A patent thicket is "an overlapping set of patent rights" which requires innovators to reach licensing deals for multiple patents. This concept has negative

connotation A connotation is a commonly understood cultural or emotional association that any given word or phrase carries, in addition to its explicit or literal meaning, which is its denotation. A connotation is frequently described as either positive or ...

s and has been described as "a dense web of overlapping

intellectual property Intellectual property (IP) is a category of property that includes intangible creations of the human intellect. There are many types of intellectual property, and some countries recognize more than others. The best-known types are patents, co ...

rights that a

company A company, abbreviated as co., is a Legal personality, legal entity representing an association of legal people, whether Natural person, natural, Juridical person, juridical or a mixture of both, with a specific objective. Company members ...

must hack its way through in order to actually commercialize new

technology Technology is the application of Conceptual model, conceptual knowledge to achieve practical goals, especially in a reproducible way. The word ''technology'' can also mean the products resulting from such efforts, including both tangible too ...

Etymology

The expression may come from ''SCM Corp. v. Xerox Corp.,'' 645 F.2d 1195 (2d Cir. 1981), a patent litigation case in the 1970s, wherein SCM's central charge had been that

Xerox Xerox Holdings Corporation (, ) is an American corporation that sells print and electronic document, digital document products and services in more than 160 countries. Xerox was the pioneer of the photocopier market, beginning with the introduc ...

constructed a "patent thicket" to prevent

competition Competition is a rivalry where two or more parties strive for a common goal which cannot be shared: where one's gain is the other's loss (an example of which is a zero-sum game). Competition can arise between entities such as organisms, indi ...

Uses and alternative names

Patent thickets are used to defend against competitors designing around a single patent. It has been suggested by some that this is particularly true in fields such as

software Software consists of computer programs that instruct the Execution (computing), execution of a computer. Software also includes design documents and specifications. The history of software is closely tied to the development of digital comput ...

or pharmaceuticals, but Sir Robin Jacob has pointed out that "every patentee of a major invention is likely to come up with improvements and alleged improvements to his invention" and that "it is in the nature of the patent system itself that atent thicketsshould happen and it has always happened". Patent thickets are also sometimes called patent floods, or patent clusters. According to a report by Professor Ian Hargreaves, published in May 2011, patent thickets "obstruct entry to some markets and so impede innovation." Patent thickets are said to have become common in fields like

nanotechnology Nanotechnology is the manipulation of matter with at least one dimension sized from 1 to 100 nanometers (nm). At this scale, commonly known as the nanoscale, surface area and quantum mechanical effects become important in describing propertie ...

as more fundamental science is patented. Some authors have expressed concern that this could reduce technological development and

innovation Innovation is the practical implementation of ideas that result in the introduction of new goods or service (economics), services or improvement in offering goods or services. ISO TC 279 in the standard ISO 56000:2020 defines innovation as "a n ...

Economic effects

The economics of innovation literature suggests that patent thickets may have an ambiguous effect on patent transactions. On one hand, dispersion in the ownership of patents increases the number of patent owners with whom bargains have to be struck, and this may reduce the incentives to conduct patent transactions. But there is a second, countervailing effect: the presence of overlapping patent rights may reduce the value at stake in each individual patent licensing negotiation, and this may facilitate licensing deals.

Potential antitrust implications in American law

Patent thickets also have potential

antitrust Competition law is the field of law that promotes or seeks to maintain market competition by regulating anti-competitive conduct by companies. Competition law is implemented through public and private enforcement. It is also known as antitrust l ...

implications. In ''In re Humira'', 465 F.Supp.3d 811 (N.D. Ill. 2020), a class of third-party payors for Humira argued that pharmaceutical company

AbbVie AbbVie Inc. is an American pharmaceutical company headquartered in North Chicago, Illinois. It is ranked sixth on the list of largest biomedical companies by revenue. In 2023, the company's seat in Forbes Global 2000 was 74, and rank 89 on the ...

's patent thicket on Humira, consisting of over 100 patents, was in violation of antitrust laws. This patent thicket extended the term of

's monopoly past the twenty year limit and effectively prevented a generic version of the drug from entering the market keeping prices inflated to upwards of $72,000 a year. The district court ruled that the patents were protected from the allegations by the First Amendment regardless of anti-competitive effect. The case is currently on appeal at the Seventh Circuit.UFCW Local 1500 Welfare Fund v. Abbvie Inc., case no. 20-2402 (7th Cir. 2021).

References

{{reflist, 30em Thicket, patent

Etymology

Uses and alternative names

Economic effects

Potential antitrust implications in American law

See also

References