Patent Misuse Defense and the Future of Traditional Publishing

An ITC ruling for Microsoft and against Barnes & Noble’s patent misuse defense on Tuesday comes on the heels of a thoughtful NYT piece linking the future of traditional publishing to B&N’s ability to keep the doors open. The dispute involves the importation of Nook readers using the Android operating system. Yes, Google’s operating system but Microsoft is the plaintiff –that’s another story. The Times article is “The Bookstore’s Last Stand” by Julie Bosman.

The patent misuse defense isn’t in the patent statutes, has always been tricky, and is rarely applied. It is invoked in situations where patents are alleged to be used in an anticompetitive way that goes beyond the normal scope of patent rights. That’s tricky because the whole idea of a patent is to confer monopoly rights on its owner to prevent all others from making, using, or selling the invention it covers. But the equitable defense is recognized even if it didn’t help B&N at this stage of the fight with Microsoft.

An interesting sidelight is how the ITC judge’s decision became known before Microsoft issued a statement. It was apparently sussed out by the blog Ross Patents which had enough information about the litigation to understand the implications of a one line docket entry for the ITC case. As mentioned here recently, a feature of the online piracy bill OPEN is the use of the ITC. The need for that active tribunal to make dockets and documents filed more accessible will be even greater if its portfolio is expanded.

Why is the fate of traditional book publishers closely linked to B & N as the last national book store chain left standing? The publisher’s role is seen as curator of the writing universe and guide to what’s worth reading. The “browsing” effect is cited by Ms. Bosman and supported by stats indicating that most people don’t walk out of a bookstore with what they came for. The same may be true to some extent online, but the vastness of offerings from Amazon and other sources is only mediated by “if you like this, you’ll also like the following” features–and what your friends tell you to read.

B & N is so small compared to Amazon, and the e-reader arms race is so fast and furious, the impact of IP litigation has to be much greater for the last national bookstore. Whether the ITC ruling in the lawsuit adds anything to the law of patent misuse remains to be–and maybe never will be–seen.

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About Craig Pinkus

Craig Pinkus is a partner in the Intellectual Property Group. He also is a member of the Litigation and the Sports, Entertainment and Media Groups. He assists clients with a broad range of disputes and transactions involving all areas of intellectual property, entertainment, and other complex business arrangements. He has conducted trials and arbitrations throughout the United States and has argued appeals before the Seventh, Sixth and Federal Circuit Courts of Appeal, the Indiana appellate courts, and United States Supreme Court.
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