Total-Sales Royalties Under the Patent-Misuse Doctrine: A Critique of Zenith

Authors

Michigan Law Review, University of Michigan Law School

Abstract

This Note criticizes the Supreme Court's treatment of total-sales royalties. Part I outlines the scope of the patent-misuse doctrine, and Part II describes the development of the Zenith conditioning test. Part III analyzes that test; it suggests that the Zenith opinion is not internally consistent and that courts may not be able to apply the conditioning test satisfactorily. Finally, in response to Justice Harlan's dissenting opinion in Zenith, in which he notes the dearth of literature on the economic consequences of total-sales royalty provisions, 14 Part III undertakes an analysis of those consequences. The analysis demonstrates that total-sales royalty provisions undermine the purposes of the patent-misuse doctrine by discouraging inventive activity and by deterring the licensee from entering new markets. In short, it will be suggested that all total-sales royalty provisions, regardless of conditioning, should be condemned as patent misuse.

Recommended Citation

Michigan Law Review, Total-Sales Royalties Under the Patent-Misuse Doctrine: A Critique of Zenith, 76 Mich. L. Rev. 1144 (1978).
Available at: https://repository.law.umich.edu/mlr/vol76/iss7/4