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Sherman Antitrust Act Overview

Sherman Antitrust Act Overview

The Sherman Antitrust Act was the first statute passed into United States federal law to address the issue of businesses improperly acting in concert with each other to gain unfair advantages over competitors and in regard to consumers. It was passed into law on July 2, 1890. It exists in the United States Code in Sections 1 through 7 of Title 15. Legal scholars and political historians generally consider the first full implementation of the Sherman Antitrust Act to have been during the administration of President Theodore Roosevelt, which lasted from 1901 to 1909. The Sherman Antitrust Act did not directly impinge on patent protection 
The Sherman Antitrust Act came about in an era in which business failures and corruption scandals had created a national mood of disaffection with big business practices. It was felt that the spread of monopolistic practices amongst large businesses had contributed to these economic troubles. 
The law was authored by the Ohio Republican Senator John Sherman, who was then the chairman of the Senate Finance Committee, and followed in the steps of that state’s similar Valentine Anti-Trust Act. The Sherman Act received widespread legislative approval. The legislation was approved by the House on June 20, 1890. On July 2, 1890, President Harrison signed the Sherman Antitrust Act.
The Sherman Antitrust Act receives its Constitutional sanction from the Congressional prerogative to preside over issues of interstate commerce. In this sense, it refers to business activities which cross state lines or in some way involve more than one state. While this inherent limitation of national legislation limited the utility of the Sherman Antitrust Act to some extent, in practice many states which did not already have adequate laws dealing with competition passed new statues modeled on the Congressional legislation.
The legislation was placed in three sections. The first part of the act dealt with the issue of the strict definition for business practices which improperly infringed on the need for competition and furnished specific examples of these rights. The second section of the Sherman Antitrust Act addressed the consequences of business practices in violation of competition laws. 
These first two sections were engineered by the legislators to supplement each other in enforcing all potentially monopolistic practices. In this sense businesses would not have the option of devising loopholes, as had been the response to previous competition laws, which could allow them to be in technical compliance with the law while working against its desired end.
 
As a kind of monopoly, patent registration and other intellectual property rights could conceivably run afoul of the provisions of the Sherman Antitrust Act against the improper control of an entire field. With a view to retaining strong intellectual property rights and thereby ensuring that industrial development could remain a high priority for science, the Antitrust Act specifically provided for the freedom from these laws enjoyed by patent holders. In some areas, however, behavior toward intellectual property rights might be found to constitute infringement of the Sherman Antitrust Act. 
For instance, deception in the course of obtaining the intellectual property rights of patent registration to some process or device might fall under the heading of the Sherman Antitrust Act. This condition was found in the 1965 case of Walker Process Equip. v. Food Machinery Corp., of which the Supreme Court ruled that the patent holder violated competition laws by gaining a patent by giving out invalid information in the registration. Other businesses should have been allowed to create the same device as required under the competition laws of the Sherman Antitrust Act.
Another competition law subject related to intellectual property rights concerns the formation of patent pools. In such a practice, the holders of patents in similar kinds of technology decide to forgo competition and cross-license their patent registrations 

Significant Legislation in Patent Law

Significant Legislation in Patent Law

Throughout the history of American patent law, significant changes have come about directly or indirectly due to the passage of Congressional legislation. In some cases, Congress has devised laws aimed directly at altering the protection of patent rights in the United States, while in other cases the need to revise business or legal practices has indirectly impinged on patent law.

The latter category includes varying cases made over a wide span of time. An early example can be found in the passage of the Sherman Antitrust ActEvarts Act of 1891United States Code System in 1926prima facie evidence for the validity of laws. The section of the code dealing with patents, Article 35, like the other forty-nine Articles did not effect as a source for legal enforcement and punishment in its own right until laws were passed to do so, in its case with the 1952 Patent Act.

Among recent pieces of legislation that have directly taken aim at patent rights issues, the General Agreement on Tariffs and TradeIntellectual Property and Communications Omnibus Reform Act in 1999. If you need legal advice and assistance, contact patent lawyers.

The Evarts Act 1891

The Evarts Act 1891

The Evarts Act of 1891 created the United States court of appeals system. It is named for Senator William M. Evarts, the main advocate for the law’s passage. It is also referred to as the Judiciary Act of 1891 and the Circuit Courts of Appeals Act. This legislation created the system of the court of appeals in the United States. With the existence of a specific system of courts of appeals, such actions, such as patent court proceedings, could be moved out of the district and circuit courts.

To implement the Evarts Act, Congress formed nine courts–each possessing one district judge and two circuit judges–to form the court of appeals system. Under this system, a court of appeals would have authority over the relevant issues found to arise in decisions made by legally subordinate courts.

