mechanism," 165-166; Hanns Ullrich, "Gene Patents and Clearing Models : Some Comments from a Competition Law Perspective," 347.
615.
van Zimmeren, et al., "Clearing House for Diagnostic Testing," 356; van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics," 110-111.
616.
Michael Spence, "Comment on the Conceptual Framework for a Clearinghouse Mechanism," 163. On the other possible welfare-reducing effects that may stem from the reduction of transaction costs, see Reiko Aoki and Aaron Schiff, "Intellectual Property Clearinghouses : The Effects of Reduced Transaction Costs in Licensing," Information Economics & Policy 22, no. 3 (2010): 218.
617.
Van Overwalle et al., "Models for Facilitating Access to Patents on Genetic Inventions," 146; van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics," 109.
618.
Van Overwalle, "Patent Pools and Clearinghouses in the Life Sciences," 326; Kock and ten Have, "Prototype of a Patent Clearing House in the Life Science Industry," 510.
619.
van Zimmeren et al., "Clearing House for Diagnostic Testing," 354. On antitrust assessment of copyright collective societies, see van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics," 93-100; Jan Corbet, "Case 7 : The Collective Management of Copyright and Neighbouring Rights : An Example of a Royalty Collection Clearinghouse," in Gene Patents and Collaborative Licensing Models, ed. Geertrui Van Overwalle (Cambridge: Cambridge University Press), 158-160.
620.
Hanns Ullrich, "Gene Patents and Clearing Models : Some Comments from a Competition Law Perspective," 345.
621.
Kock and ten Have, "Prototype of a Patent Clearing House in the Life Science Industry," 512.
622.
Graff and Zilberman, "Clearinghouse for Agricultural Biotechnology," 355.
623.
Aoki and Schiff, "Third-Party Clearinghouses and Intellectual Property Licensing", 24.
624.
TTBER Guidelines (2014), para 261. On patent pools from the perspective of competition law, see Sect. 3.3.3.2.
625.
van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics," 109.
626.
van Zimmeren et al., "Clearing House for Diagnostic Testing," 355; van Zimmeren, "Clearinghouse Mechanisms in Genetic Diagnostics," 107.
627.
Aoki and Schiff, "Third-Party Clearinghouses and Intellectual Property Licensing", 25-26.
628.
As suggested, for example, Graff and Zilberman, "Towards an Intellectual Property Clearinghouse for Agricultural Biotechnology," 9; van Zimmeren et al., "Clearing House for Diagnostic Testing," 354-356 ; Krauspenhaar, Liability Rules in Patent Law, 165.
629.
See ibid, 169.
630.
Van Overwalle, "Patent Pools and Clearinghouses in the Life Sciences," 332.
631.
Barnett, "Anti-Commons Revisited," 130.
632.
Roijakkers, Zynga, and Bishop, "Getting Help from Innomediaries." 242-243, 247-255.
633.
Krauspenhaar, Liability Rules in Patent Law, 162, referring only to royalty collection clearinghouses. See also ibid, 162-170.
634.
See Roijakkers, Zynga, and Bishop, "Getting Help from Innomediaries," 243; van Zimmeren, "IP Coordination Models," 139, referencing Esther van Zimmeren, Sven Vanneste and Geertrui Van Overwalle, Patent Licensing in Medical Biotechnology, (Acco 2011).
635.
For a discussion on enforceability of patent pledges see Sect. 3.3.1.2.
636.
Aoki and Schiff, "Third-Party Clearinghouses and Intellectual Property Licensing", 13.
637.
Ibid, 16.
638.
On legal design and technology, see for example Nigel Swycher, "Wolter Kluwer Partners with AI Analytics Company, Aistemos.," Kluwer Patent Blog, last modified 27 October 2017, accessed 31 October 2017 http://patentblog.kluweriplaw.com/2017/10/27/wolters-kluwer-partners-with-ai-analytics-company-aistemos/; Astrid Kohlmeier, “Legal Design : Die perfekte Kombination aus Recht und Design” Legal Revolutionary (2018): 42-55; Mark A. Cohen, "Global Legal Tech Is Transforming Service Delivery," Forbes, last modified 29 August 2017, accessed 31 December 2018 https://www.forbes.com/sites/markcohen1/2017/08/29/global-legal-tech-is-transforming-service-delivery/#1393bd2a1346; "Legal Tech Lab," University of Helsinki, last modified 2017, accessed 31 October 2017 https://www.helsinki.fi/en/networks/legal-tech-lab.
639.
Schultz and Urban, "Protecting Open Innovation," 19.
640.
Hope, "Open Source Genetics," 181.
641.
Ibid, 180-181.
