Building Encroachment and the Doctrine of Equivalents in Patent Law

 

Title
Building Encroachment and the Doctrine of Equivalents in Patent Law
Author
Min-Chiuan Wang
Keywords
The Boundary Principle, Building Encroachment,
Neighboring Relations, The Doctrine of Equivalents in Patent
Law, Externalities, Internalization, Non-intervention,
Equity, Michael A. Heller, Frank I. Michelman, Henry E.
Smith
Abstract
This article uses an American property theory—the boundary principle—to
discuss the neighboring relations in Taiwan’s property law and the doctrine of
equivalents in patent law. The aim is to point out that although these two branches
of legal doctrines seemingly head toward the opposite directions concerning the
distribution of rights, they both base on a similarly principle: to distribute positive
or negative externalities in accordance with equitable considerations; both doctrines
are anti-fragmentation principles aiming at recomposing fragmented property
rights.
The theory of this article is founded on Michael A. Heller’s theory of antifragmentation
and Frank I. Michelman’s arguments related to the efficiency of private
property. Heller argues that the boundary principle long existing in property
law is to prevent waste of resources caused by fragmentation. Michelman’s internalization
and nonintervention rules, two composing principles for an efficient private
property regime, are the origin of Heller’s anti-fragmentation theory. This article
asserts that the rules regarding building encroachment and the doctrine of equivalents in patent law are the examples of Heller’s boundary principle and
Michelman’s internalization principle.
In the relation of building encroachment, the right to request land purchase by
the trespasser is a typical internalization rule. To consolidate rights based on the
reason of internalization often realizes in law as the operation of equity, and nonintervention
rules appear as the formalistic reasoning of the law. Yet the fact that the
law leaves ample possibility of unconsolidated fragments shows the disparity between
the economic and the legal rationale.
An act of encroachment is one that causes positive or negative externalities on
another. The doctrine of equivalents in patent law is a set of rules that distributes
the benefits beyond the literal scope of a patent claim. Formed by case law, the
doctrine of equivalents used to distribute the whole external benefits to the patentee;
this kind of internalization rule caused too much consolidation of the rights
and was opposed by the dissenters at the U.S. Supreme Court and the Court of Appeals
for the Federal Circuit. The development of the limiting rules of the doctrine
of equivalents allows the courts to distribute some of the benefits beyond the literal
scope of a claim to competitors by re-categorizing them as externalities; the limitation
rules thus avoid complete consolidation of rights. By contrast, it seems a pity
that Taiwan’s courts rarely comment on the legitimation basis of the doctrine of
equivalents.
Abstract Article

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