The Reciprocity of Search

By Chiang, Tun-Jen | Vanderbilt Law Review, January 2013 | Go to article overview
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The Reciprocity of Search


Chiang, Tun-Jen, Vanderbilt Law Review


The discussion of search in patent law always frames the problem in terms of producers looking for patentees. But search is reciprocal. In designing a patent system, we can have producers look for patentees, or patentees look for producers. Either will result in the ex ante negotiation that is the goal of a property system. The legal rule that produces the most efficient social outcome depends on identifying the party with the lower search cost.

The corollary is that patentees should have the duty of search when they are the lower-cost searcher. For example, if there are thousands of patents covering a product, but only one producer in the industry, then it will likely be more efficient to have patentees find the well-known producer to initiate licensing negotiations, rather than having the producer search for each of thousands of unknown patentees.

The reciprocity of search is a principle that applies not only in patent law, but also to property systems more generally. Future research should therefore consider its implications for other areas of property law such as copyright and the orphan works problem.

INTRODUCTION ................2

I. THE ONE-SIDED VIEW OF SEARCH ................6

A. The Role of Search ................6

B. The Conventional One-Sided View ................10

1. The Doctrine that Requires Producers to Search ................10

2. The Literature that Proposes Helping Producers to Search ................13

3. The Literature that Argues Producers Cannot Search ................14

II. THE RECIPROCAL NATURE OF SEARCH ................17

A. Coase and the Reciprocity of Tort Causation ................17

B. The Reciprocity of Patent Search ................19

III. THE IMPLICATIONS OF RECIPROCITY ................20

A. Defining Ex Ante Search ................20

B. Comparing Search Rules ................23

C. Consequences of Misallocating Search Duty ................27

1. Breach of Duty as a Cost of Doing Business ................27

2. Moral Hazard and Patent Trolls ................29

D. Imposing a Duty of Search on Patentees ................31

E. Addressing Objections ................38

1. Producers Will Hide Their Infringing Activities ................38

2. Requiring Property Owners to Search Is Unprecedented ................39

3. Preserving the Trade -Secrecy Option ................40

4. Patentees Cannot Foresee All Uses of Their Inventions ................41

5. Patentees Will Spam Producers ................43

6. Producers Will Seek Declaratory Judgment ................46

7. The Unfairness of Enforcing Contributory Search ................47

IV. Reversing Search: § 287's Notice Requirement ................50

A. Section 287 as a Search Rule ................51

B. Judicial Evisceration of § 287 ................54

C. Reinvigorating § 287 ................57

V. Reciprocity of Search in Other Property Contexts ................58

A. Real Property ................59

B. Copyright Law ................60

Conclusion ................63

INTRODUCTION

The discussion of search in patent law always focuses on one particular model of search: producers of commercial products are supposed to identify the patents that their products might infringe and then negotiate a license from the owners of those patents. This one-sided view of search responsibility is most evident in doctrine. As a doctrinal matter, patent law imposes an absolute duty on the producer of a commercial product to find all relevant patents and obtain licenses from each of the owners before commencing manufacture. Failure to meet this duty is punished by liability for infringement, where ignorance of the patent is no excuse.1

The one-sided view of search, however, is treated as far more than simply a matter of doctrine. Numerous prominent commentators have sharply criticized the current doctrine.

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