Adam Mossoff

The European Union is considering a new regulatory regime for the licensing and litigation of standard essential patents (SEPs) that will destabilize the global telecommunications market. This proposed regulatory regime is unbalanced in favoring implementers over innovators, and thus it threatens to hamstring the explosive technological and economic growth in this vital sector of the modern innovation economy. Although the EU has finally awoken to the competitive and geopolitical threat posed by China, this regulatory proposal undermines efforts by the EU and the United States to sustain their global technological leadership.

For well over a year, Senator Elizabeth Warren (D-MA) and some members of Congress have engaged in a campaign to urge the Health and Human Services Secretary Xavier Becerra to break patents on pharmaceuticals to lower drug prices by invoking a century-old statute, Title 28 of the U.S. Code 1498. This is their “game plan”: HHS should contract with generic drug companies willfully to infringe pharmaceutical patents, thereby requiring any damages to be paid from public funds. This strategy took a new tack in early March 2023, when the Biden Administration’s Justice Department filed a surprise “Statement of Interest” in a private lawsuit on behalf  “the Government and its Department of Health and Human Services and the Department of Defense.” The case, filed in Delaware federal court, was initiated by Arbutus Biopharma and Genevant Sciences, which allege that that patents they own were infringed by Moderna in producing its version of the COVID-19 vaccine.

Earlier this month, Senator Thom Tillis (R-NC) sent a letter to the U.S. Patent and Trademark Office (USPTO) and to the U.S. Food and Drug Administration (FDA), expressing concern about policymaking on drug patents and drug prices being driven by a narrative rooted more in policy goals than in actual data. He sent another letter to a policy organization, Initiative for Medicines, Access, and Knowledge (I-MAK), which has held itself out as go-to source for data on the number of patents covering drugs. I-MAK has become very popular; its drug patent numbers are invoked as fact by congresspersons, academics, congressional witnesses, and policy activists. Senator Tillis is to be commended for expressing serious concerns about the unreliability of drug patent numbers repeatedly invoked in the policy debates over drug prices in Washington, D.C. His letter to the USPTO and FDA requests that the agencies engage in an “independent assessment and analysis of the sources and data that are being relied upon by those advocating for patent-based solutions to drug pricing.”

A year ago, the Senate held three days of hearings with 45 witnesses on a legislative proposal that would have brought much-needed reform of 35 U.S.C. § 101. These extensive hearings were a strong signal of a commitment by policymakers to abrogate the disastrous and destructive Alice-Mayo inquiry. Senators Thom Tillis (R-NC) and Christopher Coons (D-DE) promised quick action with a bill formally introduced by mid to late summer. A year later, there is no bill and the reform effort has stalled. What happened? Notably, Big Tech refused to participate in the hearings. Senator Tillis explained in the second day of hearings that “we invited some of the large, high-tech companies to be present and they decided not to as individual companies and instead be represented by … the High Tech Inventors Alliance, and that’s okay, but … silence is consent.” At the hearings, HTIA and other opponents of reform from policy organizations closely linked with HTIA members invoked the tread-worn narrative of abusive patent litigation by patent trolls. They argued they needed the Alice-Mayo inquiry to quickly and efficiently dismiss these patent troll lawsuits to avoid incurring unnecessary litigation expenses. But The data confirms a loss of the longstanding competitive advantage of the gold-standard U.S. patent system in promoting innovation relative to Europe and China.

Five years after the last of the four decisions in patent eligibility doctrine by the Supreme Court—creating what is now referred to as the Alice-Mayo framework—the impact of this upheaval in the patent system has become even more clear. Ongoing court decisions and new data confirm that the Alice-Mayo framework has wrought an unsettling revolution and sowed uncertainty in what former U.S. Patent and Trademark Office (USPTO) Director David Kappos has referred to as the “the greatest innovation engine the world has ever known.” As policy debates on subject matter eligibility ramped up this past year, it is time to return back to the original dataset created by Robert Sachs and David Kappos that we presented in Turning Gold to Lead and provide an update.

n an age with instantaneous commentary on social media, the wheels of justice in courts seem to move at a glacial pace, especially in patent infringement lawsuits in the fast-paced smartphone industry. Yet, courts have been methodically receiving and meticulously reviewing the evidence in Qualcomm’s lawsuits against Apple Computer for infringing its patents. And, like the tortoise who eventually wins over the speedy hare, the judgments are just now coming out against Apple. This past December, a Chinese court issued a preliminary injunction against Apple selling iPhones that infringed Qualcomm’s patents. A week later, A German court issued an injunction against Apple selling iPhones in that country that infringed Qualcomm’s patents. Last week, a jury in the United States found Apple liable for infringing Qualcomm’s patents and awarded Qualcomm $31 million in damages.

As judges, former judges and government officials, legal academics and economists who are experts in antitrust and intellectual property law, we write to express our support for your recent announcement that the Antitrust Division of the Department of Justice will adopt an evidence-based approach in applying antitrust law equally to both innovators who develop and implementers who use technological standards in the innovation industries. We disagree with the letter recently submitted to you on January 24, 2018 by other parties who expressed their misgivings with your announcement of your plan to return to this sound antitrust policy.

In their submission to the Washington Post’s series this week on so-called “patent reform” and “patent trolls,” James Bessen and Michael Meurer repeat the same junk science claims we’ve all heard many times before. This narrative is the unfortunate byproduct of unreliable and unscientific studies. This past March, I joined forty economists and law professors in a letter to Congress expressing “deep concerns with the many flawed, unreliable, or incomplete studies about the American patent system” that have been injected into the patent policy debate. Unfortunately, Bessen and Meurer themselves have produced some of this junk science, infected with mistakes that render their conclusions utterly meaningless. For example, they once estimated that litigation by so-called “patent trolls” cost the U.S. economy $29 billion in 2011. This figure has been thoroughly debunked and criticized for the fundamental and methodological flaws, such as using proprietary, secret data collected by a company that has a stake in lobbying for more legislative revisions to patent litigation rules.