After an issue, for instance arising in patent court, had been located by a court of appeals, the issue could be submitted by the presiding judge to the Supreme Court for consideration. This reform was intended in part to free up the Supreme Court to more closely focus on a fewer number of cases. The Supreme Court could choose to either review decisions as certified by a court of appeals, or make judgments on a court of appeals decisions, according to a higher court decision referred to as a writ of certiorari. 

As an exception to the power given to a court of appeals under the Evarts Act, the legislation included a clause specifying specific circumstances in which an appeal could be made first to the Supreme Court without being first heard by a court of appeals.

Presently, the number appeals courts in the United States have risen to thirteen. Patent court decisions may be challenged through a motion submitted for the consideration of one of the courts of appeals. In particular, the Federal circuit court has the power to supervise patent court appeals. 

Outside of this system of courts, there are other legal settings in the United States referred to as courts of appeals yet which do not owe their existence to the Evarts Act. These include the United States  the Court of Appeals for the Armed Forces and the Court of Appeals for Veteran Claims .

General Agreement on Tariffs and Trade

General Agreement on Tariffs and Trade

United States patent laws were significantly altered and affected with the 1994 passage of the General Agreement on Tariffs and Trade (GATT). After being approved by Congress, the package of legislation was signed by President Clinton on December 8, 1994. While the entirety of the GATT legislation took effect upon the start of 1996, substantial portions took effect on June 8, 1995, six months from the bill’s passage. 
The first two major changes to American patent law contained in GATT were effected in terms of the period of time for which patents would be in effect and the new availability of a provisional application option. A third major patent law innovation arrived on January 1, 1996, in the form of new regulations on the patenting of inventions created outside the U.S.
Under United States law, patents registered through the presiding United States Patent and Trademark Office. Prior to the approval of GATT, U.S. patent laws had dispensed terms of protection lasting for twenty years. After the legislation went into effect, this period of time was increased to twenty years. The extension of the term for patent protection was, however, less extensive than might be gleaned from a cursory perusal of the changes. 
The original language on terms of protection had specified that the period of seventeen years would commence with the issuance of the patent. In the new system, the twenty-year long period of protection was understood as beginning on the date on which the USPTO received the application for the patent. This change did not mean that a patent was protected from the moment that an application was submitted, but only that for the purposes of determining the end date for the period of protection, the application filing date would be referred to.
This change in the language underlying the changes may have concealed the extent to which the term of protection had not been greatly expanded. As legislators were aware at the time, USPTO filing procedures are not simple or quickly accomplished. A common period of time for the USPTO to take in approving a patent is two years. For that reason, the three-year increase in terms of protection sometimes understood as a legacy of the GATT legislation might be more realistically given as one year.
In regard to this change in language and to the many roadblocks which patent applications may encounter in the course of their journey to approval, the GATT legislation also made a new provision for the event of particularly long registration procedures. If such events as interference proceedings (on the issue of who was the first to invent a technology), secrecy orders (as regards patents impinging on America national security), and initial refusals, later successfully appealed, to issue patent registrations, the applicant could reasonably request that the USPTO give an additional five years for the protection of the patent.
Since the GATT legislation began to take effect on June 8, 1995, the United States’ patent laws have allowed applicants to file provisional applicants, prior to making the primary application. Regular applications require three elements, comprising the specification, a description of the patent’s tasks, a drawing, a visual source for all of the applicable details, and a claim, a statement as to the invention’s originality and effectiveness in accomplishing its purpose. 
Provisional applications need include only the former two elements. In this way, prospective patent holders who have not fully worked out the functionality of their invention can preempt competitors working on similar ideas. The provisional application date does not apply to the term of protection, and it marks the beginning of a one-year period in which the applicant can fully ready the invention for patenting. In the various means through which applications can be challenged under United States patent laws, provisional applications are considered to the benefit of the initial patent applicant.
The last important GATT to go into effect dealt with inventions made abroad. These changes related to interference proceedings, a unique feature of American patent laws under which the individual “first to invent” something under consideration for patent protection is granted patent rights, potentially above the individual “first to file.” In allowing for such an occurrence, the United States differs considerably from the patent laws in effect elsewhere in the world, notably in Europe, where the right of “first to file” is strictly observed. 
An interference proceeding blocks the registration of a patent until the validity of the plaintiff’s charge can be determined. Up to the point on which this portion of GATT took effect, on January 1, 1996, the date on which an invention in another country had been “reduced to practice,” as is the language used for an interference proceeding, was not eligible for consideration, in that patent laws have traditionally been restricted in their jurisdiction to a country’s own borders. 
For this reason, an interference proceeding brought by an inventor from another country against an inventor in this one, before 1996, may well have failed if the American inventor has taken the course of filing first, even if the inventor outside the country had first devised the invention. This change in GATT made the evidence of invention accomplished in another country admissible for the purposes of an interference proceeding.

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