Purging Patent Law of “Private Law” Remedies

Ted Sichelman

92 Texas L. Rev. 517

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In this Article, Professor Sichelman rejects the fundamental “private law” premise of patent law remedies that courts should always attempt to make the patentee “whole” in the event of infringement because the overarching aim of patent law is to promote innovation, not to remedy private wrongs.  Specifically, make-whole damages may thwart optimal innovation incentives when they concern small components of complex products involving high-switching costs, generate large consumer deadweight losses, result in substantial duplicated costs during the pre-invention R&D process, or create transaction costs far in excess of the value of the invention.  In other situations, a patentee should be made more than whole.  For example, inducing socially valuable innovations that do not command large profits in the private market—such as drugs for rare diseases and technologies for the disabled—may require more than make-whole compensation.

More generally, Professor Sichelman argues that the statutory remedies provisions of the Patent Act rest on a flawed foundation.  Instead of correcting for private wrongs inflicted on private parties, patent law remedies should be tailored simply to promote the types and levels of innovation that most benefit society, taking into account administrative and error costs.  As such, Professor Sichelman proposes that the patent system and its associated remedies should be viewed as part of a public regulatory regime designed to further societal goals rather than a private law system that protects individual interests.

Understanding Behavioral Antitrust

Avishalom Tor

92 Texas L. Rev. 573

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Behavioral antitrust—the application to antitrust analysis of empirical evidence of robust behavioral deviations from strict rationality—is increasingly popular and hotly debated by legal scholars and the enforcement agencies alike.  In this Article, Professor Tor shows, however, that both proponents and opponents of behavioral antitrust frequently and fundamentally misconstrue its methodology, treating concrete empirical phenomena as if they were broad hypothetical assumptions.  Because of this fundamental methodological error, scholars often make three classes of mistakes in behavioral antitrust analyses: first, they fail to appreciate the variability and heterogeneity of behavioral phenomena; second, they disregard the concrete ways in which markets, firms, and other institutions both facilitate and inhibit rational behavior by antitrust actors; and, third, they erroneously equate all deviations from standard rationality with harm to competition.  After establishing the central role of rationality assumptions in present-day antitrust and reviewing illustrative behavioral analyses across the field—from horizontal and vertical restraints, through monopolization, to merger enforcement practices—Professor Tor examines the three classes of mistakes, their manifestation, and their consequences in antitrust scholarship.  Besides providing guidance to future behavioral antitrust scholarship, Professor Tor’s Article concludes by discussing two sets of essential lessons that the behavioral approach already can offer to advance antitrust law and policy: one concerning the value of case-specific evidence in antitrust adjudication and enforcement, the other showing how antitrust law can and should account for systematic and predictable boundedly rational behavior that is neither constant nor uniform.

From Interraciality to Racial Realism

L. Song Richardson & Phillip Atiba Goff

92 Texas L. Rev. 669

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Richardson and Goff review Angela Onwuachi-Willig’s According to Our Hearts: Rhinelander v. Rhinelander and the Law of the Multiracial Family.

Constitutionalism and War Making

Peter M. Shane

92 Texas L. Rev. 689

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Shane reviews Mariah Zeisberg’s War Powers: The Politics of Constitutional Authority and Stephen M. Griffin’s Long Wars and the Constitution.

Buyers Without Remorse: Ending the Discriminatory Enforcement of Prostitution Laws

Elizabeth M. Johnson

92 Texas L. Rev. 717

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During the Progressive Era, America seemed to wake up to the real threat of the “Social Evil.”  Prostitutes, who had hitherto been cast as unfortunate and naïve women who allowed themselves to be seduced and ruined, were now seen as dangerous carriers of frightening and incurable disease.  The Federal Government reacted by passing the Mann Act in 1910.  Within 15 years prostitution had been criminalized in every state.

Criminalization, however, only ever really affected the sellers of sex.  The demand side of commercial sex—comprised of men who were given the common, judgment-free, and anonymous-sounding appellation “john”—continued to buy sex with near impunity.  Over the course of the twentieth century, police departments perfected methods of finding and arresting prostitutes, including the use of street sweeps and male decoys.  Few women who were charged with prostitution challenged these methods.  The few who did came to court armed with statistics showing pervasive discriminatory enforcement of prostitution laws against prostitutes and even police testimony admitting the same.  However, these women overwhelmingly saw their defenses thrown out.  While a small and modestly growing number of enlightened judges have dismissed cases against women charged with prostitution on the grounds of discriminatory enforcement, the problem remains.  According to recent FBI statistics, roughly two women are arrested for prostitution for every one man.

Mind the GAAP: Moving Beyond the Accountant–Attorney Treaty

Jamie L. Yarbrough

92 Texas L. Rev. 749

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The current system of litigation contingency reporting does not adequately protect investors—particularly individual and unsophisticated investors—from large, unexpected settlements and judgments.  If regulators are to fulfill their mission of providing ample, high-quality information so that investors can make informed decisions, the disclosure of contingent liabilities in the litigation context must be strengthened.  Mr. Yarbrough develops the viability of a system of disclosure based on settlement value and its potential to satisfy warring factions of attorneys and accountants.  The proposed disclosure system would require dollar amounts offered by disclosing companies in settlement negotiations to form the baseline for quantifying losses that may not otherwise trigger current disclosure requirements because the potential losses cannot be reasonably estimated.

Mr. Yarbrough’s Note begins by examining the existing reporting system for litigation contingencies and noting its shortcomings.  He then outlines a proposed reform that focuses on disclosure of the value of settlements offered by the reporting company.  Finally, Mr. Yarbrough examines the practical obstacles and objections the proposal would have to overcome.  Ultimately, Mr. Yarbrough contends that his proposal does not alleviate the problem completely, but it walks the fine line between greater protection of investors and protecting the reporting companies’ interests in ongoing and future litigation.  Though a number of practical obstacles and concerns must be overcome in order for disclosure of settlement offers to function as a viable proxy for subjective valuations by a reporting company, the interests of investors and transparency in the financial system call for a workable compromise on the issue.  Disclosure of settlement offer values can be that compromise.