hermeneutic limits and possibilities of the equality principle in the

Transcrição

PONTIFICAL CATHOLIC UNIVERSITY OF RIO GRANDE DO SUL – PUCRS
LAW SCHOOL
POSTGRADUATE LAW PROGRAM
DOCTORATE IN LAW
MILTON LUCÍDIO LEÃO BARCELLOS
HERMENEUTIC LIMITS AND POSSIBILITIES OF THE EQUALITY
PRINCIPLE IN THE BRAZILIAN PATENT LAW
Porto Alegre
2010
2
Doctoral thesis submitted to the Postgraduate
Program in Law Degree from the Law School of the
Pontifical Catholic University of Rio Grande do Sul as
partial requirement for obtaining the Doctoral degree
in Law in the area of concentration and Efficiency and
Effectiveness of the Constitution and the Fundamental
Rights in Public Law and Private Law.
Advisor: Prof. Dr. Ricardo Aronne (PUCRS)
Co-Advisor: Prof. Michael Meurer (Boston University)
Porto Alegre
2010
3
CATALOGING IN PUBLICATION (CIP) INTERNATIONAL DATA
B424I Barcellos, Milton Leão
Hermeneutic limits and possibilities of the equality
principle in the Brazilian patent law/ Milton Lucídio Leão
Barcellos – Porto Alegre 2010.
184f.
Thesis (Doctorate) – Law School, PUCRS
Advisor: Prof. Dr. Ricardo Aronne
1. Law. 2. Patents. 3. Fundamental Rights. 4. Equality
Principle.
5. Competition. I. Aronne, Ricardo II. Title
CDDir 342.27
Librarian in Charge: Salete Maria Sartori, CRB 10/1363
4
Doctoral thesis submitted to the Postgraduate
Program in Law Degree from the Law School of the
Pontifical Catholic University of Rio Grande do Sul as
partial requirement for obtaining the Doctoral degree
in Law in the area of concentration and Efficiency and
Effectiveness of the Constitution and the Fundamental
Rights in Public Law and Private Law.
Approved on August 27th, 2010.
EXAMINING COMMITTEE
____________________________________________________
President: Prof. Dr. Ricardo Aronne – PUCRS
____________________________________________________
Prof. Dr. Clarice Beatriz da Costa Sohngen – PUCRS/FADIR
____________________________________________________
Prof. Dr. Ângela Kretschmann – UNISINOS
____________________________________________________
Prof. Dr. João Marcelo de Lima Assafim – UCANRJ/UFRJ
____________________________________________________
Prof. Dr. Luiz Gonzaga da Silva Adolfo – UNILASALLE/ULBRA
Porto Alegre
2010
5
To God, always Him, foremost.
To my enlightened parents who raised and educated six
children with unmatched love and dedication, electing family
as root and reason of a decent life.
To my grandparents Lucídio Scherer, Amyta Bier,
André Leão and Hilda Ferreira.
6
ACKNOWLEDGEMENTS
Thanks to God, once more, for teaching me the two most important ―laws‖:
Love one another as He loved us and do to your neighbor as you want your neighbor
to do to you.
My parents Milton Leão Barcellos and Norma Scherer Barcellos, for motivating
me, for believing and dedicating themselves to their children.
My five siblings André, Cláudia, César, Carla and Amita, in particular to my
three ―Charlie‘s angels‖, for taking care of me and for teaching me so much, even
without perceiving it.
My aunt Tetê, for the affection of a mother, which she has always dedicated to
all of us.
My Gift Camila Bono for the light and love that irradiate from her.
My advisor Ricardo Aronne for his juridical genius and creativity, as well as his
patience, incentive, ethics and companionship which were paramount for the thesis
to have beginning, middle and end.
My co-advisor Michael Meurer for showing me the deficiencies of the patent
system in American reality.
My friend and colleague Patrícia Agra Araújo for the support and substantial
assistance at Boston University and in the thesis completion.
My friend and partner Gustavo Bahuschewskj Correa, since the achievement
of the course would be impossible without his support.
My friend and colleague Helenara Braga Avancini for the many talks, always
enriching ones.
My friend and colleague Lívia Haygert Pithan for the constant motivation to
teach.
OJF.
My friend and colleague Daniele Maia Teixeira Coelho for the vital moments of
My Master‘s Degree Advisor Juarez Freitas from whom I have learned so
much and will keep learning about hermeneutics.
The Coordinator of PUCRS Postgraduate in Law Program Ingo Wolfgang
Sarlet, for his long-suffering, teachings and for understanding the mishaps of this
eternal student.
My professors and colleagues from PUCRS, Alexandre Curvelo, Betina
Krause Suecker, Carlos Alberto Molinaro, Cezar Saldanha, Daniel Machado da
Rocha,
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Daniele Lutzky, Eugênio Facchini Neto, Jorge Luis Nicolas Audy, Karine Demoliner,
Lisianne Sabedra, Luis Paulo Germano, Luis Renato Ferreira da Silva, Marli
Elizabeth Ritter dos Santos, Paulo Antônio Caliendo, Paulo Vinícius Sporleder de
Souza, Phililip Franca, Rafael Dresch, Regina Linden Ruaro, Renato J. Ritter Júnior,
Ricardo Aronne, Ricardo Lupion Garcia, Roque Bregalda, Simone Tassinari
Cardoso, Thadeu Weber, Vilmar Fontes, a special appreciation for the fellowship,
learning and aid to follow the inquiring and investigative line.
The Professors and Colleagues from Boston University, where I was
extraordinarily welcome as a Visiting Scholar during my doctoral internship, Michael
Meurer, Keith Hylton, Ben Depoorter, Lisa Geller, Kevin Outterson, Carolina Rossini,
John Wilbanks, Caroline Cavareli Rudaz, Xie Zhiyoung Yu, Satomi Tanaka,
Catherine Bubenzer-Paim, Andreas Bubenzer-Paim, Cyro Goldstein Troper, Luis
Eduardo Pulido, Manuela Matilde Consito, Mei Kaneda, Molly Ann Torsen, Navrose
Palekar, Rodrigo Bermeo, Volodymyr Yakubovskyy, Wesley Khristopher for helping
me cope with the first adaptation in Boston and for contributing to my research.
Professor Greg Vetter from Houston University Law School for his teachings
and for presenting me with an essential book for my research.
The authorities and colleagues who effectively contributed much to the field
research conducted in Brazil and in the USA Patrícia Agra Araújo, Paulo Furquim,
Pamela Harbour, Armando Irizarry e Tara Isa Koslov.
All my colleagues and former students from the Law Specialization Course of
PUCRS Intellectual Property, as well as to my colleagues and former students from
the courses and lectures in the area of intellectual property lectured at
PUCRS,UNISINOS, UFRGS, UNILASALLE, UNIRITTER, FSG, UPF, UNISC,
AMF,UCAM/RJ, UNIVATES, UCS, ULBRA, ABAPI, ASPI, NEDE/AJURIS, ESAOAB/RS, IARGS, my thanks for the contributions and provocative questions which
have enriched me and worked as a springboard to my academic advance.
My Colleagues from the OAB/RS Special Committee on Intellectual Property
for the ever-provocative discussions and fellowship for the sake of spreading
knowledge about this important branch of law.
All my colleagues from Leão Intellectual Property for the effort to make up for
my necessary absence to complete this course and research.
Caren Andrea Klinger, Patrícia Souza de Oliveira, Raquel da Silva Pereira and
Victor de Mello Rodrigues whom, out of love and dedication and great help in their
performance at PUCRS Postgraduate in Law office, greatly contributed for the entire
course to always keep its quality and success that are its benchmark.
Charlotte Gliksman (Assistant to the Associate Dean) and Peter O'Meara
(International Scholar Advisor) for their assistance and special affection at Boston
University.
CAPES and PUCRS for granting scholarships that made the academic
improvement possible for this research completion.
8
Boston University Law School for receiving and approving the research project
developed by a Visiting Scholar.
9
Keep yourself simple, good, pure, serious, free from
affectation, a friend of
justice, fearing the gods, gentle, passionate, vigorous in
all your attitudes. Fight to live as philosophy wishes you lived.
Revere the gods and help men. Life is short.
Marco Aurélio
10
ABSTRACT
This thesis intents to demonstrate that the equality principle should be
recognized as an essential principle in the patent system in order to allow this system
to sustain its functions according to the social interest together with the economic
and technological development of the country. The equality principle based on a
different treatment of different technologies according and limited to the effective
differences acts as an optimization of the whole patent system, according to its
functional essence and also to guarantee the free competition at the same time.
The proposed study shows that the hermeneutics starting from the recognition of the
equality principle can really help with an effective optimization of the patent system to
fulfill its functional essence based on constitutional purposes. However, the
hermeneutic effort based on the equality as a starting point has limitations which
depend on integrating modifications of the law.
Keywords: Patents. Fundamental Rights. Equality Principle. Free competition.
Legal Hermeneutics.
11
LIST OF ABBREVIATIONS AND ACRONYMS
ACED - Administrative Council for Economic Defense
AL – Antitrust Law
BAIP – Brazilian Association of Intellectual Property
BAS - Brazilian Antitrust System
CAFC – Court of Appeals for the Federal Circuit
CC – Civil Code
DOJ – Department of Justice
DAU - Direct Action of Unconstitutionality
EPC – European Patent Convention
EPO – European Patent Office
FTC – Federal Trade Commission
IPL – Industrial Property Law
MFEMS - Ministry of Finance Economic Monitoring Secretariat
MJELS - Ministry of Justice Economic Law Secretariat
PC – Paris Convention
PCT – Patent Cooperation Treaty
TRIPS – Trade Related Aspects of Intellectual Property Rights
USPTO – United States Patent and Trademark Office
WIPO – World Intellectual Property Organization
12
SUMMARY
1. INTRODUCTION ………………………..……………………………………....…13
2. THE MARKET AND THE PATENT SYSTEM ……………………………...…. 20
3. EQUALITY AND WELFARE STATE ………..……………………………...…. 87
4. PROBLEMATIZING EQUALITY IN THE PATENT SYSTEM ……..………... 95
5. LIMITS OF THE CONSTITUTIONAL HERMENEUTICS AND THE SYSTEM
OBSTACLES …………………………………………………...……….………. 129
6. EQUALITY AND FREE COMPETITION AS ORIENTING AND LIMITING
HERMENEUTIC REFERENCES OF THE PATENT LAW …….…………... 139
7. POSSIBLE SOLUTIONS FOR THE ADEQUACY OF THE PATENT SYSTEM
…………………………….……………………………………………….………. 150
8. CONCLUSIONS ………………………………………..…………..…………… 157
REFERENCES ………………………………………………..………..……….. 163
APPENDIX A: Field Research ACED ………………………..……….…..… 176
APPENDIX B: Field Research FTC and DOJ……………………………......184
13
1 INTRODUCTION
The basis of the development of this thesis starts from the analysis of the equality
principle as one of the constitutional foundations to be revealed in search for
adequacy of the patent system to the reality of the technological development of
society, with special attention to examining the principle of free competition as the
hermeneutic guidance to determine the limitations on the exercise of the patent law,
aiming to point out the clashes and possible solutions for a Brazilian patent system in
line with the Magna Carta of 1988.
In effect, this study has struggle points that in general, require the topical
understanding of the equality principles and free competition, so that the impact of
these two principles on the patent system is examined under the focus of the needed
acknowledgement of the factor of discrímen taking the technological diversity as its
base.
The structure of the patent system is observed as a whole, which assumes that
every intellectual creation that meets the requirements of novelty, inventive activity,
industrial application and descriptive sufficiency, the way they are currently
interpreted, although not expressly prohibited by provision of law, is eligible as
subjective right for obtaining a patent, granting equal rights to the holder.
Before this equal treatment, there is a direct reflection on the possibility of misuse
of patent rights based on the current structure of the patent system, whose
prevention and repression by the legal system face difficulties due to the nature and
complexity of such rights.
Examining such issues under the guise of equality principle, we have the patent
system assuming in the case of innovative technology (in any given area) the legal
possibility of obtaining a patent fulfilling ―canned‖ requirements applicable to any
technological area.
14
That is, the treatment given by the patent system is formal and materially the
same for any kind of technology, even if there is a real ―black hole‖ of differences
among the technologies being examined.
It is necessary to face the equality principle, as well as analyze the patent system
from the perspective of the principle of equality of material goods, transferring its
application to an unequal treatment of unequal technologies.
Going beyond the raised questions by the application of the equality principle in
its material aspect in patent law (keeping the current discrepancies away as much as
possible) moving on to the moment of the exercise of the patent law in the market,
there is no way to analyze the intersection between patent law and antitrust law
without a clear initial individualization and contextualization of both related, through
which the understanding of factual situations that increasingly pervade the antitrust
agencies and the Judiciary becomes more didactic.
In effect, industrial property together with trademark, industrial designs,
geographical indications and repression to unfair competition, as established by the
Industrial Property Law (Law No. 9.279/96, article 2)¹ has its north bounded by the
constitutional provision for immediate effectiveness prescribing the limits of the infraconstitutional legislation connected to the fulfillment of social interest as well as the
tec
_______________________________
¹ Law 9.279/96, Art. 2 The protection of the rights regarding the industrial property, considering its
social interest and the technological and economic development of the Country, is performed by
means of: I –granting of patents of invention and utility model; II- granting of industrial design
registration; III – granting of trademark registration; IV – repression of false geographical indications;
and V – repression of unfair competition.
15
technological and economic development of the Country (CF, art. 5, item XXIX)²
In this sense, we should remember that patent law has been gaining prominence
in developing countries, considering the increasing value of the ―intellectual capital‖
instead of physical assets, as well as the essential relation of such rights with the
evolution of markets.³
Going further, the need for the existence of a patent system is linked to the
existence of competition, which is the assistance itself of the social interest to
stimulate a healthy competition that is a fundamental cornerstone of the patent
system.
More importantly, this study takes into account that in a State of Law, the
intellectual property stands out and should be guided, if possible, by its clearly
functionalizing
aspect,
with
the
guideposts
expressed
by
the
harmonic
preponderance
__________________________
2
Federal Constitution of 1988: Article 5 All citizens are equal before the law, with no distinction
whatsoever, guaranteeing Brazilians and foreigners residing in the Country the inviolable right to life,
freedom, equality, safety and property, as follows: XXIX – the law shall ensure the authors of industrial
inventions a temporary privilege for the use and protection of industrial creations, ownership of
trademarks, names of companies and other distinctive signs, bearing in mind the social interest and
the technological and economic development of the Country.
3
th
The 964 issue of the magazine ―Exame‖ of March 24 ,2010, p. 96-98 published an article on Nathan
Myhrvold (Bill Gates‘ former right-hand man at Microsoft), founder of Intellectual Ventures, a company
whose mission is stated on their website, i.e., ―energize and streamline an invention economy that will
drive innovation around the world‖. An interesting factor is that it already has a portfolio of 30,000
patents but it does not produce a single product out of it, i.e., the goal is to form an intellectual capital
for trading, which demonstrates a clash with the traditional way of viewing the patent system in the
competitive universe. The report itself demonstrates the pros and cons of a business system focused
only on the trade (in large scale) of patent rights without effectively developing products/services
related to them: If on one hand it helps to financially reward the small inventors owners of patents that
are used by large companies, on the other hand it might ―stifle innovations‖. Intellectual Ventures has
no previous risk of patent infringement (for it does not launch products/services in the market), it only
works on the accumulation and negotiation of patent rights. It has over five billion dollars for
investments. These current events indicate something very important related to this thesis: treating the
patent system as it used to be treated in its most harmonized constitution from the late nineteenth
century consists in making a big mistake, i.e., the base of the current system and the interpretation of
the system when operating in a competitive environment.
16
preponderance of utilitarian theories and social planning theories 4,
finding its
purpose at the constitutional order established.
On the other hand, the dynamics of the market competition has made compulsory
a greater regulation of the State in private relation and, in the context of industrial
property rights and in view of the restriction of the object under analysis in this essay,
an increasing need for interpretation of the limits of antitrust and patent law that
apparently (and only apparently) conflict in contemporary society.
It is noteworthy that, in the survey it was identified that an essential principle to
the solution of the questions of the basis of the patent system has been ignored, i.e.,
the equality principle provided by the Art. 5, heading and item I of the Magna Carta of
1988.
Within the context of the exercise of rights over patents, in which hermeneutics
has much to contribute, this thesis examines the contemporary issues such as an
excess of owners, broad interpretation of claims, descriptive insufficiency, license
exchange among dominant competitors in the market and the legal uncertainty
beyond the natural one of the patent system essence itself.
Still, the aim is to demonstrate that the Federal Trade Commission – FTC and the
Department of Justice – DOJ
5
conclusions, that the right over a patent should be
seen
__________________________
4
Such theories, together with the labor theory and the personality theory are analyzed by William
Fisher in his study ―Theories of Intellectual Property‖, Harvard, 2001, and are also taken into the
Brazilian reality in analysis in my dissertation titled ―The legal basis of industrial property and its
interpretations‖, defended on April 07th ,2006, PUCRS, which concludes that our current Brazilian
industrial property legal system must follow a hermeneutic guidance designed by the harmonic
preponderance of the utilitarian theories and the social planning theories in relation to the lower
incidence of the labor theories and personality theories.
5
Just like the ELS (Economic Law Secretariat) and the ACED in Brazil, the FTC and the DOJ are
North American antitrust agencies. Unlike the domestic agencies, which have complementary and
different skills, (the ELS is in charge of instruction, and the ACED is in charge of the antitrust trial
cases), the FTC and the DOJ have concurrent jurisdiction, being for most sectors, either agencies
responsible for their trial.
17
seen as the right over any other form of property, are mistaken, although wellintentioned6.
In view of these considerations, and therefore trying to equate this reality, we
seek to interpret the real meaning and value of the constitutional principles regarding
the patent rights (especially including the equality principle) also regarding the
antitrust law, adapting them to the political guidelines set by the original legislature
representative, as well as guiding its implementation and effectiveness, in
accordance with consecrated axiological vectors, in order to establish clear
hermeneutical assumptions to be relevant as studying the intersection of these
principles regarding the patent law.
One of the unintended effects from the lack of the equality principle application
on the basis of the patent system is the perverse effect generated in the competitive
environment, which will be subjected to specific analysis.
In the structural development of this thesis, essential to the market and patent
system initial approach; tracing out the assumptions on the behavior of the market
and on how the patent system is developed, it is clear that the international
harmonization has brought many benefits, but at the same time, it has brought
impositions that imprison the formatting and often detune the constitutional premises.
Later on, we pass to the analysis of the equality embedded in a Welfare State,
considered in its material sense, verifying that the fundamental right and guarantee
have passed and still pass through an integrating recognition in the society, in search
for inequality corrections.
__________________________
6
The ownership of a patent was recognized as an absolute right, i.e., the holder of a patent was
legitimated to use it as he wished, even against explicit competing principles. The equating of a patent
right to any other property right was nothing more than an evolution over the old concept of patent
―untouchability‖. That is, there is no special treatment to the patent (see Antitrust Enforcement and
Intellectual Property Rights: Promoting Innovation and Competition, issued by the DOJ and FTC in
April 2007, p. 21). However, such assertiveness, eventually forms a wrong premise, since the patent
rights, though similar to other property rights, own a diverse essence and functions which go beyond
the social function, turning to the aforementioned finalistic clause item XXIX art. 5 of the Magna Carta
of 1988.
18
The next chapter finds that the use of factor discrímen within the industrial
property, intuitively, is not new, for it already exists discrímen based on several kinds
of industrial property rights; but the application related to the incidence of the equality
principle based on new technologies (and technological differences) for which the
patent system has not been developed is original and necessary.
Next, it deals with the limits of Constitutional Hermeneutics and how far the
legal system allows a systematic interpretation of the law7 to serve as a basis for
solving the apparent conflicts in the system guided by the equality principle, free
competition and by the harmonic preponderance of the utilitarian theories and the
social planning theories which reflect a functional feature linked to the patent system.
Further analysis shows that the non-application of the equality principle on the
patent system basis generates results that, on one hand, require a hermeneutic effort
and, on the other hand, are not amenable to solutions through hermeneutics,
requiring legislative changes for its compliance in accordance with the principle of
free competition and with the very finalistic conditional clause art. 5, XXIX of the
Magna Carta of 1988.
After demonstrating the problematic intersection of the equality principle with
the principle of free competition and with the assistance for the harmonic
preponderance of the utilitarian theories and the social planning theories expressed
in the art. 5, XXIX of the Federal Constitution of 1988 as guiding and limiting the
patent law, possible solutions to help with a desirable readjustment of the patent
system are taken towards new technologies that have emerged and are still to
emerge.
__________________________
7
Terms proposed by Juarez Freitas in his Systematic Interpretation of Law 4 ed. revised and amplified
São Paulo: Malheiros 2004.
19
The findings lead to an overview of the key elements guiding the work,
summarizing and pointing to each of the repercussions that the hermeneutic limits
and possibilities generate, when they rest on the application of the equality principle
in the Brazilian patent system, without ignoring the international character and
limitations that guide it.
A patent system guided by the equality principle, with differential treatment to
different technologies, leads to an essential systematic and integrating rethinking that
results in the strengthening of the very existence of the patent system, functional and
harmonic with the Federal Constitution.
20
2 THE MARKET AND THE PATENT SYSTEM
The intellectual property is overlaid with a legal protection as long as it
belongs, far beyond the contemporary social speech, to its immanent economic
content.
Actually, paradoxically, this value transcends such immanence, being reached
by the market, which virtualizes and rebuilds it.
It is therefore important to approach the patent system from this intersection of
legal and economic issues, so that the text does not get lost in dogmatic
abstractions.
Some arguments brought by Ana Frazão are relevant to the goals led by this
thesis, especially the ideological demystification statements that have assumed a
―scientific-truth-character‖ and, among these ideological statements dressed like
―scientific truths‖ are the examples given by the author of
smithian invisible hand, the dogma that the economic growth is more
important than wealth distribution, the absolute value of the efficiency
and the idea that the economic indicators reflect effectively the
economic progress, regardless of people‘s quality of life8.
Such ideological statements, which should long not be considered as
―scientific truths‖, wind up reverberating in the object of study of this essay in several
situations of analysis of the application of the equality principle, as well as the
intersection
__________________________
8
LOPES, Ana Frazão de Azevedo, Company & Property – Social Function and Abuse of Economic
Power. São Paulo: Quarter Latin, 2006 p. 217.
21
intersection of the Patent Law with the Antitrust Law as, for instance, at the time of
the application of criteria of reasonableness considering a particular use (abuse) of a
patent when striking at the Antitrust Law, resting on aspects of economic
repercussion, as well as, the application of rule of reason in American reality in the
analysis of cases involving antitrust law in which the per se rule is not applied.
It is possible to identify several practices in the Patent Law that might be, in
fact, considered illegal (per se rules), but at the same time there are increasingly
common practices, in which there is doubt regarding its legality or still, they are
considered legal through limited analysis of its consequences.
The Antitrust Law is a regulating law in the market, so the competitive
relationships occur in the space called market, and the patent law exists as a
confluent-like-stimulus to the achievement and search of the competitive space in the
market.
Most existing doubts in the application of the harmonic and reciprocal
limitations between the Patent and Antitrust Law are due to hermeneutic
misconceptions on the foundations of such laws9, as well as limited access to
empirical data, which must go through the correct orientation of the patent system in
contrast with the principles of free competition and equality.
__________________________
9
Several analyses start from questionable assumptions about the elementary question: Why is there a
patent law and an antitrust law? For instance, one cannot agree with the statements contained in the
2002 OECD project on Genetic Inventions, Intellectual Property Rights and Licensing Practices, by
stating on page 22, that ―The essential principle of all forms of IPR is to recognize and reward the work
of inventors, designers and authors because society deems that it benefits from the promotion of the
useful and cultural arts‖. This simplistic view spread to every corner ends up literally reducing the
broadest (and several) principles of each one of the intellectual property rights species, since the
industrial property rights only exist, are protected and able to full exercise while in tune with the
Country‘s economic and technological development and its social interest. Therefore, we must look
more thoroughly into such rights to understand their dimension, as well as its connection as an
instrument for the implementation of human rights.
22
The patent system, as a legal creation towards the compliance with specific
functions, besides being externally modulated by the Antitrust Law and fundamental
rights, might be internally modified, restricted, expanded or even replaced by another
system that complies with what has been established in the item XXIX of the art. 5 of
the Federal Constitution of 198810, and it is essential to bear in mind that the history
of Brazilian Constitutions demonstrates that alternative solutions to the temporary
granting of privileges are possible11.
This constitutional relevance and provision do not come dissociated
from a binding context imposed by the art. 170 of the Federal Constitution12 that, as a
matter of fact, precedes and guides the Industrial Property Law itself due to the
systematic integration of the law and the finalistic clause itself contained in the item
XX
__________________________
10
A simple reading is enough to conclude that the Political Letter of 1988 does not protect a system of
patents, yet it seeks to guarantee ―the authors of industrial creations a temporary privilege for their
utilization‖, connected to the fulfillment of established functions at the end of the item. The election of a
patent system as a form of exteriorization of the constitutional designs stems from an infraconstitutional legislative option and, obviously, due to an international standardization. In the same
sense, there is an understanding in the U.S. as described by Rochelle Cooper Dreyfuss in Patent and
Human Rights: Where is the Paradox? (available at http://ssrn.com/abstract=929498), which states
that, There is no fundamental right to a particular form of protection—to a patent on a specific product
(no matter how ingenious) or to a patent that covers specific uses (no matter how valuable). The
legislature is free to use the tools of the patent system (such as term, subject matter, scope,
compulsory licenses, right to relief) to allocate excess benefits (those not required to spur optimum
production) in any way it sees fit. Human rights concerns should certainly inform that decision, but the
legislature could also choose to divert the benefits of inventions to fulfill other social objectives.
11
It is important to emphasize that the fact that the Brazilian Federal Constitutions prior to 1988,
traditionally provided the granting of patents when it was interesting to the ―vulgarization‖ of that
particular technology, and a right to exclude third parties for the inventor was no longer due yet a fair
reward.
12
Federal Constitution of 1988: Art. 170. The economic order, founded on the value of the human labor
as well as on the free enterprise, aims to ensure everyone a life with dignity according to the social
justice order, as follows: I-national sovereignty; II-private property; III-property social function; IV-free
competition; V-consumer protection; VI- environmental protection, including differential treatment,
depending on the environmental impact of products and services and its processes of elaboration and
provision; VII- social and regional inequalities reduction; VIII- pursuit of full employment; IXpreferential treatment to small companies, constituted under Brazilian laws, having their headquarters
and administration in the Country. Sole paragraph. It is assured to everyone the free exercise of any
economic activity, regardless of any governmental authorization, except in cases provided by law.
23
XXIX of the art. 5 of the Magna Carta of 1988, interpreted as follows:
The free enterprise and free competition principles do not exist per se, they
are not sufficient unto themselves. They are instrumental in promoting the
human dignity. The Brazilian Constitution, in its entirety, proposes to carry
out broader objectives than, simply, the free market.
[…]
That‘s why incur serious mistake, rude misunderstanding, those who argue
that the legal texts must, under penalty of unconstitutionality, fit in absolute
terms the typical rules of ―free market‖.
Obviously, we are not stating that Brazil‘s Constitution, postulates a market
model unrelated to the free enterprise and free competition; quite the
contrary. 13
In the words of Luciano Sotero Santiago14, ―[…], it can be stated as
follows: for the invisible hand of the market to work, the help of the visible hand of the
State is needed.‖ We glimpse the inevitable need for the regulation of the State in the
market.
It is necessary a more detailed analysis of the existence of the patent law as a
consistent solution to the market failure in the absence of stimulus for innovation and
improvement of means of production and products, since the patent law exists as a
way to correct such failure, aiming at meeting the social interest and the
technological and economic development of the country.
In this sense, Denis Borges Barbosa 15, dealing with the limits of the patent
rights, argues that ―What characterizes a patent as a form of social use of property is
the fact that it is a limited right by its function: it only exists while socially useful‖.
__________________________
13
GRAU, Eros Roberto; FORGIONI, Paula A. CADE V. BACEN: Conflicts of Jurisdiction between
Autarchy and the role of the Attorney General‘s Office in Antitrust law – 10 years fighting the abuse of
economic power. Belo Horizonte: Del Rey, 2005.
14
SANTIAGO, Luciano Sotero. Antitrust law and regulation. Doctrine and Jurisprudence. Salvador:
Juspodium, 2008, p.376.
15
BARBOSA, Denis Borges. An Introduction to Intellectual Property. 2. ed. Rio de Janeiro: Lumin
Juris, 2003, p. 472.
24
Following the same train of thought, Barbosa 16 delimitates the interpretation of
constitutional objectives in the granting of patents by examining the abuse through
teleological diversion.
Abuse, besides an excess of power, is also a diversion of purpose. The
purposes of a patent have, in our right, a constitutional design. As we have seen
before, the patent is intended to immediately reward the creator, and has as a mediate
purpose, the social interest and the technological and economic development of the
Country. Each one of these purposes involves an analysis of a compatible use of the
right, and the indication of the use contrary or beyond the same right.
The first facet of the abuse of patent rights is the nature of the creator‘s
reward. The letter does not determine the monetary reward of the inventor, as formerly
in the Soviet Union, but assures him a unique opportunity of using his technology for
economic production, i.e., a restriction on competition. Thus, the patent regime is an
exception to the principle of market freedom, determined by the art. 173, § 4 of the
Constitution, rooted in the art. 1 item IV and 170, IV.
Every exception to a fundamental principle of the Constitution matters in a
considerate and restricted application. Thus, the resulting restriction of the patent is
subject to parameters of a use that does not exceed what is strictly necessary for an
immediate purpose, namely, the effective stimulus, however moderate and reasonable
to the inventor. Everything that restricts competition beyond what is strictly necessary
exceeds the immediate end of the patent – it is abuse.
On the other hand, in the same constitutional plan, there would be an abuse of
patent and purpose diversion, i.e., against or away from the social interest and the
economic and social development of Brazil.
In effect, we must look more closely into the historical developments that the
patent system has been through while inserted into a competitive environment.
Taking a look at the effective beginning of an incentive system for innovation,
Nuno Pires de Carvalho17 states that
Egypt was, it can be said out of a certain historic liberty, the place where
for the first time the State promoted in a continuous and orderly way the
technological development, later the same author emphasizes that in ancient
Egypt a patent system may not have existed to generate technical creation,
s
__________________________
16
BARBOSA, Denis Borges. An introduction to…., p. 508.
CARVALHO, Nuno Pires de. The Structure of the Patent System and Trademarks – Past, present
and future. Rio de Janeiro: Lumen Juris, 2009 p. 130-131.
17
25
since the idea of individual knowledge ownership had not come forth yet, but
there were systems to promote inventions.
Brazil has just turned 200 years old since its first Patent Act18, where the
Magna Carta of 1988 has upheld the protection of industrial inventions, provided that
they observe the hermeneutic guidance related to linking the triad: the social interest
and the economic and technological development of Brazil.
However, according to Gama Cerqueira 19, Brazil was the fourth country in the
world to establish the protection of the inventor‘s rights, the first was England through
its Statute of Monopolies (1623); in the second place, more than a century later, the
United States with its Constitution in 1787, which gave powers to the Congress to
legislate on the protection of inventions (the first U.S. Law on patents came to be
enacted in 1970); in the third place, the French legislation on privileges of invention
of 1971; and in the fourth place Brazil was present, still a Colony, with the Charter of
the Prince Regent of 1809.
As Gama Cerqueira20 points out, the first Brazilian law relating to inventions
enacted after our independence only took place in 1830, which would put Brazil in
the thirteenth place to adopt legal protection for inventions.
__________________________
18
The Charter of the Prince Regent D. João VI of 1809 had the privileges introduced in Brazil as
follows: ―The purpose of this Charter is to promote the happiness of my vassals, being established
with this plan the liberal principles for the prosperity of the State of Brazil, particularly needed to
promote agriculture, encourage trade, advance navigation and cause the population to grow, making
more extensive and analogous the magnitude of this State, and it is still very convenient that the
inventors and producers of some new machine and artistic invention enjoy some privilege, besides the
right they may have to the cash value, that their service establishes on behalf of industry and arts. I
command that all persons who are in such case present their new invention to the Royal Trade
Council, which recognizing the veracity of its foundation, may grant them the exclusive privilege of 14
years, compelling them to publish it at the end of this period for the entire nation to be able to enjoy
the fruit of this invention. I command, likewise, that those which are currently granted be revised,
making them public as determined above and revoking those which, by false allegations or even with
no well-founded reasons, receive similar granting.
19
CERQUEIRA, João da Gama. Industrial Property Treaty. São Paulo: Revista dos Tribunais
(Journal of the Courts) 1982, p.6.
20
CERQUEIRA, João da Gama. Op. Cit. P. 7.
26
The temporality (while limiting the public interest and while necessary to
generate incentive) of the protection granted to inventions and the public interest in
the system of ―privileges‖ have existed since the beginning of today‘s so-called
patent system in Brazil, given that their functional aspect has evolved over the
decades, without losing this very character of temporality and the public interest
involved in the system.
The valorizing option chosen by the Country in its migration into a Welfare
State regarding patents was a balance among seemingly conflicting goals,
determining that the hermeneutic guidance to be followed is the preponderance of
utilitarian theories and social planning theories in relation to the lower incidence of
labor theories and personality theories.21
Such constitutional finding on the patent rights concludes that much more than
a personal absolute static right, it is a right in constant change, and it is social and
relative whenever confronted with other rights that direct and limit it, since the right of
patent holders exists and is bound to comply with purposes constitutionally
established.
In the Brazilian constitution regarding the protection of inventions, following
the route traced by the art. 179, item 26, of the Constitution of the Empire of Brazil of
1824, in the Brazilian Federal Constitution of 1891, in its art. 72, §§ 25 and 27, it had
already been mentioned the protection of inventions, as follows:
Article 72, § 25 – The industrial inventions will belong to their authors, who
will be ensured a temporary privilege by law, or a reasonable premium will
be granted by the Congress, whenever convenient popularize the invention.
__________________________
21
BARCELLOS, Milton Lucídio Leão. Industrial Property & Constitution: Preponderant Theories and
their interpretation in the Brazilian reality: Livraria do Advogado (Lawyer‘s library), 2007.
27
Currently, the patent system should meet clear premises of functionality,
existing as necessary, sufficient and in the limits to meet the social interest and the
economic and technological development of the Country. When these premises of
functionality fail to be met, the system should be reconfigured and reinterpreted,
observing the limits of hermeneutics in contrast with potential needs for legislative
changes.
Such constitutional premises of the patent system should be observed by the
relevant ordinary legislation (in particular the current Law 9,279/96), pointing out that
history has shown that the current patent system was created and internationally
harmonized for the traditional technologies existing in the late nineteenth and early
twentieth century, within the specific commercial and industrial concerns of the time.
Even before the Federal Constitution of 1988 the goals of the patent system
were clear as an effective instrument to ensure the national development 22.
The
current
Brazilian
(and
international)
patent
system
establishes
requirements for patentability as well as periods of the same protection to different
technologies, but it already provided in its history and national and international
tradition, a positive discrimination establishing a differential requirement of
patentability23 and granting a lower temporal protection 24 for the so-called utility
models.
__________________________
22
Arthur Carlos Bandeira, in the inaugural speech of the Third National Seminar on Industrial Property
of the BAIP 1983, which celebrated the centenary of the Paris Convention for the Protection of
Industrial Property, about dealing with the industrial property stated that ―[…] its main function is to
ensure the development of our own society together with its weaknesses, talents and peculiarities.
The system subsistence thus depends on a careful balance of its benefits and responsibilities. A fair
and efficient mechanism of the expiry of patents and trademarks, the expansion of areas where no
patent is granted, and basically, the effective administration of the agency responsible for granting
privileges and records are the guarantees that this balance is maintained‖. (Annals from the Third
National Seminar on Industrial Property of the BAIP, Porto Alegre, August, 29th and 30th , 1983,
p.23)
23
Instead of ―inventive activity‖ provided as one of the requirements for patentability of inventions, for
the utility models (which would be ―inventions or improvements with minor inventiveness‖) the
requirement of patentability is the ―inventive step‖.
24
Likewise, regarding the delay of exclusivity, the legal term of utility model patent is 15 years instead
of 20 years provided for inventions.
28
That is, a differential treatment granted to differential technologies based on
the degree of technology inventiveness already exists in the history of the patent
system.
In a comparison between the history of Brazilian patent system and the U.S.
patent system, we see that in different historical moments, positions in defense of a
national development are similar, but in relation to dealing with technologies, there is
no positive discrimination in the U.S. in the adoption of patents of utility models.
At this point, a historical retrospection of the U.S. law is worth. In the history of
patent law in the United States, according to the U.S. Patent Act of 1790, relative
novelty25, importation patents26, the absence of non-obviousness requirement, were
some of the features that made the U.S. patent system meet the constitutional clause
focused on promoting the progress of science and useful arts.
In a thorough research on the history of the patent system since 1787 until
1836, identifying the origin of the constitutional clause relating to intellectual property,
Walterscheid28, considering various alternative and cumulative hypotheses on the
origin, debate and inclusion of this constitutional clause; scrutinizes the significance
to that time of the words and terms that compose it:
__________________________
25
If the invention or discovery was only new in the United States; the requirement of relative novelty
was already fulfilled. Such provision of relative novelty followed original British standards which also
dealt with relative novelty, so that everything made outside of England would not go against the
relative novelty requirement.
26
Given the interpretation of the novelty requirement as being relative, it was possible and common the
so-called ―importation patents‖, which entrepreneurs and American ―discoverers‖ traveling, mainly to
Europe, copied inventions from there, requiring their internal protection inside the United States, since
they were about a ―discovery‖ that met the relative novelty requirement, not known or used in the
United States so far.
27
The accuracy was low as to the real contribution of the invention or discovery in relation to the
existing state-of-the-art, since the granting of patent by the government met the ―sufficient importance
and usefulness‖ requirement instead of the non-obviousness requirement, which would eventually
bring about very similar patents that did not actually contribute to the technological progress.
28
WALTERSCHEID, Edward C. To Promote the Progress of Useful Arts – American Patent Law
and Administration, 1787 – 1836. Littleton, Colorado: Rothman & Co., 1998, p. 50-51.
29
The use of the term ―science‖ is straightforwardly by the fact that in the
latter part of the eighteenth century it was synonymous with ―knowledge‖ and
―learning‖.
[…]
The origin of the words ―useful arts‖ meant basically helpful or valuable
trades. Thus to promote the progress of useful arts presupposed an intent to
29
advance or forward the course or procession of such trades .
That is, the system was designed to develop knowledge/learning and the
useful trade or value, without having any theoretical basis aimed at the
acknowledgement of natural law grounded on labor theories and personality theories,
but aimed at specific internal economic development goals.
Since its first Patent Act, the United States were already concerned about the
obligation of the inventor not only to reveal his invention or discovery, but also to
restrict the granting of patent to the requirement that the description should be
sufficiently clear and detailed so that someone ―skilled in the area‖ 30 might be able to
make, construct or use the invention, to the end, that the public may have the full
benefit from the technology after the expiration of the patent term, according to
Section 2 of the Patent Act of 179031.
Given the obvious problems of the first Patent Act of the United States, as
early as 1973 the new Patent Act came into effect, leaving the patent system less
buro
___________________________
29
Translation into Portuguese: O uso do termo ―ciência‖ sofreu evolução tendo em vista o fato de que
na parte final do século dezoito era sinônimo de ―conhecimento‖ e ―aprendizado‖. [...]. A origem das
palavras ―arte útil‖ significava basicamente útil ou valioso para o comércio. Assim, promover o
progresso das artes úteis pressupunha uma intenção em avançar ou ir adiante ao curso ou processo
de dito comércio.
30
There are various definitions or synonyms for the commonly used definition of ―skilled in the art‖,
which the technology directly related to that invention can be summed up in that person trained in the
specific invention.
31
Section 2 of the Patent Act of 1790: ―[...] which specification shall be so particular, and said models
so exact, as not only to distinguish the invention or discovery from other things before known and
used, but also to enable a workman or other person skilled in the art or manufacture, whereof it is a
branch, or wherewith it may be nearest connected, to make, construct, or use the same, to the end
that the public may have the full benefit thereof, after the expiration of the patent term [...]‖.
30
bureaucratic and less rigorous, but, at the same time, it generated a larger number of
lawsuits, as emphasized by Matsuura 32.
Under the 1793 act, any disputes associated with the substance of patents
would be resolved in federal courts. That shift was altered with the next
substantial revision of U.S. patent law, in 1836, when the process was
revised to return to a more rigorous substantive review of applications.
