Dispute Resolution Tools in Patent Infringement Cases

While arbitration has become a widely accepted alternative to litigation, the role it should play in patent disputes has been widely debated. Issued by the federal government, patents confer a temporary monopoly on the production, use, and sale of new innovations. The government may have an interest in keeping such disputes out of the private realm of arbitration, at least when the dispute is over the validity of the patent. For other patent issues such as licensing, which is essentially a private
contract, arbitration may serve as a useful and cost-effective alternative. Even when arbitration is not warranted, other useful strategies such as bifurcation of issues can make the dispute resolution process more efficient. Aoki v. Gilbert, a case coming out of the Eastern District of California, however, is a prime example of how those strategies can backfire when not executed properly. After laying out the factual and legal background of the case, this note will examine the effectiveness of bifurcation and arbitration as dispute resolution tools in patent disputes. This note concludes that while bifurcation and arbitration may not have been appropriate in this case, they nevertheless can be an effective option in most patent licensing disputes.

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