The licensing dispute between Philips and Taiwan CD-R/RW manufacturers has been a powerful generator of new developments in the field of patent and competition, which culminated with the United States Court of Appeals for the Federal Circuit's Princo en banc decision in 2010. By adding new elements to the patent-misuse test, this decision confined the applicable area of the patent-misuse doctrine to the restrictions that patent owners impose on licensees, thus substantially constraining its scope and changing its landscape. After careful review of the Federal Circuit's holding and reasoning, this article finds that this decision deviating from United States Supreme Court precedents, which emphasized the policy behind patent-misuse, to prevent patent owners from transgressing the boundary of the patent grant as set by the USPTO, and is also inconsistent with prior Federal Circuit cases law. The Federal Circuit also ignored the importance of equitable discretion, which has been a key feature of the patent-misuse doctrine. From a functional perspective, the Federal Circuit’s ruling created inevitable gaps in Section 337 proceedings for respondents to defy a patent owner’s anticompetitive practices. Ultimately, a careful reconsideration of the Federal Circuit’s decision in the Princo en banc case may be necessary.
Richard Li-dar Wang,
Deviated, Unsound, and Self-Retreating: A Critical Assessment of the Princo V. Itc En Banc Decision,
16 Marq. Intellectual Property L. Rev. 51
Available at: http://scholarship.law.marquette.edu/iplr/vol16/iss1/4