One important consequence of a patent process that is more a registration
system than an examination and review system is that it tends to shift power
from the patent examiner to the courts.33
Another criticism on the fact that the absence of request for substantive
examination under the term of the Patent Act of 1973 was detrimental to the patent
and legal system as a whole, was emphasized by Walterscheid 34, stating that instead
of taking off from the President‘s hands the task of granting patents by simply turning
the system without substantive examination, it would be better to avoid costly legal
disputes by creating patent examiners positions that would have the function and
responsibility to perform substantive examinations of each patent application.
The substantive examination by a qualified examiner35 was instituted only in
the Patent Act of 1836.
Walterscheid mentions the elaborated chart on the annual evolution of the
number of patents granted in the U.S. from 1791 to 1840 showing, among other
factors, that the system alteration without substantive examination into a system with
subs
___________________________
32
MATSUURA, Jeffrey H. Jefferson v. The Patent Trolls – A Populist Vision of Intellectual Property
Rights. United States: University of Virginia Press, 2008, p. 92.
33
Translation into Portuguese: Sob o Ato de 1793, quaisquer disputas associadas a questões de
patentes deveriam ser resolvidas nas cortes federais. Esta mudança foi alterada com a próxima
revisão substancial da Lei de Patentes dos EUA em 1836, quando o processo foi revisado para voltar
a ter uma revisão mais rigorosa de mérito dos pedidos de patentes. Uma conseqüência importante de
um processo de patente mais caracterizado como um sistema de registro ao invés de um sistema de
exame e revisão é que tende a mudar o poder do examinador de patentes para os tribunais.
34
WALTERSCHEID, Edward C. Op. Cit., p. 212-213.
35
That would solve the problem of the State Secretariat lack of time to look into many substantive
examinations.
31
substantive examination since 1836 36 did not result in considerable alterations in the
number of patents granted in the U.S. 37.
In fact the basis of the modern American patent system is deeply linked to the
Patent Act of 1836, recognizing the need for a substantive examination prior to the
granting of patents, thus avoiding fiercer legal disputes as they are today.
It is noteworthy that the patent granting system with a prior examination of the
patentability now has to deal with a huge growing volume of patent applications,
which meant that the USPTO had, in 2007, 8,913 employees in all sectors, and out of
this total number, the astonishing number of 5,477 patent examiners, i.e., in 2007,
61.45% of all the United States Patent and Trademarks – USPTO employees were
Patent Examiners, according to data from USPTO itself 38.
Despite such data, there is constant criticism on the USPTO regarding the
granting of ―weak‖ patents, i.e., with poor quality of examination and invalid.
___________________________
36
See the long Section 7 of the Patent Act which states that ―[...] the Commissioner shall make, or
cause to be made, an examination of the alleged new invention or discovery; and if, on any such
examination, it shall not appear to the Commissioner that the same had been invented or discovered
by any other person in this country prior to the alleged invention or discovery thereof by the applicant,
or that it had been patented or described in any printed publication in this or any foreign country, or
had been in public use or on sale with the applicant's consent or allowance prior to the application, if
the Commissioner shall deem it to be sufficiently useful and important, it shall be his duty to issue a
patent therefore […]‖.
37
WALTERSCHEID, Edward C. Op. cit. p. 245-247. For instance, in 1831 573 patents were granted in
contrast with 752 and 702 patents granted in 1835 and 1836, respectively. The incredible growing
number of patents granted in the U.S. compared to data of 170 years later, since only in 2006 the
USPTO granted 154,760 patents, and in the same year nothing less than 390,815 patents were
applied at the USPTO. In a direct comparison, it should be noted that in Japan, in 2006, 217,364
patents were granted by the JPO, and in the same year 514,047 patents were applied. Data from the
World
Patent
Report:
The
Statistical
Review
(2008).
Available
at
http://www.wipo.int/ipstats/en/statistics/patents/wipo_pub_931.html#tables. Accessed on: March 14,
2009.
38
UPSTO’s own data. Available at: www.uspto.gov Accessed on: March 15, 2009.
32
After 1836 there were prompt evolutions in the U.S. patent system, such as in
1839 with the introduction of the grace period and in 1842 with the introduction of
design patents (protection only of the visual aspect of the industrial design).
In 1850 there was an emphasis by the Supreme Court of the United States
that in addition to the novelty and utility requirements (new and useful) the invention
also had to be non-obvious39.
In 1870 there was the unification of the legislation in a single Patent Act,
especially the introduction into law (already recognized by jurisprudence) that in the
description of the patent application ―the best form of patent implementation known
by the applicant on the application date‖ (best mode requirement) 40 should be
indicated. In the same year, in December, Judge Clifford from the Supreme Court of
the United States, in the trial of Seymour v. Osborbe‘s case states that:
Letters patent are not to be regarded as monopolies, created by the
executive authority at the expense and to the prejudice of all the community
except the persons therein named as patentees, but as public franchises
granted to the inventors of new and useful improvements for the purpose of
securing to them, as such inventors, for the limited term therein mentioned,
the exclusive right and liberty to make and use and vend to others to be
used their own inventions, as tending to promote the progress of science
and useful arts, and as matter of compensation to the inventors for their
labor, toil, and expense in making the inventions, and reducing the same to
pr
___________________________
39
See the case of the Supreme Court of the U.S.: Hotchkiss v. Greenwood 52 U.S. (11 How.) 248. In
this case, the novelty and utility of the invention were based upon the mere exchange of material used
in the product, so that the patent was annulled by the Supreme Court for being obvious for ―a skilled in
the art mechanic‖.
40
See section 26 of the Patent Act of 1870: That before any inventor or discoverer shall receive a
patent for his invention or discovery, he shall make application therefore, in writing, to the
commissioner, and shall file in the patent office a written description of the same, and of the manner
and process of making, constructing, compounding, and using it, in such full, clear, concise, and exact
terms as to enable any person skilled in the art or science to which it appertains, or with which it is
most nearly connected, to make, construct, compound, and use the same; and in case of a machine,
he shall explain the principle thereof, and the best mode in which he has contemplated applying that
principle so as to distinguish it from other inventions; and he shall particularly point out and distinctly
claim the part, improvement, or combination which he claims as his invention or discovery; and said
specification and claim shall be signed by the inventor and attested by two witnesses.
41
Supreme Court of the United States of America. Seymour v. Osborbe. December of 1870, 78 U.S.
516, 20 L.Ed. 33, 11 Wall. 516.
33
practice for the public benefit, as contemplated by the Constitution and
42
sanctioned by the laws of Congress.
In 1887 the United States joined the Paris Convention for the Protection of
Industrial Property, being bound to recognize and process, without invalidating, a
patent application made by a member of the Paris Union, ensuring priority to the date
of the patent deposit in the country of origin within the period specified in the Paris
Convention.
A historical time in the U.S. legislation was the year of 1980 when the
Sherman Act came into effect establishing standards of antitrust law in its eight
sections, such issues will be addressed in the chapter on the evolution of the U.S.
antitrust law.
But it was only in the twentieth century that in the United States a greater
recognition of the intersection of the patent law with antitrust law began, when the
interpretation of the Sherman Act began to clearly see the patent law as a
contributory factor to the undue extension of economic monopolies. According to
Ladas43:
In general the twentieth century has seen a dynamic interrelationship
between the patent system and the application of antitrust laws. Although
the first antitrust law, the Sherman Act, was enacted in 1890, the courts did
not start to give it teeth until Theodore Roosevelt‘s administration (19011909). It was not until the 1930's that the patent system started to come
under attack, being viewed as assisting in the maintenance of monopolies
that were seen as being at least a contributing factor to the economic misery
of the thirties. This skepticism about the patent system survived World War II
__________________________
42
Translation into Portuguese: Cartas-Patente não devem ser consideradas como monopólios, criadas
pela autoridade executiva à custa e prejuízos de toda a comunidade com exceção das pessoas
nomeadas como titulares das patentes, mas sim como franquias públicas concedidas aos inventores
para melhoramentos novos e úteis com o objetivo de assegurar a estes, como inventores, por um
prazo limitado estabelecido, o direito exclusivo e a liberdade de fazer, usar e vender para terceiros as
suas próprias invenções, tendo em vista a tendência em promover o progresso da ciência e das artes
úteis, e como compensação aos inventores pelo seu trabalho, suor e despesas em realizar as
invenções e colocá-las em prática para o benefício público, como contemplado na Constituição e
sancionado pelas Leis do Congresso.
43
LADAS & PARRY. A brief history of the Patent Law of the United States. Available at
http://www.ladas.com/Patents/USPatentHistory.html . Accessed on: April 27, 2009.
34
and blossomed again in the depressed economic conditions of the 1970's, a
44
period of strong anti-trust enforcement.
In a roundabout way, since late eighteenth century there was wariness about
the patent system, for in Matsuura‘s description45, Thomas Jefferson was already
concerned about the potential harmful effects of the temporary legal monopoly:
Jefferson shared the growing public concern with regard to monopolies,
noting in a 1788 letter to James Madison that ‗monopolies are sacrifices of
the many to the few‘. Yet, he also recognized, in a 1790 letter to Benjamin
Vaughan, that patents had ‗given a spring of invention beyond my
conception‘. While he acknowledged that many of the patents were ‗trifling‘,
he noted that ‗there are some of great consequence‘. Thus, although
Jefferson was concerned about the use of monopolies to encourage
invention, he recognized that patents did provide incentives for inventive
46
work.
The changes began to be more common in the U.S. Patent Act since 1952, a
year characterized by profound changes, such as imposing a limit of two years for
the inventor to alter it, increasing the spectrum of the protection of his patent claims
after it had been granted; the legal possibility for a patent to remain valid after a
patent annulment procedure, partially derived from some of the patent claims, was
introduced in 1952 (before that, if part of the patent was invalid, nothing would remain
_________________________
44
Translation into Portuguese: No geral, o século vinte tem representado um inter-relacionamento
dinâmico entre o sistema de patentes e a aplicação das leis antitrustes. Apesar da primeira lei
antitruste, o Ato Sherman, ter se estabelecido em 1890, as cortes ainda não tinham dado força até a
Administração de Theodore Roosevelt (1901-1909). Mas não foi antes do ano de 1930 que o sistema
de patentes começou a ser atacado, sendo visto como uma ajuda a manutenção de monopólios que
eram vistos pelo menos como um fator de contribuição para a miséria econômica dos anos trinta.
Esse ceticismo sobre o sistema de patentes sobreviveu até a Segunda Guerra Mundial e reapareceu
na depressão econômica dos anos de 1970, um período de forte aplicação de regulação antitruste.
45
MATSUURA, Jeffrey H. Jefferson v. Op. Cit., p. 97.
46
Translation into Portuguese: Jefferson compartilhou a crescente preocupação pública com relação
aosmonopólios, destacando em uma carta datada de 1788 a James Madison que ‗monopólios são
sacrifícios de muitos para poucos‘. Ainda, ele também reconheceu, em uma carta de 1790 a Benjamin
Vaughan, que patentes têm ‗conferido um impulso de invenção além da minha concepção‘. Enquanto
ele se dava conta de que muitas das patentes eram ‗insignificantes‘, ele notou que ‗havia algumas
grandes conseqüências‘. Assim, apesar de Jefferson preocupar-se sobre o uso dos monopólios para
encorajar a invenção, ele reconheceu que patentes geravam incentivo para o trabalho inventivo.
35
valid; among other changes in the patent system that are summarized by Ladas &
Perry47.
A noteworthy fact is that the U.S. patent system has gone through some
procedural changes in enforcement, scope and interpretation of what would be
considered patentable and, based upon applicable theories on the comparative
analysis of the state of the art and the violation existence (e.g. theory of equivalents),
what would be considered as partial violation and dependency violation.
Within this postmodern harvest, the U.S. patent law has promoted some
―answers‖ that, nowadays are being considered not as suitable as initially were
considered to be. In 1999, William Fisher 48 noticed such problems that today, partly
justify the Patent Reform Act49 pending in the United States Congress and some
trends
__________________________
47
LADAS & PARRY. Op. Cit., bring a history of the major legislative changes in 1954 (amendments in
the plant patent act), 1955 (presumption of patent validity is applied independently in each patent
claim, 1966 (Supreme Court in the Graham v. John case establishes the appropriate test for deciding
whether one or more patent claims are obvious or not) 1971 (Supreme Court expanded the effect of
the final decision on patent invalidity from inter partes to erga omnes, as decided in Blonder-Tongue v.
University of Illinois), 1978 (Patent Cooperation Treaty comes into effect in the U.S.) 1980 (Patent
Maintenance Fees come into effect after its granting by the USPTO, creating the possibility of patent
review, stressing that ―anything made under the sun is susceptible to patentability, 1982 (CAFC was
created, the arbitration to discuss the existence of the patent infringement or validity came into effect,
the U.S. were successful because they managed to include in their agenda the topic on Intellectual
Property at the GATT round (known as Uruguay Round).1988 (the U.S. implement the patent term
extension in case of any FDA delay on the approval of the drug corresponding to the patent granted,
the legal definition that the patent is not without effect by the alleged misuse of it by reason of refusing
the licensing of it or by agreements with competitors, unless the patent holder has market power in a
particular relevant area).
48
FISHER, William W. The Growth of Intellectual Property: A History of the Ownership of Ideas in
the United States. 1999. Available at: http://cyber.law.harvard.edu/property99/history.html .Accessed
on: March, 12, 2009.
49
The Patent Reform Act started with a proposal for changes in the patent system in 2005, the Patent
Reform Act proposes several substantive changes regarding the process of obtaining a patent and the
patent rights in the U.S.. After some adjustments in its proceeding, now represented by the proposal of
the Patent Act of 2009, some of the proposals get aligned with most of the worldwide patent system,
being among them: The system alteration from First to Invent to First to file; the possibility of interested
parties presenting allowances against the granting of patents during the administrative proceeding and
before the trial by the USPTO Patent Examiner and in order to assist him in his analysis, changes
issues related to the actual damages for patent infringement, among other issues proposed in the
document of 2009. A noteworthy fact is that these proposals have been widely debated since 2005
but, if on one hand it is noted that as a whole the Patent Reform Act will weaken the rights of patent
holders and turn the administrative process of obtaining a patent more bureaucratic, on the other hand
besides outlining itself with the massive majority of countries, it creates a more equitable
administrative proceeding (with a higher probability of success) and a more balanced power of
enforcement.
36
trends of the Supreme Court of the United States about turning more rigorous the
validity of injunctions in lawsuits of patent holders:
This proliferation of the kinds of potentially patentable inventions has been
paralleled by expansion of the set of entitlements encompassed by a patent.
The doctrine that best exemplifies that expansion is the concept of
"equivalents." Ordinarily, the rights of a patent owner are defined, not by the
scope of his invention, but by the language of his "claims"; a rival's product
will infringe the patent if and only if it falls within the bounds of a valid claim.
In the nineteenth century, rivals would sometimes take advantage of this
principle. By constructing products that differed in minor respects from
patentees' claims, they sought to avoid liability. Toward the end of the
century, the courts developed the equitable doctrine of "equivalents" to
prevent such evasive maneuvers. Since that time, four developments have
transformed the doctrine into a powerful weapon in the hands of patentees.
First, the courts have abandoned the notion that an "equivalents" inquiry is
only appropriate when there is evidence that the defendant has deliberately
copied the plaintiff's invention or engaged in some other kind of fraud; now
the doctrine is available in every case. Second, the formulas used by the
courts to define the ambit of the doctrine have become more favorable to
patentees; now plaintiffs need only show that defendants' products are not
"substantially" different from the patent's claims. Third, the increasingly
common use of juries in patent cases has resulted in increasingly generous
(to patentees) interpretation of the doctrine. Finally, courts have held that the
doctrine of equivalents may be invoked by patentees even when the
defendant's product or activity only became possible as a result of new
technology -- in other words, even if the defendant's product or activity could
not have been foreseen at the time the patent was granted.
What about the manner in which the Patent Office and courts have
interpreted and applied the standard requirements for patentability -- novelty,
nonobviousness, utility, etc.? Here the dramatic shift in favor of patentees
has been more recent. Roughly speaking, the nineteenth century was
characterized by ever more generous interpretation of the statutory criteria.
Partly as a result, patents became important to many companies and
industries. Between the First and Second World Wars, however, the tide
turned. Angered by anticompetitive uses of patents by large companies, both
the Patent Office and the courts became substantially less willing to grant or
uphold questionable patents. Beginning in the 1950s, the Patent Office
became more generous, but the federal courts varied widely in their
willingness to go along. The creation in 1982 of the Court of Appeals for the
Federal Circuit eliminated these variations. Equally importantly, the new
court (as its advocates had foreseen) has been much more favorable to
patentees -- sharply lowering the bar of "nonobviousness" and encouraging
37
more generous damage awards.
50
Calling attention to the fact that the U.S. patent system has undergone
changes in its history always seeking to comply with the constitutional clause that
asserts as a guidance to be followed the ―promotion of science and useful arts,
ensuring the authors and inventors, for a limited period of time, the exclusive right to
their respective writings and discoveries‖ 51.
In fact, these changes stem from the criticism involving old treatments for new
technologies and demonstrations of current faults in the patent system as it is
handled
__________________________
50
Translation into Portuguese: Essa proliferação dos tipos de invenções potencialmente patenteáveis
tem sido paralelamente acompanhada pela expansão dos direitos sobre uma patente. A doutrina que
melhor exemplifica essa expansão é o conceito dos ―equivalentes‖. Normalmente, os direitos de um
titular de patente são definidos não pelo escopo da invenção, mas pela linguagem das
―reivindicações‖; um produto rival irá infringir a patente se, e apenas se, enquadrar-se dentro das
fronteiras de uma reivindicação válida. No século XIX rivais tiravam vantagem algumas vezes desse
princípio. Através da construção de produtos que diferiam em pequenos aspectos em relação às
reivindicações das patentes protegidas, eles procuravam evitar violação. Mais adiante no final do
século, as cortes desenvolveram a doutrina dos ―equivalentes‖ para prevenir tais manobras evasivas.
Desde aquele tempo, quatro desenvolvimentos transformaram a doutrina em uma poderosa arma nas
mãos dos titulares de patentes. Primeiro, as cortes abandonaram a noção de que uma análise de
―equivalentes‖ somente é apropriada quando há evidência de que o réu tenha deliberadamente
copiado a invenção do autor ou realizado algum outro tipo de fraude; agora a doutrina é disponível
em qualquer tipo de caso. Segundo, a fórmula utilizada pelas cortes para definir o âmbito da doutrina
passou a ser mais favorável aos titulares de patentes; agora os autores precisam apenas mostrar que
os produtos dos réus não são ―substancialmente‖ diferentes das reivindicações da patente. Terceiro,
o aumento do uso de júris em casos de patentes resultou em um aumento generoso (para os titulares
de patentes) da interpretação da doutrina dos equivalentes. Finalmente, cortes têm afirmado que a
doutrina dos equivalentes pode ser invocada pelos titulares de patentes mesmo que o produto do réu
ou sua atividade não podiam ser constatados na época em que a patente foi concedida. E o que dizer
da forma como o Escritório Oficial de Patentes e as cortes têm interpretado e aplicado os requisitos
de patenteabilidade – novidade, não obviedade, utilidade, etc.? Aqui está uma mudança dramática
em favor dos titulares de patentes que é mais recente. Falando de forma grossa, o século XIX foi
caracterizado por uma ainda mais generosa interpretação dos critérios estatutários. Como um
resultado parcial, patentes se tornaram importantes para muitas empresas e indústrias. Entre a
primeira e segunda Guerra Mundial, no entanto, a maré virou. Descontentes com os usos
anticompetitivos feitos por patentes de grandes empresas, tanto o Escritório de Patentes quanto as
cortes tornaram-se substancialmente com menor disposição para conceder ou sustentar patentes
questionáveis. Começando nos anos 50, o Escritório de Patentes se tornou mais generoso, mas as
cortes federais variavam muito na sua vontade em seguir o mesmo caminho. A criação, em 1982 da
Corte de Apelações do Circuito Federal eliminou essas variações. Igualmente importante, a nova
corte (como os seus advogados a anunciavam) começou a ser muito mais favorável aos titulares de
patentes – reduzindo o rigorismo no exame da ―não obviedade‖ e encorajando a concessão de
indenizações ainda maiores por danos.
51
Section 8 of the United States Constitution: […] To promote the progress of science and useful arts,
by securing for limited times to authors and inventors the exclusive right to their respective writings
and discoveries.
38
handled by the U.S.52, as well as the previously mentioned Patent Reform Act under
discussion since 2005 in the U.S. that proposes significant changes in the U.S.
patent system.
Before the Courts, the system has been modified following a wave of
overvaluation and excessive credibility conferred on patents granted by the USPTO.
In the previous cases prior to the Mercantile Exchange v. eBay case, for instance,
the granting of injunctions depended only on the evidence that the plaintiff was the
patent holder (owned the Patent Letter granted by the USPTO) and the evidence that
the defendant was violating one or more patent claims. There are therefore several
recent decisions granting injunctions 53 and others not granting them54, taking the socalled e-Bay case as a watershed55. That is, in the U.S. today the granting of
preliminary or permanent injunction has become more difficult, because the
requirements are higher than those applied by the CAFC from the early 80‘s until the
trial of the U.S. Supreme Court in the e-Bay case above-mentioned.
__________________________
52
See Jaffe & Lerner (2004) and Bessen & Meurer (2008).
See, for example, some recent cases of granting of injunctions: Global Traffic Technologies Llc V.
Tomar Electronics, Inc. (2009); Acumed Llc v. Stryker Corporation, Stryker Sales Corporation, Stryker
Orthopaedics, and Howmedica Osteonics Corporation; 3M v. Avery Dennison (2006); TiVo Inc. v.
Echostar Communications Corp. (2006); Rosco, Inc. v. Mirror Lite Co.(2006).
54
See also some illustrative cases of refusal of injunctions: Z4 Techs., Inc. v. Microsoft corp. (2006);
Paice LLC v. Toyota Motor Corp. (2006).
55
Mercantile Exchange v. e-Bay. The so-called e-Bay case does not involve an application for
preliminary injunction, but permanent injunction. However, it is a high relevant case in the American
Jurisprudence because it brings questions about the analysis of four relevant factors to the granting of
injunctions. In this particular case, we must look briefly into its history, starting with the refusal of
injunction by the District Court, considering that: a) there was no irreparable harm because Mercantile
Exchange had no intention of licensing (even for e-Bay), it did not put products on the market directly
with this patent and had not applied for an injunction; b) the financial compensation would be the
appropriate remedy in view of the Mercantile Exchange licensing the patent; c) the balance of the
damages for each party was more favorable to e-Bay (which would have major and unwarranted
damages with the eventual granting of injunction); d) the public interest did not favor either party
because it was about business method patent and for the fact that the plaintiff Mercantile Exchange
did not use the patent in the market but only sought for the license and abstention from using it against
third-parties. Subsequently, the Court of Appeals for the Federal Circuit CAFC reversed a decision
applying the general rule that the Courts should grant permanent injunctions in cases of clear
infringement of patent, unless there are special circumstances, such as public health protection. The
case went to the U.S. Supreme Court that determined that the lawsuit should be brought back to its
origin so that the rule of the four requirements might be applied (irreparable damage, inadequacy of
other legal remedies, balance of the damage to be incurred by the plaintiff or by the defendant with the
granting or non-granting of injunction, as well as the public interest involved).
53
39
The law is constantly changing in all societies, so stifling definitions and laws
generates inconsistent legal stagnation with the social evolution. In the area of
patents and antitrust law it is the same way, since some non-patentable technologies
decades ago, are currently patentable and may no longer be in the future, as well as
some behaviors in the competitive market allowed in the past, are no longer allowed
today. What matters is to know which ―conducting wire‖ should be observed in this
constant evolution in the ways of thinking, acting and reacting.
In U.S. law there is no doubt that this ―conducting wire‖ is reinforced by
utilitarian theories, these attitudes are aimed at highest possible efficiency, accepting
―side effects‖, provided the ―balance‖ is a positive one.
In this system, unlike the European system, there is no differentiation between
patent of utility model and patent of invention; however, the requirement for obtaining
a patent of invention is less rigorous than for obtaining a patent of utility model56.
In the U.S. context, to which extent can the hermeneutic work go and from
where is the legislative change required to adapt the system to the present reality?
The Patent Reform Act is a proof that many changes are necessary, as well as some
of them, regarding the differential treatment to different technologies based on the
equality principle, are not yet cogitated.
Surely, the patent system in a competitive environment other than the
Brazilian one should have its specific adaptations, for, according to Luciano Benetti
Tim67
__________________________
56
In the U.S. the Brazilian requirement of ―inventive step‖ for granting a patent is known as ―nonobviousness‖ requirement.
57
For example, Adam Jaffe and Josh Lerner (Innovation and its Discontents, 2004) have stressed the
term equality problem of patent protection for all technological areas, but wind up defending that the
establishment of different protection terms will create another difficult problem to solve concerning the
specific legislative pressures to each technological field. They conclude that it would be practically
impossible to establish different terms in a fair way, avoiding sectorial influences and pressures.
40
Timm58 the Brazilian market is clearly, not identical to the American or European
market.
In particular, an analysis of the Brazilian competitive environment is important
to demonstrate similarities and differences facing the American system.
It is important to look into the Brazilian competition law through an initial trigger
exposed by Paula Forgioni 59 who establishes some differences between the antitrust
rules and those on repression of unfair competition:
It is in the legal interest directly protected by two legal acts that we find the
difference between antitrust rules and the repressive ones on unfair
competition. In these, the well-protected asset immediately refers to the
competitor, while the antitrust law refers to competition, to the market. In the
first one, it concerns the competitor‘s good faith interacting with other
economic agents, while in the second ones it concerns the market structure
guidance and maintenance. Furthermore, one should bear in mind, as
Malchups teaches, that the damage caused to a competitor or to competitors
is quite different from the damage caused to competition itself.
Hermeneutical care should be taken when interpreting the statement above,
for one should understand as ―legal interest directly protected‖ not the objectives and
fundamentals of Law 9,729/96 (which are linked to the constitutional premises
outlined earlier), but in order to meet these objectives directed toward collectivity
there is the need to individually regulate rights in the competitive field, as pointed out
by Ricardo Aronne60.
__________________________
58
TIMM, Luciano Bennetti. International agreement on technology transfer in Brazil. In: TIMM, Luciano
Benetti; PARANAGUÁ, Pedro (Org.) Intellectual Property, antitrust and development. Rio de
Janeiro: FGV, 2009, p.95.
59
FORGIONI, Paula A. Fundamentals of Antitrust Law. 3. ed. São Paulo: Revista dos Tribunais
(Journal of the Courts), 2008, p.287.
60
ARONNE, Ricardo: Reason & Chaos in Legal Discourse on Civil and Constitutional Law. Porto
Alegre: Livraria do Advogado Editora (Lawyer‘s library Press), 2010, p.107.
41
The economy itself in the Welfare State, in addition to the vaunted
discourse of efficiency, must soak itself in the fundamental rights to make
sense and result in an inclusive market which contributes towards the
reduction of inequalities. It won‘t ever mean to denature or monetize them
with its false utilitarian determinism. On the contrary.
One should have an insight into its meaning, since it is something that
grounds itself and is autobiographically fundamentalist. For the economy,
when enclosed in its own system, the last foundation (grund) would look like
abyss (abgrund) of a non-foundation. Simply for its inability to substantiate.
In the Social and Democratic State of Law, the humanistic existentialism will
not be a choice of efficiency.
That is, in the Brazilian competitive legal system one should be alert to the
unintended effects that generate eminently utilitarian options in the humanistic
existentialism inherent in the established values by the Political Letter of 1988.
Such understanding makes it clear that the old conceptions of Stuart Mill 61 on
liberty has long changed their bases, from which it is inferred that liberty without
regulation does not generate the desired development in the meaning craved by the
Democratic State of Law, with a clear need for both corrective and preventive
regulation.
Moreover, it is worth mentioning that the preventive analysis of anticompetitive
conduct is relatively recent, introduced with the creation of the ACED by the DecreeLaw 7666/45, and other substantial innovations brought by this legal provision of
short
__________________________
61
In his ―On Liberty‖ (1859, p. 132-133), John Stuart states that: ―But it is now recognized, though not
till after a long struggle, that both the cheapness and the good quality of commodities are most
effectually provided for by leaving the producers and sellers perfectly free, under the sole check of
equal freedom to the buyers for supplying themselves elsewhere. This is the so-called doctrine of Free
Trade, which rests on grounds different from, though equally solid with, the principle of individual
liberty asserted in this Essay‖.
42
short duration62.
In this sense, highlighting the current natural objectives of the Brazilian
competitive system, Valéria Guimarães de Lima e Silva 63 points out:
By the current constitution the State has the responsibility to manage the
market, constitutionally raised to the condition of national heritage (art. 219),
that indicates that not only the consumers or the economic agents are
holders of the legal interest protected by the competition law, but rather the
whole collectivity, as attested in the sole paragraph article 1 of the Brazilian
antitrust law.
[…]
Once the market sets up the national heritage, the infringement of
economic order does not necessarily need to be characterized by the
conduct of an agent against another agent, but the achievement of a
practice directed against the market itself.
Going beyond the current constitutional/infra-constitutional aspect of the
systemic valorizing sense of the competitive umbrella, an extremely relevant factor to
the Competition Law (and to the present study as well) is the definition of ―relevant
market‖ for the application or non-application of certain legal provisions provided by
Law 8,884/94.
In the up-to-date and precise view of Paula Forgioni 64, which demonstrates the
complexity and the differences of international positions, one can define the
identification of the relevant market as follows:
___________________________
62
According to Valéria Guimarães de Lima e Silva. Antitrust Law. International Aspects (Juruá: 2007,
p.289 et seq.), the short duration of the Decree-Law 7666/45 and, even after, with the subsequent
laws, there was no significant development and there were no cases in the Brazilian antitrust law from
1963 to 1990, at ACED only 337 proceedings were initiated, of which only 117 resulted in
administrative processes, and, in terms of conviction, only 16, of which all were suspended by the
Judicial Power. That is, the effective use of the Brazilian antitrust system now has as landmarks the
Federal Constitution of 1988 and the Law 8,884/94 itself (which solved previous conflicts between the
Laws 4,137/62 and 8,884/94).
63
SILVA, Valéria Guimarães de Lima e. Antitrust Law. International Aspects. Curitiba: Juruá, 2007, p.
305-306.
64
FORGIONI, Paula A. Op. Cit., p.261.
43
It seems that the trend is the adoption of a more restricted market to
eventually mitigate the market share of the agents that generate its
contestability.
Surely, the relevant market is built in each concrete case. As we have seen
above, we ought not to have the illusion that, in real situations, there is a
relevant market ready to be discovered by the interpreter; on the contrary, it
is about a logical operation in which a unique procedure should be adopted,
which allows us to identify the competitive relations that the economic agent
participates in.
In short, we observe that every antitrust authority often develops their own
study method, establishing the relevant market boundaries. In the United
States, it revolves around the agent‘s power when it comes to the
acknowledgement of his capacity to keep the new price for a reasonable
period of time, deep down, the agent‘s market power is being measured,
how much it resists the market forces (=competition). Europeans, in turn, are
based on a technique that takes into account the possible substitutes for the
cogitated asset, what separates the delimitation of the relevant market
power, converging at the competitive relationship in an absolute instrumental
way. The difference between the procedures, as we have seen, is subtle, but
it has practical importance. So much that several authors in the United
States have spoken out against this classical form of the relevant market
fixation, for the distortion it may present.
Such definition problem of the relevant market is taken to the solution of
concrete application provided by the articles 20 and 21 of Law 8,884/9465, making
this delimitation particularly in the area of patents be carefully analyzed in each
concrete case, for the right to exclude others from a technology in particular often
goes beyond the patentee‘s market segment.
__________________________
65
Some behaviors, for instance, suppressed by Law 8.884/94: Art. 20 are cited. It is taken as infraction
of the economic order, regardless of fault, the acts under any circumstance, which have the purpose
or might produce the following effect, although they are not achieved:
I- restrict, distort, or by any means damage the free competition or the free enterprise;
II- dominate the relevant market of goods and services;
III- arbitrarily increase profits;
IV- abuse a dominant position.
Art. 21. The following behaviors, among others, as long as they represent hypothesis provided
by the art. 20 and its items, characterize infraction of the economic order;
XVI- take possession of or prevent the exploitation of industrial property rights either
intellectual or technological.
XXIV- impose excessive prices, or increase the price of goods or services without a cause.
Sole paragraph. In the characterization of the imposition of excessive prices or the
unreasonable increase of prices, among other relevant economic and marketable circumstances, it
shall be considered:
I- the price of the product or service; either by its increase, not justified by the cost of the
respective inputs, or by the introduction of quality improvement.
II- the price of the product previously manufactured, when it comes to the substitute resulting
from non-substantial alterations.
III- the price of similar products and services, or any improvement in competitive markets.
IV- the existence of agreements or arrangements in any way, which might cause an increase
in the price of goods or services or even their costs.
44
In a recent case tried by the U.S. Supreme Court the American antitrust
system objectives were reaffirmed, especially regarding the relevant market, being
primordial to quote the decision in Verizon v. Trinko case66.
[…]
Finally, we do not believe that traditional antitrust principles justify adding
the present case to the few existing exceptions from the proposition that
there is no duty to aid competitors. Antitrust analysis must always be attuned
to the particular structure and circumstances of the industry at issue. Part of
that attention to economic context is an awareness of the significance of
regulation.
[…]
One factor of particular importance is the existence of a regulatory
structure designed to deter and remedy anti-competitive harm. Where such
a structure exists, the additional benefit to competition provided by antitrust
enforcement will tend to be small, and it will be less plausible that the
antitrust laws contemplate such additional scrutiny.
[…]
Section 2 of the Sherman Act, by contrast, seeks merely to prevent
unlawful monopolization. It would be a serious mistake to conflate the two
goals.
The Sherman Act is indeed the ―Magna Carta of free enterprise,‖ United
States v. Topco Associates, Inc., 405 U. S. 596, 610 (1972), but it does not
give judges carte blanche to insist that a monopolist alter its way of doing
business whenever some other approach might yield greater competition.
We conclude that respondent‘s complaint fails to state a claim under the
Sherman Act.67
__________________________
66
The Supreme Court of the United States. VERIZON COMMUNICATIONS INC. v. LAW OFFICES OF
CURTIS V. TRINKO, LLP, 540 U.S. 398 (2004).
67
Translation into Portuguese: […] Finalmente, nós não acreditamos que os princípios tradicionais do
antitruste justificam adicionar o presente caso às poucas exceções no sentido de que não há dever
em ajudar concorrentes. Análise antitruste deve sempre estar conectada à estrutura particular e
circunstâncias da indústria específica sob análise. Parte dessa atenção ao contexto econômico é um
prêmio para o significado da regulação. [...] Um fator de importância particular é a existência de uma
estrutura regulatória desenhada para impedir e remediar danos anticompetitivos. Quando esse tipo de
estrutura existe, o benefício adicional à concorrência proporcionado pela efetiva implementação do
antitruste tende a ser pequeno, e será menos plausível que as leis antitrustes contemplem esse tipo
de verificação adicional. [...] Seção 2 do Sherman Act, ao contrário, procura evitar simplesmente um
monopólio ilegal. Seria um grave erro agrupar os dois objetivos. O Sherman Act é realmente a ―Carta
Magna da livre iniciativa‖ United States v. Topco Associates, Inc., 405 U. S. 596, 610 (1972), mas não
confere aos juízes uma carta branca para insistir que um monopolista altere o seu jeito de fazer
negócios sempre que modelos diversos possam gerar maior concorrência. Nós concluímos que os
argumentos do contestante não estabelecem uma reivindicação embasada no Sherman Act.
45
In a recent event held at the Itamaraty Palace in Rio de Janeiro 68, experts in
the Brazilian Antitrust System – BAS, the National Institute of Industrial Property –
NIIP, the World Intellectual Property Organization – WIPO, the Judicial Power,
international
organizations
and
academic
sector,
addressed
the
intriguing
intersection between intellectual property and antitrust law.
In the above-mentioned event, in the panel related to Intellectual Property,
competition, innovation and technological information, it was defended by Professor
Mário Possas from the Federal University of Rio de Janeiro (UFRJ), that both the
competition policy and intellectual property have important common goals, which are
to develop a competitive and innovative environment.
Elena Kamilarova highlighted in the event the abusive use of patent law in the
pharmaceutical sector, with respect to agreements and abusive lawsuits (sham
litigation). The expert lecturer‘s findings are compiled in an article of huge empirical
fire that demonstrates a high number of cases that use the patent system in a
competitive way, damaging innovation in Europe 69.
Since the research developed by Kamilarova and her two colleagues is based
upon extensive number of cases identified and analyzed in the pharmaceutical area
takentaken
___________________________
68
International Seminar on the intellectual property and competition policy, held between 7 and 8
of
June
2010,
at
the
Itamaraty
Palace
in
Rio
de
Janeiro.
Available
at
http://www.cade.gov.br/seminariopi2010/Programa.pdf . Accessed on: July 12, 2010.
69
KAMILAROVA, Helena; DOMANICO, Fabio; RIEDL, Alexander. Preliminary results of Commission
pharmaceutical sector inquiry raise competition concerns. Competition Policy Newsletter, N. 1,
2009, p. 29-31.
Available at: http://ec.europa.eu/competition/publications/cpn/2009_1_8.pdf. Accessed on: March 22,
2010.
46
that would be suffering problems in its operation, while focused on innovation70, it is
important to quote some of these figures that demonstrate the great care to be taken
regarding the examination of the abusive use of patent law, violating its own essence
and, consequently, causing anticompetitive effects:
Patent clusters
A strategy commonly applied by originator companies is to extend the
breadth and duration of patent protection by filing numerous patents for the
same molecule, forming so-called ―patent clusters‖. In some cases,
individual blockbuster medicines are protected by up to 1 300 patents and
pending patent applications in the EU, leading to uncertainty for generic
companies seeking to enter the market without infringing an originator
company‘s patents or patent applications. In the period 2000 to 2007,
originator companies also engaged in nearly 700 cases of patent litigation
with generic companies in relation to the sample of products investigated.
Generic companies won 62% of all cases where a final judgment was taken
but it took on average 2.8 years for a final judgment to be reached by
court.71
Patent opposition procedures
The preliminary findings confirm that the opposition rate (i.e. the number
of oppositions filed per 100 granted patents) before the European Patent
Office (EPO) is consistently higher in the closest available proxy for the
pharmaceutical sector than it is in organic chemistry and in all sectors
(overall EPO average). Based on the sample investigated, generic
companies almost exclusively opposed secondary patents. They prevailed in
approximately 75% of final decisions rendered by the EPO (including the
Boards of Appeal) during 2000 to 2007, either by achieving the revocation of
the patent or by having its scope restricted. Even though generic companies
are very successful in opposing originator companies‘ secondary patents,
approximately 80% of the final decisions took more than two years to obtain.
The duration of opposition procedures (including appeal procedures)
conside
__________________________
70
The initial part of the article makes the purpose of the research and its reasons very clear: Given the
importance of a wellfunctioning pharmaceutical sector, the Commission launched a sector inquiry into
pharmaceuticals on 15 January 2008. The inquiry was initiated in response to signs that competition in
the pharmaceutical market in the European Union may not be working well. This was indicated by a
decline in innovation measured by the decreasing number of novel medicines reaching the market
each year and by instances of delayed market entry of generic medicines. The inquiry sought to
examine whether certain practices of pharmaceutical companies may be among the reasons for the
generic delay and the decline in innovation.
71
Translation into Portuguese: Agrupamento de patentes: Uma estratégia comumente utilizada por
empresas que desenvolvem tecnologias é a de estender a abrangência e a duração da proteção
patentária através de numerosos pedidos de patentes para a mesma molécula, formando os
chamados ―agrupamentos de patentes‖. Em alguns casos, remédios individuais campeões de vendas
são protegidos por até 1300 patentes concedidas e em trâmite na União Européia, levando a uma
incerteza para empresas de genéricos que pretendem entrar no mercado sem infringir patentes
concedidas ou em andamento de empresas titulares das mesmas. No período de 2000 a 2007,
empresas inovadoras se envolveram também em aproximadamente 700 casos judiciais de patentes
com empresas de genéricos em relação à amostra de produtos investigados. Empresas de genéricos
ganharam 62% de todos os casos nos quais houve um julgamento final proferido, mas tomou
aproximadamente 2.8 anos até que um julgamento final fosse proferido por um Tribunal.
47
considerably limits the generic companies‘ ability to clarify the patent
72
situation of potential generic products in a timely manner.
