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February 05, 2015
Brattle Principal Andrew Abere Contributes to Amicus Curiae Brief on Post-Patent Term Royalty Payments

Brattle principal Dr. Andrew Abere contributed to an amicus curiae brief submitted by the Patents and Antitrust Committees of the New York City Bar Association (NYCBA) in a case currently before Supreme Court that proposes that the Court overrule its 1964 decision in Brulotte v. Thys Co. in which it held that a royalty agreement that extends beyond the expiration of the patent term is unlawful per se.

The NYCBA's brief argues that the per se rule of Brulotte is based on the erroneous assumption that royalties paid after a patent’s expiration somehow extend the patent right and thus extend a patent owner’s presumed monopoly power over the applicable market. The NYCBA contends that in reality, the ability to schedule the timing of royalty payments after the expiration of a patent is generally procompetitive because it encourages innovation, increases the ability to license technology, and promotes new entry into certain markets. Therefore, a licensee seeking to avoid paying post-term royalties should be required to prove under a rule of reason analysis that extending royalty payments beyond the patent term is unlawful under the antitrust laws.

Dr. Abere, an economist member of the NYCBA’s Antitrust Committee, contributed by drafting portions on the economic theory and reasoning supporting the argument to change the existing per se rule of Brulotte to a rule of reason.

“I am very thankful for the hard work of Dr. Abere and the spirit of collaboration he and the contributors showed in developing this brief,” commented James R. Klaiber, a partner at Pryor Cashman LLP and chair of the NYCBA’s Patents Committee.

The amicus curiae brief is available on the NYCBA website.