Intellectual Property, Antitrust and Cumulative Innovation in the EU and the US

Dr Thorsten Käseberg, a lawyer and economist, was a case-handler at the European Commission's Directorate-General for Competition between 2009 and 2011. He is currently working in the competition policy unit of the German Economics Ministry and was previously a lecturer in the Faculty of Law and Faculty of Economics at the Humboldt University Berlin, and a research assistant at the law firm Cleary Gottlieb Steen & Hamilton in Brussels.

This book is the first comprehensive account of the legal and policy, antitrust and IP, framework in regard to cumulative innovation and, as such, it is a valuable contribution for lawyers, both practising lawyers as well as academics. Last but not least, the comparative element of the research in relation to cumulative innovation contributes to the existing quest for awareness of informed divergence between the two major jurisdictions, the EU and the US.

• 1. Introduction 1.1. The Previous Focus On Initial Innovation 1.2. The Need to Account for Follow-On Innovation 1.3. The Regulatory Problem and the Policy Levers 1.4. Methodology and Structure 2. The Relationship between IP and Antitrust Laws 2.1. A First Look: Two Types of IP 2.2. A Closer Look: The Anti-Competitive Potential of IP Rights 2.3. Approaches to the Relationship between IP and Antitrust 2.4. A Positive Economic Analysis of the IP/Antitrust Interface 2.5. IP or Antitrust? Some Meta Rules 2.6. Which Antitrust Rules? Some Principles 2.7. Conclusion 3. The Concepts of Monopolisation and Abuse: What is the Correct Test? 3.1. The Tests Used under § 2 Sherman Act and Article 102 TFEU 3.2. Obstacles to Cross-Fertilisation? 3.3. Analysis of Potential Standards 3.4. Conclusion 4. Refusals to Deal which May Impede Follow-On Innovation 4.1. The Traditional Typology of Refusals to Deal 4.2. Cumulative Innovation and Bargaining Rules 4.3. A Typology of Refusals to Deal involving IP 4.4. Scenario 1: Impeding Research into Follow-On Innovation 4.5. Scenario 2: Impeding the Marketing of Follow-On Innovation 4.6. Scenario 3: Refusal to Give Interoperability Information 4.7. Scenario 4: Refusal to License IP which Protects a Standard 4.8. Scenario 5: Refusal to Supply Products on the Basis of IP 4.9. Conclusion 5. The Licensing Fee: Determining Liability and the Remedy 5.1. The Royalty5.2. The Relationship between Liability and the Remedy Price 5.3. Non-Discriminatory Pricing? 5.4. The Procedure: Bargaining, Determining the Price, Monitoring, and Enforcement 5.5. Conclusion 6. An Essential Facilities Test 6.1. Condition 1: Harm to Competition 6.2. Condition 2: No Ex Ante Investment Defence 6.3. Condition 3: No Ex Post Efficiency Defence 6.4. Conclusion 7. Cumulative Innovation under US IP and Antitrust Laws 7.1. The Initial Innovator's and the Improver's Positions under US IP Laws 7.2. The General 'No Duty to Deal' Rule under US Antitrust Law 7.3. Potential Exceptions to the No Duty to Deal Rule 7.4. The Remedy 7.5. Future Tendencies 7.6. Conclusion 8. Cumulative Innovation under European IP Laws and EU Competition Law 8.1. The Original Innovator's and the Improver's Positions under National IP Laws in the EU 8.2. Limits to Refusals to Supply Based on IP under Article 102 TFEU 8.3. The Remedy 8.4. Future Tendencies and Conclusion 9. Comparison and International Dimension 9.1. Differences between the US and EU Approaches9.2. Potential Explanations for the Differences 9.3. The International Antitrust Law of IP 10. Summary 10.1. IP and Antitrust as the Framework for Cumulative Innovation 10.2. The Relationship between IP and Antitrust Laws 10.3. Monopolisation and Abuse: What is the Correct Test?10.4. Refusals to Deal which May Impede Follow-On Innovation 10.5. The Licensing Fee: Determining Liability and the Remedy 10.6. An Essential Facilities Test 10.7. Cumulative Innovation under US IP and Antitrust Laws 10.8. Cumulative Innovation under European IP Laws and EU Competition Law 10.9. Comparison and International Dimension