Patent settlements
The sector inquiry also found that, between 2000 and 2008, more than 200
patent settlement agreements were concluded between originator and
generic companies in the EU, with nearly half (48%) restricting the ability of
the generic company to market its medicine. 45 settlements contained — in
addition to the restriction — a value transfer from the originator company to
the generic company, with direct payments to generic companies alone
amounting to more than €200 million.73
Patent strategies
As regards competition between originator companies, the preliminary
findings of the sector inquiry show that originator companies engaged in socalled ―defensive patent strategies‖. Originator companies used patents
falling into this category primarily to block the development of new medicines
by their competitors and not to bring a new/improved medicine to the market.
The sector inquiry also found at least 1 100 instances across the EU of
overlaps between an originator company‘s patents relating to a medicine in
the sample under investigation and the R&D programme and/or patents held
by another originator company for its medicines. These overlaps create
significant potential for originator companies to find their research activities
blocked, with detrimental effects on the innovation process.74
Patent-related exchanges, disputes, litigation and oppositions
In many cases originator companies tried to settle potential disputes, for
instance through licensing. However, in approximately 20% of the cases
where
__________________________
72
Translation into Portuguese: Medidas de oposições às patentes: Os resultados iniciais confirmam
que a taxa de oposições (o número de oposições protocoladas por cada 100 patentes concedidas)
perante o Escritório Europeu de Patentes (EPO) é consistentemente maior do que a média mais
próxima disponível para o setor farmacêutico do que para a área de química orgânica e também em
todos os setores (média geral do EPO). Com base nos exemplos investigados, empresas de
genéricos quase que exclusivamente se opõe apenas a patentes secundárias. Elas tiveram êxito em
75% das decisões finais tomadas pelo EPO (incluindo a Câmara de Recursos) durante 2000 e 2007,
sejaatravés da revogação da patente ou através da restrição do seu escopo. Mesmo as empresas de
genéricos sendo bem sucedidas nas oposições às patentes secundárias de empresas inovadoras,
aproximadamente 80% das decisões finais levaram mais de dois anos para ser obtida. A duração dos
procedimentos de oposição (incluindo procedimentos de apelação) limita consideravelmente as
habilidades das empresas de genéricos em tornar clara a situação da patente para a produção de
genéricos tempestivamente.
73
Translation into Portuguese: Acordos de Patentes: A pesquisa setorial também revelou que entre
2000 e 2008 ocorreram mais de 200 acordos de patentes entre empresas inovadoras e empresas de
genéricos na União Européia, com aproximadamente metade (48%) restringindo a possibilidade das
empresas de genéricos comercializarem seus medicamentos. 45 acordos envolviam – somando-se a
restrição – uma transferência de valores das empresas inovadoras para as empresas de genéricos,
com pagamentos diretos a empresas de genéricos chegando ao montante de EUR 200 milhões.
74
Translation into Portuguese: Estratégias de Patentes: no que tange à concorrência entre empresas
inovadoras,
os resultados preliminares do setor investigado No que tange à concorrência entre empresas titulares,
os resultados preliminares da pesquisa do setor demonstram que empresas titulares são engajadas
nas assim chamadas ―estratégias defensivas de patentes‖. Empresas titulares usam patentes dessa
categoria primeiramente para bloquear o desenvolvimento de novos remédios pelos seus
concorrentes e não para trazer um novo ou aperfeiçoado remédio para o mercado. A pesquisa
setorial também revelou pelo menos 1100 instâncias através da União Européia de sobreposições
entre titulares originais de patentes relacionadas a remédios na amostra sob pesquisa e o programa
de P&D e/ou patentes de titularidade de outros titulares originais para os seus remédios. Essas
sobreposições criam um potencial significativo para empresas titulares terem as suas atividades de
pesquisa bloqueadas, com efeitos negativos para o processo de inovação.
48
where a license was requested the patent holder refused to grant it.
Between 2000 and 2007 originator companies engaged in litigation
against other originator companies in 66 cases concerning 18 different
medicines in the sample under investigation. In 64% of the cases,
litigation was concluded by means of a settlement agreement. The patent
holders lost the majority (77%) of cases where final judgments were given
(13). The preliminary findings also showed that, between 2000 and 2007,
originator companies mainly challenged each other‘s secondary patents.
The applicant originator companies were very successful when
challenging the patents of other originator companies. During that period,
they prevailed in approximately 89% of final decisions rendered by the
EPO (including the Boards of Appeal).75
In effect, the research above points to some of the diverse forms to use the
patent system with anticompetitive purposes that go beyond the limits of the patent
law itself (diverted or abusive use of the system), which, when achieved produce
harmful effects against the very essence that should move the pro-competitive patent
system.
Bringing these questions into the field of Brazilian antitrust law, as informed in
the event on Intellectual Property and competition policy; today such abusive cases
identified and under the ELS analysis are 12 cases, which is very little not because of
the existence of factual situations worthy of the BAS analysis, but because of the lack
of identification of such situations by unfamiliarity with possible illegal activity within
the Brazilian legal system.
In this sense, the incisive way Carla Eugênia Caldas Barros 76 addresses one
kind of abusive and diverted use of patent law draws our attention:
__________________________
75
Translation into Portuguese: Trocas, disputas, litígio e oposições relacionadas às patentes: Em
muitos casos,empresas titulares tentam entrar em acordo em disputas potenciais, por exemplo,
através de licenciamento. No entanto, em aproximadamente 20% dos casos em que uma licença é
solicitada, o titular da patente se recusa a concedê-la. Entre 2000 e 2007 empresas titulares entraram
em litígio com outras empresas titulares em 66 casos referentes a 18 remédios diferentes na amostra
sob investigação. Em 64% dos casos o litígio foi resolvido através de acordo judicial. Os titulares de
patentes perderam a maioria dos casos (77%) nos quais houve uma decisão final sem acordo (13).
Os resultados preliminares demonstram também que, entre 2000 e 2007, empresas titulares desafiam-se
umas às outras principalmente quanto às patentes secundárias. As empresas titulares requerentes foram
muito bem sucedidas ingressando contra patentes de outras empresas titulares. Durante esse período,
elas prevaleceram em aproximadamente 89% das decisões finais exaradas pelo EPO (incluindo a Câmara
Recursal).
49
The legal provisions of dependent patents point out the analytical notion of
property, without the notion of social exploitation. The country needs to
increasingly develop; however, it has ordinary legislation contrary to the
Constitution and quite restrictive regarding the granting of exploitation by the
holder of the dependent patent. It all works as a vicious circle; the dominant does
not authorize the exploitation of the dependent one, since he does not release
his basic patent. The holder of the dependent patent can get the title of patent
owner; however, the prevention of initial exploitation defiles the process, should
the dependent patent object be perfected by others. One should not forget that
this legislation only meets the interests of large corporations, which use research
and hire patents among themselves, forming cartels and abusing the economic
power.
The obligation to license a patent in certain situations of abuse of patent law,
other than the cases of dependent patents, is provided in the Industrial Property Law,
in the Antitrust Law77 and directly related to forms of control of unfair competition in
license agreements at TRIPS.
So, being an instrument for the promotion of the social interest, economic and
technological development, which implies the promotion of a healthy competition and
not a limiting one above what is necessary for its own promotion in broad sense, the
patent system should have limiting mechanisms and its use goes beyond the goals
set by the original representative when it limits, for instance, the exercise of free
competition.
__________________________
76
BARROS, Carla Eugênia Caldas. Improvement and dependence on patents. Rio de Janeiro:
Lumen Juris, 2004, p. 48.
77
Both previously cited regarding the compulsory licensing as a means of abuse correction, as well as
the communication between the IPL and the AL emphasized along this essay as necessary and
uniquely relevant for the free competition and for the real foundations of the existence of a patent
system to be preserved and always monitored.
78
Despite its restrictive sense, TRIPS clearly provides and reproaches the abusive use of the
intellectual property system by establishing the harmfulness of practices that restrict competition, as
stipulated in the article 40 of TRIPS: 1. Members agree that some licensing practices or conditions
pertaining to intellectual property rights which restrain competition may have adverse effects on trade
and may impede the transfer and dissemination of technology.2. Nothing in this Agreement shall
prevent Members from specifying in their legislation licensing practices or conditions that may in
particular cases constitute an abuse of intellectual property rights having an adverse effect on
competition in the relevant market. As provided above, a Member may adopt, consistently with other
provisions of this Agreement, appropriate measures to prevent or control such practices, which may
include for example exclusive grantback conditions, conditions preventing challenges to validity and
coercive package licensing, in light of the relevant laws and regulations of that Member.
50
In this sense, Denis Borges Barbosa79 teaches:
According to the content of the international text in analysis, the national law
may, without offending the TRIPS, prohibit any provisions inserted into license
agreements or likewise that provide licensing practices or conditions that may, in
particular cases, constitute an abuse of intellectual property rights, which may
have side effects on competition in the relevant market.
[…]
The TRIPS list is merely illustrative, in light of many other clauses and
practices found in the practice of the BPTO Brazilian Patent and Trademark
Office (INPI) and documented in the Supreme Court ruling published at RJT
106/1057-1066.
Still trying to demonstrate the relevant authors‘ thinking about the function of
the social contract, some thoughts of Cláudia Lima Marques 80 are brought up:
The law develops thus, a contract theory with ―social function‖ just like those
described by Wiehweg, i.e., the law leaves the positivist (and deductive) view of
science, recognizes the social influence (custom, morality, harmony, tradition)
and takes over ideological prepositions by concentrating its efforts in solving
problems.
It‘s an increasingly typical thinking style, which is oriented towards the problem;
creating more open and more functional legal forms, concepts and principles
defined without much logical rigor, as we shall see at the CC, since they only
have significance in light of the problem to be solved, they are legal formulas in
the search for conflict solution, formulas that never lose their attempting
characteristic. This seems to be the current phase of law, once the skepticism on
the decline of the systematic thinking and the infallible decoding are overcome;
we work out the positive function of the topical thinking and the reetization of law.
Specifically, contractual practices; denying or restricting the licensing of
technology absorption, undergo competitive issues that go beyond the individualistic
right of the patent holder(s), and through the instrumental function of the contract, we
should under
__________________________
79
BARBOSA, Denis Borges. An Introduction to…, p.1101-1102.
MARQUES, Cláudia Lima. Consumer Code: The new regime of contractual relationships. 4 ed. São
Paulo: Revista dos Tribunais (Journal of the Courts), 2002, p.178-179.
80
51
should understand the characterization of the right to contract as an instrumental
right, as asserts Judith Martins Costa81:
In relation to the free enterprise economy, the freedom of contract is
instrumental, i.e., to ensure the exercise of economic activity, the necessary
means to that exercise are provided. Just like all other means, the freedom
of contract does not exist ―per se‖ but it is meant for something, i.e., it is
permanently polarized and conformed to ―what it is meant to‖. These means
are not only meant to concretize the free enterprise economy, but equally,
the structuring principles of the art. 1, the guidelines or ―objective rules‖
outlined in the art. 3 and in the art. 170, as well as the freedom, guarantees
and rights of the art. 5 and 7 of the Constitution.
Going further, another important contribution to the definition of what is
understood by the contract instrumental nature and its limitations in the area of
patents as a competitive instrument, which is complemented by the principles of
good faith and economic balance, is given by Teresa Negreiros 82:
Our premise is that the function of the social contract, when conceived as a
principle, before any other direction and extent one can assign to it, simply
means that the contract should not be conceived as a legal relationship that
only interests the contracting parties, impervious to the social conditions that
surround it and are affected by it.
In this sense, crowning the contract instrumental nature, which goes beyond
the individual, is the position of Ruy Rosado de Aguiar Júnior83:
There was a complete change in the interpretive axis of the contract. Instead
of considering the parties‘ intention and the satisfaction of their interests, the
contract should be seen as an instrument of social interaction and
preservation of the community interests, where it finds its raison d‘être and
where
__________________________
81
MARTINS-COSTA, Judith. Reflections on the principle of the social function of contracts. Revista
Direito GV, v. 1, n. 1, p.45 May, 2005.
82
NEGREIROS, Teresa. Contract Theory – New Paradigms. Rio de Janeiro: Renovar, 2002, p. 206.
83
AGUIAR, JR., Ruy Rosado de. New Civil Code Project: obligations and contracts. Revista dos
Tribunais (Journal of the Courts), São Paulo, n. 775, p. 19-20, May 2000.
52
where it draws its strength from - since the contract requires a state order to
grant its efficacy.
In Patent Law, which encompasses its functional law nature, the dialog with
Contract Law in its current equally functional dimension is important to identify the
diversions or abuse not dimensioned by the legal system, and, therefore, Judith
Martins-Costa‘s84 statements should be noted, in line with the constitutional
principles, and the provision that the ―freedom of contract shall be carried out by
reasons and limits of the social function of the contract‖85 bringing two different
hermeneutical aspects of functionality that the freedom of contract is directly linked
to:
Once this perspective is situated we can conclude that the private autonomy
(source of freedom of contract), with a new meaning, away from the atomistic
and voluntaristic perspective, based upon the postulate (concomitantly factual
and normative) of sociality, is to say that every individual is social and that the
conclusion of individualization can only be achieved socially.
[…]
We may agree, however, that this role of ―provision of negative external limit‖
sums up the principle of the contract social function, the art. 421 would be
virtually useless, since cases already decided upon by jurisprudence
demonstrate that either the hypotheses are already caught by the rule of the art.
187 of the Civil Code (consecrating unlawful means), or it is not about incidence
of the social function principle but hypotheses of interpretation favorable to the
adherent, integration according to the good faith, or even cases that have been
regulated by special laws as the Consumer Code or the Land Statute.
All of it leads to the conviction of the need to find its own and specific voice to
the art. 421. This own voice is, I think, in the second level of semantic
comprehension of the expression contained in the art. 421.
That is, according to Judith Martins-Costa‘s86 vision, the limitation of freedom
of contract by the social function does not express the real reason for which the art.
421 of the Civil Code of 2002 is innovated, so that the ―social function not only works
as an external limit, but is also an ―integrative element of the private autonomy
function field in the freedom of contract domain‖.
__________________________
84
85
MARTINS-COSTA, Judith. Op. Cit., p. 49-50
Art. 421 of the Civil Code of 2002
53
It is clear that the function issued by the art. 421 of the CC is not simply to
establish that the freedom of contract is limited by the social function, but more
importantly, this freedom should arise and persist during the business relationship
even after its completion due to the social function, having inter-subjective and transsubjective efficacies, which are the most challenging ones in one of their facets
related to the efficacy against non-determined third parties or a certain collectivity, as
for instance, the contracts that are impacted by the Competition Law.
In her conclusions on the impact of the social function on freedom of contract,
Judith Martins-Costa87 states that:
Here is a real qualitative leap that I find in the art. 421: the understanding
that the liberty of each one is exercised in an orderly way to the common
good as expressed in the social contract, assuming the internally conformed
right to freedom (of contract) in fields of particular relevance to the common
good.
In view of this functional contractual reality, Pierre Régibeau and Katharine
Rockett88 stress the possibility of even ―forcing‖ the patent holder to sign a
compulsory agreement, which is also provided in our Industrial Property Law
9,279/96, the authors assert that:
As we have just seen, compulsory licensing is most likely to be called for in
two types of situations: when the patent holder has significant market power
in both the upstream and downstream market and when another firm
develops an infringing innovation. However these two cases call for different
principles when it comes to setting the terms of the licensing contract.
In the infringing innovation case, the object of compulsory licensing is to
ensure that a socially useful innovation actually gets introduced, not to
increase competition downstream. This objective can be achieved by
choosing the royalty according to Baumol and Willig ‗s ECPR formula. This
formula sets the ‗access charge‘ paid by the licensee is equal to the
marginal
__________________________
86
MARTINS-COSTA, Judith. Op. Cit., p. 50.
Idem, p. 57-58.
88
RÉGIBEAU, Pierre; ROCKETT, Katharine. The Relationship between Intellectual Property Law
and Competition Law: An economic approach. Essex and CEPR University, June 2004, p. 47.
87
54
marginal cost of granting access (likely to be close to zero in the case of
IPR) plus an amount reflecting the profits lost by the licensor because of
increased competition downstream. In other words, the license contract
would be such that the original patent holder is made (at least) as well off as
if it refused to grant a license. License terms that are less favorable to the
licensor would amount to an ex post revision of the scope of the property
right initially granted. As we have discussed above, such revisions are
undesirable as they undermine the implicit ‗contract between society and
innovators.89
The concern about the perversion or abuse of patent law not only in the
contractual context90, but also facing individual behaviors, is a topic much studied
internationally, it is also relevant to bring some notions of comparative law, in
particular the way it is dealt with in the United States of America.
The largest economy in the world has a long tradition in cases involving
competition law (or antitrust as it is called there) with the famous Sherman Act of
1980
__________________________
89
Translation into Portuguese: Tradução livre: Como vimos recentemente, licença compulsória é mais
comumente utilizada em dois tipos de situações: quando o titular da patente possui poder de Mercado
significante em ambos os mercados primário e secundário e quando outra empresa desenvolve uma
inovação infratora. No entanto, nesses dois casos são aplicados princípios diferentes quando chega o
momento de definir os termos do contrato de licença. No caso de infração à inovação, o objetivo da
licença compulsória é de garantir que uma inovação socialmente útil seja efetivamente introduzida no
mercado e não que haja aumento de competitividade no mercado secundário. O objetivo pode ser
atingido escolhendo-se o royalty de acordo com a fórmula ECPR de Baumol e Willig. Essa fórmula
estabelece que a ‗cobrança de acesso‘ paga pelo licenciado é igual ao custo marginal de concessão
de acesso (tendente a ser próximo de zero nos casos de direitos de propriedade intelectual)
adicionado um valor referente ao lucro perdido pelo licenciante em decorrência do aumento da
concorrência no mercado secundário. Em outras palavras, o contrato de licença será feito de tal
forma que a empresa titular da patente se mantém (pelo menos) tão bem quanto estaria se recusasse
a concessão da licença. Termos de licenças que são menos favoráveis ao licenciante irão gerar uma
revisão posterior do escopo do direito de propriedade inicialmente concedido. Como discutimos
acima, esse tipo de revisões são indesejadas, pois prejudicam o implícito ‗contrato entre a sociedade
e os inovadores‘.
90
In the contractual context of patents, not only voluntary contracts and their abuses are included, but
also the unwarranted negativeness of hiring and the compulsory hiring called compulsory license. This
is why, it is important to understand the Brazilian contractual system while instrumental.
55
198091as a watershed between the old and modern treatment of antitrust cases in the
U.S., and it has been complemented later by the Clayton Antitrust Act of 191492.
The Sherman Act has only two relevant sections93 in which the behaviors that,
regardless of their effects on the market, are considered anticompetitive and
forbidden (per se rules) and those that require further analysis to characterize an
effective antitrust law violation (application of rule of reason) may be framed.
The U.S. doctrines differ when it comes to the goals of the Antitrust Law.
According to John Kirkwood and Robert Lande 94 the fundamental goal of the Antitrust
Law is to protect the consumers from anticompetitive actions that might cause them
any harm in short, medium and long term, with no ground to keep the doctrinal chain
that defends as its main goal the promotion of an economic efficiency or an
increased competition.
However, in Richard Posner‘s95 view the main goal of the antitrust law is to
promote the so-called ―economic welfare‖ or a so-called ―allocative efficiency of the
market‖ and not the protection of consumers (which would be an ―outcome‖ or a
purpose accessory of the economic or allocative efficiency of the market).
__________________________
91
The Sherman Act is a national and international reference in analysis of antitrust cases, considering
that the simplicity of its applicable provisions towards unilateral, bilateral/multilateral, horizontal and
vertical behaviors, remains up-to-date, enabling the adequacy and interpretations of Courts over
decades.
92
Because of the Sherman Act generosity and the need for more specific provisions, the Clayton Act
came to solve the unfilled gaps, specifying particular prohibited behaviors, three levels for effective
compliance, exceptions and specific remedies against harmful attitudes towards competition.
93
Section 1: Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of
trade or commerce among the several States, or with foreign nations, is declared to be illegal. Section
2: Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any
other person or persons, to monopolize any part of the trade or commerce among the several States,
or with foreign nations, shall be deemed guilty of a felony […].
94
KIRKWOOD, John; LANDE, Robert. The fundamental Goal of Antitrust: Protecting Consumers, Not
Increasing Efficiency. Notre Dame, Indiana. Notre Dame Law Review, Vol. 84, 2008.
95
POSNER, Richard. Antitrust Law. 2. Edição. Chicago: The University of Chicago Press, 2001.
56
In effect, the Chicago School and Posner‘s position is until now much criticized
as an imperfect or incomplete answer, for despite the merits of this economic
analysis of law, since there is no doubt that the economic indicators greatly
contribute to Law, the economic simplification does not offer a complete answer.
Paula Forgioni96 states:
Thus, the search for security and legal predictability turns out to be a
dangerous incentive for the antitrust student to fall into a trap of economic
analysis of law, which shows, just like the Siren‘s song; formulas able to solve
concrete cases that might present themselves. All this argument is, however,
thrown to the ground when we think just like Sullivan, that antitrust does not
mean only allocative efficiency. Law is a complex phenomenon that cannot be
enclosed within the economy limits.
It is understood that the fundamental objectives of the U.S. antitrust law, in the
words of Keith Hylton97, permeate a dialog and combination between the objectives
of maximizing competition (in which most of the time the consumers‘ interests are
protected) and the consumer protection.
In effect, prior to the quotation above, Robert Land together with Neil state
that98:
Consumer choice only is effective when two fundamental conditions are
present. There must be a range of consumer options made possible through
competition, and consumers must be able to choose effectively among these
options. The antitrust laws are intended to ensure that the marketplace
remains competitive, unimpaired by practices such as price fixing or
anticompetitive mergers. The consumer protection laws are then intended to
___________________________
96
FORGIONI, Paula A. Op. Cit., p. 179.
In a lecture attended by this doctoral student in the subject of Antitrust Law from the Law School of
Boston University during the Visiting Scholar program in 2009 as part of the studies for the completion
and improvement of this thesis, it was stated by Prof. Keith Hylton that the objectives of the antitrust
law permeate a composition between the maximization of competition and the maximization of social
interests seen as fulfilling the consumer interests. This is because there are situations in which the
monopolistic activity serves the consumer interests.
99
LANDE, Robert H.; AVERITT, Neil W.. Consumer Sovereignty: A Unified Theory of Antitrust and
Consumer Protection Law. Chicago: ABA, Antitrust Law Journal, Vol. 65, p. 713, 1997.
97
57
ensure that consumers can choose effectively from among those options,
with their critical faculties unimpaired by such violations as deception or the
withholding of material information. Protection at both levels is needed to
ensure that a market economy can continue to operate effectively.99
It is interesting to note that the definition and cooperation between the Antitrust
Law and the consumer protection in the United States is far from being static, as
Pamela Jones Harbour100 states:
As a result of this diversity in antitrust and consumer protection
enforcement, we have multiple levels of government adopting both
complementary and conflicting statutes. Moreover, these statutes may be
enforced by variously motivated actors and agencies, applying rules of
101
law that may change over time, even without legislative intervention.
Even being aware that there is a combination of factors to define the U.S.
antitrust system, the influence of law economic theory is steeped in such a way that
the utilitarian view with an economic bias (even the one focused on the
implementation of social welfare) winds up determining the direction of the antitrust
system. Such statement does not express the rejection of the U.S. antitrust system,
but rather a feeling that it is incomplete when analyzed under the principles of
Competition Law, constitutionally considered in Brazilian reality.
___________________________
99
Translation into Portuguese: A escolha do consumidor somente é efetiva quando duas condições
fundamentais estão presentes. Tem que haver uma gama de opções possíveis ao consumidor
através da concorrência, e consumidores devem ter a possibilidade efetiva de escolher entre uma
dessas opções. As leis antitruste são voltadas para que se assegure a continuidade de um mercado
competitivo, isento de práticas como fixação de preços ou fusões anticompetitivas. As leis de
proteção ao consumidor têm por objetivo assegurar que os consumidores possam escolher
efetivamente dentro dessas opções com as suas faculdades críticas intocadas por estas violações ou
por possuir informações materiais. Proteção em ambos os níveis é necessária para assegurar que a
economia de mercado possa continuar operando de forma efetiva.
100
HARBOUR, Pamela Jones. Cooperative Federalism in the Enforcement of Antitrust and
Consumer Protection Laws. Federal Trade Commission 90th Anniversary Symposium. September
23, 2004, p. 5. Available at: http://www.ftc.gov/speeches/harbour/040923coopfed.pdf . Accessed on:
June 23, 2009.
101
Translation into Portuguese: Como resultado dessa diversidade entre a efetivação do antitruste e
proteção ao consumidor, nós temos níveis múltiplos de governos adotando tanto dispositivos
complementares quanto dispositivos que conflitam. Além disso, estes dispositivos podem ser
efetivados por diversas pessoas e agências motivadas, aplicando regras de lei que podem mudar
com o tempo, mesmo sem intervenção legislativa.
58
The ultimate goals for the continuity of this thesis intensively reverberate in
this chapter that deals with the constructive dialog that the Patent Law has with the
Competition Law, and it is exciting to see the innumerable intersection hypotheses
that both areas of Law provide in the legal reality.
This way, methodologically, the analysis of the intersection between patent
law and Brazilian and American antitrust law will be conducted, identifying individual
behaviors of companies under the legal control, as well as the behaviors through
agreements with other companies, stimulating our romantic rethinking:
And therefore as a stranger give it welcome. There are more things in
heaven and earth, Horatio, Than are dreamt of in your philosophy. But
come- Here, as before, never, so help you mercy, how strange or odd
102
soe‘er I bear myself[…]
The Brazilian reality of intersection between Antitrust Law and Patent Law is
recent and has no tradition and relevant legal precedent as we can find in the vast
American precedents and literature. It is a relationship which uncovers itself and,
many times, is covered by a fog that prevents its identification.
Of course, the Brazilian antitrust law does not ignore the existence and
possibilities of interaction with the patent law, but due to the lack or insufficiency of
knowledge
__________________________
102
SHAKESPEARE, Willlian. Hamlet the Play, act I, scene V. July 26, 1602. Stationer‘s Register.
59
knowledge of the latter, combined with our recent culture applier of an effective
regulating antitrust law, the interaction of these two areas is still a matter of scarce
literature and court decisions.
If the patent system provides a negative right to prevent third parties from
using a particular technology for a certain period of time it is, prior to being legal,
intuitive to say that the exercise of that right can generate a need for dialog with the
Competition Law.
Going further, it is the care of the social interest itself in encouraging a healthy
competition as one of the fundamental cornerstones of the patent system, so that if
there was no competition the existence of the patent system would be unnecessary.
Now, it has already been said that the patent law, besides being eminently
functional, exists and is defensible as long as it meets the harmonic preponderance
of the utilitarian theories and social planning theories 103 established in the item XXIX
of the art. 5 of the Magna Carta of 1988.
This relationship between patent law and antitrust law is intimate, provided in
the Antitrust Law and Industrial Property Law that allow the restriction of patent rights
when they are used beyond their constitutionally delineated purposes.
In the Industrial Property Act the compulsory licensing system is present,
which was implemented in the Paris Convention – PC at the Hague Revision of 1925,
replacing the original provision called ―compulsory labor‖, where the inventor had to
work his work inventions in all countries from where he received the granting of the
patent. This substitution, in the words of Di Biasi, Garcia and Mendes104, was the
result of the search for a more flexible provision that would meet the aspirations of
the national economy, but that might not let the patent owner uninterested.
__________________________
103
BARCELLOS, Milton Lucídio Leão. Op.Cit.
60
The use of compulsory licensing institute, within its diverse modalities, is
provided in the articles 68 and 74 of Law no. 9,279/96, and Denis Borges Barbosa 105,
based on the present legal system, divides the compulsory license into diverse
modalities including a license due to abuse of rights, a license due to abuse of
economic power, a license of dependence, a license due to public interest and the
legal license that the employee, co-patentee, grants ex legis to his employer,
according to the art. 91 § 2 of the IPL/96.
It is clear that each of the compulsory license modalities deserves a deep and
detailed analysis, which is not the goal of this study, being only worth to highlight the
existence of diverse modalities of implementation of compulsory license in restriction
to the particular exercise over a patent right ownership, seeking the balance of
interests as fairly as possible.
For this study, the most important modalities of compulsory license are the first
three above-mentioned.
Regarding the abuse of rights, provided in the art. 68 with greater detail of
requirements and possibilities in its following paragraphs, what is mentioned by
Marcus Elidius Michelli de Almeida106 should be noted:
When, for instance, the patent is no longer used, or even if it is acquired so
that no one can make use of it, an abusive act might be occurring.
Best explained, the unfair competition can be practiced both in the face of
an act of forgery and by the holder of an industrial property who make use of
it (or fails to use it) in an abusive way.
__________________________
104
DI BLASI, Clésio Gabriel; GARCIA, Mario Augusto Soerensen; MENDES, Paulo Parente Marques,
The Industrial Property. Rio de Janeiro: Forense, 1997, p. 42.
105
BARBOSA, Denis Borges. An introduction to…, p. 501.
106
ALMEIDA, Marcus Elidius Michelli de. Abuse of Law and Unfair Competition. São Paulo: Quartier
Latin, 2004, p. 193-195.
61
As seen in a separate chapter (1.1), the abusiveness of the right can be
either due to an action or an omission. Thus, should the holder of a patent
right fail to use it just to keep another product in the market, although of poor
quality makes him a higher profit, he will be abusing of his own right.
[…]
A patent is a privilege granted by the State, it is not like buying a house
and owning it. Obtaining a patent and not making use of it, or even charging
high amounts for licensing it, would only serve to stifle competition.
[…]
Also on this point, it is noteworthy that the non-use of a patent, which
involves cost reduction to other employers, since it deals with a good that
integrates the final production of another good, will certainly affect the
business of the latter. It means that the patent holder forces the continuity of
a more costly activity carried out by a third party (whether or not his
competitor), causing him damage, just by not offering a good, of which he
has a privilege. The situation is about unfair competition not stricto sensu but
indirectly, lato sensu.
It is interesting to note that it is also possible to characterize the compulsory
license modality due to abuse of economic power as one of the modalities of
compulsory license due to abuse of rights.
Carla Eugênia Caldas Barros108, analyzing the compulsory license as a result
of the refusal to voluntarily license, states:
An example is the case of the patent holder who refuses to hold a
voluntary license, thus impairing the development of the economic activity of
the country. The exploitation proposal exists, the licensee is likely to
negotiate prices and other terms and the holder, in advance and point-blank,
denies the licensing. This might mean abuse of economic right, legitimating
the compulsory license granting.
__________________________
107
In this conception, every abuse of economic power by using a patent as an instrument of such
abuse is anti-judicial and, somehow an abuse of rights. However, not every abuse of rights is an
abuse of economic power. For instance, a patent holder who unreasonably refuses to license it and
refuses to produce a product that incorporates the patented technology within the statutory period,
may be committing an abuse of rights without committing an abuse of economic power. The economic
power is a factual finding, either you have it or you do not have it. About possessing, the right will only
intervene if its use is made in an abusive form. The art. 187 of the Civil Code of 2002 defines the
abuse of rights as unlawful, declaring that: the holder of a right commits an awful act if by exercising it,
he clearly exceeds the limits imposed by its economic and social purpose, and by good faith and
morality. It remains as a general typification, but oriented, so that the abuse of rights may be
recognized as unlawful. In this sense see Paula Forgioni, op. cit.
108
BARROS, Carla Eugênia Caldas. Intellectual Property Law Handbook. Aracaju: Evocati, 2007, p.
276.
62
The compulsory license comes just to reaffirm this functional essence of
patent law aimed at fulfilling the purpose of a harmonic preponderance of the
utilitarian theories and social planning theories, it is not a patentee‘s absolute right,
but a right-duty of, for instance, exploiting direct or indirectly the subject of the patent,
under penalty of compulsory license and, should it not be enough, acknowledging
the patent expiry with the consequent extinction of it before the expiration of its term.
So the compulsory license is one of the international accepted instruments for
the correction of the discrepancies between the goal of the patent system and its use
in the competitive market.
Such corrective instrument111, due to some market instrumental problems as
well as instrumental problems of lack of clear definition of empirical data, ends up not
being used in the competitive environment, despite its strength and international
provision.
___________________________
109
Law 9,279/96: Art. 68. The holder shall be subject to having the patent compulsorily licensed should
he exercise its rights abusively, or exercise abuse of economic power, proven under law, by
administrative or judicial decision.
§1 Grounds of compulsory license: I- the non-exploitation of the patent object in Brazilian territory for
lack of manufacturing or incomplete manufacturing of the product, or even the lack of full use of the
patented process, except in cases of economic inviability when the importation shall be admitted; or IItrade that does not meet market needs.
§5 The compulsory license which § 1 deals with will only be required after 3 (three) years from the
granting of the patent.
Art. 80. The patent will expire ex officio or upon request of any person having legitimate interest if, 2
(two) years from the granting of the first compulsory license, this term has not been sufficient to
prevent or remedy the abuse or disuse, except for justifiable reasons.
110
As mentioned previously, the compulsory licensing system (since when it was known as
―compulsory labor‖ in other patterns) has provision in the Paris Convention since 1925 and is inserted
at TRIPS art. 31 (another use without the holder‘s authorization).
111
As well as the patent system works to some extent, as a correction of discrepancies presented in
the competitive system for the pursuit of constitutional goals. What will be dealt with later on is that the
equality principle as the basis of the patent system, works on two biases, for instance, the first is the
one in which the one who develops technology cannot be treated as the one who does not develop it,
the second is embodied in the fact that different technologies should be treated differently according to
their differences.
112
Note that here it is not about the compulsory license due to public interest according to the Law
9,279/96, widely spread by the media about the case of drugs for treating AIDS, but it is about other
species of compulsory license applied by the Competition Law.
63
In one of the few decisions involving the compulsory licensing of patents in the
competitive environment, there are still instrumental restrictions in the implementation
of such measure (which should really be seen as exceptional, but never as an
instrument ―not to be used‖) 113. In this sense, below is part of the decision of the
ACED of 1999:
[…]
16. The public agency empowered to investigate and prosecute abuses of
economic power is the ACED (CADE), under Law no. 8,884/94. Since the
abuse of economic power is proven resulting from the patent, and if the
severity of the violation requires it, the penalty provided in the art. 24, item
IV, subheading ‗a‘ should be imposed by the ACED through a
recommendation to the BPTO (INPI) for the compulsory license to be
granted.
[…]
17. On the other hand, according to the art. 68 of Law 9,279/96, the BPTO
(INPI) has the power-duty to impose a penalty provided in the art. 68,
because the legal provision expresses the holder‘s will – in this case, the
collectivity – and it is towards the satisfaction of this will – public interest –
what the Agency activity should be addressed to.
[…]
This procedural difficulty, besides the procedural matter of competence, is
much due to the peculiarities of the patent system, including the difficulty of defining
the patent limits (or group of patents), which also influences the definition of relevant
market being analyzed for setting up the typicity of the provision in the art. 24 of Law
8,884/94.
Taking as an example what happens in the U.S. system, there are behaviors
involving patents which are considered illegal regardless of an analysis of relevant
market, economic power and/or reasonableness that can be categorized as abusive
behavior (abuse of rights).
Taking as an example, such behaviors observed in contracts of patent
licensing/exploitation can be: license connected with other patents unrelated to the
__________________________
113
In consultation with ACED answered in 1999 (Consultation no. 31/99, of 03/31/99, Inquirer: Ministry
of Health. DOU of May 11, 1999, 1. Session), one of the procedural issues remains clear that make
the use of compulsory license complex in competitive environment: ACED recommends, but the one
that applies the compulsory licensing is the BPTO (INPI).
64
object of the contract itself, charge of royalties besides the patent term, among
others.
On the other hand, in analysis made by the BAIP regarding the contracts of
licensing/transfer of technology involving patents, it is clear the understanding of the
association that the rule of reason is the one to be applied in all situations in which
there is evidence of the use of contractual clauses involving anticompetitive patent
rights (emphasizing that the presumption is always that the contracts of
licensing/transfer of technology are, in principle, pro-competitive. In this sense, here
are the conclusions of the BAIP114:
54. In view of the competitive aspects of technology transfer contracts/rights
licensing, as well as the prevalence of the rule of reason in the analysis of
corporate conduct, it becomes necessary the analysis of specific conduct and
the trade-off between the anticompetitive effects and the possible benefits or
identified efficiencies, including the structuring of the market, the market power
of the contracting parties and the benchmarking of the degree of competition in
the relevant market.
55. More importantly it is to note that these practices have pro-competitive
impact so that a given clause can be crucial to improve the quality of goods and
services, promote efficiency and the technological or economic development and
increase business productivity/market competitiveness.
56. For these reasons, the analysis of technology transfer contracts and rights
licensing should occur judicious, thorough and extensively; in order to reach the
―market innovation‖, encouraging the dissemination of the knowledge.
Objectively, Nuno Pires de Carvalho115 demonstrates the competitive fields in
which patent rights put their holders into:
___________________________
114
BAIP. Guidelines on Examination of Technology Transfer Contracts and Rights Licensing of
the Industrial Property from an Antitrust Law Perspective. Resolution BAIP no. 68. Available at:
http://www.abpi.org.br/bibliotecas.asp?idiomas=Português&secao=Resoluções%20da%20ABPI&codi
go=3&resolucao=1 . Accessed on: Mar. 02, 2009.
115
CARVALHO, Nuno Pires de. Interview published at ACED informs, n. Feb. 23, 2010. Available
at: http://www.cade.gov.br/news/n023/entrevista.htm . Accessed on: Mar. 22, 2010.
65
[…] The patent has the effect of reducing transactions costs (in comparison
to these two rival systems) through a better quantification and qualification of
rights. By describing the invention and by delimiting in time the period of
protection, the patent puts the protected invention in competition with: (a)
other competing patented inventions; (b) competing technology that is in
public domain; (c) prospection of emerging competing inventions; and (d) the
threat of the violation of rights. These four possibilities (many times existing
at the same time) press the patent holder and hinder the transformation of a
property right into a monopoly situation. We should not forget that one of the
key principles of the patent system is the principle of alternativity of
inventions, through which a patent is only granted for inventions likely to be
alternated with other technical creations. This principle was formulated by
th
the Supreme Court of the United States in mid 19 century and continues in
full force. So even when the patent is granted for an invention that has no
competitor in the market, the competing technology may emerge at any
moment – by the holder overpricing, so as to attract the gain interest from
his competitors. Soon they will have developed techniques that will enable
them to gain market share. The only exception, the only case in which the
patent could become synonymous with absolute barrier for competitors‘
entrance, it is the case of technical standards. When such are imposed by
governmental authorities, or when, even voluntarily, they take up a share
from the relevant market, the patent on the standard technique could indeed
mean a monopoly. This is why the compulsory licensing regime is almost
automatically applied to patents that turn out to be technical standards.
Therefore, there is no conflict, there is no paradox. The patent generates
competition or is synonymous with competition. The countries where the
patent system is most used (either on the acquisition of rights or on the
enforcement of such rights) are the ones where the respective industry is
more aggressive and competitive. […]
Despite the brilliance and up-to-datedness of the statements in the interview,
we disagree over the statement from the passage that
even when the patent is granted for an invention that has no competitor in
the market, the competing technology may emerge at any moment – by the
holder overpricing, so as to attract the gain interest from his competitors.
Soon they will have developed techniques that will enable them to gain
market share.
Taking as an example, the jet turbine116, in its inventive concept applied to the
solution of a technical problem, which was susceptible to patentability, is still unique,
despite having generated subsequent undeniable technical advances susceptible to
__________________________
116
It is noteworthy that various types of jet turbines are included in the concept of jet engine, however,
they are all based on the jet propulsion consistent solution through a high-speed expelled jet.
66
dependent patents. The exaggeration in pricing may be a factor, but not the only one.
So, there comes the question: is there any competing technique as efficient as the
ones applied to the jet turbines for years in the commercial aviation? No, there isn‘t.
There is only technical improvement resulting from the original technical solution.
This way, alternative techniques emerged in the market can (and it often occurs) be
in a situation of dependency on the prior technique, which can generate a clear
barrier to enter the market, whose identification is not always easy.
Another routine example is that of the ballpoint pen (technical solution based
on applying a metering ball flow of ink in a writing instrument) that was created by
Laszlo Birô in the 30s, and in 1944 Birô sold his patent in the United States to
Eversharp-Faber and in Europe to Marchel Bich. If such invention had occurred
nowadays and a specific market was created (ballpoint pen market 117), there would
certainly be clear barriers to enter the market, being noteworthy to analyze whether
or not such barriers would be used in violation of competition law (since the ballpoint
pen technology, even though it has competitors in the market, creates its own market
of massive prevalence, lacking to date, technology with the same benefits similar in
terms of competition materially considering). Today the technology is in public
domain, but if it were still in effect it would certainly create barriers to entry that would
have to be analyzed within a carefully defined relevant market.
