Accidental infringement of patent rights is a pervasive and growing problem in the Information Age. As IP rights proliferate and expand in scope, it is becoming increasingly easy for companies and individuals to inadvertently infringe patents. When such accidental infringement occurs, patent law holds the infringer strictly liable. This contrasts with many areas of tort law where defendants are only liable if they act negligently. This Article questions the normative desirability of strict liability in patent infringement cases. Assuming the primary value of patent law is utilitarian, the Article poses the research question: What liability rule will maximize social welfare? The Article answers the question theoretically by applying economic models of accidents developed in tort law literature. The research finds that a negligence rule is preferable. Unlike strict liability, negligence liability will encourage both patentees and technology users to take reasonable measures to prevent accidental infringement, and thus minimize the social cost of patent accidents. Therefore, the Article recommends reforms to the liability rule in direct patent infringement cases. Defendants should be liable for accidental patent infringement only when they fail to adopt reasonable care to avoid the infringement.

Introduces the concept of 'IP accidents' to establish a new way to look at intellectual property law and its enforcement.

Dr. Holzmann introduces the manager and technologist as well as the student and the foreign patent practitioner to the United States Law of Patent Infringement. Dr. Holzmann directly addresses what to do when a patent is being infringed. The author explains and interprets the intricacies of the patent law and provides a strong basis of understanding future changes in patent law. This valuable volume should appeal to academics and students of law, attorneys specializing in corporate law, patent attorneys, CEOs in technical firms, and CEOs of foreign corporations.

In recent years, business leaders, policymakers, and inventors have complained to the media and to Congress that today's patent system stifles innovation instead of fostering it. But like the infamous patent on the peanut butter and jelly sandwich, much of the cited evidence about the patent system is pure anecdote--making realistic policy formation difficult. Is the patent system fundamentally broken, or can it be fixed with a few modest reforms? Moving beyond rhetoric, Patent Failure provides the first authoritative and comprehensive look at the economic performance of patents in forty years. James Bessen and Michael Meurer ask whether patents work well as property rights, and, if not, what institutional and legal reforms are necessary to make the patent system more effective. Patent Failure presents a wide range of empirical evidence from history, law, and economics. The book's findings are stark and conclusive. While patents do provide incentives to invest in research, development, and commercialization, for most businesses today, patents fail to provide predictable property rights. Instead, they produce costly disputes and excessive litigation that outweigh positive incentives. Only in some sectors, such as the pharmaceutical industry, do patents act as advertised, with their benefits outweighing the related costs. By showing how the patent system has fallen short in providing predictable legal boundaries, Patent Failure serves as a call for change in institutions and laws. There are no simple solutions, but Bessen and Meurer's reform proposals need to be heard. The health and competitiveness of the nation's economy depend on it.