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3 Potential Anticompetitive Harms of Pools Reduction of horizontal price competition between licensors Reduction of horizontal price competition between licensors Leads to rise in prices of products and services that utilize the pooled patents Foreclosure of innovation by discouraging research and development Foreclosure of innovation by discouraging research and development
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Hot Topics at the Interface of Intellectual Property and Competition Law
Possible Antitrust Concerns Arising from Patent Pools
ABA International Law Section ABA International Law Section • • Fall MeetingFall MeetingSeptember 26, 2008September 26, 2008
Frances Marshall*Frances Marshall*Special Counsel for Intellectual PropertySpecial Counsel for Intellectual Property
Antitrust DivisionAntitrust DivisionU.S. Department of JusticeU.S. Department of Justice
*Views expressed are not necessarily those of the Department of Justice *Views expressed are not necessarily those of the Department of Justice
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Procompetitive Benefits of Pools
Integrate complementary technologiesIntegrate complementary technologies Reduce transaction costsReduce transaction costs Clear patent blocking positionsClear patent blocking positions Avoid costly infringement litigationAvoid costly infringement litigation Promote dissemination of technologyPromote dissemination of technology
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Potential Anticompetitive Harms of Pools
Reduction of horizontal price competition between Reduction of horizontal price competition between licensorslicensors Leads to rise in prices of products and services Leads to rise in prices of products and services
that utilize the pooled patentsthat utilize the pooled patents
Foreclosure of innovation by discouraging Foreclosure of innovation by discouraging research and developmentresearch and development
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Limiting the Risk of Horizontal Price Competition in a Pool
Limit pools to complementary patentsLimit pools to complementary patents Exclude substitute patentsExclude substitute patents ““Essentiality” testEssentiality” test
Use independent review process to select pool Use independent review process to select pool patentspatents
Limit access to CBILimit access to CBI
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Limiting the Risk of Harming Innovation Incentives in a Pool
Keep invalid patents out of the poolKeep invalid patents out of the pool Licensors grant non-exclusive licenses to poolLicensors grant non-exclusive licenses to pool
Retain right to license individuallyRetain right to license individually Limit scope of grantbacksLimit scope of grantbacks Provide clear understanding of pool contentsProvide clear understanding of pool contents
Non-exclusiveNon-exclusive Essential patentsEssential patents
License available to all interested licenseesLicense available to all interested licensees
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Antitrust Guidance on Patent Pools United StatesUnited States
1995 Antitrust-IP Licensing Guidelines 1995 Antitrust-IP Licensing Guidelines Patent pool business review letters Patent pool business review letters
MPEG-2 (1997); 3C DVD (1998); 6C DVD (1999); MPEG-2 (1997); 3C DVD (1998); 6C DVD (1999); RIFD (2008) (?)RIFD (2008) (?)
IP2 Report, ch. 3IP2 Report, ch. 3 ECEC
2005 Technology Guidelines 2005 Technology Guidelines ¶¶ 210-235¶¶ 210-235 JapanJapan
2005 Standards and Pooling Guidelines2005 Standards and Pooling Guidelines
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Hot Topics at the Interface of Intellectual Property and Competition Law
Possible Antitrust Concerns Arising from Patent Pools
ABA International Law Section ABA International Law Section • • Fall MeetingFall MeetingSeptember 26, 2008September 26, 2008
Frances Marshall*Frances Marshall*Special Counsel for Intellectual PropertySpecial Counsel for Intellectual Property
Antitrust DivisionAntitrust DivisionU.S. Department of JusticeU.S. Department of Justice
*Views expressed are not necessarily those of the Department of Justice *Views expressed are not necessarily those of the Department of Justice