642.
Maggiolino and Montagnani, "From Open Source Software to Open Patenting - What's New in the Realm of Openness," 827.
643.
Schultz and Urban, "Protecting Open Innovation," 8-9; Van Overwalle, "Inventing Inclusive Patents," 238-246.
644.
Merges, "New Dynamism in the Public Domain," 192, 200, 201.
645.
Ullrich, "Open Innovation, the Patent Exclusivity and Knowhow Secrecy," 305.
646.
See Sect. 3.1.3.1.
647.
Maggiolino and Montagnani, "From Open Source Software to Open Patenting - What's New in the Realm of Openness," 806.
648.
See Sect. 3.1.3.2.
649.
Hope, "Open Source Genetics," 179.
650.
Ibid.
651.
Dusollier, "Commons as a Reverse Intellectual Propery," 276-277.
652.
Hope, "Open Source Genetics," 179.
653.
GPL, LG München, 19 May 2004, IIC 2004, 73; Jacobsen v. Katzer, 535 F3d 1373, 1381-1383 (Fed. Cir. 1995).
654.
Maggiolino and Montagnani, "From Open Source Software to Open Patenting - What's New in the Realm of Openness," 818-819, 829.
655.
Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1408.
656.
Dusollier, "Commons as a Reverse Intellectual Propery," 276-277.
657.
Hope, "Open Source Genetics," 180.
658.
Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1409. “Any person to whom the technology is distributed may in turn become a licensee and exercise the same rights of distribution.” Hope, "Open Source Genetics," 180.
659.
See Schultz and Urban, "Protecting Open Innovation," 23-24.
660.
Hope, "Open Source Genetics," 180. Hence, an open viral license cannot feature restrictions on the use or distribution of a technology and its improvements or attempt to segment the market or discriminate against certain licensees. Ibid.
661.
Ibid, 181-182.
662.
Ibid, 180.
663.
Van Overwalle, "Inventing Inclusive Patents," 240.
664.
Hope, "Open Source Genetics," 182, 184. However, this is not required of in-house development. Ibid, 182.
665.
HapMap sought to establish a sustainable database mapping variations in human DNA sequences. However, the object of its user conditions was information, not patents. See "About the International HapMap Project." National Human Genome Research Institute. Last modified 4 June 2012. Accessed 10 June 2019. https://www.genome.gov/11511175/about-the-international-hapmap-project-fact-sheet, "Hapmap." National Center for Biotechnology Information. Last modified n.d. Accessed 2 November 2017 https://www.ncbi.nlm.nih.gov/genome/probe/doc/ProjHapmap.shtml; Boettinger and Burk, "Open Source Patenting," 222; Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1408; Van Overwalle, "Inventing Inclusive Patents," 233, fn 121. The defensive patent license proposed by Schultz and Urban encompasses the establishment of a distributed defensive portfolio by virtue of patent holders’ reciprocal commitments to license their patents royalty-free for defensive purposes. Schultz and Urban, "Protecting Open Innovation," 38-41. However, the proposed model represents an unsustainable, limited form of access. Van Overwalle, "Inventing Inclusive Patents," 247. Open hardware licenses, despite seeking an open viral effect, do not involve patents. Ibid, 240-241, 249. Finally, a clause that precludes the licensing or transfer of a patent without the recipient’s commitment to the licensing terms of the open initiative is not an element of viral openness but instead a contractual instrument intended to ensure the longevity of access. Cf. Maggiolino and Montagnani, "From Open Source Software to Open Patenting - What's New in the Realm of Openness," 823, 824.
666.
See "BiOS Initiative." Cambia. Last modified n.d. Accessed 2 November 2017 http://www.bios.net/daisy/bios/bios/bios-initiative.html. The initiative features an information clearing house (Patent Lens), a technology clearing house (BioForge), and a licensing initiative. See Nicol and Hope, "Cooperative Strategies," 96-97.
667.
"BiOS Agreements FAQs." Cambia. Last modified. n.d. Accessed 10 June 2019, https://cambia.org/bios-landing/bios-faqs-bios-agreements/.
668.
Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1415.
669.
Nicol and Hope, "Cooperative Strategies," 106; Hope, "Open Source Genetics," 182-184. Furthermore, reach-through clauses do not qualify as open viral licenses. Ibid, 182, 184; Boettinger and Burk, "Open Source Patenting," 228-229.
670.
Van Overwalle, "Inventing Inclusive Patents," 243.
671.
Ibid, 244.
672.
See Sect. 3.1.3.3.
673.
Ullrich, "Open Innovation, the Patent Exclusivity and Knowhow Secrecy," 302-305.
674.
Ibid, 305.
675.
