| Author Info |
| Abstract |
hindered or blocked (termed technology suppression) by
corporations’ use of patents. In other words, are there ways in
which the exploitation of the exclusive development right of the
patent can be shown to retard the process of innovation, other than
in the trivial sense of excluding third parties from the right to
develop the technology covered by the patent? There are many
references to this possibility in the management, economic and
legal literatures, but two papers stand out for grounding their claims
of corporate suppression of innovation in the historical record
(Dunford 1987; Merges and Nelson 1990). Historical writing is the appropriate form of evidence bearing on how companies have made
use of their patents, but this paper shows that in Dunford and
Merges and Nelson’s writing the historical evidence has been
misinterpreted as providing evidence of technology suppression.
What it really reveals are a variety of practical problems in the
administration of the patents system as a system of development
prospects.
In the first sections of this paper the ground is prepared by a brief
review of the nature of property rights and the changing view of the
function of the patent system in the literature. This argues that the
development prospect function of patents must be considered a
feature of significant patent development. Then follows a detailed
reexamination of the claims for technology suppression in the
commonly cited historical cases. These are organised to cover the
major ‘development scenarios’ involving: ‘pioneer’, or platform
technology patents; multiple, necessary, but independently held
patents (eg. radio); the hundreds of minor patents in the so-called
‘patent thicket’.2
The empirical reanalysis confirms that most claims of deliberate
corporate technology suppression are the product of a misinterpretation
of the evidence. The interpretation that patents have
been used to retard technology development is found to have been
promoted by a number of features of the literature;
1) the widespread belief, especially amongst economic analysts,
that a patent is a form of economic monopoly
2) basic features of property law most pertinent to the function of
patents have been forgotten within the contemporary legal
literature
3) some of the historical accounts themselves are confused in their
use of the term ‘competition’ and in their understanding of
patents as property
4) the longstanding, hostile US anti-trust treatment of patents, itself
a product of the assumption that patents are conducive to the
formation of economic monopoly. Merges and Nelson argue that the cases of radio, the Selden
patent, Edison’s carbon filament patent and the Wright brothers’
warped wing patent illustrate the general problem that awarded
patent scope tends to be excessively broad. In contradiction to their
position, it is shown here that these cases illustrate a range of
idiosyncratic problems in the administration of the patent system
that generated unusually severe conflicts between awarded scope
and technology development. The general problem is not an
excessive award of ‘broad scope’, but the ability of Patent Offices
and courts to maintain the patent institution as an effective system
of development prospects. In particular problem cases, one must
consider the reasons why the patent failed to act as a proper
development prospect and devise a tailored policy solution with the
object of retaining the development prospect function as much as
possible.
This revision therefore reinforces an understanding of the patent
system as a system of property rights that in principle, and usually
in practice, is an effective social device to aid the exploration and
exploitation of novel technical ideas (inventions).
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This page was last updated on 2009-12-1.