__________________________
117
Using a specific vision of the relevant market, for the given example, the large market of pens, or
even larger market of manual writing instruments are not considered. About the definition of relevant
market, it is noteworthy to reproduce the teachings of Paula Forgioni (Op. Cit., p. 231), in the sense
that ―The relevant market is the one where the competitive relations are dealt with, or the one where
the economic agent whose behavior is under analysis acts upon. Without its boundaries, it is
impossible to determine the incidence of any of the hypotheses contained in the items of the art. 20 of
Law 8,884/94‖. We go through the geographic relevant market delimitation and through the material
relevant market. Paula Forgioni cites several examples of definition of material (or product) relevant
market, importantly to emphasize that, on one hand there are decisions that define a single market for
all razors that require water for their use, including the disposable ones, the ones with two blades and
the ones with a blade system, on the other hand the pasteurized type C milk constitutes a relevant
market distinct from that of long-life milk.
67
Another statement extracted from the excerpt from the interview of Nuno Pires
de Carvalho endowed with relativism is that The patent has the effect of reducing
transaction costs (in comparison with the two rival systems) through a better
quantification and qualification of the rights. As for this statement, there are
technological areas in which the transaction cost reduction provided by the patent
system is totally questionable, as for instance, patents involving computer
programs118.
What the best interpretation119 demonstrates is that the existing relation
between Competition Law and Patent Law is contributory or complementary not
contradictory, since there is no conflict between the two legal systems when their
limitations and goals are understood.
To encourage a better social-economic-technological performance of the free
competition there is a system of temporary ―privileges‖ (patents) connected to its
functionality. When there is a diverted or abusive use of such system there are some
applicable legal mechanisms in both Law 9,279/96 and Law 8,884/94 to keep the
functional balance of the system as a whole in respect to the valorizing functional
guidance provided in the Magna Carta of 1988.
The patent system has limitations, mainly based on its historical stagnation
which ignores the technological specificities and uses the same patentability
requirements, delimiting rights both materially and temporally, even when the
technological essence that generates the subjective right towards the patent is quite
diverse.
It is also relevant, within the ―legal transplant‖ limitations, to analyze how the
relationship between patent law and competition law is seen in a comparative law
analysis, based on research done in the U.S. system.
_________________________
118
119
Among others, see the aforementioned Bessen & Meurer (2008) and Jaffe & Lerner (2004)
FREITAS, Juarez. The systematic interpretation of the law. 4. ed. São Paulo: Malheiros, 2004
68
The relationships between patent law and antitrust law in the USA have the
particular characteristic of a higher volume and greater tradition of situations of
intersection in the area of contracts, mergers, acquisitions and other marketing
transactions involving patents by limiting either present or future actions of
competitors in vertical or horizontal relations, as well as the existence of undue
individual behaviors.
Currently, due to the increased number of patents from different holders and
due to the increasing complexity and interactivity of the technologies developed,
situations involving the relation between patents and competition law are becoming
more frequent and more complex, since today we are experiencing the tragedy of the
anticommons.
For us to understand the meaning of the anticommons in the area of patents, it
is essential to understand the origin of such term and how it was applied.
According to Michael Heller120, and his classic example of the reasons that
made market stall owners, at the time of the fall of communism in several Eastern
European cities, not migrate to stores and expand their businesses, leaving
unoccupied and underutilized spaces, was the excessive bureaucracy and the
amount of permissions that the stall owners had to obtain to occupy premises and
expand their businesses, so they would rather remain in their small stalls.
Making an analogy to the patent system, it is clear that the failure of the
existing market consisted in the fact that the investments in technology would get
pulverized should there not be the creation of a ―maneuver‖ to correct such failure
and prevent that the technology be easily disseminated before the investor/creator
had time to recover his expenses and might benefit from his creation. The answer to
that, balancing the public and private interests, was the creation of a system of
temporary ―rewards‖, which currently work through a national and international patent
system.
__________________________
120
HELLER, Michael A. The Tragedy of the Anticommons: Property in the Transition from Marx to
Markets. Harvard: Harvard Law Review, v. 111, 1997, p. 621-668.
69
Thus, the current solution found to solve this market failure and encourage the
dissemination of new technologies (seeking to make effective the material sense of
the principle of free competition), generating development, is the patent system, i.e.,
the granting of a temporary easement conferring the right to exclude others from
practicing that technology for a specific period of time. In short, to solve the problem
of commons (several people having the same benefit of using technologies created
so that no one can exclude the others from using them), the anticommons were
created (the right to exclude others from using a technology protected by the patent).
However, recent history has also shown that the excess of patent owners can
generate the opposite effect to the one intended by the creation of the patent system,
i.e., many owners create transactions difficulty and limit investment in technologies
that have many patents, keeping the interest away from joining and competing in
technology markets, i.e., the tragedy of the anticommons.
Michael Heller121, in his latest work on ―gridlock‖ economy that‘s hidden in
relation to the patent system, demonstrates that the tragedy of the anticommons
(which would be the problem of excessive owners in the area of patents) generates
serious and large proportion effects:
Unfortunately, privatization can overshoot. Sometimes we create too many
separate owners of a single resource. Each one can block the others‘ use. If
cooperation fails nobody can use the resource. Everybody loses. […]
Now imagine twenty or two hundred owners. If anyone blocks the others,
the resource is wasted. That‘s gridlock writ large – a hidden tragedy of the
anticommons. I say ―hidden‖ because underuse is often hard to spot. For
example, who can tell when dozens of patent owners are blocking a
promising line of drug research? Innovators don‘t advertise the projects they
a
__________________________
121
HELLER, Michael. The gridlock economy: How too much ownership wrecks markets, stops
innovation, and costs lives. New York: Basic Books, 2008, p. 2.
70
abandon. Lifesaving cures may be lost, invisibly, in a tragedy of
anticommons.
Gridlock is a paradox. Private ownership usually increases wealth, but too
much ownership has the opposite effect: it wrecks markets, stops innovation,
and costs lives. Savvy companies such as IBM, Celera, and Bristol-Myers
Squibb already understand some of the hidden costs of gridlock. Rather than
waste time and money trying to assemble fragmented ownership rights that
might profit them and benefit us all, many of the world‘s most powerful
business simply abandon corporate assets. They redirect investment toward
less challenging areas, and innovation quietly slips away.
But this debacle has a flip side. Assembling fragmented property is one of
the great entrepreneurial and political opportunities of our era. We can
reclaim the wealth lost in a tragedy of the anticommons. After you learn to
spot gridlock, you will become convinced, as I am, that the daunting costs it
imposes can be reduced or even reversed – not just in the business world
but in our political, social, and everyday lives. You will want those who made
the mess to clean it up. You may even find ways to profit from assembling
ownership. But it takes tools to unlock a grid.122
In a broader sense, pointing out all the problems currently criticized in the
patent system, Michael Gollin143 brings eight major criticisms on intellectual property:
__________________________
122
Translation into Portuguese: Infelizmente, privatização pode ultrapassar seus benefícios. Algumas
vezes nós criamos proprietários separados em demasia para uma única fonte. Cada um pode
bloquear o uso dos outros. Se cooperação falhar ninguém poderá usar a fonte. Todo mundo perde.
[…]. Agora imagine vinte ou duzentos donos. Se qualquer um bloquear os outros, a fonte será
desperdiçada. Isso é um cadeado (impasse) largamente citado – uma tragédia do anticommons
escondida. Eu digo ―escondida‖ porque a falta de uso é normalmente difícil de ser identificada. Por
exemplo, quem pode dizer que dúzias de proprietários de patentes estão bloqueando uma linha
promissora de pesquisa de drogas? Inovadores não anunciam os projetos que eles abandonam.
Curas que salvam vidas podem ser perdidas, invisivelmente, em uma tragédia do anticommons.
Cadeado (impasse) é um paradoxo. Propriedade privada normalmente aumenta o bem-estar, mas
muita propriedade possui o efeito inverso: complica os mercados, interrompe a inovação, e custam
vidas. Empresas experientes como IBM, Celera e Bristol-Myers Squibb já entenderam alguns dos
custos escondidos do cadeado (impasse). Ao invés de gastar tempo e dinheiro tentando compor
direitos de propriedades fragmentadas que poderiam gerar lucro e beneficiar todos nós, muitos dos
negócios mais poderosos mundialmente simplesmente abandonam propriedades corporativas. Eles
redirecionam seus investimentos em áreas menos desafiadoras e a inovação silenciosamente
escapa.
Mas esse desastre possui outro lado. Compor propriedade fragmentada é uma das maiores
oportunidades empresariais e políticas da nossa era. Nós podemos reivindicar o bem estar perdido
em uma tragédia do anticommons. Após você aprender a identificar o cadeado, você ficará
convencido, como eu sou, de que os custos impostos podem ser reduzidos ou até mesmo revertidos
– não apenas no mundo dos negócios, mas em nossas vidas políticas e sociais. Você irá querer que
aqueles que fizeram a bagunça a limpem. Você até mesmo pode achar formas de lucrar com a
composição de propriedades. Mas são necessárias ferramentas para destravar um cadeado.
123
GOLLIN, Michael A. Driving innovation: Intellectual property strategies for a dynamic world. New
York: Cambrige University Press, 2008, p. 40.
71
Critics seek to restrict or even eliminate some types of intellectual property
protection, using eight different arguments based on concerns about
negative consequences. These arguments may be summarized as theories
based on restricted access to technology, increased cost, monopolization,
inappropriate investment incentives, competition, expense, institutional
124
requirements, and ethics.
As if it were not enough, in the area of patents, as described by Michael
Meurer and James Bessen125, there is still the problem of lack of clear definition of
the limits of each patent, so that there are chances of uncertainty regarding the
existence or not of infringement of a particular technology, be it partial or by
equivalence.
Such problems of excess of owners added to the difficulties of establishing the
state of the art as well as the definition of clear existence or inexistence of violation in
the area of patents generate a discouraging effect to the entrance or development of
certain market already populated by countries/creators.
But what would be the relationship of this anticommons problematicness with
competition issues? There are many answers, starting from turning into another
barrier to enter the market, hindering competition and eventually facilitating the
―legal‖ domain of markets.
In the words of Michael Carrier 126, except for the so-called per se rules127, all
the
antitrust
procedures involve
an
analysis
of
the
pro-competitive
and
anticompetitive effects that the conduct or activity generates in the market, we should
__________________________
124
Translation into Portuguese: Críticos procuram restringir ou até mesmo eliminar alguns tipos de
proteções de propriedade intelectual, usando oito argumentos diferentes baseados em preocupações
com o acesso restrito à tecnologia, aumento de custos, monopolização, incentivos inapropriados para
investimentos, concorrência, despesas, requisitos institucionais e ética.
125
MEURER, Michael; BESSEN, James. Op. Cit, p. 47.
126
CARRIER, Michael A. Resolving the patent-antitrust paradox through tripartite innovation.
Nashville, TN: Vanderbilt Law Review, May, 2003, p. 1049-1110.
127
When a particular activity or behavior is directly regarded as having an anticompetitive effect by
itself, regardless of the analysis of the context in which such behavior is inserted into.
72
be careful with the natural effect of which the right to exclude others embedded in the
patent system generating an allowable price increase or an output decrease.
This way, we must look into individual behaviors and those considered plural
behaviors involving the interconnection of antitrust law and patent law in the market.
An example would be the refusal to license a patent.
In an old way of seeing the property right as a whole, the analysis of refusal to
license a patent would be a banal analysis, in which the preponderant observation
would be that exploiting or not his property right would be part of the owner‘s rights.
When it comes to analyzing the property right as a functional right, not
absolute and that generates rights and obligations to its holder, and when the patent
right is equated, for legal purposes, with a property right, the mission to verify
whether a particular refusal to license a patent is legitimate or whether it is inserted
into the so-called doctrine Patent Misuse becomes more challenging.
The DOJ and FTC guide of 2007 128 includes five issues related to the refusal
to license a patent that are interesting to be analyzed separately, since the DOJ and
FTC findings are based on opinions of several panelists who participated in the guide
formation through hearings on their experiences and opinions 129. The five issues
concerning the unilateral refusal to license a patent are under analysis.
Should patents be seen as a special property right and receive special
treatment from the antitrust legislation? According to the DOJ and FTC Guide of
2007, the conclusion was that the antitrust legislation should be applied in patent
rights
__________________________
128
US Department of Justice and US Federal Trade Commission. Antitrust enforcement and
Intellectual Property Rights: Promoting Innovation and Competition. April 2007.
129
It is interesting to note that the above-mentioned DOJ and FTC Guide is based on experiences and
knowledge of different specialists, such as Steve Anderman, Ashish Arora, Roxane Busey, Carl
Cargill, Rebecca Dick, Ian Forrester, Jeffery Fromm, Jonathan Gleklen, Peter Grindley, Benjamin
Klein, Josh Lerner, Howard Morse, Carl Shapiro, Christopher Sprigman, James Venit, among other
renowned panelists that integrated several pieces of research and consultation done by the DOJ and
FTC in 2002.
73
rights as well as it is applied in any other property rights, not granting any special
treatment due to the patent intangible essence130.
Should the market power be presumed when there is patent law? The FTC
and DOJ‘s reply is that the patent itself does not create market power, citing
precedent of the DOJ and FTC and the Supreme Court of the United States
themselves. This fact stems from the observation that even if there is a patent over a
particular technology, it won‘t be a stumbling block for there to be other
substitute/parallel technologies in the market that might stop the patent holder from
exercising market power.
Is there a remedy for an unconditional and unilateral refusal to license a
patent, considering a violation of the antitrust rules? According to the DOJ and FTC,
if a unilateral refusal to license a patent is considered a violation of the antitrust rules,
a proper remedy would be the compulsory licensing. The DOJ and FTC go further by
pointing out that some of the lecturers who participated in public hearings prior to the
preparation of the 2007 Guide stressed that the Courts and Agencies are not
adequately equipped to determine appropriate terms and conditions, since the
compulsory licensing as a solution would be complicated. But this problem would be
easily solved if there was already a voluntary licensing of technology in the relevant
market under analysis for comparison purposes 132.
__________________________
130
It is important to note that part of the old doctrine regarded the patent rights (and industrial property
rights as a whole) as being untouchable and immune rights towards external ―provocations‖,
consisting in a kind of hermetically sealed right with its own rules unattainable by other branches of
Law. However, at the same time that such equating of patent rights with the rights over any other
physical property showed an evolution against the hermetic absolutism of patent rights, we can see
that such equating bears problems related to the intangible essence of the patent Law in relation to
the tangible essence of the tangible property rights. For a clear understanding of the differences
between these concepts, see Besse & Meurer (2008), in particular the treatment given to the lack of
clarity of the boundaries of the patent.
131
This aspect is important to demystify once and for all the wrong meaning in which the word
monopoly is used to describe the right over a patent. Of course, the fact of holding one or more
patents has no direct relationship with the existence of market power; therefore, such statement
should be made cautiously, since often the market power is obtained through one or more patents.
Therefore, it is critical the examination of each slice of the market separately, identifying the major
players and the origins of their market shares.
74
What would be the effect in terms of incentives to innovate if the refusal to
license was suppressed? In this analysis the lecturers using sources for the findings
of the DOJ and FTC were divided among those who defend that innovation is
reduced by the threat of a compulsory license with royalties far below those already
charged by the monopoly (and that might not be enough to pay for investment in
search and development), and among those who claim they are not convinced that
the accountability for the antitrust rules would have a negative effect on innovation 133.
What are the competitive effects on the refusal to license patents? At this
point, the competitive aspect in the negotiating strategy of the company was equally
reflected in refusing to license a patent. That‘s because many refusals to license are
only apparent and are part of the ―game‖ of trading, besides the fact that the value of
the patent license for a few licensees is higher than the value applied to a larger
number of licensees, since the secondary market would be willing to invest more and
pay a higher value for the license should there be little commercial pulverization. That
is, the patent holder would have difficulty in obtaining the maximum financial return
on the patent, in case he should not commit himself to limiting and/ or refusing
licenses of his patent to the licensees.
___________________________
132
The limitations of the FTC and DOJ to conduct further analysis regarding the legitimacy and impact
on the market and on the consumer that the refusal to license generates in short, medium and long
term is the Achilles heel of the intersection of patent law with competition law, because the damage to
the consumer and to the market might not be apparent or predictable should there not be a minimal
structure available to identify them and establish conditions in a compulsory license that meets the
limits of the U.S. rules of reason. This aspect will be discussed more deeply, since it is the crux for the
solution of numerous problems that depend on qualified investigation and technical study to measure
the possible effects on the market with eventual unilateral refusal to license the patent(s).
133
As noted above, only technical information clarity submitted to the analysis in each case will be
able to make viable the prevision of the effects that the market and consumer would be subject to with
the rebound behavior of the patent holder(s).
75
The findings of the DOJ and FTC mean that the conditions or reasons for the
refusal to license cannot be immune to an analysis of the Antitrust Law, yet this
particular intersection does not represent a significant portion to be analyzed134.
There are several effects of a unilateral and unjustifiable refusal to license a
patent. One of them is the positive stimulus in the market itself to generate better and
parallel technologies, keeping the harmonic objective of the patent system and
competitive system immaculate. However, there are situations where the unilateral
refusal to license a patent by him who holds the dominant position generates
anticompetitive effects, for instance, should the market not be able to be totally
assisted and should the non-assistance of the market as a whole be an obvious
strategy of the patent holder for the current or future price rise based on scarcity.
Now, stipulating the value of the product is the patentee‘s right, but he is obligated to,
once exploiting the patent, serve the whole market within a reasonable term, and
once he has no intention or is not able to do it, he should allow the voluntary
licensing of the patent to companies that are able to exploit it in non-served markets.
A recent and much debated case due to its decision effects is the case of
Image Technical Services Inc. vs. Eastman Kodak Co. 135, where the unilateral refusal
to license patents concerning parts of products produces anticompetitive effects.
Paul Kirsch136 analyzing the Kodak case137 in contrast with the CSU case138,
stressed that
__________________________
134
At this point, it is worth noting the position of the Specialized U.S. Court of Appeals for the Federal
Circuit, which, though pointing to the lack of immunity in patent law, demonstrates that the possibilities
of defense against the abuse of one or more patents by its holder are limited by the situations where
the violator of the patent can prove: ―(1) that the asserted patent was obtained through knowing and
willful fraud within the meaning of Walker Process Equipment, Inc. v. Food Machinery & Chemical
Corp., 382 U.S. 172, 177 (1965), or (2) that the infringement suit was a mere sham to cover what is
actually no more than an attempt to interfere directly with the business relationships of a competitor,
Eastern R.R. Presidents Conference v. Noerr Motor Freight, Inc., 365 U.S. 127, 144 (1961)‖, as it can
be seen in the grounds of the decision of April 1999 regarding the case of Glass Equipment Inc. vs.
Besten Inc. and Simonton Windows Company (96-1467, - 1481).
135
125 F. 3d 1195 – United States Court of Appeals for the Ninth Circuit confirmed the application of
the Sherman Act, recognizing as abusive the conduct of Kodak not licensing its patents.
136
KIRSCH, Paul F. Refusals to License IP – The Perspective of the Private Plaintiff. May 1st, 2002,
Available at: www.ftc.gov/opp/intellect/020501kirsch.pdf . Accessed on Feb. 5th, 2009.
137
125 F. 3d 1195 – United States Court of Appeals for the Ninth Circuit.
138
203 F. 3d 1322 – Federal Circuit, 2000.
76
stressed that the decision in Kodak case based on detailed analysis of the relevant
market is better than the decision in CSU case, since what was decided in Kodak
case does not immunize patents of competitive violation when by refusing to license
patents, the company acts in an anticompetitive manner.
There is no doubt that the refusal to license patent can be considered illegal
when it comes to Antitrust Law, but such situations should be examined case-bycase, importantly to exemplify some circumstances in which the refusal to license a
patent represents an unwarranted abuse to be repressed and rebalanced by not only
the antitrust law principles, but also by those pertaining the constitutional guidance
made for the patent system:
Refusal to license one or more patents when there is already agreement on
licensing to third parties, and even so, the market is still not being fully satisfied.
Refusal
to
license
from
the
―mother‖
patent
holder
(cases
of
improvement/dependence among patents) when the company that wants to put a
product on the market has developed new technology consisting in relevant
technological improvement in relation to the ―mother‖ patent. This refusal to license
may be expressed or tacit, i.e., after negotiation attempts, there is a lack of response
or a response with an absurd proposal dissociated from the factual reality of the
relevant market of trading technologies.
Individual behaviors anchored in patent rights that defile the antitrust rules that
pass through the improper exclusion of competitors from the market through specific
practices139, product innovations140, and prohibition on reverse engineering 141. They
also pass through litigation practices and patent processing that present themselves
___________________________
139
An example of these exclusion practices analyzed under section 2 of the Sherman Act is the United
States of America v. Microsoft Co. case (US Court of Appeals – District of Columbia – 253 F. 3d 34 –
2001).
140
It is also an example the Microsoft Co. case (US Court of Appeals – District of Columbia – 253 F.
3d 34 -2001) and the California Computer Products v. IBM Co case (US Court of Appeals – Ninth
Circuit – 613 F. 2d 727 – 1979), while in the latter the exclusion of non-natural competitors in the
market was not proven (which would be the Plaintiff‘s obligation), the plaintiff fails to prove conspiracy
or illegal monopolization.
77
in form of Sham litigation142, obtaining patents through fraud 143 and accumulation of
patents144.
There are also the behaviors expressed through horizontal agreements
(cartels, price fixing agreements145, patent litigation agreement146, cross agreements
_________________________________________________________________________________
141
See Bowers v. Baystate Technologies Inc. (US Court of Appeals for the Federal Circuit – 320 F 3d
1317 – 2003), dealing with the interesting and widespread case of possibility of use of reverse
engineering for the development of new products, since there is no violation of intellectual property
rights.
142
Several kinds of Sham litigation are known, and in the patent field they present themselves through
lawsuits based on patents which the holder himself is aware they are invalid, pressure on the
competitive market assigning a greater right to the patent than that which was actually granted, the
widespread agreements between pharmaceutical patent-holding companies in nullity lawsuits brought
by generic drug companies, among other anticompetitive practices that, through abusive or diverted
use of the patent system, generate anticompetitive effects.
143
Making use of illegal procedures before the USPTO generates addicted patents which can be
annulled if fraud is proven in obtaining them. In Nobelphama AB v. Implant Innovations Inc. (US Court
of Appeals for the Federal Circuit – 141 F. 3d 1059 – 1998) it was proven by the jury that there was
fraud in obtaining the US 4,330,891 patent, stressing that such patent did not show the best form to
implement the invention (best mode) and such fact was deliberately ignored, and the patent by fraud
was granted.
144
According to the decision in SCM Corp. v. Xerox Corp. (US Court of Appeal for the Second Circuit
– 645 F. 2d 1195 – 1981) the accumulation of patents made by Xerox, making its product virtually
unique, did not violate the antitrust rules, with no evidence of anticompetitive practices by Xerox by the
simple accumulation and exploitation of patents.
145
See the traditional case of the 1940‘s tried by the Supreme Court of the United States involving the
United States v. Line Material Co. (Supreme Court – 333 US 287 – 1948), in which three different
approaches are given, recognizing or not the abusive price fixing among patent holders in patent
license agreements also providing the price fixing.
146
Once again, the best examples derive from undue agreements legally signed in the US and Europe
involving litigation among companies producers of protected drugs and generic drug companies. See
Louisiana Wholesale Drug Co. v. Hoechst Marion Roussel Inc and Andrx Pharmaceuticals Inc (United
States Court of Appeals for the Sixth Circuit – 332 F. 3d 896 – 2003) among other relevant decisions.
78
and cross licensing involving several patents147, among other practices) and vertical
agreements (exclusivity clauses, territorial restraints, restrictions on area of use and
restrictions on resale) involving patents, all subject to antitrust analysis, regardless of
being based on patent individual rights, in view of the real possibility of abuse or
diverted use of these rights.
Luciano Benetti Timm148 emphasizes some specific clauses inserted in
technology transfer agreements which are considered anticompetitive and which
harm the market:
The main problematic clauses in relation to their anticompetitive effects are:
grant back clauses, prohibitions of using technology after the post expiry,
clauses prohibiting the administrative and judicial inquiry concerning the
validity of the intellectual property right (no challenge), tying arrangements,
prohibition or restriction on competition (non-competition clauses), price
fixing, volume restrictions, Field of use restrictions, package license, noncompetition clauses, export restrictions, cross licensing and pooling patents).
It is noted that many individual, horizontal and vertical behaviors represent a
diverted use of the patent system, generating the so-called doctrine Patent Misuse,
as mentioned by Gary Myers149 commenting on the leading case of the Supreme
Court of Morton Salt Co. v. Suppiger (314 US 488, 62 S. Ct. 402, 86 L. Ed. 363 –
1942):
___________________________
147
It is noted that many times the agreements involving several patents are pro-competitive (in the US
there is the presumption that they are pro-competitive), and some restrictions imposed on agreements
can promote an integrative efficiency coming from, for instance, economy of scale, research and
development capabilities integration, production and marketing in circumstances that generate
benefits to the market and to the consumer in short, medium and long term. The possibility of
agreement involving patents is essential to minimize the effects of the tragedy of the anticommons,
allowing the circulation and use of property productively.
148
TIMM Luciano Benetti. Op. Cit., p. 104.
149
MYERS, Gary. The intersection of antitrust and intellectual property – cases and materials.
St. Paul: Thomson West, 2007, p. 66.
79
The Supreme Court held that, as a Court of equity, it would not aid Morton in
protecting its patent when Morton was using that patent in a manner contrary
to the public policy. Id. At 490-92, 62 S.Ct. at 404-05. The Court stated:
The grant to the inventor of the special privilege of a patent monopoly carries
out a public policy adopted by the Constitution and laws of the United States,
‗to promote the progress of science and useful arts, by securing for limited
times to… inventors the exclusive right…‘ to their ‗new and useful‘
inventions. United States Constitution, Art. I, para. 8, cl. 8, 35 USC para. 31.
But the public policy which includes inventions within the granted monopoly
excludes from it all that is not embraced in the invention. It equally forbids
the use of the patent to secure an exclusive right or limited monopoly not
granted by the Patent Office and which it is contrary to public policy to grant.
Id. 492, 62 S.Ct at 405. Thus, the Supreme Court endorsed ‗misuse of
patent‘ as an equitable defense to a suit for infringement of that patent. 150
The General Court of the European Union has recently confirmed 151 a long
and detailed decision of the European Commission 152 on punishing AstraZeneca
pharmaceutical company for abusing its own patent right (improper arguments that
originated the Patent Supplementary Protection Certificate granted irregularly) and
for abusively striving to delay the legal trading authorization of the generic drug under
the name of Losec of AstraZeneca (the active principle generic name is
Omeprazole):
Broadly speaking, this decision deals with two alleged abuses in
connection with Astra‘s strategy in relation to its applications for so-called
supplementary protection certificates (hereinafter .SPC.) extending the
protection for the active substance omeprazole in its anti-ulcer medicine
Losec
__________________________
150
Translation into Portuguese: A Suprema Corte decidiu que, como uma Corte de equidade, não irá
apoiar Morton na proteção de sua patente quando Morton estiver usando esta patente em uma forma
contrária à política pública. Id. At 490-92, 62 S.Ct. at 404-05. A Corte sustentou que: A concessão ao
inventor de um privilégio especial de um monopólio de patente traz consigo uma política pública
adotada pela Constituição e leis dos Estados Unidos, ‗para promover o progresso da ciência e das
artes úteis, através da garantia por um prazo limitado [...] aos inventores direitos exclusivos [...]‘ para
as suas ‗novas e úteis‘ invenções. Constituição dos Estados Unidos, Art. I, parágrafo 8, cl. 8, 35 USC
parag. 31. Mas a política pública que inclui invenções com a concessão de monopólios ao mesmo
tempo exclui de proteção tudo que não for abrangido pela invenção. Igualmente proíbe o uso da
patente para garantir um direito exclusivo ou monopólio limitado não concedido pelo Escritório de
Patentes o qual seja contrário à política pública conceder. Id. 492, 62 S.Ct at 405. Assim, a Suprema
Corte endossou o ‗uso desviado de patente‘ como uma defesa condizente para uma ação de violação
dessa patente.
151
Only reduced the total compensation amount from EUR 60,000,000 to EUR 52,250,000.
152
Decision related to the case: COMP/A 37.507/F3 – AstraZeneca. Full decision available at:
http://ec.europa.eu/competition/antitrust/cases/dec_docs/37507/37507_193_6.pdf . Accessed on: Oct.
7th, 2010.
80
Losec; and Astra strategy in relation to a switch (mainly in 1998) from
capsule to tablet formulations of Losec.
[…]
It should be mentioned at the outset that the said two alleged abuses
respectively concern behavior in relation to two distinct regulatory systems:
a) the patent system whereby extra protection is granted under Community
patent law in the form of SPCs for pharmaceutical products and b) the
procedures and conditions under Community and national pharmaceutical
law relating to the authorization to market pharmaceutical products.
However, both abuses have the same objective of preventing or delaying
market entry of generic omeprazole based products.
[…]
HAS ADOPTED THIS DECISION:
Article 1
1. AstraZeneca AB and AstraZeneca Plc have infringed Article 82 of the
Treaty and Article 54 of the EEA Agreement by the pattern of misleading
representations before patent offices in Belgium, Denmark, Germany, the
Netherlands, Norway and the United Kingdom and before national courts in
Germany and Norway.
2. AstraZeneca AB and AstraZeneca Plc have infringed Article 82 of the
Treaty and Article 54 of the EEA Agreement by their requests for the
surrender of the market authorizations for Losec capsules in Denmark,
Norway and Sweden combined with their withdrawal from the market of
Losec capsules and launch of Losec MUPS tablets in those three countries.
Article 2
For the infringements referred to in Article 1, the following fines are imposed:
(a) a fine of EUR 46,000,000 on AstraZeneca AB and AstraZeneca Plc,
jointly and severally liable, (b) a fine of EUR 14,000,000 on AstraZeneca AB.
Article 3
This decision is addressed to AstraZeneca AB (S-151 85 Södertälje,
Sweden) and AstraZeneca Plc (15 Stanhope Gate, London W1K 1LN, the
United Kingdom).
This decision shall be enforceable pursuant to Article 256 of the Treaty.153
This paradigmatic decision of the European Court shows the extreme difficulty in
identifying, in apparently lawful procedures, strategies that just abuse the system in
or
________________________________
153
Translation into Portuguese: Em termos gerais, esta decisão trata com dois alegados abusos conectados à estratégia da
empresa Astra em relação aos seus pedidos de Certificados de Proteção Suplementar (chamados SPC) estendendo a
proteção do princípio ativo omeprazole no seu medicamento anti-úlcera Losec; e também a estratégia da empresa Astra em
relação à troca (principalmente em 1998) de cápsulas para formulações em tabletes do Losec. […].
Deve-se mencionar que os ditos dois abusos respectivamente trazem atenção para dois diferentes sistemas regulatórios: a) o
sistema de patentes no qual proteção extra é concedida através da Lei de Patente Comunitária na forma de SPCs para
produtos farmacêuticos e b) os procedimentos e condições, de acordo com a legislação farmacêutica Comunitária e nacional
relacionada à autorização para comercializar produtos farmacêuticos. No entanto, ambos os abusos possuem o mesmo
objetivo de impedir ou atrasar a entrada no mercado dos produtos genéricos com base no omeprazole. […].
Adotou a seguinte decisão:
Artigo 1
1. AstraZeneca AB e AstraZeneca Plc infringiram o Artigo 82 do Tratado e o Artigo 54 do Acordo EEA através de atos de
artifícios perante os Escritórios de Patentes da Bélgica, Dinamarca, Alemanha, Holanda, Noruega e Reino Unido e perante
Cortes Nacionais na Alemanha e Noruega.
2. AstraZeneca AB e AstraZeneca Plc infringiram o Artigo 82 do Tratado e Artigo 54 do Acordo EEA através dos seus
pedidos formulados para a obtenção de das autorizações de comercialização do Losec em cápsulas na Dinamarca,
Noruega e Suécia combinado com a sua saída do mercado do Losec em cápsulas e lançamento do Losec MUPs em
tabletes nesses três países.
Artigo 2
Pelas infrações especificadas no artigo 1, as seguintes multas são impostas:
(a) Uma multa de EUR 46,000,000 na AstraZeneca AB e na AstraZeneca Plc, juntamente e severamente responsáveis,
(b) Uma multa de EUR 14,000,000 na AstraZeneca AB.
Artigo 3
Esta decisão é aplicada contra AstraZeneca AB (S-151 85 Södertälje, Suécia) e AstraZeneca Plc (15 Stanhope Gate,
Londres W1K 1LN, Reino Unido).
This decision will be required according to the article 256 of the Treaty
81
order to obtain practical effective gains in the market (involving the aforementioned
Sham Litigation)
It should be noted that a major problem in judging anticompetitive conduct
expressed through the abusive use of the patent system is precisely the difficulty in
identifying such conduct and, at the same time, predict its effects in short, medium
and long term, demanding an enormous investigative effort from the antitrust
authorities as well as an effort to deepen the available empirical data.
Trying to clarify and prove the difficulty encountered by the authorities and
parties involved in identifying abusive anticompetitive behaviors in cases involving
patent rights, research was conducted based on interviews with officials from FTC
and DOJ, as well as the ACED and ELS.
The professionalism and organization of the US Department of Justice and the
Federal Trade Commission should be highlighted concerning the capability of
organization and compilation of information through a practical and specific ―guide‖
on the intersection of intellectual property rights with the antitrust law.
Far beyond a simple ―guide‖, actually the work developed by members of the
DOJ and FTC jointly brings in-depth analyses of specific cases, and it is preceded by
public hearings with the participation of society as a whole and, in particular, the
experts in public and private academic field.
In the Brazilian reality, despite the existence of those judged by the ACED
involving this intersection, there is not a specific ―guide‖ to deal with such cases, as it
occurs with the DOJ and FTC. But there are some more restricted works under
develop
___________________________
154
U.S. Department of Justice and the Federal Trade Commission. Antitrust Enforcement and
Intellectual Property Rights: Promoting innovation and competition. Available at:
www.ftc.gov/reports/index.shtm . Accessed on: 02/09/2009
82
development as for instance, the BAIP Resolution no. 68 of 10/21/2004, under the
name of Guidelines on Examination of Technology Transfer Agreements and
Licensing of Intellectual Property Rights under the perspective of Antitrust Law 155.
However, analyzing the work referred by the DOJ and FTC, and some of the
works developed in Brazil as well as some decisions of the Federal Circuit and the
Supreme Court of the United States itself, we come across issues that are left
unanswered, which generated the need for an elaboration of a questionnaire and
interviews with some FTC, DOJ, ACED and ELS officials, seeking not only a
comparison between the two perceptions, but more than that, seeking to fill some
gaps that are important to the study developed.
Regarding the FTC, the answers obtained had Armando Irizarry156, Tara Isa
Koslov157 and Pamela Jones Harbour158 as reference sources.
Those interviewed in several occasions made reference to the April 2007
DOJ/FTC ―guide‖ on their answers, but they pointed out some factors and cases
worthy to be stressed.
The function of the FTC is to protect the consumer and to stimulate
competition, i.e., there is a harmonic duality of goals.
To the FTC, the conduct is important when analyzing issues related to
antitrust. This fact shows the depth of research that should be done for the
typification of anticompetitive conduct.
The forms of investigation used by the FTC are, basically the press (including
the very public statements of the company‘s CEOs), complaints from other
companies
__________________________
155
Available at:
http://www.abpi.org.br/bibliotecas.asp?idiomas=Portugu%C3%AAs&secao=Resolu%C3%A7%C3%
th
B5es%20da%20A BPI&codigo=3&resolucao=1 . Accessed on: Feb. 9 , 2009.
156
Counsel for Intellectual Property – FTC – Bureau of Competition – Office of Policy and
Coordination.
157
Attorney Advisor of Commissioner Pamela Jones Harbour – FTC.
83
companies, FTC easy access to the public (they receive everyone/every complaint,
and have a complaint hotline).
The FTC understands that the goals of the patent system and antitrust system
are focused on the bottom line benefits generated to the consumers, and the natural
monopolies are not affected by the antitrust rules;
In the interviews it became clear that the FTC has human resources structural
problems to analyze more complex cases with advanced technologies and uncertain
impacts on the market. This fact confirms the inadequacy of the current patent
system when applied to the protection of essentially diverse technologies from those
which this system has been designed for, as it is defended in this work.
To support the personal opinions explained in the interviews, a few cases
considered in the ―guide‖ have been quoted, such as Verizon 159, Kodak160, CSU161
(see FTC guide p. 21).
Field research was also conducted together with representatives of the
Brazilian antitrust authorities, interesting results were obtained that confirm the
hypothesis of the importance of clearly recognizing the equality principle towards the
recognition of a differential treatment of different technologies, meant for the patent
system, causing effects on the competitive environment.
Paulo Furquim de Azevedo, ACED Councilor at the time of field research 162, in
his answers to the questionnaire concerning the research, states:
___________________________
158
Commissioner.
Verizon Communications Inc. v. Law Offices of Curtis V. Trinko LLP, 540 US 398, 407 of 2004. In
this trial, it is clear the position that the exercise of monopoly power naturally and legally obtained in
the market, with monopoly pricing, cannot be affected by the US antitrust legislation.
160
Above-mentioned – 125 F. 3d 1195 – US Court of Appeal for the Ninth Circuit.
161
Above-mentioned – 203 F. 3d 1322 – Federal Circuit, 2000.
162
Full questions and answers to the survey available at Appendix A.
159
84
I do not know if I have understood the question. It does not seem to me
that the patent rights are areas in which the existence or not of market power
or abuse of power is, comparing to all other sectors, difficult to gauge.
Undoubtedly this is a hard task, but it is also hard to the market production of
media content, software, specialized services, etc. A very important item in
this area is the sham litigation. Since it is not clear whether or not the
property right has been infringed, companies can make use of the
intellectual property protection system to impose costs on competitors, even
if they have not, in fact, infringed such rights. Therefore, the difficulty in
assessing whether or not there has been violation of IPR is a source of
competition concern.
In my view, there is no, at first, incompatibility between the intellectual
property right protection and its full exercise as well as the antitrust policy.
In fact, it has been soberly proven during this thesis that the inaccuracy of the
patent rights limits due to several factors (among them, the use of writing techniques
that extend the protection without a descriptive sufficient support and the nonrestrictive interpretation of patents), works as an instrument of abuse of patent rights,
as well as little expertise in the issue.
Another analogous factor on the inaccuracy of the patent rights limits is the
complexity of conduct that involves diverted acts of the legality provided for the lawful
competitive use of the patent system. In the final revision stage of this thesis, after
the event held at Itamaraty Palace in Rio de Janeiro, a technical cooperation
agreement was signed among BPTO, ELS and ACED163, which shows the first step
towards
___________________________
163
The Brazilian Patent and Trademark Office – BPTO, the Union, through the Economic Law
Secretariat – ELS and the Administrative Council for Economic Defense- ACED celebrate among
themselves the Technical cooperation agreement.
85
towards the development in the identification and analysis of anticompetitive
practices perpetrated by abuses in the area of intellectual property:
The following constitutes object of this technical agreement among the
Participants, when requested, and according to its convenience and opportunity:
I) Provide advice, regarding definition of routines, guidelines and procedure
rules on concentration acts or anticompetitive practices that involve intellectual
property;
II) Studies on the relationship and interfaces between intellectual property and
antitrust;
III) Participating and holding events and seminars, including aiming to train
servers;
IV) Providing studies and analyses of proceedings in a compiled collection;
V) Exchange of information and expertise among their technical bodies, and
VI) Based on analyses and studies, preparation of normative proposals, which
will lead, under this agreement, the integrated measures to case resolution.
Sole Paragraph: Once an investigation has begun, the ELS may report to the
BPTO requesting the sharing of technical information on eventual property rights
securitized by the investigated economic agent(s), by (an) other economic
agent(s) acting in the relevant market under examination.
Second Paragraph: When the BPTO, exercising its duties, verifies the
evidence of restrictive practices on the free competition and the intellectual
property, shall report to ELS, giving account of the facts, and if need be, shall
manifest itself in advance about its jurisdiction area for the purposes of the art.
30 et seq. of Law no. 8,884/94.
Third Paragraph: Once the administrative process for the confirmation of the
existence of violation to the economic order is established, the ELS, once the
defense (s) from the Representative (s) is received, will send copies of the
proceedings, defense representation (s) by letter to the BPTO, so that the Office,
if need be, gives its opinion on the subjects of its specialization, which should be
submitted before the procedure instruction finishes within the ELS.
Fourth Paragraph: Once the BPTO is aware of practices that may constitute
the noncompliance of the ACED decision, it will inform the President of the
Council.
