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Contracts
University of Dayton School of Law
Germain, Gregory

I. history
A. Purpose
i. Patent Clause reflects a balance between the need to encourage technological innovation and the avoidance of monopolies which stifle competition [and dissemination of fruits of innovation] without any concomitant advance in the “Progress of Science and the Useful Arts.”
ii. Ultimate goal is to bring new designs and technology into the public domain through disclosure. Bonito Boats.
iii. Congress’s purpose and objective: 1) “promote progress” through incentive to invent, 2) ensure disclosure to public domain, 3) to ensure material in public domain is not removed, and 4) encourage people to seek patents.
iv. solution is financial reward as inducement
B. Applicant whose invention satisfies the requirements of §101 utility, §102 novelty, and §103 nonobviosness, and who is willing to reveal to the public the substance of his discovery and the §112 “best mode… of carrying out his invention,” is granted “the right to exclude others from making, using, or selling the invention throughout the U.S.” for a period of 17 years. Bonito Boats.
C. ancient
i. literae patentes “letters patent”
a) grant of dignity, office, franchise, etc
ii. 700 BC – Greek prizes of exclusive rights or prize money
iii. 480 AD – monopoly outlawed in Rome. lack of tech dev
iv. Dark ages – guilds
v. Renaissance – 1421 first patent issue. Guilds still relied upon
vi. Venetian statute of 1474 – granted 10 yr right to exclude for new and unique inventions
a) similar system sprung up virtually everywhere before 1600
vii. 1624 – Statute of Monopoly
D. modern
i. exclusive right to make, use, and sell the invention in the US or importing into US for 20 yrs after filing
a) bargain = inventor describes in detail to give notice and place in public domain
b) not a positve right to sell; only negative right to exclude
ii. 1790 Act
iii. 1836 Act
iv. 1870 Act
v. 1930 suspicion
vi. 1952 Act
E. philosophical justification
i. natural rights or deontological – “just deserts” theory
ii. consequentionalist or utilitarian – necessary means to greater end
II. modern patent
A. Art 1 §8 –
B. Federal Circuit Appellate court (1982)
i. takes patent infringement case on appeal
ii. unified circuit created in 1982 to solve problems
a) forum shopping from drifted circuits
b) unification created more coherent and consistent body of case law from 12 judges who understand technology
iii. still inconsistent according to members of three members of panel
a) Festo – doctrine of equivalence decision with many dissen

induce “inventing around”
C. balance of monopoly incentive and social benefit
D. anti-competition device- monopoly power drives system
i. 20 yrs from date of application (1995)
a) previously 17 yr term from issue
V. adherence to statutory req
VI. patent infringement
A. different process
B. invalidity
C. damages and remedies
D. trade secrets vs patent
i. pre-emption of state COA
VII. theories of patent law
A. incentive = primary justification of patent law
i. incentive to invent and for commercialization
ii. incentive to disclose
B. natural right
i. natural right to use and profit from creation
C. labor theory
D. property theory
E. social welfare theory
F. monopoly theory
G. market regulation theory
H. investment incentive theory
I. rent seeking theory
J. prospect theory
K. reward theory
L. contract theory
i. public disclosure promotes advances
ii. contract between gov’t and inventor. disclosure for monopoly
M. inventing around
VIII. STATUTORY SUBJECT MATTER