FTC Should Seek Rehearing on Rambus, Says AAI

May 13 2008
Testimony and Interventions

In a letter to the Federal Trade Commission, the AAI said that the D.C. Circuit panel was wrong in its recent Rambus decision overturning the FTC, and urged that the FTC seek an en banc rehearing:CommissionersFederal Trade Commission600 Pennsylvania Ave., NWWashington, DC 20580Cc: William Blumenthal, John Daly, Melanie SaboDear Commissioner:    The American Antitrust Institute stated its views on the Rambus case in an amicus brief we filed with you long ago. We supported the kind of action you have taken and despite the D.C. Circuit’s decision, we continue to believe that your position is essential to the public interest, as reflected in our petition to open an investigation of Rembrandt and in our public comments on the Negotiated Data Solutions consent order. All of these matters are of the same cloth.    We believe the D.C. Circuit’s recent decision is in conflict with the same court’s en banc decision in U.S. v. Microsoft,which described the nature of conduct that constitutes unlawful monopolization. In particular, the panel’s decision fails to recognize the core Section 2 principle that the acquisition of monopoly power by illegitimate means unrelated to superior skill, industry, or foresight is – and ought to continue to be—a violation of the federal antitrust laws. Moreover, if this decision stands, it will encourage deception and other nefarious conduct inimical to the standard-setting process, to the detriment of consumers and to high tech companies that depend on a fair standard-setting process in which participants do not have the leeway to engage in the practice of ‘patent ambush.’    What course of action should the Commission now take? We urge that you seek an en banc rehearing of the Rambus case. We would be pleased to file an amicus brief in support of your appeal.Sincerely,Albert A. Foer, President