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The Supreme Court held 3/1/06 that, because a patent does not necessarily confer market power on the patentee, a plaintiff challenging a tying arrangement under Section 1 of the Sherman Act must prove that the defendant has economic power in the market for the tying product. In his opinion for the Court, Justice Stevens noted that the Court’s past disapproval of tying arrangements was based on a now-discredited belief that such arrangements “serve hardly any purpose beyond the suppression of competition,” and that the Court had more recently moved from relying on presumptions to requiring a showing of actual economic power in the market for the tying product. The Court explained that Congress, antitrust enforcement agencies, and most economists had all rejected the conclusion that a patent necessarily confers market power. Indeed, the presumption that holding a patent creates market power arose in “patent misuse” cases but was rejected in that context by Congress in the 1988 amendments to the patent laws. The Court today likewise eliminated any presumption in the antitrust context that a patent necessarily confers market power on the patent holder. Jones Day lawyers drafted amicus curiae briefs on behalf of the American Bar Association at the petition and merits stages. This case has important implications for any business buying or selling a product that arguably is tied to a patented or copyrighted product.

Decision Below: 396 F.3d 1342 (Fed. Cir. 2005)