Ending Patent Law's Willfulness Game
Patent law turns the attorney-client privilege on its head. Patent lawpunishes willful infringers by subjecting them to treble damages. An oddset of legal rules stemming from patent law's effort to determine whatconstitutes willful infringement effectively requires companies confrontedwith a patent first to obtain a written opinion of counsel and then todisclose that opinion in court. To do that, the accused infringer will haveto waive its attorney-client privilege in virtually every case. Even worse,the law puts the question whether an accused infringer will have to waiveprivilege in the hands of the patent owner, who can send a carefullycrafted letter putting a potential defendant on notice of the patent. Apatent owner thus triggers the obligation to obtain a written opinion ofcounsel without actually threatening to sue anyone. In turn, accusedinfringers who are aware of these rules respond to such letters byobtaining a sort of pseudo-legal advice that both they and their attorneysrecognize to be a construct. Both plaintiffs and defendants are playing acostly game.The rules of this game have perverse consequences for patent law. Some ofthese consequences affect litigation - lawyers and clients who know thatthe lawyer's advice will be disclosed to the other side will behavedifferently, withholding information and candid advice from each other. Butother consequences extend beyond litigation. They infect pre-litigationadvice, essentially making it impossible for a competent lawyer to advise aclient that a competitor's patent should be avoided. The rules of thewillful infringement game set traps for the unwary, who may not realize theconsequences of failing to obtain the necessary written opinion of counsel.They interfere with a client's ability to choose counsel. And theydiscourage engineers and companies from reading a competitor's patents atall, thereby undermining the disclosure function that is at the foundationof the patent system.One possibility is to abolish the willfulness rule entirely. We ultimatelyreject this approach because we worry that ordinary patent damages alonewill be insufficient to deter infringement optimally in many cases. Anotherpossibility is to abolish the rule that requiring disclosure of opinions ofcounsel. While a good idea, this option would not solve the problemscreated by the willfulness game, because many defendants will still need torely on the opinion of counsel in order to disprove willfulness.Instead, we think the better approach to willful infringement is first toredefine it as adopting a technology with knowledge that it was derivedfrom the patentee, and second to adjust the premium charged for it. Many ofthe problems with the willfulness rules stem from the fact that willfulnessis an ongoing inquiry. The ongoing nature of the inquiry adversely affectsa defendant that develops or adopts a technology in good faith but laterlearns it is infringing a patent. Changing the focus of the inquiry to thetime of adoption is consistent with the ordinary understanding ofwillfulness outside of patent law and would help end the willfulness game.An independent developer could never be a willful infringer, and thus wouldnot need either to obtain or disclose in court a written opinion of counselmerely because it later learned of a patent. By contrast, an accusedinfringer would need advice of counsel if it was aware of a patent andaffirmatively sought to design around the patent. Such an accused infringertherefore would have to waive privilege. But since only the accusedinfringer's intent at the time of adoption would matter, the scope ofprivilege waiver would be limited to communications at the time ofadoption, and would not infect the advice given by litigation counsel.