Fifth Paragraph: The decisions of the ACED Board that may have effects on
intellectual property rights should be forwarded to the BPTO, together with the
Reports produced, for the knowledge of this Agency and for the appropriate
measures to be taken.
It is shown in this way, an acknowledgement of the complex relationship
between the market and the patent system, demanding special study and clear
understanding of the reciprocal and harmonic limitations imposed by the patent
system
86
system and the antitrust law, on behalf of the compliance of the art. 5, XXIX of the
Magna Carta of 1988.
In the area of copyright there is also the problematic intersection with the
antitrust law, Helenara Braga Avancini 164 states in her conclusions:
Actually, the economic order principles are only meaningful when
analyzed in light of the fundamental rights, in particular, by the principle of
copyright functionalization, which is not new to the Academy and judges.
The challenge is to turn this evidence into effectiveness, since the use of
the Antitrust Law and the use of the consumer law, in order to limit the
excessive ownership, eventually exercises the functionalization of the
Copyright, implementing the fundamental rights.
Added to these factors is the importance of the recognition and respect of the
equality principle on the basis of the patent system, in order to adequately protect the
patentable intellectual creations according to their different technological essence
and their subsequent impact on the competitive context.
__________________________
164
AVANCINI, Helenara Braga. The copyright in a perspective of fundamental rights. The
limitation of excessive ownership through the antitrust law and the consumer. Doctoral Thesis
presented at the Pontifical Catholic University of Rio Grande do Sul – PUCRS, Porto Alegre, 2009.
87
3 EQUALITY AND WELFARE STATE
The French novelist Honoré de Balzac used to say, in the nineteenth century,
that Equality may be a right, but there is no power on earth that can make it a fact.
There is no doubt that the notion of equality has been longer approached than
the notion of competition and patents, and it is clear that the principle of equality of
material goods exploited by Aristotle over two thousand years ago clearly shows, to
the present day, that treating unequal people equally does not match the ideal pursuit
of justice165.
The equality principle in our legal planning is defined, essentially, in the art. 5,
item and paragraph I, ensuring, in short, that all men and women are equal and
should be treated materially speaking (not only formally) equally 166. It is noted that
the manifestation of the equality principle not only derives from the art. 5., item and
paragraph I of the Magna Carta of 1988, but also from the very essence of the art. 1.,
paragraph III and article 3. and its paragraphs of the same Carta167.
The analysis of the equality principle in the legal planning is of paramount
importance, for the understanding of how such principle should work as a ―corrective‖
to the existing discrepancies in the formally equal treatment that the patent system
con
___________________________
165
ARISTOTLE. Nichomachean Ethics. São Paulo: Martin Claret, 2003.
Federal Constitution of 1988: Art. 5 All are equal before the law, without distinction whatsoever,
guaranteeing Brazilians and foreigners residing in the Country the inviolable right to life, liberty,
equality, safety and property, as follows: I- men and women have equal rights and obligations under
this Constitution;
167
Federal Constitution of 1988: Art. 1 The Federative Republic of Brazil, made up of the indissoluble
union of the States and Municipalities and the Federal District, constitutes a Democratic State and has
as its foundations: III – the dignity of the human person; Art. 3 The fundamental objectives of the
Federative Republic of Brazil are: I – build a free, fair and helpful society; II – guarantee the national
development; III – eradicate poverty and marginalization, and reduce the social and regional
inequalities; IV – promote everyone‘s welfare, without racial, sex, color, age prejudice or any other
form of discrimination.
166
88
confers on technologies168 susceptible to patentability at the present time.
According to Jorg Neuner169, the equal treatment can be essentially justified
and due to three reasons: protection of the individual, protection of the group
involved and the community interest.
When the author emphasizes the protection of the individual, he relates it to its
objective of consideration for the dignity of the human person, limiting the holder of a
private right to the development of another.
In the words of Patrícia Uliano Zoch de Moura 170, ―By understanding that the
human beings, although equal as species, look unequal when it comes to social
issues, it is worth trying to equate them‖.
Somehow, it involves the principle of equality of material goods, consisting in
recognizing the inequalities and, facing them, establishing proportionally unequal
treatments.
Examining the principle of equality of material goods as one of the
components of expression of dignity, we must look into the broader question
involving dignity, pointed out by Ricardo Aronne 171, stating that ―Any notion of dignity,
in view of a material level and not merely formal, should be perceived concrete
(topical) and intersubjectively, as translated by Ingo Sarlet, in the most significant
work devoted to the topic, in the legal literature‖.
__________________________
168
The term technology has different meanings depending on the context in which it is used. It is
adopted the concept of technology expressed at Wikipedia Encyclopedia: Technology, in general, is
the meeting between science and engineering. It is a term that includes in it from simple tools and
processes, such as a wooden spoon and fermenting grapes, to the most complex processes ever
created by the human being, such as the International Space Station and the desalination of seawater.
Available at: http://pt.wikipedia.org/wiki/Tecnologia . Accessed on: Sep. 10th, 2008.
169
NEUNER, Jorg. The equal treatment principle in German private law. Fundamental Rights &
Justice, n. 2, p. 85, Jan/Mar. 2008.
170
MOURA, Patrícia Uliano Effting Zoch de. The purpose of the equality principle – The social
leveling – Interpretation of acts of being equal. Porto Alegre: Sergio Antonio Fabris Editor, 2005, p.38.
171
ARONNE, Ricardo. Op. Cit., p. 69.
89
That is, escaping from the purely formal concept of equality, we must
necessarily and topically examine this principle so that we can figure out its materially
accepted definition.
In the words of Bolzan de Morais, stressing the broad and open hermeneutical
sense of the Constitution that permeates the principle of equality of material goods,
―The role of the Constitution is not finished yet, even if it undergoes a profound
reformulation stemmed from a new reality that imposes itself and is ordained, taking
into consideration its open and universalized nature‖.
The practical problem of the application of the principle of equality of material
goods is not in the premise of defining what justice is, but it is in how to achieve it in
the individualized reality (topical), being noteworthy the relevance indicated by
Barzotto173 of the analysis of realism174, pragmatism175, ethical character176,
casuistry177, and traditionalism178 used by the Roman jurists on this author‘s
endeavor to demonstrate the elective affinities between the Aristotelian prudence and
the Roman jurisprudentia.
In an analysis of Comparative Law regarding the possible limits of a
universality of human rights, Angela Kretschmann179, drawing a comparison among
___________________________
172
MORAIS, José Luis Bolzan de. Human rights ―global (universal)‖. Of everyone, everywhere.
Yearbook of the Postgraduate Program in Law – Master‘s and PhD – Center for Legal Studies –
Unisinos, São Leopoldo, 2001, p.69.
173
BARZOTTO, Luis Fernando. Prudence and jurisprudence. Yearbook of the Postgraduate
Program in Law – Master‘s and PhD – Center for Legal Studies – Unisinos, São Leopoldo, 1999, p.
163-192.
174
While Aristotle focuses on getting to know the practical truth through prudence, which is
contingent, but no less objective, Romans seek solutions outside of abstractions, based upon patient
examination of reality.
175
Despite the Roman jurisprudentia not aiming at producing a theory of justice, it performs it in
concrete cases, as well as the Aristotelian prudence seeks to know the concrete man‘s good and the
concrete polis, imposing itself as a purpose to all.
176
As well as prudence describes a premise of a prudent man in the sense of moral excellence, the
Roman jurisprudentia seeks to find a more adequate solution, from a moral standpoint, for the
practical case.
177
As well as prudence comes from experience for Aristotle, denying the existence of prudence
among youth, for the Roman jurisprudentia without long contact with the realities of life, there is no
way to find the rights present in the cases.
178
Attention should be given to the elderly, because their opinions are worthy of it. The Roman
jurisprudentia asserts that experience comes from soundness of decisions and it could only be
inquired by extremely grounded reasons.
179
KRETSCHEMANN, Ângela. Universality of Human Rights and Dialog in the Complexity of a
Multi-civilizational World.
90
Western cultures and human developments, Hindu, Muslim and Chinese, clearly
demonstrates that the respect for the contextualized considered individual is
essential to trace possible parameters of universalization of human rights.
In work dedicated exclusively to the analysis of the equality principle, Celso
Antônio Bandeira de Mello180, proposes the node question that, in its positive form of
the need for establishing discriminations, is interesting to the development of this
thesis: ―When is the law forbidden from establishing discriminations? That is: what
limits oppose this normal function, inherent to the legal function of discriminating?‖
Going beyond the Aristotelian important findings of unequal treatment to the
unequal and equal treatment to the equal, Celso Antônio Bandeira de Mello 181,
stating that ―to the legal rule itself it is forbidden to grant several disciplines to
equivalent situations‖, concludes that there is an offense to the constitutional precept
of equality when:
II- The norm adopts as a discriminating criterion for the differentiation of
regimes, the non-resident element in the facts, and unequalized situations or
people. This is what happens when you want to take the factor ―time‖ –
which does not rest on the object – as a differential criterion.
III- The norm assigns different legal treatments in attention to adopted
factor that, still, does not have a relation of pertinence logic to the disparity of
regimes granted.
IV- The norm assumes relation of pertinence logic existing in the abstract,
but what has been established leads to opposing effects or anyhow
discordant with the interests constitutionally esteemed.
We conclude that the mentioned author clearly defends that ―there is no way
to unequalize people and situations when unequal factors182 are not found in them‖,
basing not only on the person for the unequal treatment, but also on the factors and
situation that unequalize them.
__________________________
180
MELLO, Celso Antônio Bandeira de. Legal Content of the Equality Principle. 3. Ed. São Paulo:
Malheiros Editores, 2009, p. 13.
181
MELLO, Celso Antônio Bandeira de. Op. Cit., p. 11 and 47.
182
Idem, p. 35.
91
That is, the need to equalize or discriminate does not stem from the analysis
of equalities and inequalities among human beings as individuals, but from the
equalities and inequalities taking into account equal or unequal facts, situations or
people. Treating equal and unequal people equally or unequally requires a deeper
analysis rather than the simple interpersonal comparison, because if it is not like that,
the very equalization and discrimination will harm the equality principle.
Looking for contributory answers in the Comparative Law, it can be seen that
the Standford University Encyclopedia of Philosophy183, establishes that the equality
principle is a complex and highly contested concept, where it divides equality into 4
possible principles (Formal Equality184, Proportional Equality185, Moral Equality186 and
Presumption of Equality187).
__________________________
183
Available at: http://plato.stanford.edu/entries/equality/ . Accessed on: Apr. 23rd , 2010.
When two persons have equal status in at least one normatively relevant respect, they must be
treated equally with regard
to this respect. This is the generally accepted formal equality principle that Aristotle formulated in
reference to Plato: "treat like cases as like" (Aristotle, Nicomachean Ethics, V.3. 1131a10-b15; Politics,
III.9.1280 a8-15, III. 12. 1282b18-23).
185
When factors speak for unequal treatment or distribution, because the persons are unequal in
relevant respects, the treatment or distribution proportional to these factors is just. Unequal claims to
treatment or distribution must be considered proportionally: that is the prerequisite for persons being
considered equally.
186
Since "treatment as an equal" is a shared moral standard in contemporary theory, present-day
philosophical debates are concerned with the kind of equal treatment normatively required when we
mutually consider ourselves persons with equal dignity. The principle of moral equality is too abstract
and needs to be made concrete if we are to arrive at a clear moral standard. Nevertheless, no
conception of just equality can be deduced from the notion of moral equality. Rather, we find
competing philosophical conceptions of equal treatment serving as interpretations of moral equality.
These need to be assessed according to their degree of fidelity to the deeper ideal of moral equality
(Kymlicka 1990, p. 44). With this we finally switch the object of equality from treatment to the fair
distribution of goods and ills or bads.
187
The presumption of equality provides an elegant procedure for constructing a theory of distributive
justice. The following questions would have to be answered in order to arrive at a substantial and full
principle of justice: What goods and burdens are to be justly distributed (or should be distributed)?
Which social goods comprise the object of distributive justice? What are the spheres (of justice) into
which these resources have to be grouped? Who are the recipients of distribution? Who has a prima
facie claim to a fair share? What are the commonly cited yet in reality unjustified exceptions to equal
distribution? Which inequalities are justified? Which approach, conception or theory of egalitarian
distributive justice is therefore the best?
184
92
Historically, when the ideal of equality ―was born‖ in the United States
Declaration of Independence the contrast between this ideal and the reality back then
was enormous 188.
One of the symbols defending the equality principle as a way to abolish the
racial discrimination in the US was the US Supreme Court Judge Thurgood Marshall,
who believed and defended that equality, would be best achieved through an
integrated movement of society.
In Catherine Bernard‘s189 view, in an article showing four different perspectives
of the equality principle, understanding the equality principle in European
jurisprudence shows that there are justifiable grounds on views of a utopian equality
(political slogan of little practical effectiveness), an equality aiming for a social
informative objective, whose implementation would work as an advisor to a nondiscrimination, without having a major legislative force, and eventually an equality
seen as a general principle of Law limiting legislative activities.
The Declaration of the Right of Man and of the Citizen of 1789 190 is an
international historical paradigmatic benchmark at the beginning of understanding the
material sense of the equality principle.
Vanessa Batista Oliveira Lima191 points out that ―The thesis of legal equality
proposed since the French Revolution, has undergone profound changes, from
formal
__________________________
188
For instance, in regard to the voting right at the time, only males had suffrage in the new
independent states. This fact shows the acceptance of a higher ideal against a normal cultural
practice, creating a healthy shock between being and having to be as it was considered at the time.
189
BERNARD, Catherine. The principle of equality in the community context: P, Grant, Kalanke
and Marschall: Four uneasy bedfellows? The Cambridge Law Journal (1998), 57:2:352-373
Cambridge: University Press.
190
Art. 1. Men are born and are free and equal in rights. Social distinctions can only be founded on the
common good.
191
LIMA, Vanessa Batista Oliveira. Affirmative Actions as instruments for the implementation of
the equality principle and the principle of the dignity of the human person. P. 09. Available at:
http://www.fa7.edu.br/recursos/imagens/File/direito/ic/v_encontro/acoesafirmativascomoinstrumen
rd
tos.pdf Accessed on Apr. 23 , 2010.
93
formal equality to a real one, from abstract to concrete, but always standing as a
cornerstone of the Western legal systems‖.
The same author adds: ―Paraphrasing CANOTILHO, strength (sic) is to
recognize that the equality principle does not prohibit, but rather assumes, that the
law should establish distinctions of situations, since there is objective and factual
basis for such discrimination‖192.
On several occasions the Supreme Court has spoken on the equality principle
application, recognizing the necessary application of the principle in its material or
substantial dimension.
At the trial of the DAU 2649/DF, regarding the constitutionality of Law 8899/94,
it became explicit through the Reporter Cármem Lúcia‘s vote that The Law 8,899/94
is part of public policies to insert the handicapped into society and it aims at equal
opportunities and at the humanization of social relations, pursuant to the foundations
of the Republic of citizenship and dignity of the human person, which is concretized
by the definition of the means in order for them to be achieved.
Analyzing the equality principle within a competitive environment of equal
opportunities to competitors in a competitive market, makes clear the notion that the
development of the equality principle starts parallel to the development of the free
competition. The purely formal notions of equality and that the market was selfregulated without the need for minimal state regulation were giving way to
increasingly developed notions of a necessary material or substantial equality, as
well as a constant state regulation to ensure compliance of equality principle and free
competition.
For there to be a totally free market (with no regulation) it would be forcible to
assume a situation of absolute material or substantial equality. As such assumption
does
__________________________
192
LIMA, Vanessa Batista Oliveira. Op. Cit., p. 10.
94
does not exist, the search for further corrections on behalf of a material equality
contributes to a greater possibility of keeping the State away from the regulation on a
postmodern treatment of the principle of free competition.
As pointed out by Paula Forgioni 193, in this correlation of meeting the principles
of equality and free competition, we should be attentive to the current capitalist
model, because:
As we shall see in the third part of this line of development of the
competition disciplinary rules that we are tracing, the biggest current danger
is for us to consider, only, this restrict function of the antitrust regulation, as if
we were in the initial period of the economic liberalism, disregarding its
development process, which runs parallel to the one of the functions
exercised by the modern capitalist State.
There is no doubt that the effective application of the equality notion in its
material sense reaffirms the recognition of the free competition applied to an
increasingly less regulated market by the State. It cannot be seen today because the
scope of an equality of material goods through an effective unequal treatment to the
unequal according to their inequalities represents an arduous task, almost utopian, in
a Democratic State of Law permeated by secular inequalities to be gradually and
constantly adjusted.
So, we must pay attention to the fact that the patent system has a direct
linkage with an efficient and properly understood system of free competition, in the
same way as it has a valorizing linkage with an axiological focused basis on a
material or substantial equality that ends up not being observed in some situations
that are based on the application of a merely formal equality when it comes to the
absence of an unequal treatment to unequal technologies according to their
inequalities.
__________________________
193
FORGIONI, Paula A. Op. Cit., p. 69.
95
4 PROBLEMATIZING EQUALITY IN THE PATENT SYSTEM
Achieving equality in the patent system is an arduous task when this thesis
argues that, the equal treatment of the patent system granted to different
technologies undermines the equality principle.
Within this context the analysis goes through the seemingly simple matter on
where the patent system meets and on where it does not meet the principle of
equality of material goods, and it is clear the fulfillment of this principle, for instance,
regarding everyone‘s access to the patent system194.
Interesting to note an empirical observation that the infra-constitutional
legislation embodied in the Law 9,279/96 already presupposes and indicates some
situations of unequal treatment based on the existing differences among
technologies195.
To generate the subjective right to the patent, all technologies submitted to a
patent application must meet requirements of a formal or material order. Among the
req
___________________________
194
It should be noted that even at this point we could infer certain material inequality, since access to
the patent system and its concrete benefits depends on numerous factors that pass, essentially,
through the cost of using the system nationally and internationally.
195
The Brazilian patent system works with two different types of patents: invention and utility model.
Leaving aside the discussion on the terminological/conceptual utility model being effectively a patent
(in its international sense as treated by the PC, PCT and TRIPS), it is about an unequal treatment to
different technologies, since it establishes different patentability requirements, as well as it grants
different protection terms. Besides this question, we have yet another example in the area of
biotechnology that, in certain cases, requires the deposit of biological material for the effective
analysis of the descriptive sufficiency and the understanding of the invention, treating unequally
(regarding the necessary requirements for obtaining a patent) unequal technologies.
96
requirements of formal order are those referred to in the article 19 of Law 9,279/96 196
and among the requirements of material order are those established in the arts. 8, 9
and 24 of the same Law197.
There are situations of unequal treatment of technologies legally subject to
obtaining a patent, and as to formal requirements, for example, technologies that do
not imply the need for a representation through drawings, are obviously exempt from
such presentation. Of course the unequal treatment as to formal requirements is not
the goal of this work, but it only serves to demonstrate that, even formally, the
differences are already legally identified. The key to this study is the analysis of
unequal treatment as to the verification of its material requirements, i.e., for example,
as already emphasized, the Law 9,279/96 establishes an inventive activity to a minor
degree (inventive step) and a temporal right term to exclude third parties from the
exploitation of the object of the minor patent (15 years instead of 20 years).
That is, the Law 9,279/96 recognizes and applies the equality principle in its
material dimension treating explicitly differently different technologies.
The problematicness comes in when an internationally harmonized system
over a century ago was not designed and harmonized to handle non-existing
technologies back then198.
___________________________________________
196
Art. 19. The patent application, as established by the BPTO, shall contain: I- requirement; IIdescriptive report; III- claims; IV- drawings, if need be; V- summary; and VI- proof of the payment of
the fee related to the filing.
197
Art. 8. The invention that meets the requirements of novelty, inventive activity and industrial
application is patentable.
Art. 9. It is patentable as a utility model the object of practical use, or part thereof, susceptible to
industrial application, which presents new form or disposition, involving inventive step, that results in
functional improvement in its use or in its manufacturing.
Art. 24. The report should clearly and sufficiently describe the object, so that it can be achieved by a
skilled technician and it may indicate, whenever appropriate, the best execution form.
198
Citing just a few examples, biotechnology, integrated circuits, computers, software, among others
that did not exist in the nineteenth century.
97
In effect, at the time, the only necessary unequal treatment in view of the
existing technologies was related to the utility model, whose relationship of minor
inventive activity x proportionally minor protection was the adequate and sufficiently
found solution. Therefore, our pre-understanding of the patent system ends up linking
our understanding of the current patent system, being necessary to be aware of the
pre-understanding as an integrating element of the understanding199.
Meurer and Bessen200 point out that the benefits of the private property are
directly related to procurement rules and to the clear determination of the limits or
extent of such rights, concluding that:
The benefits of private property derive from the promise of efficient, nonarbitrary enforcement. The details of the rules of acquisition and the
determinants of the scope of the rights affect this efficiency. Poorly designed
rules of acquisition, ownership, and scope can cause property to fail. 201
If the property right has flaws in its procurement rules or difficult delimitation of
its limits, when properties in large scale and from several ownerships came to be,
such problems, which were previously ignored, became relevant.
This is what is happening in the area of patents, it is much simpler identify and
delimit the rights over a patent in the electrical or mechanical field than do the same
involving computer programs (seen as methods or steps for solving a technical
problem not based on the protection of the program or source code itself). The patent
____________________________________________
199
See GADAMER, Hans-Georg. Truth and Method. Translated by Paulo Meurer, new revision by Ênio
Paulo Giachini Sá Cavalcante Schuback. 5 ed. Rio de Janeiro: Vozes, 2003.
200
MEURER, Michael J. ; BESSEN, James. Patent Failure: How Judges, Bureaucrats, and Lawyers
Put Innovation at Risk. Princeton: Princeton University Press, 2008, p. 45.
201
Translation into Portuguese: Os benefícios da Propriedade privada derivam de uma promessa de
eficiência, de uma execução não arbitrária. Os detalhes das regras de aquisição e os fatores
determinantes do escopo dos direitos afetam essa eficiência. Regras de aquisição, de propriedade e
de abrangência mal desenhadas podem gerar o fracasso da propriedade.
98
system was not created to protect this kind of technology and its simple adaptation
ends up treating equally diametrically different technologies.
Notwithstanding the provisions of the TRIPS Agreement to bar discrimination
against protection granted by patents based on the technological diversity 202, the
developed countries already establish discrimination, as, for instance, in the
pharmaceutical area, allowing additional validity period of patents based on the
approval delay of the product related to that patent by the agencies of public health. It
is, without a shadow of a doubt, a differential treatment based on the peculiarities of
market entry of products related to these technologies.
In this sense, we must quote observations made in the Reference Book on
TRIPS and Development203, specifically regarding the interpretation of the article
27.1 of the TRIPS Agreement as to the possibility of discrimination and its
interpretation in the face of the TRIPS provisions:
Neither the Paris Convention nor national laws contained a provision
comparable to Article 27.1. Hence, discrimination now banned was permissible,
such as establishing different terms of patent rights according to the field of
technology, as provided for under some domestic patent law. The principle that
patents shall be available, and patent rights enjoyable without discrimination as
to the place of invention had generally been accepted under the European
Patent Convention. However, in some countries, differential treatment was
granted to patents depending on the country of invention. That was the case, for
instance, under the Canadian regulation on compulsory licenses introduced in
1988 and in force until Bill C-91 was passed in February 1993. The United
States – the single country to maintain a ‗first-to-invention‘ rule concerning
entitlement to a patent - imposed a discriminatory burden on foreign inventors
under §104 of the U.S. Patents Act. Evidence of inventive acts was restricted to
the territory of the U.S., and foreign applicants were not permitted to prove a
date of invention which antedated their U.S. filing date. This territorial limitation
was later extended to Canada and Mexico under the North American Free Trade
Area Treaty.
Similarly, national laws could treat patents differently depending on the local
or imported origin of the product. Thus, Section 337 of the U.S. Tariff Act
accorded to imported products challenged as infringing U.S. patents treatment
less favorable than the treatment accorded to similarly challenged products of
__________________________
202
TRIPS – Article 27.1: […] patents shall be available and patent rights enjoyable without
discrimination as to the place of invention, the field of technology and whether products are imported
or locally produced.
203
Resource Book on TRIPs and Development, Part II: Substantive Obligations. 2.5 Patents.
ICTSDUNCTAD. Capacity Building Project on IPRs and Sustainable Development, p. 29-35.
Available at: http://www.iprsonline.org/unctadictsd/docs/RB2.5_Patents_2.5.2.pdf . Accessed on Jan.
th
10 , 2010.
99
U.S. origin. This Section was found inconsistent with the GATT in United
States -- Section 337 of the Tariff Act of 1930.
It has been a common feature in patent laws (of developed and developing
countries) to provide for compulsory licenses in cases of "non-working" (in
conformity with Article 5.A (4) of the Paris Convention), and to interpret that
―working‖ was only satisfied by local production (not by importation). Some
commentators have interpreted Article 27.1 as a ban to such differentiation
but, as discussed below, such interpretation is controversial. 204
[…]
The non-discrimination rule contained in Article 27.1 is intended to protect
right-holders against arbitrary policies that undermine their rights, when such
policies are adopted on grounds of the field of technology, the place of
invention or the origin (locally manufactured or imported) of the products.
The need to differentiate the rights according to the types of inventions
concerned has been extensively debated. Many have wondered why patent
rights of equal effect and duration should be granted to inventors who have
made different contributions, some of them significant and others less so.
Debates have largely focused on the duration of patent rights, since the rate
of obsolescence of technology and the periods necessary to recover R&D
investments significantly vary across sectors.
In fact, patent laws in many countries currently allow for a differentiation
based on the field of technology, as illustrated by the extension of protection
conferred to pharmaceutical patents in the U.S. and Europe in order to
compensate for the period required to obtain the marketing approval of a
new
____________________________
204
Translation into Portuguese: Nem a Convenção de Paris ou as leis nacionais continham previsão comparável
ao Artigo 27.1. Então, discriminação agora banida era permissível, tais como o estabelecimento de prazos
diferentes de patentes de acordo com a área tecnológica, como era feito em algumas leis de patentes
domésticas. O princípio de que patentes devem ser acessíveis e que os direitos de patentes aproveitados sem
discriminação quanto ao local da invenção foi em geral aceito através da Convenção Européia de Patentes. No
entanto, em alguns países, tratamento diferenciado foi concedido para patentes dependendo do país da
invenção. Esse foi o caso, por exemplo, da regulação Canadense de licenças compulsórias introduzida em 1988
e em vigor até a Proposta C-91 passar em fevereiro de 1993. Os Estados Unidos – o único país a manter a regra
do ‗primeiro a inventar‘ relacionada à titularidade de uma patente – impôs um limite discriminatório através do
parágrafo 104 do U.S. Patents Act. Evidência de atos inventivos era restrita ao território dos EUA, e para
requerentes estrangeiros não era lícito provar a sua data de invenção que era anterior à data do pedido
protocolado nos EUA. Essa limitação territorial foi posteriormente estendida ao Canadá e ao México em
decorrência de acordos do Tratado de Livre Comércio das Américas do Norte.
Similarmente, leis nacionais podiam tratar patentes de forma diferente dependendo do local ou origem de
importação do produto. Assim, a Seção 337 do U.S. Tariff Act concede para produtos importados que violem
patentes estadunidenses tratamento menos favorável do que o tratamento dado a produtos similares violadores
produzidos originariamente nos EUA. Esta Seção foi reconhecida como inconsistente com o GATT nos Estados
Unidos – Seção 337 do Tariff Act de 1930.
Tem sido uma questão comum nas leis de patentes (de países desenvolvidos e em desenvolvimento) prever
licenças compulsórias em casos de ―não exploração‖ (de acordo com artigo 5.A (4) da Convenção de Paris), e a
interpretar que esta ―exploração‖ apenas é satisfeita através de produção local (não por importação).
Alguns críticos interpretaram o artigo 27.1 como um banimento para esse tipo de diferenciação, mas, conforme
discutido abaixo, essa interpretação é controvertida.
100
new drug.
205
The problem of the non-application of the equality principle on the basis of the
patent system, abstracting away the provisions and possible interpretations of the
TRIPS Agreement, generates repercussions that the hermeneutic effort cannot solve
for the effective optimization of the patent system as a functional-oriented gear
towards meeting the harmonic preponderance of the utilitarian theories and social
planning theories.
Nuno Pires de Carvalho206 points out that the attempt to impose an
international termination of technological discrimination (it was argued at the time that
a country was not able to arbitrarily define, according to its interests, what would be
susceptible to patentability or not):
The game rules introduced in 1883 remaining unchanged in essence no
longer worked, therefore. It was necessary to introduce new rules that would
reduce the free riding of the new major players. […] This draft treaty, which
proposed a language that is now included in the article 27.1 of the TRIPS
Agreement, was discussed at the WIPO from 1986 to 1990. The Diplomatic
Conference to adopt this Treaty started in Hague, in June 1991, and never
ended. The main opponents to the idea of ending technological
discrimination in the field of patents were the developing countries. The idea
was to use the principle of the national treatment of the Paris Convention in
its favor. Since Brazil and other countries felt they had no expertise in the
development of inventions in certain sectors, or they felt they had no
comparative advantage, they would rather deny protection to their own
nationals, so that they could deny protection to foreigners. This reasoning
was mainly applied in the pharmaceutical and chemical fields.
There was nothing else for the main players but to change the game rules.
And they did it by simply introducing a new trump. Formerly, the major
argument for promoting the international protection of inventions through
patents
___________________________
205
Translation into Portuguese: A regra da não discriminação contida no artigo 27.1 é voltada para proteger os
titulares de direitos contra políticas arbitrárias que minem seus direitos, quando esses tipos de políticas são
adotadas em termos de áreas tecnológicas, o local de invenção ou de origem (produzido localmente ou
importado) dos produtos.
A preocupação sobre a necessidade de diferenciar direitos de acordo com os tipos de invenções foi debatida
exaustivamente. Muitos consideraram por que direitos de patentes de efeitos e duração iguais devem ser
concedidos para invenções que tenham feito contribuições diferentes, algumas delas significantes e outras nem
tanto. Os debates foram focados largamente sobre a duração dos direitos sobre patentes, tendo em vista a taxa
de obsolência da tecnologia e os períodos necessários para recuperar investimentos em P&D variam
significativamente de setor para setor. De fato, leis de patentes em muitos países freqüentemente permitem uma
diferenciação com base na área tecnológica, como ilustrado através da extensão de proteção conferida a
patentes farmacêuticas nos EUA e Europa no sentido de compensar o período necessário para obter a
aprovação de comercialização de uma nova droga.
206
CARVALHO, Nuno Pires de. The Structure of the Systems…, p. 404-405.
101
patents was the promise of technology transfer. It was in this frame of mind,
moreover, that Brazil had requested from the General Assembly of the
United Nations to examine true impact of patent protection, as I described
above. But as this argument seemed not to have convinced the free riders,
the United States and the European Communities changed the trump card:
the international protection of the intellectual property was not only worth to
encourage technology transfer, but also and above all, to ensure free trade.
In a particular work on the implementation of the TRIPS Agreement, analyzing
the article 27, reaffirming that TRIPS has not innovated in relation to the article 2 of
the PC, the same interpretation prevails over what it was at that time and what it is
today, Denis Borges Barbosa207 notes:
This time, it is not introduced, with the TRIPS, concerning the nondiscrimination standard, any new requirement; any new face to the nondiscrimination rule of the Paris Convention. Furthermore, since it is
consecrated by an a-hundred-ten-year-tradition of peaceful application, the
practice followed since 1884 in the application of the Paris Convention is
applied to the understanding of the Article 27 of the TRIPS, in accordance
with the Article 30.2b of the Vienna Convention.
In short: what has never been considered discriminatory under the Paris
Convention, shall not be so under the TRIPS.
The fact is that the patent system should work as a doer of the social interest
and the technological development of the Country to the same extent as it is
necessary to fulfill this function. When it goes beyond or falls short of these goals we
come across diversion that must be corrected.
One of the diversions of foundation is exactly the disregard of the equality
principle when there is the equal treatment to diametrically diverse technologies,
leading to an inadequate protection to the constitutionally provided one. That is,
techno end
__________________________
207
BARBOSA, Denis Borges. Intellectual Property – The implementation of the TRIPS Agreement. 2
ed. Rio de Janeiro: Lumen Juris, 2005, p. 142-143.
102
technologies that end up retaining a temporarily or qualitatively greater protection
than what its very essence requires, inserted into a system that is extremely legally
unsafe by nature.
Now, the patent rights, among property rights, are the most unstable and the
ones that present the greatest legal uncertainty to their holder and to those who one
way or another are involved or connected to the exploitation of such rights.
It all begins with the difficulty of definition of state of the art for determining
novelty and inventive activity. Like everything else that has become accessible to the
public, by written or oral description, prior to the date of patent application, worldwide,
regardless of the language used or the ―publishing‖ means, it should be considered
as relevant material for the analysis of the novelty and inventive activity
requirements, it remains clear that it is impossible to exhaust the analysis in 100%
safe way before filing the patent application and often throughout the patent life 208.
As the detailed analysis of the legal uncertainty inherent in the patent system
is not object of this study (but it serves as a factor to identify the need for a correct
understanding of the equality principle as the basis of the system), here are some
brief considerations on this inescapable legal uncertainty.
- Period of 18 months of patent application secrecy: before starting research,
before entering a patent application, during the process of patent application and
prior to effectively using the technology object of the patent application, good practice
recommends that a search be conducted on the state of the art to identify relevant
anteriority that might limit or interfere the rights of the holder of the patent application
or
__________________________
208
Law 9,279/96: Art. 11. The invention and utility model are considered new when not included in the
state of the art. § 1 The state of the art comprises everything made accessible to the public prior to the
date of filing the patent application, by written or oral description, by use or otherwise, in Brazil or
overseas, except as provided in the arts. 12, 16 and 17.
103
or the granted patent. However, as there is a statutory period of secrecy of 18
months from filing the patent application on (during which you cannot know the
content of the patent application); any search for anteriority, no matter how
extensively and carefully conducted, will not identify any eventual relevant anteriority
existing in the past 18 months209. This fact by itself, already makes the system
insecure and risky.
- State of the art consists of everything that was accessible to the public in
Brazil and overseas: Not only the patent documents that are considered as state of
the art. Any lecture, scientific article, text, description or any disclosure of analogous
knowledge, in any language and in any country, can be considered as relevant state
of the art to stop the acquisition of a patent or even to cancel the granting of a patent.
It is humanly impossible to exhaust the search for state of the art before, during and
after filing a patent request. Another factor that shows a total legal uncertainty in the
patent system.
- The patent nullity can be argued throughout its term: After the lengthy
process of patent application, involving opportunities of third parties intervention, the
search conducted by the applicant and by the examiner of the BPTO, if not located
prior deterrent anteriority in the researched state of the art and provided that it fulfills
legal requirements, the patent is at last granted and, subsequently, the Letter Patent
is issued. However, unlike the limitation periods provided in the Civil Code, since it is
an atypical property right, of outstanding character and strongly driven by the public
interest, the term to file a patent nullity action lasts throughout its validity. Therefore,
it starts on the date of its granting and only ends on the last day of its validity. And
else, the effects of the declaration of nullity retroactive to the date of the filing of the
patent
__________________________
209
Besides being provided the secrecy in the Law 9,279/96, such secrecy is an internationally
accepted and virtually uniform rule. This is provided in the article 30 of our IPL: Art. 30. The patent
application will be kept secret during 18 (eighteen) months from the date of the filing or the date of the
earliest priority, after which it shall be published, except as provided in the art. 75.
104
patent, as if it had never generated any legal effects 210. And it could not be
different211.
- During the processing, the patent application might go through changes: On
the holder‘s initiative or on the requirements of the BPTO patent examiner, the patent
application may be modified during the process. However, there is no provision of a
republication of the application, prior to its granting, unfolding the changes made and
giving opportunity to the manifestation. The dissonances of this absence of
republication together with the arrangements provided in the Administrative
Procedure Act (Law 9784/99), as well as the limits of the possible changes are not
object of this work, since what is relevant it is to note the possibility of change added
to this lack of republication of the altered application as another factor contributing to
the legal uncertainty in the current patent system212.
- Interpretation of the limits of protection granted to patents: even if there is the
express legal provision providing limits of protection granted by the patent 213, the
legal provision itself forwards the protection to interpretation. And as the act of
interpreting, however methodological it might be, is not an exact science, here is
another element of legal uncertainty in the patent system.
It is concluded that, an uncertain system by nature that, besides this legal
uncertainty, does not properly use a factor of discrímen based on the technological
differences
__________________________
210
Law 9,279/96: Art. 48. The nullity of the patent shall take effect from the date of the filing. […]. Art.
56. The nullity action may be brought upon at any time during the validity of the patent, by the BPTO
or by any other person with legitimate interest.
211
Understanding the rationality of the patent system as a connected functional exception, if any of the
requirements for patentability have not been fully met, it is important to recognize the fundamental
constitutive addiction of a right that could not have belonged to the holder of an annulled patent.
Accurate analysis of the patentability requirements and retroactivity of the effects of nullity till the date
of the patent filing are demandable due to the very essence of the patent system. Legal certainty shall
be established once there is the expiration of the term of the patent validity, lest, during this period,
anyone should argue the nullity of this limited and temporary ownership.
212
Law 9,279/96: Art. 32. To better clarify or define a patent application, the applicant may make
changes until the request for examination, provided that they are limited to the issue initially exposed
in the application. […]. Art. 35. Because of the technical examination, the search report and relative
feedback will be elaborated a: I – patentability of the application; II – adaptation of the application to
the claimed nature; III – reformulation of the application or division; or IV – technical requirements.
105
differences of each technological creation eligible to obtain a patent, generates a
further factor of unnecessary legal uncertainty in the system.
This fact is clearly seen in the area of technology involving computer
programs, as highlighted by Michael Meurer and James Bessen 214:
We believe that, on average, software patents suffer notice problems more
acutely than patents drawn from most other areas of technology. There also
seem to be large numbers of obvious software patents, which aggravate
these notice problems. Taken together these factors probably explain why
software patents impose higher litigation costs than other types of patents. 215
These authors cite several legal cases in the USA in which the legal
uncertainty resulting from patents involving software is clear, especially the difficulty
in determining the clear limits of the technology in this area 216.
According to statistics from the World Intellectual Property Organization –
WIPO the number of patents in effect (already granted and within their validity) has
been gradually increasing, as described below217:
_________________________________________________________________________________
213
Law 9,279/96: Art. 41. The protection extension granted by a patent shall be determined by the
content of the claims, interpreted based on the descriptive reports and by the drawings.
214
MEURER, Michael J. e BESSEN, James. Op. Cit., p. 194.
215
Translation into Portuguese: Nós acreditamos que, na média, patentes de programas de computador
sofrem de problemas de informação consistente mais agudamente do que patentes da maior parte de
outras áreas tecnológicas. Também parece existir um grande número de patentes de programas de
computador óbvias, o que agrava esses problemas de informações consistentes. Tomados em
conjunto esses fatores provavelmente explicam por que patentes de programas de computador
geram maiores custos de litígio do que outros tipos de patentes.
216
One of the examples cited is the E-Data case, in which the interpretation of the claims in a wider
way based on the technique of using vague terms such as ―material object‖, generates a greater legal
uncertainty and a greater loss for the patent system as a whole. There is no doubt that the
interpretation of a patent should be in a restrictive not ampliative way. See Interactive Gift Express, Inc
v. Compuserve Inc., 256 F.3d 1323 (dispute involving patent US 4,528,653) and in the same sense of
problematic interpretation of the patent limits: Wang Lab.,Inc. v. America Online, Inc. 197 F.3d 1377
(dispute concerning the US patent 4,751,669) and also Pinpoint Inc. v. Amazon.com Inc., 369 F.Supp.
2d 995 (dispute concerning the patent US 5,758,257).
217
World Intellectual Property Indicators. Produced by World Intellectual Property Organization. 2009
Issue, p. 41.
106
In 2007, the total number of patents in force across the world is estimated
to be around 6.3 million. The United States of America (1.8 million) and
Japan (1.2 million) are the countries in which most patents are in force.
Compared to the United States of America (US) or Japan, the number of
patents in force in China is low. However, in recent years there has been a
significant increase in the number of patents in force in China, reflecting the
increase in the number of patents issued by the patent office of China (see
A.23 and A.24).
Residents of Japan (around 1.7 million) and the US (around 1.2 million)
owned the majority of patents that were in force in 2007. Between 2005 and
2007, the number of patents in force owned by residents of China, the
Republic of Korea and Israel increased by 69.4%, 32.0% and 16.1%,
respectively, while the number of patents owned by residents of Ukraine and
Germany decreased by 16.1% and 14.1%, respectively. Some countries,
such as China and Mexico, rank higher in terms of patents in force by patent
office than by country of origin, reflecting the presence of a large number of
foreign applicants in their respective domestic markets (see A.4).
