1999 BEYOND PREEMPTION Beyond Preemption The Law and Policy of Intellectual Property Licensing Mark A Lemley Proposed Uniform Commercial Code Article 2B, which would govern transactions in information, would remake the law of intellectual property licensing in a radical way. But federal and state intellectual property laws and policies impose significant limits on the ability of states to change the rules of intellectual property licensing by contrac law. One such limit is preemption, but preemption is unlikely to provide significant protection for the established rules of intellectual property law. Several other doctrines will limit the ability of parties to set their terms by contract, even in the Article 2B world. The first is copyright misuse, which has been applied against restrictive licensing provisions. The second set of doctrines provides that a number of licensing rules are decided as questions of federal, not state, law. The third set of doctrines is a number of state public policies that cannot be overridden by contract. Taken together, these doctrines create a patchwork public policy of intellectual property law that Article 2B cannot alter [LEgislatures, courts, and scholars must consider copyright and patent misuse, and such other issues as federal preemption of state law affecting intellectual property-together with U.C. C. issues if they are to construct a coherent body of transactional rules -Robert m A act and end in to displace copyright it would surely benefit us all if lawmakers took care to apply to 2 .Robert P Merges, Intellectual Property and the Costs of Commercial Exchange: A Review Essav,93Mich.L.Rev.1570,1571-72(1991999] BEYOND PREEMPTION Beyond Preemption:The Law and Policy of Intellectual Property Licensing Mark A. Lemley Proposed Uniform Commercial Code Article 2B, which would govern transactions in information, would remake the law of intellectual property licensing in a radical way. But federal and state intellectual property laws and policies impose significant limits on the ability of states to change the rules of intellectual property licensing by contract law. One such limit is preemption, but preemption is unlikely to provide significant protection for the established rules of intellectual property law. Several other doctrines will limit the ability of parties to set their terms by contract, even in the Article 2B world. The first is copyright misuse, which has been applied against restrictive licensing provisions. The second set of doctrines provides that a number of licensing rules are decided as questions of federal, not state, law. The third set of doctrines is a number of state public policies that cannot be overridden by contract. Taken together, these doctrines create a patchwork public policy of intellectual property law that Article 2B cannot alter. [L]egislatures, courts, and scholars must consider . . . copyright and patent “misuse,” and such other issues as federal preemption of state law affecting intellectual property—together with U.C.C. issues if they are to construct a coherent body of transactional rules. —Robert Merges2 As contract and encryption begin to displace copyright . . . it would surely benefit us all if lawmakers took care to apply to 2 .Robert P. Merges, Intellectual Property and the Costs of Commercial Exchange: A Review Essay, 93 Mich. L. Rev. 1570, 1571-72 (1995)