Friday, December 14, 2007
Posted by D. Daniel Sokol
Ariel Katz of the University of Toronto Law School offers a fascinating analysis of the intersection of antitrust and IP in his article Making Sense of Nonsense: Intellectual Property, Antitrust, and Market Power.
ABSTRACT: While the economic rationale for intellectual property ("IP") rights rests on the concepts of "monopoly" or "market power," the U.S. Supreme Court, in Illinois Tool Works v. Independent Ink, has recently joined a "virtual consensus" among antitrust commentators believing that no presumption of market power should exist in antitrust cases involving IP. This Article critically analyzes this consensus, and clarifies the relationship between IP and market power, shows why IP rights often do confer market power in the antitrust sense, but also explains why acknowledging this should not necessarily lead to oversized application of antitrust law to IP.