For the patents in force by patent office indicator, the European Patent
Office is not reported because EPO issued patents are converted into a
bundle of national patents, which are validated and maintained at national
patent offices.218
Such data demonstrate the growing number of patents in force, as well as the
_________________________
218
Translation into Portuguese: Em 2007, o número total de patentes em vigor mundialmente era
estimado em aproximadamente 6.3 milhões. Os Estados Unidos da América (1.8 milhões) e Japão
(1.2 milhões) são os países nos quais a maioria das patentes está em vigor. Comparado com os
Estados Unidos da América (US) ou Japão, o número de patentes em vigor na China é baixo. No
entanto, nos anos recentes têm ocorrido um aumento significante de patentes em vigor na China,
refletindo o aumento do número de patentes concedidas pelo Escritório de Patentes da China (ver
A.23 e A.24).
Residentes do Japão (aproximadamente 1.7 milhões) e dos EUA (aproximadamente 1.2 milhões) são
titulares da maioria das patentes que estavam em vigor em 2007. Entre 2005 e 2007, o número de
patentes em vigor de titularidade de residentes da China, República da Coréia e Israel aumentou em
69.4%, 32% e 16.1%, respectivamente, enquanto o número de patentes de titularidade de residentes
da Ucrânia e Alemanha diminuiu 16.1% e 14.1%, respectivamente.
Alguns países, como China e México, estão mais bem classificados em termos de patentes em vigor
por Escritório de Patentes do que por país de origem, refletindo a presença de um grande número de
requerentes estrangeiros nos seus respectivos mercados domésticos (ver A.4).
Para as patentes em vigor por indicativos de Escritórios de Patentes, o Escritório Europeu de
Patentes não é computado porque EPO concede patentes que são convertidas em uma série de
patentes nacionais, as quais são validadas e mantidas nos Escritórios Nacionais de Patentes.
107
growing number of future patents that will take their place in the competitive
environment, all of them having equal rights, even dealing with completely different
technologies. In the US there were 1,800,000.00 patents in force, whereas in Brazil
there were 31,000 in 2006, which produce legal effects in the market.
It is important to note that the legal uncertainty inherent in the patent system,
when applied in the area of computer programs, takes greater dimensions because
the use of more comprehensive terms for the protection of the developed technique
solution generates a far greater impact on the analysis of the patent limits as to its
enforcement. Much of this problem can be attributed to the use of principles, rules
and protection criteria not designed specifically in compliance with the technology
peculiarities involving computer programs.
According to Beresford
219
, the first patent filed in the area of patents involving
computer programs is from 1962 and aimed at protecting an improvement in the
computer memory management.
The national and international discussions about whether or not having the
possibilities of patent protection involving software has lasted until today, despite
already having a greater uniformity in the sense that if the technical solution is
implemented by a computer program, but it fulfills the requirements of patentability,
there is no way to deny the patent granting, since the source code or the computer
program itself would not be being protected 220.
___________________________
219
BERESFORD, K. Patenting Software under the European Patent Convention. London: Sweet
& Maxwell, 2000, p. 4.
220
Law 9,279/96: Art. 10. It is not considered invention nor utility model: […] V- computer programs
per se;
108
The European Patent Convention (EPC) has the same view of not considering
a computer program as an invention 221.
In this sense, in manifestation almost two decades ago, the memorable and
cherished encourager and defender of intellectual property, Fr Bruno Jorge
Hammes222, shows that the protection of technology patents involving computer
programs was possible, but treated as complementary to Copyright protection:
Tendencies and perspectives. It can be said that the copyright protection of
computer programs has been seen as the most appropriate way; for twenty
years it has met its purpose and presumably will do so for a long time. It has
been generally accepted and practiced. Even when the peculiarities of the
program imply that the Copyright is not suitable, the tendency is
complementarily rely on other legal institutions, such as invention patent,
unfair competition, contractual form. […] There are situations in which the
patent law can be complementarily arrogated. It occurs in technical
inventions related to programs, in which the program is part of a technical
complex.
André Bertrand223 also reflects the existing concern at the time about failures
of adaptation of Copyright protection to computer programs, considering that:
A useful weapon directed against exact copies made by ―pirates‖, but
which is an insufficient resource when it comes to affecting a third party, a
competitor, for instance, who will have taken possession of some software
internal logic without copying the instructions, so that he might benefit from
that inside of his own company, thus saving money at the creator‘s expense.
__________________________
221
Article 52 of the European Patent Convention of 1970: (1) European patents shall be granted for
any inventions, in all fields of technology, provided that they are new, involve an inventive step and are
susceptible of industrial application. (2) The following in particular shall not be regarded as inventions
within the meaning of paragraph 1: (c) schemes, rules and methods for performing mental acts,
playing games or doing business, and programs for computers;
222
HAMMES, Bruno Jorge. ―Software‖ and its legal protection. Legal Studies, São Leopoldo, v. 24, n.
63, p. 73, Jan/Apr 1992.
223
BERTRAND, André. The legal protection of computer programs. Porto Alegre: Livraria do
Advogado Editora (Lawyer‘s Library Press), 1996, p. 29.
109
So, basically, what occurs at the national and international level is the
separation (within the same technology) from what is protected by Copyright (source
code, visual screens, descriptions, that is, the program itself) and from what is
protected by the patent system (processes or systems that involve a computer
program as a means for performing the process or system, i.e., the program itself is
not protected).
However, the discussions on how to protect, through the intellectual property
system, technologies included in a computer program and those implemented by it,
are historically relevant, since there was a major debate about the possibility of
protection exclusively by the Copyright or by the creation of a mixed system of
protection because of the sui generis nature of the computer programs224.
Alexandre Dias Pereira225 concludes, after historical and conceptual analysis
of the express intellectual creation or the one which contains a computer program,
that:
Well, will it make sense to assign private rights over the ―thinking‖
operations of computers? What is the foundation to exclusively reserve the
possibility of a computer to be controlled and operated in a particular way?
Will it not be translated into an obstacle to the evolution of the ―cyberbrains‖?
Now, in our view, the answer is right here. Computers are machines and
machines are objects of rights, not subjects. It seems untenable assigning
private rights over the intellectual operation of the human spirit; we do not
believe so for the machines. The machine, as a thing, can be object of
rights, regarding its physical appearance, as well as to its intellectual
composition.
In other words, the machines ―intelligence‖, contrary to human beings, can
be taken away. The patent rights will be, precisely, the legal form suitable for
this possession.
The legal nature and the necessary form of writing a patent involving computer
programs differ from other traditional forms of intellectual creations protected by
copyright and by patents. Echoing the criticism of undue adequacy of computer
programs
____________________________
224
See, among others, PEREIRA, Alexandre Dias. Software Patents. In: Portuguese Association of
Intellectual Property Law, Coimbra, V. I, 2001, p. 385-429.
225
PEREIRA, Alexandre Dias. Op. Cit., p. 421.
110
programs to current forms of protection of intellectual creations, in particular with
regard to patentability, Luiz Antônio Xavier dos Santos 226 points out several relevant
technical issues:
For an invention to be patentable it should meet the following
requirements: novelty, inventive activity and industrial application (IPL art. 8).
In fact, the patentability requirements in the Brazilian legislation follow similar
patentability concept defined by the art. 52(1) of the European Patent
Convention (EPC), as previously mentioned.
The concept of industrial application – concept not used in the US
legislation – means that the invention should be used or produced in any
kind of industry (IPL art. 15). The invention should contain technical
specifications and should be related to a product or manufacturing process
(IPL art. 42 and Normative Act item 15.1.3.2 – NA 127/97).
Maria Dal Poz and Sandra Brisolla (2004) report that the ―vast majority of
countries now recognize as patentable an object that represents a ―technical
contribution‖, i.e., an industrial application. This characterization is
considered too much restrictive by the USA, which defend the use of the
concept of ‗utility requirement‘ or ‗practical application‘‖ [31].
Therefore, the concept of utility is one of the reasons why an invention
related to the software is prone to patentability in the United States.
Another important factor for us to analyze is the invention description. The
art. 24 of Law 9,279/96 establishes that the report should describe clearly
and sufficiently the object, in order to enable its implementation by a skilled
technician and indicate, whenever appropriate, the best form of
implementation. It is known that computer programs are not fully described
(the source codes, for example, are not fully disclosed). In fact, the BPTO
Resolution no. 58/98 that established rules and procedures relating to
registration of computer programs, provides in the art. 4(2) that the technical
documentation is made up of the full or partial listing of the source program.
Another important question: would the computer program be an ―object‖
which enables its implementation by a skilled technician, as provided in the
art. 24 of the IPL?
It is known that when the programs are deposited they are truly ―black
boxes‖ and are not fully disclosed. The depositor almost never reveals the
program source code, since he prefers to keep it as an industrial secret to
prevent copying and piracy. The programs are not objects and are usually
described in flowcharts, mathematical formulas and graphic interfaces.
How can a computer program, which is not an object, be reproduced and
performed by a skilled technician and be patentable by the art. 24 of the
IPL?
In the United States, contrary to Brazil, the object described in the
descriptive report does not need to be fully revealed. It only needs to be
sufficiently described and understood in the technology sector to which the
patent protection is intended.
Dal Poz and Brisolla (2004) also report that the permission for the
patenting can be obtained: ―i) from a description based on subjective inquiry,
which conceals many characteristics of the object to be patented or,
patented
__________________________
226
SANTOS, Luiz Antônio Xavier dos. The legal protection of software with emphasis on patent –
The conflicts, interests and alternatives. Elaborated on Feb/2007 and inserted into Jus Navigandi n.
st
1644 of Jan 1 , 2008, p. 2. Available at http://jus2.uol.com.br/doutrina/texto.asp?id=10312&p=2 Accessed
rd
on: Feb 23 , 2009.
111
ii) in the case of objective explicitness on it, forcing the disclosure […]. Laws
in the USA and in some developed countries, follow the first provision, while
developing countries pursue the maintenance of the current standard of
objective description‖ [32].
Therefore, the description of the application based on the subjective inquiry
is another reason why an invention related to the software is prone to
patentability in the United States.
A computer program, besides not being considered an invention (art. 10, V
of Law no. 9,279/96), is a purely abstract conception (not patentable by the
art. 10, II of the Law) and also a mathematical method (algorithm) (not
patentable by the art. 10, I of the Law) and, if related to a computer, it will not
―turn‖ into a product or process with ―technical characteristics‖ that can be
manufactured in the industry (not susceptible to industrial application and not
patentable by the art. 8 of the Law).
Engr. Abrantes reports that ―patent protection has been significantly
expanded at the international level‖ and at the endnote of the article he
explains that ―in the United States the decision of the Supreme Court
Diamond v. Diehr 1981 starts a series of decisions increasingly expanding
the possibility of software patents‖[33].
It is a real fact that the 1981 Diamond v. Diehr case starts a series of
decisions increasingly expanding the possibility of software patents, but only
in the United States, Japan and EPO. As for the argument that the patent
protection ―has been significantly expanded at the international level‖ does
not correspond to the reality. The European Parliament recently rejected, in
2005, the software patenting, and the vast majority of developed and
developing countries also oppose the patenting.
Further, incisively contrary to the protection of any intellectual creation that
might be related to computer program, Luiz Antônio Xavier dos Santos 227 points out:
The regime of protection for computer programs as invention patent is not
liable to privilege, according to the art. 10, item V of Law no. 9,279/96.
The program when related to a computer, does not technically alter the
functioning of the computer. According to Professor Pedro Resende, only by
designing the chip, during the computer project stage, it is possible to alter
the functioning of the computer. He exemplifies ―the same way as a disc
does not alter the functioning of a turntable‖.
A computer program is a purely abstract conception, a mathematical
method and is not liable to industrial application. It is not patentable also by
the art. 10, items I and II, and by the art. 8 of the IPL.
Most of the Patent Offices in the world do not consider the patentable
computer program as an invention. The USPTO, JPO and EPO Offices,
together, make up the Trilateral Patent Office. Not coincidentally, the three
Offices grant software-related patents.
__________________________
227
SANTOS, Luiz Antônio Xavier dos. Op. Cit., p.3.
112
The USPTO and JPO do not follow the TRIPS Agreement, since they do
not apply the ―industrial application‖ requirement. They advocate
harmonizing the patent system, but the patentability requirements provided
at TRIPS are not met and harmonized in their Patent Offices.
After the start of the software-related patenting, the United States and
Japan also considered the patentable computer programs as business
models.
In the Brazilian legislation, the business models are abstract conceptions,
financial and commercial methods, etc. and are not liable to industrial
application as well (they are not patentable by the art. 10, items II and III of
the IPL).
The logic of the patent system is to privilege the true inventor who invents
something creative and something that has an application in the industry.
The invention, after a given period, is put in public domain so that the whole
society might enjoy its benefits.
The increase of the scope of an invention leads to the increase of the
private monopoly, and consequently, the reduction of the public benefit,
affecting Brazil and the developing countries to have public access to new
knowledge and preventing researchers and inventors from developing their
own inventions.
The software patenting goes against the principles of the patent system
that does not accept the patenting of an invention that is vulgar, abstract and
has no industrial application.
We might partly disagree with this position, because in fact, an intellectual
creation related to a computer program (and not the computer program itself) is likely
to meet the requirements of patentability and therefore, eligible to obtain a patent.
There are several recognized examples and even cited by the author above, since
they result in effective technical solution of a technical problem and meet the
requirements of patentability (PI9504218 – memory allocation in a printing system;
PI9503180 – control of car gears; PI9404321 – image processing MPEG; PI9307625
– television program selection system; PI9306983 – telecommunications system;
PI9302550 – encryption system; PI9300395 – graphics window control; PI9203427 –
multimedia system task control; PI9107319 electronic mail; PI9105295 – character
recoPI
113
recognition; PI8404687 – elevator control; PI8402214 – data printing)228.
In this sense the very Patent Office Board BPTO in its Examination Manual of
1991 explains:
An invention cannot be excluded from legal protection, provided that the
conventional requirements of patentability are met, merely by the fact that for
its implementation they use computer programs.
Thus, the computer program itself is excluded from patent protection;
nevertheless, if the program controls the operation of a computer, even
conventional, the unit resulting from the computer and the program
combined can be a patentable invention as a method or device.
The problems in protecting technologies implemented by software as patents
are related to the adequacy of a system that was not initially developed to such
technologies.
Dan Burck and Mark Lemley229 believe that the best solution for the
problematic adaptation of new technologies to the old patent system lies in the
correct interpretation of the courts in cases involving patents:
Both innovation and patent Law unquestionably work differently in different
industries. The law can either take account of those differences or seek to
ignore them. Ignoring them would require major changes in existing law, and
would leave the law ill-equipped to deal with the fundamentally different
ways in which innovation works in different industries. Indeed, given the
crisis of confidence the system currently faces, it is not much an
exaggeration to say that the patent system must bend or break: a patent
system that is not flexible enough to account for these industry differences is
unlikely to survive.
[…]
__________________________
228
Available at www.inpi.gov.br. Accessed on April 22nd , 2009.
BURK, Dan L.; LEMLEY, Mark A. The patent crisis and how the Courts can solve it. Chicago:
The University of Chicago Press, 2009, p. 167 e 169.
229
114
Courts are better suited than Congress to take account of these changes,
but to do so they will have to remain open to considering evidence of those
changes. Put another way, legal rules will have to evolve in the common law
tradition.230
Notice that, as previously described in the work of Michael Meurer and James
Bessen231, there is a legal uncertainty in the delimitation of the limits of patents
involving software besides the usual uncertainty related to the possibilities of
interpretation of a patent in more traditional technologies; causing a well-defined
problem when it comes to dealing equally with diametrically different technologies.
Treating as property right (which traditionally has its limits well defined)
technologies involving software that are defined through writing and several linguistic
possibilities aimed at the future protection of the patent, ends up generating an
inadequacy, whose base is on the non-proportional treatment to the inequalities of
these technologies in relation to others.
Analyzing empirically all lawsuits involving patents in the area of software,
biotechnology and business methods in the USA (2002 data), Bessen and Meurer 232
have shown that the percentage of lawsuits in the area of patents involving software
is absurdly higher than other technological areas, and in these lawsuits that argue
about patents involving software, arguments involving the writing and interpretation of
patents are extremely common.
__________________________
230
Translation into Portuguese: Tanto inovação quanto o Direito de Patentes inquestionavelmente
funcionam diferentemente em diferentes indústrias. A lei pode ou levar em conta essas diferenças
ou procurar ignorá-las. Ignorando-as então irá demandar maiores mudanças na lei existente, e iria
deixar a lei mal equipada para lidar com as formas fundamentalmente diferentes nas quais a
inovação funciona em diferentes indústrias. De fato, tendo em vista a crise de confiança que o
sistema enfrenta correntemente, não é exagero dizer que o sistema de patentes deve se dobrar ou
quebrar: um sistema de patentes que não é suficientemente flexível para lidar com essas
diferenças de indústrias possui uma improvável chance de sobrevivência. [...]. Tribunais são mais
bem preparados do que o Congresso para lidar com essas mudanças, mas para isso eles terão
que permanecer abertos para considerar as evidências dessas mudanças. Colocando de outra
forma, regras legais terão que ser envolvidas dentro da tradição da common law.
231
Op. cit., p. 198-253.
232
MEURER, Michael J. ; BESSEN, James. Op. Cit., p. 191.
115
Not surprisingly, the highest probability of litigation in the USA is related to
business method patents, which are legal in the US system, but not susceptible of
protection in the vast majority of other legal systems (e.g. Brazil and Europe do not
allow the patenting of business methods). That shows, once again, the more abstract
the possibility of writing a patent application, the greater the possibilities of legal
indefiniteness of protection and the greater the chances of validity discussion, scope
and interpretation.
Since in the Brazilian legal system, the business methods are not considered
inventions by express legal provision 233, the issue addressed herein focuses on
patents involving software.
Therefore, the current legal system related to the protection of technologies
involving computer programs presents two main problems: the first related to the
adequacy itself of the patent system which was not created for the protection of this
kind of technology (equal treatment to diverse technologies) and the second
regarding the interpretation of this kind of legal protection as to its limits (often
ampliative interpretation for the future, blocking and/or putting up barriers of hard
definition for the entry and establishment in the competitive market).
And, in a perspective of competition, highlighting how the protection systems
and the use of technology should be evaluated, by examining the social value of the
patent, Denis Borges Barbosa234, states that:
Reichmann says that whether the minimal protection or the proper protection
or the reasonable protection do not meet more effectively the competition
interests should be examined. The value of the patent or the value of the
software should be evaluated not in terms of meeting the final utilities, but
rather, in terms of the capacity the intellectual property has of increasing
competitiveness.
__________________________
233
Law 9,279/96: Art. 10. It is not considered inventions or utility model: III – schemes, plans,
principles or commercial, accounting, financial, educational, advertising, lottery and supervision
methods.
234
BARBOSA, Denis Borges. An introduction to… p. 637.
116
rather, in terms of the capacity the intellectual property has to increase
competitiveness. The value of the patent, in this universe we are in, is not
the care for the sick in Africa. The value of the patent, or the comparative
value of the several systems of intellectual property, is the capacity the
patent has to provide a greater competition in the market. Within the
assumptions that the hand of the market caresses and fondles everything
and from it come all the benefits of mankind, the patent, the copyright, the
MP3, all this new, and ever new systems of protection and the use of
technology should be evaluated in their capacity to increase competition.
Therefore, there are currently two well defined problems in the protection of
technical solutions involving computer programs: One of them related to protective
base that disregards the principle of equality of material goods and the other one
disregards these very peculiarities when interpreting the patent protection involving
software in the market (indefiniteness of the limits of protection). Regarding second
use patents, the first problem described as to the disregard of the principle of equality
of material goods based on factor related to the peculiarities of each technology is
also identified.
As mentioned above, an immediate effect of the mentioned problems on the
application of the patent law is that it might turn into an inhibitor of competition in the
formation of barriers to entry or even unduly increase of the cost of rivals.
Another problematic issue in the current patent system is the treatment given
to the patents for second medical use235 (or even first 236 or third237 medical use).
________________________
235
A new medical use for a particular product/compound that is already used as medicine for another
purpose.
236
A new use, as medicine, of a product/compound that is already known, but was never used in the
medical field.
117
The definition of patent for second medical use, given by the BPTO in its
public discussion on patentability of such technologies, is that ―The invention of
second medical use is based on the account of a new therapeutic activity of a
chemical compound already known, aiming at producing a product with different
purpose from the one already applied to the state of the art‖238.
That is, the inventions of second medical use would be those that developed a
new purpose for a chemical compound already known, being, in theory, patentable
should it meet the requirements of novelty, inventive step and descriptive
sufficiency239, since the requirement of industrial application, if understood in its
broadest sense, is easily met in this technological area.
There are several arguments against the granting of patents for second
medical use, and one of the major ones concerns the lack of novelty, industrial
application and inventive step or the existence of inventive step in a minor degree
(since the compound or the active principle already existed, so the research and
application to treat a diverse pathology would be more associated with the finding
than
___________________________
237
A new medical use for a particular product/compound that was already used as medicine for a
specific purpose, as well as, subsequently, for another purpose and, eventually, is researched and
developed for a third medical purpose for that product/compound.
238
Available at <http://www.inpi.gov.br/menu-esquerdo/patente/discussoes-tecnicas/diretrizes-paraoexame-de-pedidos-de-patentes-na-area-de-segundo-uso-medico/>. Accessed on Dec. 20th , 2009.
239
According to these interim guidelines still under discussion at the BPTO, the definitions of novelty,
inventive step, industrial application and descriptive sufficiency are as follows:
3. NOVELTY: The second use to be considered new should be substantially different from the use already
revealed in the state of the art. The patent application of second medical use should reveal the application
of a pharmaceutical product already known to treat pathology/ clinical status different from the one for which
this product was already applied in the first use.
4. INVENTIVE STEP: The second use invention is endowed with inventive step whenever, for a skilled
technician, it does not occur in an apparent and obvious manner of the state of the art.
However, in this particular area, some aspects should be carefully observed for measuring this requirement:
a) the mechanism of action; b) relation therapeutic activity-chemical structure; c) etiology of target diseases.
5. DESCRIPTIVE SUFFICIENCY: Clinical approach? Description of the stages of clinical trials?
Experimental tests in vivo associated with tests in vitro?
118
than the invention as to the inventive step requirement).
To solve this problem of meeting or not the requirements of patentability
(novelty, inventive step, industrial application and descriptive sufficiency), the
advanced public discussion itself established by the BPTO starts to outline specific
considerations lest second use patents be granted without technical criterion and
without the accurate examination of their patentability requirements.
Moreover, analyzing European, Japanese and Chinese cases of granting of
second use patents, within the scope of technical discussions debated at BPTO,
Flávia Riso Rocha240, notes that:
- When the claim is related to a class of compounds: analyze carefully
whether there is ground for such comprehensive claim.
- New use should be substantially different from the known use; it‘s not
only about a new form of expression, or more generic or more specific
expression of the known use.
- New use cannot be inferred directly by the mechanism of action or by the
pharmacological action of known use. The use invention of a known
compound is considered inventive if the new use cannot be derived or
expected from its structure, composition, molecular weight, known
physicochemical properties and use already revealed for such product, but it
uses a newly discovered property of the product and leads to an unexpected
or advantageous technical effect.
On the other hand, which is also cited by the same author in the abovementioned work, Argentina and India are examples of countries that do not grant
second use patents, and the arguments for not granting such patents are:
Indian Office
Indian Patent Act (2005)
__________________________
240
Available at: <http://www.inpi.gov.br/menu-esquerdo/patente/discussoes-tecnicas/diretrizes-paraoexame-de-pedidos-de-patentes-na-area-de-segundo-uso-medico/>. Accessed on Dec. 20th, 2009.
241
Op. Cit.
119
Section 3(d) of the Patent Act (1970): the mere discovery of a new form of
a known substance which does not result in the enhancement of the known
efficacy of that substance or the mere discovery of any new property or new
use for a known substance or of the mere use of a known process, machine
or apparatus unless such known process results in a new product or
employs at least one new reactant.242
Argentine Office
Second use patents are not liable to protection:
- Claims like: ―use of compound X (known) to treat disease Y‖: is equivalent
to a therapeutic method.
- Claims like: ―use of substance X (known) to produce a drug to treat
disease Y‖: lacks novelty, since the compound is already known for medical
use, as well as the drug manufacturing process.
- Claims like: ―process to manufacture a drug for the treatment of an illness
and characterized by containing the compound X (known)‖: lacks novelty, as
above-mentioned. The novelty of the manufacturing process is not derived
from the new therapeutic use, since the composition is already known.
That is, we go back to the interpretation fundamentals for the definition of
whether or not second use patents are likely to meet the patentability requirements.
Once these requirements are met, we should take heed of the fact that the
protection granted by the second or third use patent is as comprehensive as the one
granted to any other patent, i.e., even if the so-called ―inventive potential‖ related to
second use patents is smaller than the one related to other intellectual creations
eligible for protection by patents of invention, the ―privilege‖ is granted without any
difference, which demonstrates, in practice, an equal treatment to diverse ―inventive
potentials‖, going against the equality principle materially considered.
It is seen that the analysis of the fact that the second use patents meet the
harmonic preponderance of the utilitarian theories and the social planning theories,
despite
_________________________
242
Translation into Portuguese: Patent Act Indiano (2005). Seção 3(d) do Patent Act (1970): a simples
descoberta de uma nova forma de uma substância conhecida a qual não resulte em reforço da
conhecida eficácia desta substância ou a mera descoberta de qualquer nova propriedade ou novo
uso para uma substância conhecida ou o mero uso de um processo conhecido, máquina ou
aparelho a não ser que este processo conhecido resulte em um novo produto ou empregue pelo
menos um novo reagente.
120
despite having a direct relationship, is different from the analysis of meeting the
principle of equality of material goods considered under the premise of technological
diversity.
It is important to highlight some considerations brought by Charlene Maria
Coradini de Ávila Plaza243:
When we face the practical scope of the use claims it is important to reflect
on three unique questions. The first one is the legal possibility of formulating
a claim that would result in a patent directed to the use or not for the product
or previous process, so as not to confuse the public and the competitor by
the new title. The second question concerns the effectiveness of this patent,
because logically, granting this privilege we have to have an exact notion of
how the position of the contestants who have the previous privilege or
benefit from the technology in public domain would be, and eventually,
reconcile the social interests with the second use patent claim in practice.
In Brazil, we must call attention to the huge debate raging between ANVISA
(National Health Surveillance Agency) and the BPTO concerning the possibilities or
non-possibilities of granting second use patents 244. In this sense, Eduardo Ribas De
Biase Guimarães245 says:
The granting of patents involving second medical use – also known as
―Swiss formula‖ – is not the only type of controversial claim in the field of
intellectual property of drugs. It will be highlighted here because it was an
object of official resolution of ANVISA Collegiate Board – which did not occur
to any other type of claim – which generated broad debate. It is worth
mentioning the arguments of industrial property agents, class organizations
and ANVISA members over the issue.
__________________________________________
243
PLAZA, Charlene Maria Coradini de Ávila. Patent protection and innovation in pharmaceutical
industries: evergreening mechanisms and fair followers alternatives. Annals of the XVII CONPEDI
(National Council for Research and Post-Graduation in Law) National Congress, held in Brasília
th
st
nd
– DF on November 20 , 21 , 22 2008.
244
BPTO considers as susceptible to patentability, provided that the legal requirements are met and
ANVISA considers as non-susceptible to patentability. When it comes to the richness of the debate
and the international controversy itself on the topic, it is noted that the legal role of ANVISA in this
discussion is totally inappropriate, since it is not up to it to legally analyze patentability requirements.
245
GUIMARÃES, Eduardo Ribas De Biase. Right to Health and Drugs Intellectual Property in
Brazil. National Health Surveillance Agency prior consent. Dissertation submitted as partial
requirement for obtaining the Master‘s Degree in Collective Health, Postgraduate Course in Collective
Health – a major in Humanities and Health Science of the Institute of Social Medicine from Rio de
Janeiro State University. Rio de Janeiro, 2008, p. 51-53.
121
Second medical use patents refer to a patent medicine whose active
principle – namely, the substance in the composition that is responsible for
its therapeutic effect – is an old molecule that shows an unexpected new
therapeutic use. According to Correa (2006, 2007), even though they are
allowed in some countries, their patentability is not expressly required by the
TRIPS – which only forces the granting of patents on products and
processes. As a common practice in the pharmaceutical field, the author
points out that these applications are inconsistent with the novelty
requirements – since the compound to prepare the drug as well as the drug
itself would already be known – and with the industrial application – since
the novelty would be, in these cases, an identified effect on the human body,
and not the product itself or its manufacturing method. He finally points out
that the second medical use patent is substantially equivalent to a
therapeutic treatment method; something that is not subject to private
ownership in most countries. Other critical insights highlight the fact that new
uses are simple discoveries related to a product already known, i.e., they
would be a mere disclosure of an already existing feature in the product in
question.
The patenting of discoveries is universally forbidden in the intellectual
property system. However, some experts say that the applications that
involve the ―Swiss formula‖ are not random discoveries, but rather the result
of research, analysis and investments, and therefore, they represent
patentable inventive steps.
There is no international consensus on the issue. As TRIPS does not
require the granting of these patents, the national industrial property offices
have been adopting different approaches. The Andean Community60, for
instance, in official resolution, opted to reject the second use patent. 61 The
United States and Europe, in turn, considered it patentable. It is important to
remember that the legal controversy over the issue has a long history.
Ferrier (1994), analyzing these legal impasses in Europe, especially in the
history of the French patent system, says that the second pharmaceutical
application was not considered patentable for a long time. In 1960, when the
decree no. 60,507 introduced for the first time the drugs patent protection in
France under a specific title (brevet spécial de médicament), it was clear that
only the first application could be protected, and all subsequent applications
were thus not patentable. This same principle, of the limitation of the first
application, was also restored by the February 2nd 1968 French law, when
the drugs first entered the general patent act framework. Talking of the main
opinions of judges and lawyers about the issue, the author highlights that
there was no consensus on the possibility of such claim meeting the novelty
and inventive step requirements.
In the Brazilian scenario, it is noted the fact that the patenting of new
applications of an object already known has been traditionally accepted. At
the same time, there are opinions of experts indicating that the use patent
would not be possible in the current Brazilian legal conjuncture. Added to
this situation of uncertainty, the current Industrial Property Law does not
contain a specific provision that expressly forbids a second application in the
pharmaceutical field (Barbosa, 2004).
The BPTO, within this controversial context, decided to accept this type of
claim, as shown in the excerpts below taken from the guidelines for the
examinations of patent applications in biotechnology and pharmaceutical
fields:
There are two basic types of claims: those related to objects (compounds,
products, appliances, devices, etc.) and those related to activities
(processes, uses, applications, methods, etc.). ´[…]
2.39 Second use inventions
122
2.39.1 These inventions can be of two types: (i) a new use, as a drug, of an
already known product used outside the medical field (first medical use); (ii)
a new medical use of a product already known as a drug (second medical
use) […]
2.39.2.4 Claims such as: i) Use of product X characterized by the
preparation of a drug to treat disease Y. j) Use of product X characterized by
the preparation of a drug to treat disease Y, treatment that consists in such
and such. They are known as ―Swiss formula‖, and are almost exclusively
used in second medical use inventions. They are patentable, observing the
considerations contained in the items 2.23 above.
If there was differential treatment to deal with technical solutions involving
second medical use (among other technologies) the controversy over the analysis of
patentability requirements as well as the adequacy of the current protection to these
solutions would be solved.
When the second use patents are analyzed from the perspective of the
Decree no. 1355, 12/30/1994 (TRIPS Agreement), it can be seen that the provisions
of the article 27.1246 of the above-mentioned Agreement cover the protection for
second use patents, provided that the elastic patentability requirements established
by the TRIPS247 are met.
This is because at TRIPS, all technologies that meet such requirements and
that are not expressly excepted by other provisions of this Agreement, are subject to
patent
___________________________
246
Article 27. Patentable Subject Matter: 1. Subject to the provisions of paragraphs 2 and 3, patents
shall be available for any inventions, whether products or processes, in all fields of technology,
provided that they are new, involve an inventive step and are capable of industrial application. Subject
to paragraph 4 of Article 65, paragraph 8 of Article 70 and paragraph 3 of this Article, patents shall be
available and patent rights enjoyable without discrimination as to the place of invention, the field of
technology and whether products are imported or locally produced.
247
It is important to note that besides the hermeneutic open space of the concepts of inventive step and industrial
application, TRIPS makes an explicit reference in footnote, that For the purposes of this Article, the terms
―inventive step‖ and ―subject to industrial application‖ can be characterized by a Member as synonymous with the
terms ―non-obvious‖ and ―usable‖. Such caveats harmonize TRIPS with the U.S. treatment of the patentability
requirements and with those countries that follow the designations of these patentability requirements even more
elastically. The problem established at TRIPS (which concerns the present thesis) is that ALL technical solutions
that comply with the article 27.1 (except for the exceptions contained in this very Agreement) are subject to patent
protection and these patents have a less than 20-year term (article 33 of the same Agreement).
That is, within TRIPS, considering the applicable provisions to the area of patents, there is no way to establish
technological factors both based on the type of protection and based on the validity extension of that protection.
123
patent protections with equal rights and obligations 248.
In this sense, Maria Thereza Wolff and Paulo de Bessa Antunes249 state that:
The importance of research on other uses of known molecules grows
enormously today, since it has become prohibitively costly the search for
new molecules for invention of drugs, from their initial research to the sale in
the drugstore shelves. Thus, the new therapeutic effects have been given
vital importance in technological research and the patent protection is
absolutely necessary as an incentive for clinical trials and the Research and
Development (R&D). It is important to note that in the development of a new
molecule there are several lines of research, a primary one and the others
secondary. The granting of patents for second medical use has the great
merit of serving as stimulus so that the secondary lines are developed and,
often, the secondary lines become the primary.
We are talking about new inventions and not random ―discoveries‖, since
with the invention of known drugs for the treatment of other diseases there
are entirely different circumstances that will have to be tested. The new use
results from research, analyses and investments and not from a mere
chance, as those who oppose the second use patenting want it to be.
Actually, there can be no justification to discriminate the first and the other
uses since all represent patentable inventive step, the chemical may be the
same though. The research is protected and paid for as an inventive work,
not obvious or with an evident industrial utility.
It seems that one of the TRIPS Agreement problems is precisely the lack of
flexibility in enabling a temporal modulation or protective extension of the technical
solutions that are essentially diverse from those traditionally and originally provided
as susceptible to protection by the patent system.
___________________________
248
Taking as an example, the Argentine PTO interpretation to refuse to grant second use patents is formally in
accordance with TRIPS, for either it recognizes the lack of novelty or recognizes it as a therapeutic method, not
violating the provisions of this Agreement (at least formally considered). Now, the biggest problem with such
interpretations that generate either the possibility of granting patents for second use or its mere non-granting is
exactly in the extremism of such options, disregarding immediate solutions based on the application of the
equality principle. Technical solutions focused on the second use clearly have a lower level of inventive potential
in relation to the technical solutions of development of an entirely new compound to cure AIDS, for instance.
Using this same compound, adapted for the treatment of cancer clearly spared the compound identification
inventive step. By simply saying that the protection will be proportional to the one that was created as plus to the
compound initially developed and by saying that there will be dependence among the patents does not establish a
sufficient factor for the fulfillment of the equality principle materially considered.
249
WOLFF, Maria Thereza; ANTUNES; Paulo de Bressa. Patents for second medical use. BAIP
Journal, N. 74, p. 53, Jan/Feb. 2005.
124
It is worth observing that the terminology used or the framework used in the
treatment of intellectual creations applied in the industry that have a load of
inventiveness and an expression form of technical solution for a differential technical
problem, is not uniform. That is because while utility models are not considered
patents250 worldwide, in Brazil, through the Law 9,279/96, they are clearly arranged
as a kind of patent251, generating, since then, some confusion concerning the
terminology applied to it.
It is a fact that the technical solutions that have ―lower level of inventive step‖
and are applied in the day-to-day industry, also known as improvements, are usually
called ―small patents‖ or ―minor patents‖ internationally.
Besides Brazil, many countries provide protection for these intellectual
creations as lower level of inventive potential technical solutions, granting a shorter
period of legal protection than the one granted to patents of invention.
While patents of invention, by express provision of the TRIPS Agreement
cannot have a less than 20-year term from the date of the filing of the patent
application or the date of the first claimed priority, usually, the utility model (or utility
model patents as referred by the Law 9,279/96), when accepted in national legal
systems, have a term equal to or less than 10 years252.
__________________________
250
A clear example of this is the Paris Convention itself that, in its article 1, item (2) does not consider
the utility models as a kind of subspecies of patents: The protection of industrial property is aimed at
patents of inventions, utility models, industrial models or designs, service trademarks, business name
and the indications of source or the descriptions of origin, as well as the repression of unfair
competition.
251
Law 9,279/96: Art. 8 The invention that meets the novelty requirement, inventive step and industrial
application is patentable. Art. 9 It is patentable as utility model the object of practical use, or part of it,
susceptible to industrial application, that presents a new form or arrangement, involving inventive step
that results in functional improvement in its use or in its manufacture.
252
Except for Brazil, Honduras, Japan, South Korea and Malaysia, which have legal provision of
protection for utility models for 15 years, the vast majority of other countries that grant protection for
utility models (e.g., Germany, Argentina, Austria, Belgium, Bolivia, Chile, China, Colombia, Denmark,
Ecuador, Finland, France, Italy, Mexico, Peru, Russia, South Africa, Spain, Turkey, Venezuela, UAE,
among others) have protection terms equal to or less than 10 years only.
125
That is, in many countries this kind of higher industrial protection is provided
(called Gebrauchsmuster in Germany) and, when it is not provided with another term,
it can ―fit‖ into the requirements for patentability of inventions that end up being more
elastic253.
It is interesting to note the proximity of the concepts of invention and utility
model, and it is worth quoting the teachings of João da Gama Cerqueira 254 analyzing
such institutes still under the aegis of the old Industrial Property Code:
25. In principle, not only the creation of an entirely new product, previously
unknown or nonexistent is considered an invention, which is in fact very rare,
but also products created by the modification of analogous products or
similar ones, which have their own characteristics. It cannot be concluded,
however, that mere changes in the shape, size or proportions of objects or
products always constitute inventions. In general, such changes do not
constitute an invention. If it were otherwise, anyone could become an
inventor and obtain a patent, by simply increasing or decreasing the size of
an object, by changing its proportion or modifying its shape or
ornamentation. In Germany, for instance, it was recognized that such
modification in the dimensions and proportions of a gas burner, based on
experimental observations, allowing it to get lighting power significantly
higher with the same consumption of gas, was enough to characterize an
invention.
[…]
284. The object of the right over a utility model and, therefore, over the
respective patent, it is the model itself characterized by its shape and
structure, by the arrangement of its elements or by its devices. Unlike the
inventions, the object of the right, in this case, does not consist in the idea or
conception of the model, in the inventive idea (n. 218 above), but, as we
have said, it consists in the model itself, concretely considered and limited
by the novelty of its form. As we have seen at no. 89 of the volume 1, the
protection of utility models does not extend beyond the particular form that
characterizes them, while the object of the invention patent does not consist
in the form that the invention is carried out, but in the idea of invention, in
which the form appears only as a means of application of the forces of
nature.
__________________________
253
It is the example of the USA, since the patentability requirements there are more elastic (nonobvious and useful instead of inventive step and industrial application) many utility models, so named
in other countries, are eligible for protection as ―Utility Patents‖ in the USA. It is noted that in the USA
the term ―Utility Patent‖ is used to define the form of protection for inventions and to differentiate from
the term ―Design Patent‖, because there is no protection in the USA in the form of ―Utility Model‖. It is
interesting to note that in Brazil the industrial designs are not considered patents and in the USA they
are (Design Patent), and there they are submitted to substantive examination before the granting of
the Design Patent, which does not occur here in Brazil regarding the records of Industrial Designs.
With these observations, we conclude that it is important to note that under the designation and
requirements of Utility Patents in the USA, the protection of the so-called Utility Models in other
countries is often possible there.
254
CERQUEIRA, João da Gama. Op. Cit., p. 56 and p. 379.
126
Also dealing with utility models, already considered in the current reality, Denis
Borges Barbosa255 teaches that:
Under Brazilian law, as well as under Argentine, German, Greek, Italian,
French and Japanese law, for instance, together with the invention patents a
special kind of protection for the so-called utility models subsists.
