Historical Development of the Misuse Doctrine

The misuse doctrine has been subject to substantial scrutiny in the
courts and academic literature. Nevertheless, confusion and disagreement
remain over its roots, rationales, and the role it should play in
contemporary intellectual property law. Various aspects of the doctrine
are explored more fully in later chapters. This chapter provides a basic
overview of the historical development of the patent misuse doctrine,
which is the genesis of the modern-day misuse doctrine that today also
encompasses misuse of copyrights and trademarks.1
A. Patent Misuse Generally
“Patent misuse” is an affirmative defense to an action for patent
infringement or for royalties under a license that arises when the patentee
engages in certain anticompetitive conduct, or conduct contrary to public
policy, using the patent in suit. Conduct found to be patent misuse
typically has involved imposing conditions on access to a patent that
extend beyond the physical or temporal scope of the patent—thereby
improperly “extending” its effective scopeand occasionally other
violations of the antitrust laws. For example, requiring a licensee of patent
A to license an unrelated patent B as a condition of the license may
constitute misuse of patent A. A finding of patent misuse generally
renders the patent unenforceable until the conduct is ended and its effects
are purged. As discussed in further detail below and in later chapters,
some efforts to extend the scope of the patent have been condemned as
misuse per se, while others require a further showing that the conduct
causes anticompetitive effects.
1. Chapter VI contains a separate discussion of the development of t he
copyright and trademark misuse doctrines.
2 Intellectual Property Misuse
Although many recent misuse decisions have borrowed heavily from
antitrust principles in shaping the doctrine,2 the concept of misuse
emerged not from antitrust law, but from the patent law doctrine of
contributory infringement. In fact, courts almost universally rejected early
attempts at developing a defense to patent infringement claims based on
alleged antitrust violations by the patent holder.
This chapter reviews these early “antitrust defense” cases, charts the
development of the misuse defense from the doctrine of contributory
infringement, and discusses more recent case law and legislative
developments emphasizing antitrust principles in misuse analysis.
B. The Early Cases
Early efforts to develop a defense to patent infringement suits based
on the patent holder’s conduct relied primarily on the antitrust laws.
Almost immediately after the passage of the Sherman Act in 1890, alleged
infringers began trying to use this new statute as a defense to patent
infringement suits. Patent infringement defendants would plead that the
plaintiff was an illegal trust, that the plaintiff acquired title from an illegal
trust, or that the patent infringement suit was part and parcel of a
conspiracy to restrain trade, the terms of which were often said to include
price stabilization agreements. With rare exception, these efforts at
developing an antitrust-based defense to patent infringement claims
2. Chapter VII discusses the intersection between the policies behind
antitrust and misuse.
3. See, e.g., Edison Elec. Light C o. v. Sawyer-Man Elec. Co., 53 F. 592, 598
(2d Cir. 1892); Strait v. Nat’l Harrow Co., 51 F. 819, 820 (C.C.N.D.N.Y.
1892); American Soda Fountain Co. v. Green, 69 F. 333 (C.C.E.D. Pa.
1895); Bonsack Co. v. Smith, 70 F. 383, 385-87 (C.C.W.D.N.C. 1895);
Columbia Wire Co. v. Freeman Wire Co., 71 F. 302, 306-07 (C.C.E.D.
Mo. 1895); Brown Saddle Co. v. Troxel, 98 F. 620 (C.C.N.D. Ohio 1899);
Nat’l Folding-Box & Paper Co. v. Robertson, 99 F. 985 (C.C.D. Conn.
1900); Otis Elevator Co. v. Geiger, 107 F. 131, 132 (C.C.D. Ky. 1901);
Cimiotti Unhairing Co. v. American Fur Ref. Co., 120 F. 672, 673
(C.C.D.N.J.), rev’d on other grounds, 123 F. 869 (3d Cir. 1903), aff’d, 198
U.S. 399 (1905); Johns-Pratt Co. v. Sachs Co., 176 F. 738, 739-40 (C.C.D.
Conn. 1910); Motion Picture Patents Co. v. Ullman, 186 F. 174, 175
(C.C.S.D.N.Y. 1910); U.S. Fire Escape Counterbalance Co. v. Joseph
Halsted Co., 195 F. 295 (N.D. Ill. 1912); Western Elec. Co . v. Wallerstein,
48 F.2d 268, 269 (W.D.N.Y. 1930); Western Elec. Co. v. Pacent
Historical Development of Misuse Doctrine 3
For example, Strait v. National Harrow Co.4 involved an action by an
alleged infringer to enjoin the patent holder from instituting an
infringement suit. The alleged infringer asserted that the patent holder had
entered into an improper combination for the purpose of acquiring a
monopoly in the market for spring-tooth harrows and, as an incident to
this combination, had acquired all the relevant patent rights from other
manufacturers. The court rejected this assertion, observing that “[e]ven a
gambler, or the keeper of a brothel, cannot be deprived of his property
because he is an obnoxious person or a criminal; and it is no defense to
the trespass upon it . . . that it was used in carrying on the unlawful
Similarly, in Brown Saddle Co. v. Troxel,6 a direct infringement case,
the defendant alleged by way of an affirmative defense that the patent at
issue was being used as part of an illegal combination. The trial court
struck these allegations as impertinent. Then Circuit Judge Taft upheld
the trial court’s action, holding that the manner in which a patent is used
is immaterial in a suit to enforce it: “[The plaintiff] is merely seeking by
its bill to preserve its rights in its own property. What it may do with that
property . . . cannot deprive it of its right to invoke the protection of the
court against trespass and infringement.”7
Perhaps the most explicit rejection of a defense based on the patent
holder’s use of the patent is found in United States Fire Escape
Counterbalance Co. v. Joseph Halsted Co.8 There, the court stated that an
alleged attempt to extend the patent “monopoly” to cover unpatented
products—conduct that would become the very epitome of patent
misuse—was not a defense to an infringement action, even though it was
possibly an antitrust violation:
The sole value of patent property resides in monopoly. Within certain
limits this monopoly may be made to extend to nonpatentable property
Reproducer Corp., 53 F.2d 639, 640 (S.D.N.Y. 1930); Radio Corp. of Am.
v. Duovac Radio Tube Corp., 6 F. Supp. 275 (E.D.N.Y. 1931); Radio
Corp. of Am. v. Majestic Distribs., 53 F.2d 641, 642-44 (D. Conn. 1931);
Radio Corp. of Am. v. Hygrade Sylvania Corp., 10 F. Supp. 879, 881
(D.N.J. 1934).
4. 51 F. 819 (N.D.N.Y. 1892).
5. Id. at 820-21.
6. 98 F. 620 (C.C.N.D. Ohio 1899).
7. Id. at 621.
8. 195 F. 295 (N.D. Ill. 1912).

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