March 2009

In In re Lewis Ferguson, a March 6, 2009 decision from the Court of Appeals for the Federal Circuit, the applicant sought to patent “a marketing paradigm for bringing products to market.” After the application was denied by the various levels of the Patent Office bureaucracy for lack of patentable subject matter, the applicant appealed. The CAFC court quoted this claim from the application as an example:

A paradigm for marketing software, comprising:

a marketing company that markets software from a plurality of different independent and autonomous software companies, and carries out and pays for operations associated with marketing of software for all of said different independent and autonomous software companies, in return for a contingent share of a total income stream from marketing of the software from all of said software companies, while allowing all of said software companies to retain their autonomy.

Novel and nonobvious? It may just be me, but if this isn’t a distribution system that’s been implemented a million times, I’ll be damned.… Read the full article

Judge Posner is Not Afraid to Use the "D" Word

by Lee Gesmer on March 12, 2009

Judge Posner is Not Afraid to Use the "D" Word

The redoubtable Seventh Circuit Appeals Court Judge Richard Posner (“the most cited legal scholar of all time”; “probably the greatest living American jurist”), isn’t afraid to call it as he sees it, and given Posner’s brains, experience, and economic cred as an antitrust expert, he may be more credible than your average, run-of-the-mill economist (“economists exist to make astrologers look good”).

In Posner’s newest book, A Failure of Capitalism: The Crisis of ’08 and the Descent Into Depression, he states:

The world’s banking system collapsed last fall, was placed on life support at a cost of some trillions of dollars, and remains comatose. We may be too close to the event to grasp its enormity. A vocabulary rich only in euphemisms calls what has happened to the economy a “recession.” We are well beyond that. We are in the midst of the biggest economic crisis since the Great Depression of the 1930’s.

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Jerry Spence On the Art of Cross Examination

by Lee Gesmer on March 11, 2009

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U.S. District Court Judge Richard Stearns has issued a summary judgment decision dismissing AVX Corp.’s claims of an an antitrust violation by Cabot Corporation, based on allegations of illegal tying by Cabot.

A tying arrangement is where a seller says, “I’ll sell you product A, but only if you also buy product B.”  Product B is said to be “tied” to product A, the “tying product.”  A little thought and common sense would cause even an economist to conclude that if the seller doesn’t have market power in product A, rather than be forced to buy product B a rationale buyer will look around for another seller, who can sell it product A without the “tie.”  In fact, this is just the conclusion the Supreme Court reached in the Illinois Tool case in 2006.

In the AVX v. Cabot case Judge Stearns noted that “AVX offers no evidence that Cabot had a sufficiently dominant market position to ‘force’ it into a multi-year purchase agreement for a product that it did not want.”  The fact that AVX was unable to satisfy this element of an illegal tying arrangement doomed its antitrust claim.… Read the full article