Restricted, as a rule, to improvements or enhancements of tools,
equipment or parts, such small patents protect the creativity of the worker,
the production line engineer, the small inventor and the artisan. In theory, it
is the tutelage of the improvements resulting in greater efficiency and
convenience in any physical apparatus. According to the Law 9,279/96,
utility model is ―the object of practical use, or part of it, susceptible to
industrial application, that presents a new form or arrangement, involving
inventive step, that results in the functional improvement in its use or in its
manufacturing‖.
As basic criterion, the national laws require meeting lower requirements for
granting the patent, and they provide shorter terms, or more restrictive
protection conditions. In France, for instance, the report of the state of the art
for granting certificates of utility is exempted – lower cost to the inventor.
In Brazil, most of the national authors‘ patents are classified as utility model
(or UM). The notion of invention clearly houses the utility models.
Later in the same work, when dealing with the relations of utility model with the
TRIPS, Denis Borges Barbosa256 states that:
There is no reason for the incentive system to invention of countries like
Brazil to restrict itself to the great and noble invention patents. It seems
reasonable that, as part of a temporary program, an official system for
rewarding simple innovations, improvements in the concrete productive
process be founded, without questioning the inventive activity, or even the
objective novelty. Alternatively, the program could provide advisory support
or be in charge of the promotion of encouraging activities under each
company domestic policy responsibility.
Particularly notable the trend of the current intellectual property law of
reducing the requirements regarding the originality and creativity, the
protection of new technologies turns out to be more a guarantee of the
investment than the creativity itself. Thanks to this trend – and without the
slightest consideration for the most restrictive levels of inventiveness of the
developing countries – the rules of TRIPS do not oblige countries to
establish
__________________________
255
256
BARBOSA, Denis Borges. An introduction to…, p. 567.
Op. Cit., p. 571-572.
127
establish any system of protection for minor inventions and improvements,
leaving that decision to the national criterion.
Since the 1925 Hague Revision of the Paris Convention it is already provided,
internationally, the utility model protection257.
To conclude, it is worth quoting Barbosa‘s258 considerations regarding the
problematic definition of the inventive step requirement as an ―inventive activity in
lower potential‖ for granting patents of utility model (or utility models only):
As already seen, the ―inventive step‖ is an essential element of the utility
model.
It is hard, however, to discern the difference between ―evident or obvious
consequence of the state of the art‖ typical of invention patents, and the
―common or vulgar consequence of the state of the art‖, typical of the
models.
Is the subjective parameter relevant? Would the skilled technician, the
judge required in the inventive step, be replaced by a layman in the inventive
act case? What‘s the fine line between an invention that is clear or obvious
and the one that is common or vulgar? So, it is in this seamless limit that the
Utility Model shall exist in its new version.
As we read on the European Community Directive proposal on MU, the
inventive step should be the requirement that, relative to the state of the art,
the invention is not very obvious for an expert in the field. This formulation
establishes that the protection for utility model requires inventive data, and
not only novelty. However, the gradation proposed at the EC that
corresponds to the word «very» would indicate that such piece of inventive
data is not inferior to the one required for the patent.
A formulation like this exists under certain national laws on utility models. It
is about a technical or practical benefit for the utilization or manufacturing of
the product or process in question, or another benefit to the user, as for
instance, an educational benefit or a value in terms of entertainment.
__________________________
257
The original text of the PC of 1883 (Decree no. 9233 of June 28, 1884) in its article 2 did not mention utility
models, they were only treated in the article 1, paragraph 2 of the 1925 Hague Revision (Decree no. 19056 of
December 31, 1929), according to the original texts as follows: PC of 1883, article 2: Nationals of any country of
the Union shall, as regards the protection of industrial property, enjoy in all the other countries of the Union the
advantages that their respective laws now grant, or may hereafter grant, to nationals; all without prejudice to the
rights specially provided for by this Convention. Consequently, they shall have the same protection as the latter,
and the same legal remedy against any infringement of their rights, provided that the conditions and formalities
imposed upon nationals are complied with.
PC of 1925 (Hague Revision), article 1, paragraph 2: The protection of industrial property has as its object
patents, utility models, industrial designs, trademarks, service marks, trade names, indications of source or
appellations of origin, and the repression of unfair competition.
128
What matters to analyze is precisely the provision of a differential protection
based on a lower inventive potential expressed in specific intellectual creations, i.e.,
the existence of a factor of discrímen based on the inventive potential.
As the inventive potential is considered lower in the utility models, the solution
was to give a protection time lapse equally lower, in order to enable different
protection for different technical solutions.
This is an example of the application of the equality principle in its material
dimension historically inherent in the industrial property, i.e., there is a factor of
discrímen which considers the degree of inventiveness or even a mixture of the
degree of inventiveness with the technological area so that, because of this, it grants
a shorter term of protection in relation to the one provided for other intellectual
creations that are expressed as higher inventive potential solutions for technical
problems.
__________________________
258
Op. Cit., p. 569-570.
129
5 LIMITS OF THE CONSTITUTIONAL HERMENEUTICS AND THE
SYSTEM OBSTACLES
Within the integrative perspective, in which the hermeneutics tries to
understand the best solution for every factual situation, the constitutional and
infraconstitutional mechanisms outline parameters for an integrating systematic
interpretation, eliminating the ever apparent conflicts.
Hermeneutics provides suitable answers within a limit of a minimum of legal
predictability, and it is not up to it to create rules and principles, but rather understand
them and topically apply them, especially highlighting the teachings of Vicente de
Paulo Barreto259:
The process of constitutional hermeneutics, assumes, therefore, the
consideration of values and social and political conditions, which dictate its
roots in a moral understanding of the political body. It is not confused with a
semantic game or with the understanding of the application of the law as the
mere subsumption of the positive norm valued to the social facts. For this
reason, the contemporary constitutional hermeneutics cannot be restricted to
the interpretive processes typical of the understanding of the law, as a
dogmatic system to be read semantically. The hermeneutic process implies
more than a simple, seductive observation and acceptance of the existence
of rules. The contemporary constitutional hermeneutics, specifically to serve
the function of interpreting specific guidelines, which are legitimated by the
democratic state of law, takes place in the argumentative process, where the
values that precede the very construction of the constitutional order are
present. The contemporary constitutional hermeneutics lives a similar
situation to the one found in the advent of the protestant interpretation of the
body of tradition: and it is not currently about the creation of new mechanic
methods, which replace the old ones, but about a new conception of the
object under analysis, the legal phenomenon in question, through its
hermeneutic reading. Only thus, can the legal interpretation integrate into the
broader framework of the contemporary hermeneutics, as it is found
formulated and accepted in the humanities and social science field.
________________________
259
BARRETTO, Vicente de Paulo. From interpretation to constitutional hermeneutics. In: CAMARGO,
Maria Lacombe (Org.). 1988-1998: a decade of Constitution. Rio de Janeiro: Renovar, 1999, p. 18.
130
Always seeking to examine hermeneutics within a realistic view of the being,
which is undoubtedly made up of its pre-understanding, it is important to emphasize
the words of Gadamer260:
The overcoming of all prejudice, this global demand of Aufklärung, shall
prove itself as prejudice whose revision will give way to a more suitable
understanding of the finitude, which not only controls our human character
but also our historic consciousness.
Is it true that finding oneself immersed in tradition means at first hand be
subjected to prejudices and be limited in their own freedom? Is it not right,
rather, that all human existence, even the freest one, is limited and
constrained in many ways? And if it is right, then the idea of an absolute
reason does not represent any possibility for a historic humanity. For us,
reason only exists as real and historical, that simply means: reason is not
the owner of itself, because it always refers to the side on which it plays its
role.
That is, there is a historicity of the pre-understanding and the
understanding, but it is the pre-understanding that constitutes us, since truth
goes beyond the method.
One of the pre-understandings that is part of the patent system is the one
related to the assumption that the patent system itself, considered in its essence, has
more benefits than costs. Such pre-understanding is only partially true, as
demonstrated by several authors cited here regarding the problems raised by the
patent system in certain technological areas.
In order to undo some pre-understandings, the most important understanding
is to temporarily situate the patent system and understand that it has not gone
through substantial adaptations in its evolutionary history, since it has been about a
century of a certain international stability when it comes to the requirements for
obtaining a patent, despite a current increasingly technological evolution, as
highlighted by Marcos Wachowicz261:
__________________________
260
GADAMER, Hans-Georg. Op. Cit., p. 367.
WACHOWICZ, Marcos. Reflection on the technological revolution and the intellectual property
tutelage. In: ADOLFO, Luiz Gonzaga Silva; MORAES, Rodrigo (Coord.). Rio de Janeiro: Lumen Juris,
2008, p. 303.
261
131
The process of social assimilation of new technologies and the legal
planning of social changes produce a kind of misalignment between the
technological evolution and the adaptation of Law to new social situations.
This is an extremely significant and relevant issue given the recent
Technological Information Revolution, in which the socio-technological
evolution has acquired an exponential rhythm, of which Law resents a kind
of slowness for necessary changes in the legal planning.
However, the adjustments and adaptations of the legal planning in the face
of the socio-economic evolution are essential and unavoidable, even if they
occur later.
Obviously, before the TRIPS Agreement there was more national liberty to
establish a patentable issue or a non-patentable issue, to define what was
considered to be invention or not, among other liberties that existed in a system that
only provided minimal standards recommended for technology protection without
imposing sanctions or international repercussions.
That non-authoritative secular system composed by rules providing more
traditional technologies262 turned into a mandatory observance system, more
uniform, disregarding the evolutionary stage of each country 263 and without the
proper adequacy to the peculiarities of different new technologies created 264.
These aspects are not exempt from a constitutional filtration concerned about
an integrated and harmonic system that eliminate, within the possibilities of the world
of
_________________________
262
1883 Paris Convention (currently in force the 1967 Stockholm Revision) without imposing any kind
of imposing norm regarding the non-positive discrimination.
263
No matter how much it is alleged in the demonstration of reasons at TRIPS to have an attitude
Recognizing also the special need of least-developed countries Members in respect of maximum
flexibility in the domestic implementation of laws and regulations in order to enable them to create a
sound and viable technological base, the fact is that TRIPS, while agreement in the international field
as it is, privileged the bargaining power and the specific interests of countries most able to impose
their will. This noteworthy fact does not create the possibility of noncompliance of this Agreement, but
it demonstrates a need for harmonization and some reading of it in line with the 1988 Brazilian Federal
Constitution.
264
As already pointed out above, TRIPS provides in Article 27.1 a non-discrimination clause based on
the technology differences, as follows: Article 27. Patentable Subject Matter. 1.
Subject to the
provisions of paragraphs 2 and 3, patents shall be available for any inventions, whether products or
processes, in all fields of technology, provided that they are new, involve an inventive step and are
capable of industrial application. Without any damage to paragraph 4 of Article 65, paragraph 8 of
Article 70 and paragraph 3 of this Article, patents shall be available and patent rights enjoyable without
discrimination as to the place of invention, the field of technology and whether products are imported
or locally produced.
132
of facts, most of the system disintegrating clashes, since the relations established
between Constitutional Law and Private Law constitute a necessary linkage.
In a preliminary analysis between the Constitutional Law and the Private Law,
Paulo Bonavides265 clearly shows his constitutionalist vein concerned about the
integration and harmony of the legal system:
Both all other branches of Public Law and the Private Law find themselves in
a position of inferiority and submission – never of equality and coordination –
in the face of Constitutional Law. This is the one that, in a privileged way,
heads the legal planning, outlining the basic rules of the normative system.
Such statements demonstrate that every infraconstitutional legislation should
be interpreted in accordance and compliance with the constitutional axiological
harmony, since TRIPS, PC and IPL, although their particular rules have a higher or
lower extent over private and public interests, should be interpreted in accordance
and compliance with the Brazilian Federal Constitution.
In this integrating movement that seeks to keep away the existing clashes in
the system, Ângela Kretschmann266 highlights:
What should be understood, in the midst of so much controversy, is that
the protection system can serve and, should aim at precisely reconciling the
conflicting interests, provided that appropriate rules are focused on
protection, without exaggerating the power granted to the author or holder.
Actually, a suitable system can serve conflicting interests, all is needed is
establish benefits in a balanced form. In order to get it done, it is necessary
to respect the rules on competition, seek to balance the interests between
domestic and foreign market, considering that the economic globalization
has imposed limits to the government social and political action itself, within
the ambit of Intellectual Property.
__________________________
265
BONAVIDES, Paulo. Constitutional Law Course. 11. Ed. São Paulo: Malheiros, 2001, p. 33.
KRETSCHMANN, Ângela. Intellectual Property Rights and Human Dignity – Re(visting) the
Copyright in the Digital Age. Florianópolis: Conceito Editorial, 2008, p. 223.
266
133
Identifying the harmonic organization of the legal system, within a hermeneutic
analysis involving equality and property rights, important lessons are highlighted by
Ricardo Aronne267:
While the guarantee of private property is a special principle which
concretizes the general principle of liberty, the social function of private
property is to densify the equality principle.
Equality and liberty have a sense remelted from the one that emerged from
the liberal constitutions. They concretize the principle of human dignity as a
fundamental principle that connects directly to the Social and Democratic
State of Law.
[…]
In each normative interpretation, the whole system is being interpreted,
implying a process of concrete re-legitimation of law, whenever it occurs.
It occurs, because every time the Law is put into effect it holds a different
meaning. When this new meaning is not revealed, it implies a denial of
jurisdiction, since it would be unnatural and insecure for a law along the
years, to remain untouchably the same.
Property is not far from other institutions at this point, without damage of
the several economic myths whenever it might want to do otherwise. The
meaning that the economic system might want as to the ownership
entitlements goes through the mediation of the legal system in order to
acquire a meaning, or at least cogency.
Juarez Freitas268 brings fundamental contributions to understanding the limits
and possibilities of an integrating topic-systematic interpretation of the system:
For these reasons, we urge not to treat the interpreter like a passive
reagent to the established system, observing to prepare him for the arduous,
painful and not always well-made exercise of continuous vigilance on the
proportionality of his axiological considerations. The interpreter systematizes
– although does not create the Law (in terms of legislative production) – by
simply not surrendering to the supposed absolutism of the normative
prescriptions. By doing so, he draws limits to the legislator‘s own mission,
who cannot, in respect to the constituent power, engender antinomies that
pose special risks to the survival of the founding elements of the Positive
Law.
Such sensible and rational attitude – in the communicative sense of the
term, explained in the previous chapter – does not get confused at all with
the pure discretionarity advocated by many, even less with the discretion
that is anchored in fallacious arguments. The interpretation makes choices,
yes, chooses solutions, but it never does it indiscriminately, although there is
__________________________
267
268
ARONNE, Ricardo. Op. Cit., p. 106-107.
FREITAS, Juarez. Op. Cit., p. 76-77.
134
not ―the‖ right interpretation, it remains bound to the indeclinable duty of
finding systematically better solutions, at least as serene pretense.
It is in this pretentious way – in a good sense – that a hermeneutic harmony is
sought after, based on the application of the equality principle as the patent system
harmonic base while a constitutionally assured consideration of a factor of discrímen
grounded on the natural differences of each technology submitted to protection by
the patent system.
As pointed out by Gonzaga Adolfo 269, the challenges of a constantly changing
society are many, but all of them are subject to adaptation on behalf of a more just
and fraternal society:
Of course, the reality surrounding the topic under discussion, particularly
as related to the fantastic technologies that daily emerge and get improved,
is so complex and overwhelming that it is feared, as it is being written, being
already overcome by it. That is, a topic, just like most others, that is ―open‖
and around which constructions that will timely be made will dictate the
direction that will be taken in a society that, while incessantly seeks
knowledge and information, might see in authors and intellectual creations
the exact dimension of a world where they, given the freedom of expression,
can be the cause and consequence of a new reality of balance, freedom and
social justice that are sought to erect.
In this regard, the constitutional hermeneutic helps the interpreter topically
analyze each technological area within their specificities and, after these specificities
are considered, by knowing the intellectual creation for which the protection or the
exercise of rights resulting from this protection in the patent system is sought after,
the analysis of the limitations imposed by the free competition principle and by a
finalistic delimitation of the patent system itself towards an observance of a harmonic
preponderance of the utilitarian theories and the social planning theories is made
possible.
__________________________
269
ADOLFO, Luiz Gonzaga Silva. Private works, collective benefits: the public dimension of the
copyright in the information society. Doctoral Thesis at the University of Vale do Rio dos Sinos –
UNISINOS, São Leopoldo, 2006, p. 349.
135
However, there are limits to the hermeneutic performance that require an own
legislative movement so that there might be adequacy to the current reality.
As previously mentioned, the patent system was not created internationally
harmonized to cover innovative technologies like those that are housed by the
system today, such as patents involving computer programs, second medical use,
biotechnology, among others. That is, the system established treats equally
diametrically different technologies, requiring the same patentability requirements
and granting the same term of protection, creating a harmful effect under the
axiological perspective of the patent system in its harmonic functional character,
being noteworthy to mention the already cited author Celso Antônio Bandeira de
Mello270 regarding the importance of differentiation inherent to the equality principle:
Now, the isonomy principle states that equal situations be treated equally
and unequal situations be treated unequally. Hence there is no way to
unequalize people and situations when unequal factors are not found in
them. And finally, as repeatedly commented, it is important moreover that
the regime differentiation be correlated with the difference that has been
taken into account.
If the protection granted starts to be considered exacerbated over time and
starts to represent a clash with the technological essence of the object of the
mentioned protection, the use of hermeneutics as a corrective instrument of the
clashes faces legal structural obstacles to an integrating correction.
_________________________
270
MELLO, Celso Antônio Bandeira de. Op. Cit., p. 35.
136
Taking as an example, if the average life of a technology involving computer
program is 10 years, the 20-year protection for patents, legally provided and that
enables the existence of dependable technologies subject to dependence license271,
becomes exacerbated, but without being able to be solved through hermeneutics for
the reestablishment of the excessive protection.
The base of such problem is the disregard of the equality principle establishing
the temporal term of protection.
Another example is directly related to the level of protection of a patent. If this
level of protection is high (ampliative interpretation of the protection granted to a
patent272), there will be more difficulties for competition to be established at ideal
levels, once the possibility of third parties patent infringement as well as the creation
of parallel invention is high, there will be a real discouragement to competition in that
specific technological area.
Once again analyzing the issue from an economic point of view, Posner and
Landes273 highlight:
The greater patent protection is, the smaller the benefit to competitors from
the information contained in the patent Grant because the less they can do
with it. They will face greater difficulty and higher costs in inventing around
the patent, a high probability of losing a patent infringement suit, and greater
sanctions if they lose. Their marginal cost curve will be steeper or,
equivalently, the elasticity of supply lower, making the residual demand
curve less elastic and thus enabling the patentee to charge a higher price
and
_________________________
271
Problem already identified, among other authors, by Carla Eugênia Caldas Barros in the work cited
Improvement and dependence on patents. Rio de Janeiro: Lumen Juris, 2004.
272
Such ampliative interpretation can be derived, for instance, from an ampliative application of the
doctrine of equivalents or from the consideration and definition of substantial violation of patent claims.
One way or another, there is a need for a balance between adequate protection and no restriction of
free competition as well as what is strictly necessary for the functionalization of the patent system.
273
POSNER, Richard A.; LANDES, William M. The economic structure of intellectual property
Law. Cambridge/MA: The Belknap Press of Harvard University Press, 2003, p. 299.
137
and capture a greater share of the post-invention market.274
Therefore, the system imposes real limitations for constitutional hermeneutics
to be able to sufficiently assist the solution, for instance, of the so-called gridlocks
highlighted by Michael Heller275.
Within a systematic view, it is clear that hermeneutics has an important place
in the correction of the clashes in the patent system, especially when it helps with the
topical consideration on the seemingly conflicting rights whenever there is nonexcluding room for interpretation.
The non-excluding room refers to the possibility of hermeneutic effort
effectively being likely to solve the apparent conflict. For example, when the
compulsory licensing defined by abuse of rights is legally provided, but procedural
steps are established that, many times, prevent it from being implemented, it faces
an excluding room for the possibility that the hermeneutic effort might be useful.
Therefore, it becomes an obstacle of the system to hermeneutics.
In this sense, even if the anticompetitive practice is identified, the
disproportional remedy can be as harmful as the inertia, as notes Ricardo Sichel276:
The neuralgic point is investigate the misuse of patent rights, when applied
to market relations. Precisely the existence of conduct that causes
marmarket
__________________________
274
Translation into Portuguese: Quanto maior a proteção da patente, menor é o benefício aos
concorrentes através da informação contida na patente concedida porque menos eles podem fazer
com a mesma. Eles irão enfrentar grande dificuldade e maiores custos em inventar paralelamente à
patente, uma maior probabilidade de perder um caso judicial de violação de patente e ainda maiores
penalidades se eles perderem. A sua curva de custo marginal será espaçada ou, equivalentemente,
menor será a elasticidade de suprimento, fazendo com que haja uma curva de demanda residual
menos elástica e, assim, possibilitando ao titular da patente cobrar preços mais altos e obter uma
maior fatia do mercado pós-invenção.
275
HELLER, Michael. The gridlock economy: How too much ownership wrecks markets, stops
innovation, and costs lives. New York/USA: Basic Books Publisher, 2008.
276
SICHEL, Ricardo. The European patent law and other studies on intellectual property. Rio de
Janeiro: Lumen Juris, p. 110-111.
138
market distortion, without the consequent gain of efficiency, is what must be
opposed. I observe, therefore, that the privilege granted to a patent, as an
occasioning element of technological development should win the State
shelter. Nevertheless, the use of a legally obtained right to obtain ill-gotten
gains, causing market shortage, deserves from the Public Power, the
appropriate response in order to repress abuses. This point is especially
relevant, when it is observed that the Federal Constitution guarantees the
temporary property right of a patent. This right is, therefore, conditioned to
the public interest and the technological development of Brazil.
For the hermeneutic effort to be productive there might not be express legal
limitations concerning the minimum protective time lapse and diverse types of
technologies necessarily getting equal treatment, since in these cases the system
obstacles create chains that negatively affect the subsequent analysis of the exercise
of the right over a particular technology in the competitive market, distorting, the true
meaning of the patent system as functionally a worker of the principle of free
competition.
139
6 EQUALITY AND FREE COMPETITION AS ORIENTING AND
LIMITING HERMENEUTIC REFERENCES OF THE PATENT LAW
If the patent system exists as functionally useful and with clear objectives 277,
its harmony with the equality principle materially considered and with the free
competition is essential, lest it should suffer from a ―defunctionalization‖ that impairs
its essence and objectives.
Now, the German Constitutional Court itself establishes the functional
character added to the harmony of the constitutional totality, as highlighted by Denis
Barbosa, Karin Grau-Kuntz and Ana Beatriz278 commenting on the judgment in the
―Patentanmeldung‖279 case:
The constitutional interpretation of the intellectual property should be
made:
a) taking into account the purpose and function of the property (functional
interpretation)
b) taking into account the whole structure of the Constitution.
Once recognized the nature of the property right and the protection of the
art. 14 of the Fundamental Law the same interpretative systematics used for
property over material goods is applied, i.e., ponderation between the effects
of the protected individual interest and the collective interests.
As well as competition is dynamic and generates new challenges, getting
adapted over time, the same way it is for the intellectual creations in constant
evolution, also generating new challenges in constant evolution over the years.
___________________________
277
It is reiterated at this point, the arguments already posted about the essence and purpose of the
patent system.
278
GRAU-KUNTZ, Karin; BARBOSA, Denis Borges. The intellectual property in the Constitution of
the Constitutional Courts. Rio de Janeiro: Lumen Juris, 2009, p. 58.
279
BverfG, 36, 281, of 01.15.1974.
140
Such market and creativity dynamics require real hermeneutic challenges lest
the harmony with the essence and objectives of a protection system of intellectual
creations should end up staying in evolutionary dissonance.
Thus, the baptizing elements that are intended to orient the hermeneutic
movement in order to ensure this harmony between essence/objectives with the
effective desired results should be identified.
Roberto Jaguaribe and Otávio Brandelli 280 share concerns related to the
effective development of the country through intellectual property, citing some
relevant important aspects on an ―evolution‖ of the patent system:
An adequate intellectual property protection system can be a valuable
instrument for development. But it must be properly inserted into the national
innovation system and compatible with the other instruments. The great
surge of globalization over the last thirty years has expanded the
international operation of large companies and has diversified production,
which creates a demand for increasing homogenization of rules. There thus
seems to be no room (and, most probably, interest) for going back to the
period of full flexibility preceding the TRIPS Agreement.
Nevertheless, it is crucial to avoid an inertial expansion of the system,
mainly raised by the strength of the rental sector lobbies that most benefit
from the system. It is also important to prevent the classical limits from
exceeding the scope of the intellectual property rights. These limits concern
in particular to preserve the distinction between discovery and invention and
they also concern the obstruction of exclusive appropriation of knowledge.
In this sense, always catching a glimpse of development, there is no doubt
that competition is essential for the development of society. In the words of João
Marcelo de Lima Assafim281, dealing with the panorama of the antitrust rules:
_________________________
280
JAGUARIBE, Roberto and BRANDELLI, Otávio. Intellectual property: room for developing
countries. In VILLARES, Fábio (Org.). Intellectual property: tensions between the capital and the
society. São Paulo: Paz e Terra, 2007, p. 303.
281
ASSAFIM, João Marcelo de Lima. Technology transfer in Brazil – Contractual and competitive
aspects of Industrial Property. Rio de Janeiro: Lumen Juris, 2005, p. 271.
141
Besides the benefits that competition bestows on consumers, the
competitiveness among companies creates a suitable environment for the
country‘s economy to play an increasingly relevant role in the context of
global economy.
From the economic point of view, the patent system has many flaws due to,
among other factors, fixed cost differences related to intellectual creations in different
technological areas, as highlighted by Posner and Landes 282:
Whether a given degree of patent protection is socially desirable depends
on the patentee‘s fixed costs, the inherent difficulty of inventing around the
patent (that is, holding constant the degree of patent protection), and the
extra profits that the patentee can expect to receive from greater protection.
The greater the fixed costs of research and development and the easier it is
to invent around the patent, the greater will be the degree of patent
protection required to create adequate incentives to invest in developing the
invention in first place. The patent system makes no effort, however, to
match the degree of patent protection to those variables. A patentee‘s
monopoly markup, which of course is influenced by the degree of patent
protection, beers no direct relation to the fixed costs that he actually incurred
283
in creating the patented invention.
In a specific economic aspect, it is identified that the patent system fails to
establish a proportionally related modulation to the fixed costs involved in the
creation of patentable creations.
Ideally, if the equality principle is analyzed as the basis for determining the
spectrum of protection of a patent, even from the standpoint of economic justification
of the system, there would be a more appropriate modulation, since the consideration
________________________
282
POSNER, Richard A.; LANDES, William M. Op. Cit., p. 300.
Translation into Portuguese: Mesmo um grau de proteção por patentes sendo socialmente
desejável isso depende dos custos fixos do titular da patente (o que significa manter um grau
constante de proteção da patente), e dos lucros extras que o titular da patente pode esperar receber
através de uma maior proteção. Quanto maiores os custos fixos de pesquisa e desenvolvimento e
quanto mais fácil for inventar ao redor da patente, maior será o grau de proteção patentária
necessário para criar os incentivos adequados para o investimento em desenvolver a invenção.
Apesar disso, o sistema de patente não faz nenhum esforço para alcançar o grau de proteção de
acordo com essas variáveis. A base do monopólio do titular da patente, o qual evidentemente é
influenciado
283
142
of the equality principle in accordance with each type of technology to be protected
helps suit a closer proportion to the ideal between the developed technology and the
granted protection.
Therefore, the very flaws existing in the patent system should serve as an
indicator so that one can better know the system as an intrinsically limited system to
the protection of technological innovations increasingly diverse, peculiar and
challenging.
And the huge work of hermeneutics is, facing such challenging problems, help
and establish an understanding as objective and detached from preconceptions 284 as
possible, as highlighted by Mario Bunge 285 analyzing the epistemology in its
dimension of objectivity vs. subjectivity:
In effect, it is a declared purpose of the scientific research to produce
representations of the world that are objective (impersonal and publicly
susceptible to test). That is why the scientist submits them to continuous
verifications and tries to improve them. That is why any subjective elements
(whenever identified) suffer elimination. And because there is a need to keep
distinction between objectivity and subjectivity is that the semanticist should
strive to clarify distinction.
As politicians, carry luggage of training, knowledge, experience, that is
introjected into the being and that influences the decision power (in which emphasis
must be given to the tendency of present and future absolutization of how the patent
system is seen), it is also important to remember the reflections of David Schnaid 286
that:
The contamination of the interpreter‘s understanding by his formed
ideology is inevitable, formed from experiments and experiences, distorted
by
_________________________________________________________________________________
pelo grau de proteção da patente, não possui qualquer relação direta com os custos fixos que ele
despende em efetivamente criar uma invenção patenteável.
284
Here, the term pre-understanding is used in its negative sense, that is, in the sense of addiction
that we all carry on the established system.
285
BUNGE, Mario. Basic Philosophy Treaty – Volume 2. Semantics II: Interpretation and Truth.
Translated by Leônidas Hegenberg and Octanny S. da Mota. São Paulo, 1976, p. 211.
288
SCHNAID, David. Philosophy of law and interpretation. São Paulo: Revista dos Tribunais, 2004,
p.235.
143
by pre(previous) concepts and proto-ideas, determined by his existential
history (ek-sistere). This experience or legal experience may imply the
presence of irrational elements and contingents in the decision-making
process, which do not appear in the doctrinal thinking. Our attitudes are
influenced by the beliefs we hold, which, in turn, were formed without the
evidence of their veracity, but rather pre-conceptually, and by impulses of
fear, hope and desires‖.
While participating in a particular analysis of law, rules of conduct and
behavior, above all, a pre-analysis based on the individual history is carried out. The
human being is naturally subject to beliefs and prejudice that influence rationality to
deal with life concrete situations, so that the understanding of pre-understandings
serves as benchmark so that the principle of participation, within the asymmetry of
individual formations, can help find decisions as universalized as possible in each
specific technological area.
The equality principle, located at the very founding base of the patent system,
works as a basilar hermeneutic guidance, distinctive and inseparable from any
technology susceptible to patent protection. It means that, even before a functional
consideration of the patent system, there should be respect for difference, because
the material equality implies the recognition of this difference.
Aware of this need to recognize equality as an orienting element of
hermeneutics applied in patent law, based on the differential treatment to different
technologies, the patentability requirements are put at stake, which, in spite of being
universalized and constitutional, were not historically developed in respect for the
equality substantially considered.
The requirement of novelty is based on preventing identical intellectual
creation from being subject to patent protection for different holders, by establishing
as the basis for meeting the requirement of novelty, the first to file a patent
application that does not have a full public disclosure of its content prior to the date of
the patent application
144
the patent application. The motivation is related to the balancing to meet the principle
of free competition (in order to stimulate innovation and, consequently, stimulate the
innovative competition) through a restriction of temporary protection that reaches
only what is strictly necessary to meet the social interest and, the economic and
technological development of the country.
In a similar sense is the requirement of inventive step, going beyond the
requirement of novelty, which implies that, the creator should have contributed in a
relevant manner, in technical terms, in relation to everything that was accessible to
the public on the date of the patent application or that, once having the protocol date
prior to the application, has been subsequently published to that one. Once again the
motivation is related to the balancing described above, so that it represents an
effective technical contribution to the state of the art and not only a few nonsubstantial differences, and just because they are not part of the constitutional
objective, do not enjoy the possibility of protection by the patent system.
From the standpoint of an instrumental view of only granting patents to
intellectual creations that describe and enable, technical and theoretically, to
reproduce the invention, the requirement of descriptive sufficiency 287 also has a
direct relation with free competition and with the functional designs of the patent
system
__________________________________________
287
This requirement, together with the requirement of inventive step, are the most relevant from the practical and theoretical
point of view of the patent system, since the requirement of descriptive sufficiency aims that a patent application be practically a
―comprehensive manual‖ of how that technology will be put into practice. The intentional or unintentional deception of full
revelation of this ―comprehensive manual‖ leads to addiction that, should it not depend only on small and simple contextual
explanation or definition of words, is insurmountable. This is because often the omission of the so-called ―ace in the hole‖ in a
patent application is a strategy intentionally adopted by the applicant to avoid, even when the competitor has access to the
patent document, having real difficulties (or even the impossibility) in learning (theoretically or practically) and reproduc ing the
teachings contained in the application in agreement with the effects described therein. It is an extremely important requirement
guided by the free competition and by the need for a constitutional functional performance of the patent. Another crafty
possibility of use of the patent system in violation of the requirement of descriptive sufficiency is the patent application protocol
requesting protection for a particular technical effect without actually having a minimum of scientific basis to support this
technical effect, i.e., running ahead in the innovative race ―revealing‖ the theoretical proof of the technical effect described
during the patent application and benefitting from the date of the filing corresponding to the moment when the technical effect,
described since the very beginning, had not theoretically been mastered yet. It is noted that the individual inventor and
companies in good faith should be aware of this requirement, since the sufficient description of the patent application should be
seen as a key element together with the novelty and inventive step (or inventive act in the case of utility models).
145
system, as follows:
There has recently been a decision of the U.S. Court of Appeals for the
Federal Circuit288 (CAFC) reaffirming the importance of the ―written description‖
requirement being sufficient when considered both the original drafting of the claims
regarding the drafting of amendments, as well as separating the requirements into
two different parts (the description of the invention itself and the description of how to
use the invention) establishing greater rigor regarding the effective identification if the
inventor, on the date of the patent application protocol, has literally been able to
establish a line between what has been described and what has been claimed in the
patent application. The U.S. Court of Appeals for the Federal Circuit itself had
already determined five years ago that 289:
The 'written description' requirement implements the principle that a patent
must describe the technology that is sought to be patented; the requirement
serves both to satisfy the inventor's obligation to disclose the technologic
knowledge upon which the patent is based, and to demonstrate that the
patentee was in possession of the invention that is claimed.290
Now, the requirements listed above are nothing more than part of the ―deal‖
done so that the patent system meets its functional objectives and, instead of
restricting, generates greater competition with better use to the society.
The fact is that the constitutional functional objectives of the patent system
cannot be achieved in an ideal way if the equality principle in its basis is not observed
(as the equality of material goods and not merely formal), since the treatment
onlyemm
__________________________
288
Ariad Pharmaceuticals, Inc. v. Eli Lilly & Co. (US Court of Appeals for the Federal Circuit, 2010) (en
banc).
289
Capon v. Eshhar, 418 F.3d 1349, 1357, 76 USPQ2d 1078, 1084 (US Court of Appeals for the
Federal Circuit, 2005).
290
Translation into Portuguese: O requisito do ‗relatório descritivo‘ implementa o princípio de que a
patente deve descrever a tecnologia que busca ser patenteada; o requisito serve tanto para
satisfazer a obrigação do inventor em revelar a tecnologia conhecida sob a qual a patente se
baseia, e para demonstrar que o requerente dominava a invenção que é reivindicada.
146
only formally equal (the same application requirements, term of protection and
interpretation) of
different technologies generates a not desired difficult and of
complex correction defunctionalization of the patent system by the competitive
market.
The patent system is already complex and insecure by nature, so by
constituting and interpreting it ignoring the equality principle materially considered
based on the differences of each technology submitted to protection corresponds to a
hermeneutic attitude that adds even more complexity, insecurity and functional
diversion to the system, creating significant impact on the free competition itself.
It is worth remembering, the teachings of Habermas 291, concerning a not
merely formal posture of the Law:
The law achievement project, which refers to the operating conditions of
our society, therefore of a society that emerged in certain historical
circumstances, cannot be merely formal. Nevertheless, differing from the
liberal paradigm and the social State, this paradigm of law no longer
anticipates a specific vision of society, not even a particular vision of good
life nor a particular political option. Since it is formal in the sense that it only
formulates the necessary conditions under which the subjects of the law can,
as citizens, understand each other to figure out their problems and solve
them.
In this search for the achievement of law in the area of patents, the differences
of objectives between market efficiency and efficiency in the continuous search for
justice should be noted.
In this sense, Rawls calls attention to the differences between the ideal
legislative process and the ideal market process, noting that both are designed to
achieve different goals, since the ideal market process aims at efficiency whereas the
ideal legislative process aims at justice. Moreover, the ideal market is a perfect
process
147
process regarding its purpose, whereas the ideal legislative one is an imperfect
procedure. Thus, as Rawls292 teaches the economic theory does not fit in the legal
procedure, since the application of economic theory to the constitutional process
presents clear limitations, but at the same time it also provides data to, analyzed in a
broader context, help grant effectiveness to fundamental rights.
It was already pointed out by Maria Vitoria Stout 293 that, within a restrictive
view of the non-discrimination clause based on different technologies; even the
provisions that provide a longer validity term for pharmaceutical patents because of
the delay of the regulatory agencies to authorize the entry of corresponding goods
into the market were considered a kind of ―compensatory‖ discrimination:
The amended template sets up an interesting dichotomy between
pharmaceutical and nonpharmaceutical patents in the area of patent term
extensions. The template now provides that while a party must adjust the
term of a nonpharmaceutical patent to compensate for unreasonable delays
that occur in granting the patent, a party has discretion to adjust the term of
a pharmaceutical product patent to compensate for unreasonable delays in
granting the patent. Whether this revision now discriminates against holders
of pharmaceutical patents in allowing a country to choose not to grant
automatic patent term extensions for unreasonable delays is an interesting
question outside the scope of this Article.
[…]
CAFTA Articles 15.9(6)(b) and 15.10(2), giving pharmaceutical patent
holders the unique ability to extend the term of their patents for delays in the
regulatory approval process and to halt any attempt to manufacture their
patented product under compulsory license, do not just dance around the
line set by TRIPS on impermissible discrimination. CAFTA boldly goes
where no United States free trade agreement has gone before it,86 and
where no United States free trade agreement will (likely) go after it.87
Because these provisions touch on the ability to fight devastating health
epidemics on a global scale, the TRIPS dispute settlement system is an apt
forum to challenge them, and Article 27.1 offers the strongest argument to
invalidate
___________________________
291
HABERMAS, Jurgen. Law and Democracy: Between Facticity and Validity. V. II [s.I.]: Tempo
Universitário, 1992 (original 1959b), p. 190.
292
RAWLS, John. A theory of justice. São Paulo: Martins Fontes, 2002, p. 400.
293
STOUT, Maria Vitoria. Crossing the TRIPS nondiscrimination line: How CAFTA Pharmaceutical
patent provisions violate TRIPS article 27.1. Boston University Journal of Science and Technology
Law, v. 14, 25 April 2008, p. 199-200.
148
them.
294
It is in this context that the principle of equality and free competition should be
seen as the early and harmonic basis of the patent system, since it is impossible to
think of a fair patent system without taking into account the equality principle as a
hermeneutic guiding focus. On the other hand, this equality considered as a
generator of specific factors of discrímen, besides guiding, it restricts the patent
rights to the technological essence contained in the intellectual creation subject to
patent protection, allowing a better adequacy in the competitive environment.
Out of respect for the equality principle, technologies involving computer
programs, second medical use, biotechnology, nanotechnology, among other
challenging ones that already exist and are still to be created cannot be treated
equally both among themselves and in relation to traditional technologies that form
the basis that has justified the existence of the patent system and its ―canned‖
requirements.
Hermeneutics has much to contribute both considering the equality principle
applicable on the basis of the patent system, recognizing the technological
differences and, from them, understanding the system within its functional orientation
(social interest, economic and technological development) and considering this
system.
__________________________
294
Translation into Portuguese: O texto emendado estabelece uma dicotomia interessante entre
patentes farmacêuticas e não farmacêuticas no que tange à extensão do prazo de validade de
patentes. O texto agora provê que enquanto um interessado deve ajustar o prazo de uma patente
não farmacêutica para compensar atrasos não razoáveis que ocorrem no processo de concessão
de patente, outro interessado tem discricionariedade para ajustar o prazo de uma patente de
produto farmacêutico para compensar pelos atrasos não razoáveis na concessão de patentes. Se
esta revisão agora discrimina contra os titulares de patentes farmacêuticas ao permitir um país de
escolher não conceder prazos adicionais automáticos de patentes por atrasos não razoáveis é
uma interessante questão fora do escopo deste artigo.[...]
Artigos 15.9(6)(b) e 15.10(2) do CAFTA, concedendo aos titulares de patentes farmacêuticas a
habilidade única de estender o prazo de suas patentes por atrasos no processo de aprovação
regulatória e evitar qualquer tentativa de produção dos seus produtos patenteados através de
licenças compulsórias, não apenas dançam ao redor da linha estabelecida por TRIPS sobre
discriminação não permitida. CAFTA vai onde nenhum acordo de livre comércio dos Estados
Unidos jamais foi antes e onde nenhum acordo de livre comércio dos Estados Unidos irá
(provavelmente) depois disso. Porque essas previsões tocam na habilidade de lutar contra
epidemias devastadoras em uma escala global, o sistema de disputas do TRIPS é um fórum apto
a desafiá-los e o Artigo 27.1 oferece o argumento mais forte para invalidá-los.