See von Hippel, Democratizing Innovation, 11.
676.
Asay, "Enabling Patentless Innovation," 436, 464-466.
677.
Hope, "Open Source Genetics," 190.
678.
Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1433.
679.
Ullrich, "Open Innovation, the Patent Exclusivity and Knowhow Secrecy," 304-305.
680.
Schultz and Urban, "Protecting Open Innovation," 8-9.
681.
See Sect. 3.1.3.3.
682.
See Ziegler, Gassmann, and Friesike, "Why Do Firms Give Away Their Patents for Free?," 21-23. Not-for-profit open viral initiatives could also be subsidized. von Hippel and von Krogh, "Free Revealing," 302 , 304.
683.
Nicol and Hope, "Cooperative Strategies," 102.
684.
Baldwin and von Hippel, "Modeling a Paradigm Shift," 1403.
685.
Hope, "Open Source Genetics," 186.
686.
Ibid.
687.
See Gal, "Viral Open Source," 482-487, 505.
688.
See Sect. 3.1.3.4 and note 637.
689.
Lerner and Tirole, "Some Simple Economics of Open Source," 231. Theoretically, open viral licensing in return for royalty payments would correspond to the OI model.
690.
Ullrich, "Open Innovation, the Patent Exclusivity and Knowhow Secrecy," 303-304. The strategy to pursue cross-licensing negotiations reflects an OI, rather than UOCI approach.
691.
Boettinger and Burk, "Open Source Patenting," 225.
692.
Dusollier, "Commons as a Reverse Intellectual Property," 276.
693.
Dusollier ,"Sharing Access to Intellectual Property through Private Ordering," 1414-1416.
694.
§§ 3, 23 and 69c UrhG.
695.
David W. Opderbeck, "Penguin's Genome, or Coase and Open Source Biotechnology," Harvard Journal of Law & Technology 18, no. 1 (2004): 199-200; Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1418-1420.
696.
Boettinger and Burk, "Open Source Patenting," 225-227.
697.
Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1419-1420. On compulsory licenses for dependent patents, see Sect. 6.4.1.
698.
Ibid, 1434.
699.
Boettinger and Burk, "Open Source Patenting," 225-227.
700.
See Dusollier, "Sharing Access to Intellectual Property through Private Ordering," 1419; Van Overwalle, "Inventing Inclusive Patents," 244.
701.
See Dusollier, "Commons as a Reverse Intellectual Property," 279-281; Chien, "Opening the Patent System," 857.
702.
Van Overwalle, "Inventing Inclusive Patents," 249-262. See also Chien’s proposal for “defensive-only” patents, which would entitle patentees to the right to exclude when they become targets of patent litigation. Chien, "Opening the Patent System," 857-862.
703.
Van Overwalle, "Inventing Inclusive Patents," 207, 225-226, 269-271.
704.
Ibid, 262-263.
705.
An inclusive patent differs from a license of right in that the patent holder chooses not to exercise the right to exclude ex ante, that she remains free to determine the level of royalties, and that the improvements made to the patent may be made sustainably accessible, ibid, see 250, 255-258.
706.
For an overview of the incentives to employ licenses of right, see Sect. 3.3.2.4.
707.
See von Hippel and von Krogh, "Free Revealing," 302 , 304.
708.
See Gal, "Viral Open Source," Ibid, 482-487, 505; Lambrecht, "Fencing the Commons to Protect It from Appropriation?"
709.
See de Jong et al., "Market Failure in the Diffusion of Consumer-Developed Innovations," 1863; von Hippel, Eric, et al., "Market Failure in the Peer-to-Peer Diffusion of User Innovations,” 121, 124.
710.
Baldwin and von Hippel, "Modeling a Paradigm Shift," 1408-1409. The 3D printing sector has featured a number of patent disputes, including a case where a commercial company sued an entrant that emerged from an UOCI community. The increased litigation in the sector may hinder UOCI practices that rely on 3D printing. Lukaszewicz, "Patent Use Exception for User-Generated Inventions," 37-42.
711.
In this regard, the inclusive patents proposed by Van Overwalle should feature certain balacing safeguards, such as “reverse” compulsory licenses or exceptions in favour of innovators whose R&D efforts are completely conditional on the incentivizing effect of the right to exclude. However, considering that exclusivity is only one of the many means of obtaining competitive advantage, the “reverse” exceptions should be narrowly constructed.
712.
User and open collaborative innovation scholars have viewed the patent regime as insufficiently accommodating innovative practices alternative to those that rely on incentive theories and strive to commercialize innovative products. von Hippel, Democratizing Innovation, 2-3.
713.
Lukaszewicz, "Patent Use Exception for User-Generated Inventions," 168-174, 208.
