Licensee Estoppel And Royalty Payments After Lear: Inconsistencies Within The Lower Courts Circumvent Lear Rationale

Article I of the Constitution\u27 expressly provides Congress with the authority to grant inventors exclusive rights to their discoveries for limited periods to promote the development of new ideas and innovations. By according the inventor-patentee the seventeen-year right either to exclude all others from making, using, or selling his invention or to contract for its limited use in the form of assignments or licenses, Congress has attempted to provide the initiative and incentive necessary to encourage the continued progress of science and the arts.\u27 Moreover, statutory safeguards, which presume the validity of the patent until a contesting party establishes its invalidity, protect the patentee-licensor from patent infringement by unauthorized users. Although a declaration of patent invalidity constitutes an affirmative defense for licensees to an action for patent infringements or recovery of royalties, the availability of this defense historically was precluded by the licensee estoppel doctrine,which prevented a licensee from disputing the validity of the patent he had contracted to utilize. Based on the settled theory of contract law that prohibits a purchaser from repudiating a contract merely because of subsequent dissatisfaction with the bargain, the estoppel doctrine became increasingly in conflict with the sound public pol-icy of challenging monopolies based on worthless patents and promoting the free circulation of ideas for public benefit Recognizing the incongruity of these competing doctrines, the Supreme Court,in Lear, Inc. v. Adkins,\u27 overruled the common-law doctrine of licensee estoppel. Notwithstanding this purported abandonment of the rule, the ability of a licensee to invoke patent invalidity as a defense remains unclear