Business Empire to Patent Umpire: Amazon and the Ascent of Platform Patent Adjudication
Shih-wei Chao
Article
The full text of this Article may be found here.
34 Fordham Intell. Prop. Media & Ent. L.J. 607 (2024).
Article by Shih-wei Chao*
ABSTRACT
[A]
trend in patent law is mounting, one which this Article refers to as Platform Patent Adjudication. Amazon’s Patent Evaluation Express (“APEX”) now allows patent owners and sellers to resolve infringement disputes without using courts, and even without traditional alternative dispute resolution mechanisms like arbitration or mediation, but instead entirely within the platform setting. Amazon touts, and many practitioners agree, that its procedure is much less expensive and much quicker than litigating in court. But why is Amazon doing this? And why have other platforms not done this before? This Article takes a step back to examine the conditions and constraints underlying the evolution of Platform Patent Adjudication to illustrate why APEX became as it is. The tale begins with a complicated problem e-commerce platforms face—upon receiving patent owners’ infringement complaints, whether to review and decide them on their merits. Countervailing incentives are at play here, including cost and reputation, but especially legal liability. This Article demonstrates that platforms face liability risk both when they do and do not review complaints, creating a catch-22. APEX is best understood against this backdrop: its structural design circumvents these legal and non-legal incentives, thus making it viable for Amazon to provide. This Article suggests that APEX setting an example signals the beginning of Platform Patent Adjudication; more and more patent disputes can be decided using these private resolution mechanisms administered by e-commerce platforms. If this is an overall positive development, legally prescribed incentives and safe-guards, such as immunity mirroring Section 230 or conditional liability mirroring the DMCA, can encourage even more platforms to provide patent adjudication services. This Article outlines reasons why Platform Patent Adjudication may or may not be a welcome development and contemplates parameters for designing standards or model rules to guide Platform Patent Adjudication in a positive direction.
* J.S.D. Candidate, University of California, Berkeley, School of Law. I am grateful to Berkeley Law Professors Robert Merges, Andrew Bradt, Tejas Narechania, and Talha Syed for invaluable guidance, and to the participants at the 5th IP & Innovation Researchers of Asia Annual Conference for comments and suggestions. I would also like to thank Amazon General Counsel David Zapolsky for general advice, but this Article does not contain any of Mr. Zapolsky’s comments nor represents Amazon’s views. Finally, I thank the Fordham IPLJ staff for excellent editorial assistance. All errors are my own.