714.
See Strandburg, "Users as Innovators," 505-540 in which the author proposes a research use exemption; see Lukaszewicz, "Patent Use Exception for User-Generated Inventions," 214-217, for a proposal for a general exemption for not-for-profit UOCI.
715.
Consider, for example, the heterogenous to use patent pledges, see Sect. 3.3.1.1.
716.
For example, a transition from a manufacturing company to an NPE or an interest in entering a neighbouring market can alter a company’s approach with respect to the open licensing of IPRs. In addition, a company’s rise to a market-dominant position by virtue of creating a de facto standard may trigger changes in its open licensing strategies. A new patent owner may also be disinterested in maintaining indiscriminate or sustainable access.
717.
Krauspenhaar, Liability Rules in Patent Law, 172.
718.
See Sects. 3.2.4. and 3.3.2.4.
719.
Krauspenhaar, Liability Rules in Patent Law, 172. See also Shapiro, "Navigating the Patent Thicket," 126, in which the author attributes the hold-up problem to the market failure of imperfect information.
720.
See Mattioli, "Patent Pool Outsiders," 7-9, 17, 22-23, 27-33, 50, 62-64, and the discussion Sect. 3.3.3.3. The Mattioli’s finding confirms both the relevance of Geradin, Layne-Farrar, and Padilla’s presumption on the explanation for the lack empirical findings of royalty stacking presented in Geradin, Layne-Farrar and Padilla, "Assessing the Evidence on Royalty Stacking", 165-168 and the relevance of Barnett’s broad MCM theory explained in "Property as Process," 431-433, 455-456, in connection with patent pools.
721.
See Sect. 3.1.2.2. discussing incentives to engage in OI.
722.
This motivation is recognized both in the context of MCM, see Sect. 3.1.1, and in relation with OI see Sect. 3.1.2.2.
723.
This motivation is recognized both in the context of MCM, see Sect. 3.1.1.2, note 453 and especially in relation with UOCI, see Sect. 3.1.3.3.
724.
See discussion on the incentives to engage in UOCI, Sect. 3.1.3.3.
725.
The interest to establish a standard is acknowledged by all OAI. For MCM, see Sect. 3.1.1.2 and note 443; for OI, see Sect. 3.1.2.2; for UOCI, see Sects. 3.1.3.3 and 3.1.3.4 and note 638.
726.
Altruism and public policy interests, as incentives are most closely associated with UOCI, see Sect. 3.1.3.3, as an incentive, is acknowledged by UOCI, see Contreras, "Patent Pledges," 587, 590-591; Hars and Ou, "Working for Free?," 28; Ziegler, Gassmann, and Friesike, "Why Do Firms Give Away Their Patents for Free?," 21-23.
727.
See Arora, Fosfuri, and Gambardella, Markets of Technology, 192-193, 195.
728.
See Nikolaus Franke and Sonali Shah, "How Communities Support Innovative Activities : Exploration of Assistance and Sharing among End-Users," Research Policy 32 (2003): 170-171; Baldwin and von Hippel, "Modeling a Paradigm Shift."; Shah, Sources and Patterns of Innovation in a Consumer Products Field, 1401, 1403.
729.
See Chesbrough and Ghafele, "Open Innovation and Intellectual Property" 204-206. See also Vanhaverbeke and Cloodt, "Theories of the Firm and Open Innovation," 276.
730.
See Merges, "Contracting into Liability Rules," 1321 and fn 76.
731.
See Chesbrough and Ghafele, "Open Innovation and Intellectual Property," 197-201.
732.
See Nikolaus Franke and Sonali Shah, "How Communities Support Innovative Activities : Exploration of Assistance and Sharing among End-Users," Research Policy 32 (2003): 170-171; Baldwin and von Hippel, "Modeling a Paradigm Shift."; Shah, Sources and Patterns of Innovation in a Consumer Products Field, 1401, 1403.
733.
See Arora, Fosfuri, and Gambardella, Markets of Technology, 192-193, 195.
734.
Chesbrough and Ghafele, "Open Innovation and Intellectual Property" 204-206. See also Vanhaverbeke and Cloodt, "Theories of the Firm and Open Innovation," 276.
735.
See Barnett, "Property as Process," 417–418.

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Alina Wernick

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Wernick, A. (2021). Open Approaches to Innovation. In: Mechanisms to Enable Follow-On Innovation. Munich Studies on Innovation and Competition, vol 15. Springer, Cham. https://doi.org/10.1007/978-3-030-72257-9_3

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DOI: https://doi.org/10.1007/978-3-030-72257-9_3
Published: 14 May 2021
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