149
system always limited by a necessary role in an environment where the principle of
free competition is the rule.
150
7 POSSIBLE SOLUTIONS FOR THE ADEQUACY OF THE PATENT
SYSTEM
This chapter begins with the conclusions of Dan Burk and Mark Lemley 292 in
which several researchers have already figured out possible solutions to the current
patent system issue in different industries, but the challenges will continue to come
up and the patent system should keep getting adapted to the new and challenging
technologies:
Some exciting recent work has already been done in filling out the frame
work we have established. Chris Cotropia has identified a new policy lever in
the doctrine of equivalents, for example. Richard Gruner has suggested that
obviousness could serve as a policy lever in industries such as software and
business methods, in which a large majority of patents seems to consist of
taking existing ideas and applying them in a new context. And others have
suggested that the forseeability doctrine should be applied in different ways
in the biotechnology industry. Deciding which policy levers should and
should not be used will require further work by a lot of people.
Second, courts and scholars will have to pay attention to the characteristics
of the particular industries for which courts are setting rules. We don‘t claim
any monopoly on knowledge about the proper patent law rules for any given
industry, and others can and have disagreed with the suggestions we have
made in this book. This disagreement is healthy; devoting serious scholarly
attention to the needs of particular industries will help better tailor the law to
those industries. Further, the scientific characteristics of industries and
particular technologies within each industry change over time, and the law
needs to adapt to those changes. The nature of the software industry as we
have describe it today looks very different than it did in the 1970s, and the
legal rules that made sense then seem rather archaic today. Some have
argued that biotechnology is undergoing similar evolution, reducing the
anticommons risks at the research stage but heightening concerns at the
downstream products stage. And surely it is true, as we suggested in
chapter 11, that the biotechnology industry itself is not monolithic; the rules
appropriate for DNA patents may not be the same ones that fit monoclonal
antibody patents. Courts are better suited than Congress to take account of
these changes, but to do so they will have to remain open to considering
evidence of those changes. Put another way, legal rules will have to evolve
in the common law tradition.
Finally, the industries themselves will come and go over time. If we had
written this book 120 years ago, we would likely have focused significant
attention on the railroad industry, which faced significant patent issues that
previous industries had not had to deal with. Ninety years ago we would
have discussed the problematic issues that arose in the nascent airline
industry. Both industries still exist today, but their characteristics have
changed. As they have become more mature, the role of patents in both
industries has declined, to the point that it no longer make sense to tailor
pate
____________________________________
295
BURK, Dan L.; LEMLEY, Mark A. Op. Cit., p. 169-170.
151
patent rules to those industries. By contrast, software and biotechnology –
two of the most important industries in the modern economy and ones that
occupy a significant part of this book – were not even on the radar screen of
the patent system forty years ago. New industries – nanotechnology,
perhaps, or synthetic biology – will doubtless challenge the courts years to
come.296
The difference between the theoretical basis of what has been defended by
Dan Burk and Mark and what is understood as the application of the equality
principle, is that those who support the possibility of protective adaptation in each
type of industry, and such considerations should be taken under an eminently
economic
_________________________
296
Translation into Portuguese: Alguns trabalhos recentes e excitantes já foram feitos em preencher a
moldura que nós estabelecemos. Chris Cotropia identificou um novo parâmetro político na doutrina
dos equivalentes, por exemplo. Richard Gruner sugeriu que a obviedade poderia servir como
parâmetro político em indústrias como as de softwares e métodos de negócio, nas quais a grande
maioria das patentes parece consistir em adotar idéias existentes e aplicá-las em um contexto
diverso. Outros têm sugerido que a doutrina da previsibilidade deveria ser aplicada de forma
diferente na indústria biotecnológica. Decidir quais parâmetros políticos serão ou não usados irá
demandar muito trabalho adicional de muitas pessoas.
Em segundo lugar, cortes e estudiosos deverão estar atentos para as características das
indústrias em particular para as quais as cortes estão determinando regras. Nós não reivindicamos
qualquer monopólio sobre o conhecimento a respeito de regras apropriadas no direito de patentes
para qualquer indústria específica, e outros podem e já discordaram das sugestões feitas por nós
neste livro. Essa discordância é salutar; dedicar séria atenção de estudiosos para as necessidades
de indústrias em particular irá ajudar a melhor definir o direito para essas indústrias. Além disso,
as características científicas das indústrias e tecnologias específicas com cada indústria mudando
de tempos em tempos, o direito precisa se adaptar a essas mudanças. A natureza da indústria de
software que descrevemos dos dias de hoje é muito diferente daquela dos anos 1970, assim como
as regras legais que faziam sentido naquela época parecem arcaicas nos dias de hoje. Alguns
argumentaram que a biotecnologia está seguindo em uma evolução similar, reduzindo os riscos de
anticommons na fase de pesquisa, mas aumentando as preocupações no mercado secundário na
fase dos produtos. E certamente é verdade, como sugerimos no capítulo 11 que a indústria da
biotecnologia em si mesma não é monopolista; as regras apropriadas para patentes de DNA
podem não ser as mesmas para enquadrar patentes de anticorpos monoclonais. Cortes estão
mais bem equipadas que o Congresso para dar conta dessas mudanças, mas para fazerem isso
terão que permanecer abertas para analisar as evidências dessas mudanças. Colocado de outra
forma, regras legais terão que ser realizadas em uma tradição da common law.
Finalmente, as próprias indústrias irão ir e vir com o passar do tempo. Se tivéssemos escrito este
livro há 120 anos, nós provavelmente teríamos focado atenção significativa na indústria ferroviária,
a qual enfrentou questões significativas na área de patentes que indústrias anteriores não tiveram
que lidar. Noventa anos atrás nós teríamos discutido os aspectos problemáticos que foram
levantados na indústria aeronáutica nascente. Ambas as indústrias continuam existindo hoje em
dia, mas as suas características mudaram. Como ficaram mais maduras, o papel das patentes em
ambas as indústrias foi reduzido, ao ponto que não há mais sentido em ajustar as regras de
patentes para estas indústrias. Em contraste, software e biotecnologia – duas das mais
importantes indústrias da economia moderna e as quais ocuparam parte significante desse livro –
nem mesmo eram localizadas na tela do radar do sistema de patentes há quarenta anos. Novas
indústrias – nanotecnologia, talvez, ou biologia sintética – irão sem dúvida alguma desafiar as
cortes nos próximos anos.
152
economic point of view of the effects caused in the market, so that in accordance
with the versatility of industries, solutions should occur in a common law system
through the courts and not through the legislative changes.
Such statements differentiate themselves from the possible solutions within an
effective application of the equality principle, as a principle of fundamental rights, on
the basis of the patent system even before the consideration of the effects that the
technological differentiation (factor of discrímen) will cause in the market. Let us
make it clear that, although the modulation of the factor of discrímen proposed is
assisted by the effect it causes in the competitive field, the need for recognition of the
differences is inherent in the current patent system, as well as the patentability
requirements regarding novelty, inventive step (inventive act in the case of utility
models), descriptive sufficiency and industrial application.
Within this possible modulation of the equality principle materially considered,
assisted by the principles of free competition and by the functionality or conditionality
to the social interest, economic and technological development of the country, is that
the adaptations of the patent system become constitutionally legitimate.
Emphasis should be given to the recent publication of Marshall Phelps and
David Kline297 in the sense that the intellectual property rights should go through
constant adaptation to effectively serve their essential purposes:
Today‘s renaissance boom in information age technology has once again
strained our patent system. The PTO simply hasn‘t had the resources to
respond to the three-fold increase in patent applications over the past 20
years. And as a result, patent quality has suffered in some areas and
litigation rates have risen. Hence, the need once again for reforms to help
patent system meet the challenges of today‘s new technologies and new
industries.
Patent quality must improve. We must make it easier for small businesses
and independent inventors to obtain patents for their discoveries. We must
take
____________________________________________
297
PHELPS, Marshall; KLINE, David. Burning the Ships – Intellectual property and the
transformation of Microsoft. Hoboken/New Jersey: John Wiley & Sons, 2009, p. 161-162.
153
take reasonable steps to reduce the flood of litigation. And we need to
harmonize our patent system with those of other countries. This last item is
perhaps the most important measure we could take in the short term, for it is
incredibly inefficient and expensive for applicants to conduct prior art
searches and obtain patents in each and every country separately.
But there are voices today – in some cases, very loud voices – for whom
reform is not enough. They argued that intellectual property is outmoded, a
tool used by monopolists to crush innovative young firms, and a barrier to
open innovation, knowledge sharing and economic growth. They cloak their
arguments in the rhetoric of ―the common good‖. But some of their
misguided proposals – such as they call to eliminate patent rights for
software or to abrogate IP rights in order to achieve greater interoperability –
would, if adopted, cut the heart out of the knowledge economy and lead to
devastating losses in jobs and living standards for millions worldwide.298
Despite understood, but refuting the DOJ and FTC statement in their
aforementioned 2007 Guideline that the intellectual property rights should be seen as
any other property right for purposes of anticompetitive behavior analysis; we can
just check the endless number of possible differences generated in the market
because of clear clashes between the intellectual property rights and the traditional
tangible property rights, being once again important to quote the words of Phelps and
Kine299:
A house, after all, is worth what it‘s worth no matter who lives in it – and its
worth can be more or less determined through comparables. The worth of a
patent, on the other hand, depends upon who wants to use it, for what
commercial
_________________________
298
Translation into Portuguese: O boom renascentista na era da informação tecnológica mais uma
vez restringiu o nosso sistema de patentes. O PTO simplesmente não tem tido recursos para atender
à triplicação no número de pedidos de patente nos últimos 20 anos. E como resultado, a qualidade
das patentes tem sofrido em algumas áreas e o percentual de litígios tem aumentado. Assim, a
necessidade mais uma vez de reformas para ajudar o sistema de patentes a atingir os desafios das
novas tecnologias e novas indústrias.
A qualidade das patentes deve ser melhorada. Nós precisamos tornar mais fácil para que pequenas
empresas e inventores independentes obtenham patentes para as suas descobertas. Temos que
tomar passos razoáveis para reduzir o fluxo de processos judiciais. E nós precisamos harmonizar o
nosso sistema de patentes com aqueles de outros países. Este último item é talvez a medida mais
importante que nós podemos tomar em um curto prazo, por isso é incrivelmente ineficiente e caro
para os requerentes conduzir buscas prévias no estado da técnica e obter patentes em cada um dos
países separadamente.
Mas existem vozes hoje – em alguns casos, vozes muito altas – para as quais reforma não é
suficiente. Elas argumentam que a propriedade intelectual está desadaptada, uma ferramenta usada
por monopolistas para esmagar jovens empresas inovadoras, e uma barreira para a inovação aberta,
compartilhamento de conhecimento e de crescimento econômico. Eles focalizam os seus argumentos
na retórica do ―bem comum‖. Mas algumas de suas propostas desviadas – como as que denominam
de eliminação dos direitos de patentes para programas de computador ou para a ab-rogação de
direito de propriedade intelectual no sentido de adquirir maior interoperabilidade – iriam, se adotadas,
arrancar fora o coração da economia do conhecimento e levar a perdas devastadoras de empregos e
padrões de vida para milhões ao redor do mundo.
299
Op. Cit., p. 168.
154
commercial or other purpose, in what market (or litigation setting), and under
300
what set of economic and legal constraints.
Further, in their conclusions, these authors recognize 301:
IP‘s role will continue to evolve – indeed, must evolve – to meet the
demands of new technologies and changing economic realities, continuing
recalibrating IP‘s careful balance between private incentive and public
interest. That is the only way intellectual property can continue, as it has for
past 200-plus years, to serve as a spur to innovation and economic progress
that benefits the whole of society.302
One of the possible solutions to the problems faced in the patent system is the
restrictive interpretation of the claims that delimit the scope of the patent protection.
Such restrictive interpretation should observe the factor of discrímen of each
specific technology to, including the technology developed (descriptive report and
drawings, if necessary) and the required protection (claims), perform an appropriate
restrictive interpretation, avoiding the generalization of interpretive concept.
Taking as an example, in view of the subjectivity of the language used in the
patent writing involving computer programs, the restrictive interpretation should be
even more careful than the restrictive interpretation performed in an industry of the
traditional mechanical area, whose linearity of vocabulary and limitations of semantic
understanding of words requires less hermeneutic effort.
________________________
300
Translation into Portuguese: Afinal, uma casa vale o que vale independentemente de quem vive
nela – e o seu valor pode ser mais ou menos determinado através de comparações. O valor de uma
patente, por outro lado, depende de quem quer usá-la, para qual finalidade (comercial ou outra), em
que tipo de mercado (ou definição de litígio), e sob que tipo de restrições jurídicas ou econômicas.
301
Op. Cit., p. 177.
302
Translation into Portuguese: O papel da Propriedade Intelectual continuará a envolver – de fato,
precisa envolver – o atendimento das demandas das novas tecnologias e a mudança das realidades
econômicas, continuamente recalibrando cuidadosamente o balanço da propriedade intelectual entre
o incentivo privado e o interesse público. Esse é o único modo que a Propriedade intelectual poderá
continuar estimulando a inovação e progresso econômico que beneficia toda a sociedade.
155
As already mentioned and proven empirically, the problem of delimitation of
protection is stronger in the area of patents involving software, so the restrictive
interpretation should be aware of this peculiarity to avoid this mistaken expansion of
the scope of protection in a particular patent.
Through a restrictive interpretation besides the one provided for more
traditional technologies and through a rigorous analysis based on the descriptive
sufficiency and on the inventive step, most of the problems that cause the lack of
definition of the boundaries of patents involving software will be solved.
However, regarding the patents of second medical use, hermeneutics faces
obstacles that require a legislative reformulation also having the equality principle as
a hermeneutic guide on the basis of the patent system to understand that, as they
are patent that involve minor inventive activity (and for this reason are clearly
unequal) it should be attributed shorter period of protection for them taking as an
example what happens to the utility model patents. For this purpose, a legislative
change preceded by greater empirical research is necessary to determine, within the
ambit of this particular technology, which term corresponds to an effective application
of the equality principle, while maintaining the functional balance that keeps
stimulating research and development of new inventions in this particular
technological area.
As for the problematic excess of owners (tragedy of the anticommons) and the
reflections it may cause in the market, also the equality principle must be seen as a
base guiding element, since the problems due to excess of owners bring out legal
issues formerly submerged by the absence of what can be named as specific ―traffic‖
of patents in each technological area.
156
In those cases where a particular technological area is with heavy traffic of
patents and there is expressed, clear and defined difficulty in obtaining licenses for
the lawful technology exploitation, once again the factor of discrímen is essential to,
within a specific marketing context, house a higher or lower intensity of interpretation
of the requirements for the compulsory use of technologies.
For this purpose, the investments in specific empirical research are essential,
a joint work between the Brazilian System for Protection of Competition and the PTO
with investment in continuous training of workers focused precisely on the
identification of specific characteristics of each market associated with the specific
use of particular technologies as an instrument of domination besides and in
disrespect to the specific factor of discrímen itself of that technological area, causing
a defunctionalization that should be properly fixed in specific cases.
These solutions are quite far from the generalization of a procedure that
negatively impacts the patent system, since it is known that the essence of this
system of patents is pro-competitive, for the proposed solutions only seek the
underlying adjustments so that the exceptional defunctionalizations can be fixed
without absolute bonds that ignore the equality principle materially considered and, in
doing so, avoid problems difficult to solve in the competitive environment.
157
8 CONCLUSIONS
It has been observed that one of the major problems still existing in the patent
system is the hyper-potentiation when confronted with other constitutional principles,
since the research began analyzing essentially the patent law in contrast with the
free competition, showing that the patent law as a legal creation aimed at a specific
purpose should be considered as such and should always be linked to its exceptional
essence.
It has also been observed that, in the same chapter on the market and the
patent system, history shows that this has been evolving and getting adapted in a
more elastic way to the international harmonization of minimum standards for the
patent protection originated from the Paris Convention, also considering a system
developed with the pre-understandings and the evolutionary possibilities back then.
Analyzing equality in a Welfare State, it has been shown that since Aristotle it
has been no longer about equality in its formal dimension only, so the fundamental
right to equality implies its necessary substantial or material consideration to enable
an equal treatment according to the inequalities.
Consequently, it has been found that the application of the equality principle
comes across problems when it faces the patent system, mainly due to ―canned‖
patentability requirements and the lack of the possibility of positive discrimination as
to the gaping technological differences existing in the intellectual creations
susceptible of patent protection.
Despite these problems pointed out, it has been observed that, even if only
instinctively and in a specific traditional discriminatory way, the application of the
equality principle on the basis of the patent system already exists. This occurs when
when
158
considering the utility model patents as a factor of discrímen based on the diversity of
inventive potential and technological essence, causing a factor of discrímen which
provides a less rigorous requirement of inventive activity (inventive step) and a
shorter temporal protection (15 years instead of 20 years) than the one provided for
all other patents.
It has also been found that the modulation of the patent protection term, as
well as the interpretation form of the patentability requirements, causes direct effects
on the exercise of patent rights in the competitive market, as an excess of protection
can guarantee the patent holder an improper competitive advantage, thus excluding
or damaging the competitive dynamics.
Subsequently, it has been shown how far hermeneutics solves the clashes
and how far the hermeneutic effort faces obstacles expressed by legal limitations
imposed by the very canning of the patent system.
It has been observed, for example, that hermeneutics solves, through
restrictive interpretation, some problems related to the limits of the right over a
particular patent outlined in the patent document, thus avoiding the functional
distortion of the patent system in this aspect. Emphasis has been given to the fact
that the restrictive interpretation itself should precisely be aware of the factor of
technological discrímen to enable the fulfillment of the functional axiological vector of
the patent system.
On the other hand, it has been observed, for example, that hermeneutics
cannot fully solve that which regards to the determination of the uniform temporal
protection term for all intellectual creations that meet the ―canned‖ requirements of
novelty, inventive step, industrial application and descriptive sufficiency.
When it comes to these considerations, the study has focused on the
application of the equality principle and the principle of free competition as guiding
references
159
and limiting references of the patent system, intending thereby, to demonstrate that
the recognition of the material equality on the basis of the patent system and,
consequently, the application of the factor of discrímen according to the technological
diversity, besides being constitutionally provided (although not applied) fixes the
clashes and causes pro-competitive effects assisting the principle of free competition.
When it comes to the possible solutions for the problems shown, there have
been evidences that, from the observance of the equality principle, the possible
solutions can be directed through hermeneutics and, when the latter finds itself
limited by the patent system, the possible solutions can be directed through
integrating legislative change.
Hermeneutics serves as an important instrument to, analyzing patents
involving computer programs or complex technologies currently or in the future,
assist in the restrictive interpretation of the right existing in the Letter Patent, focusing
on the unequal treatment to unequal technologies from the perspective of those
inequalities.
An essential factor for the constitutional understanding of patents involving
complex technologies is the restrictive interpretation based on the equality principle,
resulting in a particular factor of discrímen to each specific technology. It is important
to say that, due to the current techniques of patent writing, which at times provide
protection today for patents that will come to exist and which the inventor himself has
not yet mastered on the date of the patent application, greater attention is necessary
to avoid that the protective craving results in protection beyond the one that is
effectively adequate and observant of the patentability requirements in line with the
technology under examination.
Moreover, as demonstrated, an increasing number of empirical studies have
been identified, showing that the patent system has been failing in the performance
of its functionality or that such performance is disproportionate in certain
technological areas. Such studies indicate and support the conclusion that a
necessary adequacy of the patent system to the equality principle in its material
dimension
160
dimension and constitutionally expressed is needed, based on the respect for
technological diversity.
Despite the importance of hermeneutics solution, getting rid of the shackles of
the pre-understandings impregnated in the patent system since the beginning of its
international harmonization, it has limitations imposed by the patent system itself.
Such limitations occur, for instance, when some technology requires a time cycle less
than twenty years to meet its constitutional objectives.
The old discussion on the possibility of granting validity term of different
patents to different technologies is strengthened by the application of the equality
principle as a guiding element of such a possible factor of discrímen.
This claim of validity term, apparently utopian, is the one that would suit the
application of the equality principle on the basis of the patent system when
hermeneutics is not sufficient to keep the apparent clashes away. It is because an
elastic protection term for a problematic technology creates greater possibilities of
patent exploitation in a dysfunctional sense, i.e., does not meet the social interest
and the economic and technological development of the country, causing intervention
beyond the necessary one in order to meet the principle of free competition.
A clear example in which hermeneutics is limited (as there are few problems of
interpretation of the limits of law), so that a legislative change in the patent protection
term is necessary, is the second medical use patents. It is about clearly defined
patents, usually with lower investments, whose inventive activity occurs at lower
potential in relation to the necessary one for the development of the molecule or of
the development of the first use, and which, paradoxically, have the same validity
term. Going beyond the argument, that is limited in itself, that the protection is
smaller because it is restricted to the claimed use, in fact there is clear and equal
temporal treatment where there should be an unequal temporal treatment due to the
e
161
explicit inequality among the inventive activities.
It is understood that second use patents, applying the factor of discrímen,
should have a temporal term less than twenty years, since the ideal term, despite
possible analogy with the temporal term granted to utility model patents, would still
depend on further empirical research for its mensuration to be as close as possible to
the ideal one. Thus, the necessary alteration in the article 40 of Law 9,279/96 would
be necessary for the inclusion of another temporal discrímen.
This temporal differentiation, reducing the term in accordance with the equality
principle, generates direct beneficial effects in the competitive environment because
it will remove one of the major explicit barriers of market entry by the lower temporal
resolution of the protection granted, taking into account the free competition.
Obviously, the equality principle materially considered does not solve all
problems through hermeneutics and through the adequacy of protection to
technological diversity, still leaving unanswered questions which shall be answered
by further studies.
But a position in which the equality principle can also contribute as a
determining factor for the application of the factor of discrímen is in the case of the
exercise of patent rights on the market, since the differential treatment of different
technologies assists in the identification, prevention and repression of anticompetitive
conducts, favoring a constitutionally healthy competition in a market populated by an
excess of holders as well as barriers to entry caused precisely by the exercise of an
abusive or maladjusted patent right, and many times difficult to identify.
For this purpose, once abuse is identified in the competitive environment
(which is facilitated by the application of the equality principle on the basis of the
patent system), the use of compulsory license for abuse of rights, for abuse of
economic
162
economic power and for patent improvement (dependence) should be more frequent
and procedurally more accessible, favoring the functionality of the patent system on
behalf of free competition.
It is clear that, although such factors contribute to the understanding of how
mistaken is the understanding that the rights over patents, when their competitive
effect in contrast with an antitrust examination is analyzed, should not be considered
different from any other property rights. That is, the inappropriate premise permeates
all further analysis of hermeneutic addictions that would not occur if such premise
were not adopted.
In view of these considerations, in a Welfare State, it is concluded that
property rights over patents and their exercise should be aligned with the
fundamental rights, in particular with the principle of equality of material goods, since
such principle, when recognized on the basis of the patent system, plays a
fundamental and inexorable role optimizing the whole system, enabling the functional
constitutional association of patent law to be carried out in effective harmony with the
free competition.
163
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176
APPENDIX A: Field Research ACED
Questionnaire and Answers: Paulo Furquim de Azevedo
PONTIFICAL CATHOLIC UNIVERSITY OF RIO GRANDE DO SUL – PUCRS
LAW SCHOOL
POSTGRADUATE LAW PROGRAM
DOCTORATE IN LAW
Doctoral Thesis in progress- THE INTERPRETATION OF THE LIMITS OF
PATENT LAW IN CONTRAST WITH THE MARKET COMPETITIVE DYNAMICS
Doctoral Student: Prof. Me. Milton Lucídio Leão Barcellos
Field Research: The research aims to analyze how ACED interprets the concepts,
laws, economic and social effects, when there are competitive behaviors (or anticompetitive) involving rights over patents.
Research Methodology: Sending the pre-elaborated questionnaire for councilors,
and other officials and lawyers involved in cases analyzed by the Brazilian
Competition Defense System.
Objectives: Obtain answers that will help to define the actual US Competition
System when it faces patent related issues, in order to establish a comparative
analysis between the FTC/DOJ Authorities (US) practices and the SDE/CADE
Authorities (BR) practices, since the same research has been conducted in the
Brazilian Competition System. Those answers will also be useful to identify the
struggle points of both systems and will help to map possible solutions in order to
confirm or not the hypothesis developed in the ongoing Doctoral Thesis.
Presentation of answers in the thesis: Despite the intention of giving special
thanks in the thesis, should it be requested by the interviewee, it shall be ensured
him full anonymity. Only the names of the interviewees who authorize the revelation
shall be published.
Questionnaire
1) Within the legally established functions, in your view, what are the main
functions performed by the ACED lately?
The ACED performs three main functions: preventive control (market structure),
repressive control (conduct) and competition advocacy. All of them are relevant and,
each in its own way, have limits, which are detailed in subsequent questions.
177
2) In your view, how has the ACED positioned itself in the formulation and
conduct of the competition defense public policy when involved in the abuse of
property rights (either related to tangible property or intangible property)?
First, it is necessary to conceptualize what ‗abuse of property rights‘ means. The
characterization of an antitrust illicitness requires the observation of two conditions:
that the act causes damage to competition and that from this act do not derive
benefits that outweigh the costs come from the competition discouragement.
Therefore, exercising legitimate property rights, for instance by setting prices that
generate extraordinary profits, does not constitute illicitness by itself. In order for this
to occur, it is necessary to characterize the damage to competition, which may occur
through the direct elimination of competition, via concerted conduct, or via unilateral
exclusionary conduct.
3) In your view, what are the limitations or problems the ACED faces in carrying
out these functions?
The ACED faces relevant limitations in the exercise of all its three main functions: In
a brief summary, the control of structures is constrained by the subsequent
notification system, which reduces the capacity of enforcement of structural
measures, since, in general, the merger is a fait accompli at the time of notification.
In regard to conduct control, the major limitations arise from the increasing
judicialization of conduct of proceedings in the administrative sphere, which is, in
case of conviction, succeeded by judicial review. It leads to an immense distance
between the commission of an offense and its effective punishment, resulting in subpunishment. In the case of competition advocacy, the opinions of the Brazilian
Antitrust System BAS (the main actor for this role is the Economic Monitoring
Secretariat EMS not the ACED) are often ignored at no cost to its recipient.
4) In your view, what could be implemented to improve the performance of these
functions at the ACED (both prevention and repression)?
Control of structures: prior notification
Conduct control: simplification of procedures and reduction of instruction time.
Competition advocacy: partnerships with other agencies, with the aim of spreading
the culture of competition and a greater effect of vocalization on behalf of
competition.
5) Did you ever judge cases where patent law was directly or indirectly involved?
For instance: Cases involving clauses in agreements that the term goes
beyond the expiring term of patents (or effects of the agreements in this way,
although indirectly); cases involving market power based, among other factors,
on cross-licensing, mergers involving patent pools on market dominant
technologies; agreements involving monopolists/oligopolists in lawsuits
involving patents; unilateral and exclusive ―grant-black‖ clauses
(improvements
178
(improvements on technologies developed by the licensee that, through this
clause, belong to the licensor or ensure the licensor the exclusive exploitation);
the application of compulsory license, either by refusing to license or supply, or by
any other reason, among other situations. If so, do you think the understanding
and focus given by the BAS and/ or by the judiciary were correct or not? Why? Do
you believe that some element has been missing in the analysis (either by the
BAS or by the judiciary)?
Yes. I was reporter in the Gemplus and Axalto case (which resulted in Gelmato),
smart cards manufacturers holders of roughly 50% of patents. The concern was that
the control of intellectual property rights might have detrimental effect on the smart
cards manufacturing market, more competitive than the innovation manufacturing
market. The case was concluded through a (TDC) agreement, in which the
applicants agreed to license their patents on non-discriminatory basis for a period of
5 years. This period was not extended in order not to create adverse incentives for
future innovation. As the case was concluded with agreement, the judiciary was not
called upon.
6) In your opinion, should the patent rights be treated as any other form of
possible exercise of market power or should they be treated in a special way?
How?
There are, of course, peculiarities in the patent rights, but not to the point of requiring
the constitution of a single category in antitrust analysis. I understand that the main
element – which enables a grouping with other kinds of rights – is the fact that an
eventual market power comes from a public policy, part of a technological or
industrial policy, and, therefore, it is legitimated by the same society that supports the
existence of an antitrust policy.
7) In your opinion, should each specific technological market have a differential
treatment? Can this differential treatment also be stipulated by virtue of the
necessary technological percentage and by virtue of the one who dominates it
(instead of solely relying on market power directly exercised by the owner (s)
of the patent (s)), instead of considering the company market share?
At first, all markets should have a differential treatment, that is to say that none
should have it. A market analysis is always made case-by-case, and conclusions are
case-specific. There are possible analogies (e.g. technological innovation markets)
which allow the appropriation of knowledge and experience obtained from other
markets, but this analogy should be sufficiently substantiated in each case.
8) In your view, is it possible that contracts with clauses involving patent rights
could be ―hiding‖ violations of the competition Law because it is about areas of
difficult benchmarking of the existence or not of market power or abuse of
market power? Besides the deeper and empirical analysis of each relevant
market, what else could be done by the Brazilian antitrust system so that such
tem
179
clauses were more easily identified or repressed?
I do not know if I understand the question. I do not believe that patent rights are
areas where the existence or not of market power or abuse of market power is,
compared to all other sectors, hard to benchmark. Undoubtedly it is a hard task, but it
is also hard to the manufacturing market of media content, software, specialized
services etc. A relevant item in this area is the sham litigation. Since it is unclear
whether the property rights have been infringed or not, companies can use the
intellectual property protection system to impose costs on competitors, even though
they have not, in fact, infringed them. Therefore, the difficulty in evaluating whether or
not there has been violation of IPR is a source of competition problems.
9) From your experience and knowledge in the area, which other contributions
could you provide to this field research? For instance, if the BAS had more
experts in each technological area to identify potential present or future effects
caused by all kinds of patent exploitation in the relevant market, it would be
better able to anticipate future damage that the past, present and future acts
under the BAS analysis might potentially cause on the competitive system
and, consequently, on the considerate fulfillment of constitutional clauses that
constitute the principles of free competition, social interest, social function of
property and consumer protection.
In my view, there is no, at first, incompatibility between the protection of property
rights and its full exercise and the antitrust policy. This proposition is, partly,
developed in the ADMINISTRATIVE PROCEDURE no. 08012.000912/2000-73,
which I quote the following extract:
Although [the ELS] has undertaken statistic analysis to
identify the observance of the first necessary condition [high
prices], the subsequent analysis of the ELS summarily discard
the harmfulness of the conduct, even in those cases where the
disproportionate price increase was identified. I argue, as
follows, that, in fact, there is no occurrence of illegal antitrust by
abusive pricing in the proceedings, considering the plexus of
necessary facts to infer the damage to competition caused by
the company action. This path of analysis, simple and
straightforward, makes the procedure unnecessary.
180
The central question in this case and in other administrative procedures
because of the “PCI (Parliamentary Commission of Inquiry) of Drugs” is to characterize
which set of facts, once observed, can be concluded from the occurrence of an antitrust
illicitness of abusive prices, according to Law 8,884/94.
Obviously, the disproportionate price increase and the existence of a dominant
position are part of this set of facts, but are certainly insufficient to infer illicitness.
Excessively low prices, in very restrictive conditions, can represent predatory pricing
illicitness, as it is already known in the antitrust literature303. It remains to be seen what set of
facts is sufficient to represent an infringement through excessively high prices.
First of all, it should be recognized that, under competitive conditions and
under the absence of market failures, the pricing that makes a company targeted at making
the maximum profit, is socially desirable. The maximum profit of a company is obtained
through the optimal choice of technology (combination of inputs) and through the choice of
the quantity produced which makes the marginal cost and the marginal revenue equivalent. In
other words, with the aim of making the maximum profit for itself, the company uses the
inputs as efficiently as possible and expands its production until it depletes the profit
possibilities. If there is competition, its marginal revenue coincides with the market price, in
such a way that this company production reaches the highest level of social welfare, i.e., the
point where the marginal cost equals the market price.
If the company has market power, it has such relevance in the market that a
variation in its production is able to affect prices. As a result, there are incentives for such
firm to produce less than what is socially desirable, getting higher prices than those that
would be observed under competitive conditions. The company‟s price of choice could,
therefore, be considered „excessive‟, in the sense that there would be, in a static analysis,
gains derived from an embarrassment to the firm‟s pricing strategy.
However, the market power held by a company is often legitimate; many times
protected by the public policy, i.e., by society‟s choice.
This is the case of dominant
pospositions
__________________________
303
In this regard, see MOTTA, Mássimo. Competition Policy: Theory and Practice. New York:
Cambridge University Press, p. 412-422.
181
positions acquired in the market, through greater efficiency, better product quality and
innovation. It is also often directly protected by patents, which grant the innovator the status
of holder of exclusive production rights or the use of a particular product.
The profit realization arising from positions achieved by the legitimate
exercise of market rules is the basis of the incentive so that firms compete on cost reduction,
quality growth and innovation. Preventing, through antitrust policy, the realization of gains –
e.g. condemned, by itself, to the practice of high prices, would be contradicting the foundation
of the same policy. This proposition is convergent with the one constant in the main textbooks
of the Industrial Organization, as cited below.
Surely the government cannot condemn a firm for increasing demand
for its product by providing information, by reducing its own costs
investing in R&D and in physical capital, or by accumulating
experience. The problem is that most of the decisions that make the
firm healthy also improve its position in the market in relation to
potential and actual newcomers. (Tirole, 1988:323)
For no other reason, the legislator was careful to add the paragraph 3
of the art. 20 of Law 8,884/94, which states that “gaining market share as a result of a
natural process based on economic agent greater efficiency in relation to their competitors
does not characterize the illicitness provided in the item II”(regarding market domination).
The same legislator, however, includes, among other competitive conducts, in the Art. 21,
item XXIV, of the same law, the practice of “imposing excessive prices, or increasing without
good cause the price of goods or services.”
From the previous argumentation, it is concluded that „excessive
prices‟, providing they are the result of profit realization of dominant position legitimately
achieved, do not characterize an infringement of antitrust. The application of the item XXIV
of the Art. 21 of Law 8,884/94 should be restricted to the use of illegitimate market power
(e.g. result of concerted conduct of prices) or to the pricing that directly causes damage to
competition. In the first case the „excessive price‟ is a symptom of some anticompetitive
llegitimately,
182
conduct that allows, illegitimately, price rise, and not directly the conduct that must be
repressed. It should, therefore, be observed if there are in the case under study elements that
show the existence of a practice that, by inhibiting competition, enables the realization of
higher prices. This is certainly not the case of legitimate exercise of intellectual property
rights or the dominant position gained within market rules. It is in this very sense that Prof.
Rubens Nunes stated about, in a simple and lucid article on the topic, as cited below:
Excessive prices are those that result from violations of the economic
order, as the cartelization, either by obtaining monopoly by spurious
means, such as the influence with the legislator, or by the regulating
agency in regulated sectors. In the first case, the violation
characterized in the article 21, XXIV would always be followed by
conducts that would give material conditions for the imposition of
“excessive prices”. The second case is outside the scope of
antitrust.304
„Excessive price‟ can also be part of a strategy to exclude competitors
in vertically related stages, in a continuous variation of a strategy of sale refusal, also
described as illicitness in the item XIII of the Art. 21 of Law 8,884/94. The relationship
between the two conducts is in the fact of a sale refusal to be conceptually equivalent to an
indefinite price and, therefore, impossible to be paid. In this sense, „excessive price‟, as a
violation of antitrust, would not be the one derived from the pricing of maximum static profit
– in which the marginal cost equals the marginal revenue -, but the one that is essentially a
strategic action aimed at reducing competition in a manner similar to the sale refusal
strategy. In this case, „excessive price‟, just like „sale refusal‟ and „predatory pricing‟, would
result in the reduction of the current profit in exchange for private benefit derived from the
reduction of competition in the future.
In the case under discussion, the factual elements are not present to
infer the damage to competition resulting from price rise. There is no evidence of pricing
strategy to exclude mpetitors or of illegal conduct that could stain the price rise with
illegitimacy, and occurring no infringement to competition.
___________________________________________
304
NUNES, Rubens. Arbitrary Profit and Excessive Price. ACED –Informs, no. 041, Mar. 2007.
183
strategy to exclude competitors or of illegal conduct that could stain the price rise with
illegitimacy, and there is no occurrence of infringement to competition.
184
APPENDIX B: Field Research - FTC e DOJ
Questionnaire
PUCRS
BOSTON UNIVERSITY
SCHOOL OF LAW
SCHOOL OF LAW
POSTGRADUATE PROGRAM
VISITING SCHOLAR PROGRAM
IN LAW
DOCTORATE IN LAW
___________________________________________________________________________
RESEARCH
Doctoral Thesis in course - THE INTERPRETATION OF THE PATENT LAW
LIMITS BASED ON THE DYNAMICS OF THE MARKET COMPETITION
Doctoral Student/Researcher: Prof. Milton Lucídio Leão Barcellos
FTC Commissioners’ Research: This research aims to analyze how the FTC
Commissioners understand and act in the United States Competition System when
faced with competition behaviors involving Patent issues.
Research Methodology: Interviews with the FTC Commissioners in order to answer
the eight questions, regarding their high experience and overview of the intersection
of Competition Law and Patent Law faced by DOJ and FTC.
Goals: Obtain answers that will help to define the actual US Competition System
when it faces patent related issues, in order to establish a comparative analysis
between the FTC/DOJ Authorities (US) practices and the SDE/CADE Authorities
(BR) practices, since the same research has been conducted in the Brazilian
Competition System. Those answers will also be useful to identify the struggle points
of both systems and will help to map possible solutions in order to confirm or not the
hypothesis developed in the ongoing Doctoral Thesis.
Presentation of the answers and results in the Thesis: Although the intention of
this researcher is to individually identify the source of the answers with a special
thankful note to the Honorable Commissioners that took their precious time to help
with
185
with this research, if any Commissioner requests not to be identified or connected to
its answers this researcher will fully respect that, and the name of the specific
Commissioner will not be mentioned in any part of the research results, information
or final Thesis, related in all the citations just as a ―DOJ/FTC source interviewed‖.
Questions:
1) Based on your experience and understanding, which are the main functions
and duties of the FTC nowadays?
2) Based on your experience and understanding, which are the limitations and/or
problems that the FTC is facing to develop those main functions and duties?
3) Based on your experience and understanding, what could be changed or
implemented in order to improve the development of those main functions and
duties? If applicable, please answer based on both areas: Prevention and
repression of anticompetitive behaviors.
4) Did you ever judge antitrust/competition cases involving directly or indirectly
patent rights? Such as cases involving patent licensing agreements that the
terms goes beyond the expiring term of the patents; market power or attempt
to reach market power involving cross-licensing patents; horizontal and/or
vertical agreements involving patent pools, patent misuse, exclusion of
competitors or other anticompetitive conducts using the patents as one of the
basis for this conducts; Anticompetitive patent settlements; Unilateral and
exclusive grant-back clauses; refusal to deal and compulsory license based
on the refusal to licensing and to supplying the needs of the market; and other
possible situations that you may have faced while analyzing antitrust cases
involving patent rights. Which were the main difficulties founded in this kind of
cases in order to establish a per se rule or a rule of reason analysis?
5) Based on your recent experience and understanding, and also based on the
fact that the US Antitrust Guidelines General Principles was established
almost 14 years ago, do you think that the Patent Rights should be treated as
any other form of property and also generally do not create market power in
the antitrust context? Or should it be treated from a different perspective? If it
should be treated from a different perspective, could you explain briefly how?
6) Based on your experience and understanding, should each specific
technological market have a specific and/or different treatment by the Antitrust
Authorities? If so, could this specific and/or different treatment be established
also based on the percentage of technology needed in the very specific
product/service instead of based only on the market power of the owner(s) of
the patent(s)?
7) Based on your recent experience and understanding is it possible that
contracts with clauses involving patent rights could be ―hiding‖ violations of the
competition Law that do not come to the attention of the Competition/Antitrust
Authorities since it would be difficult to identify the existence of market power
or even the abuse of this market power behind those clauses? Besides the
deeper and empirical analysis of each relevant market, what else could be
done by the DOJ/FTC in order to improve the analysis of cases dealing with
the
186
the intersection of the Patent Law and Competition Law and also to help that
such clauses could be better identified and repressed?
8) Based on your experience and understanding, which other contributions could
you give to this research?
Thank you very much for your time and cooperation. Your distinct participation will
really help improve and qualify my Thesis.

hermeneutic limits and possibilities of the equality principle in the

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