Hi all; Another patent article re JEDEC:
May 18, 1998
Group Standard-Setting Grows More Significant
De jure standard-setting raises patent enforceability issues as well as antitrust implications.
BY DAVID J. HEALEY
SPECIAL TO THE NATIONAL LAW JOURNAL
INDUSTRY STANDARDS are vital to many aspects of the economy. Indeed, they may be the only way to ensure that the hardware and software making up the information superhighway are compatible with each other.
...
Fairness Requirement
Standard-setting groups also have an obligation to implement chosen standards in a fair way. For example, the Supreme Court has twice found antitrust violations in cases in which standard-setting groups tried to exclude competing products by unnecessarily and unfairly denying needed product certifications.[31]
Courts have held that ordinarily a patent owner has no duty to license its patents.[32] Owners of other types of property, however, have been required to allow competitors the use of their property when that property is essential to competition in a relevant market.[33] This obligation to allow access to property needed to compete is embodied in the "essential facilities" doctrine.[34]
The treatment of de jure standards as "essential facilities" is not necessarily inconsistent with the traditional rights of patent owners. While this amounts to compulsory licensing, the patent owner who participates in creation of a de jure standard to which its IP is essential has gone beyond the bounds of its patent grant by acting with others to create an economic market over which its patent gives it power.
Thus, the traditional rule against forcing a patent owner that acts alone and within its own patent rights to license remains intact, while access to de jure standards is available to all comers, and competition in the market created by the de jure standard is preserved.[35]
It should also be noted that misconduct in standard-setting may give rise to various common-law claims. As noted above, failing to disclose patent rights despite an obligation to do so may give rise to fraud or misrepresentation claims, as well as provide an estoppel against enforcement of a patent.
In re Dell Computer Corp. is an example of unfair competition in standard-setting based on attempts to enforce undisclosed patents. In Samsung v. Texas Instruments,[36] the district court held that an allegation of misappropriation of technology from standard-setting groups stated a claim under the common law of unfair competition. Moreover, the Federal Circuit recently made clear that federal patent statutes do not pre-empt state common-law unfair-competition claims.[37] Thus, in evaluating standard-setting issues, common-law claims also should be considered.
Standard-setting is important for technical and economic progress. Participation in group standard-setting activity, however, generally subjects a patent owner to bylaws or other contractual obligations that can limit how it enforces or licenses its patents. Further, the group nature of the activity puts the patent owner in a much different position from that of one who is acting alone--and subjects the patent owner to the impact of antitrust and other laws that regulate cooperation among competitors.
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-- Carl |
