AAI Applauds DOJ Patent Policy on Standard Setting and Encourages Government Agencies to go Further

In a letter to Acting Assistant Attorney General Joseph Wayland, the AAI applauded and endorsed the Antitrust Division’s policy positions concerning patent holdup outcomes resulting from ownership transfers of standard-essential patents (SEPs), which the Division expressed in its February 13, 2012 statement on its decision to close its investigation of certain patent acquisitions by Google, Microsoft, Apple, and RIM. The AAI also encouraged the Division to elaborate on its positions in an effort to better protect against patent holdup outcomes going forward.

The letter outlines AAI’s belief that a new SEP owner who repudiates an existing F/RAND commitment may be subject to Sherman Act Section 2 liability, and a proposed acquisition of a patent portfolio containing SEPs may be challenged as a violation of Section 7 of the Clayton Act if it may substantially lessen competition through exclusionary unilateral effects. The letter requests that the Division make clear that SEP owners are obligated to abide by their own or a predecessor’s F/RAND commitments and forego injunctive relief or ITC exclusion orders, as well as unreasonable licensing provisions or grant back demands, and that standard setting organizations must take seriously their responsibility to ensure protections are in place, all of which is necessary to ensure that consumers are protected from unnecessary welfare losses.