Patent Challenges for Standard-Setting in the Global Economy Lessons from Information and Communications Technology (2013) / Chapter Skim
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have generally adopted policies regarding the disclosure and terms of licensing of patents essential to the standards they create (so-called standard-essential patents or SEPs)
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The Academies appointed a committee composed of academic economists and social scientists, legal scholars, standards professionals, and technologists and charged them with documenting and evaluating the policies and practices of different types of SSOs in different geographical contexts, focusing on such matters as patent disclosures, terms of licensing, and provisions for the transfer of obligations when patents are traded, sold, or disposed in bankruptcy proceedings. The committee held four meetings, including a workshop with presentations selected by the committee as well as public commentary and commissioned original research and analysis, including a study of a dozen SSOs operating in the information and communications technology (ICT)
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formal global/UN Affiliated communications International Electrotechnical Commission (IEC) formal global electrical, electronics-related permits but does not technologies require ex ante disclosure of the terms Institute of Electrical and Electronics Engineers formal professional global broad electronics reviews ipr policies as part Standards Association (IEEE-SA)
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SSO policies regarding Licensing are, if anything, even more varied and in some instances ambiguous: What specific terms or limitations are imposed by a commitment to FRAND licensing; what is meant by the individual terms "fair," "rea sonable," and "non-discriminatory"; whether a maximum royalty must be posted before the standard is adopted ("ex ante") ; how FRAND ap plies to portfolio licenses and cross-licenses; how non-royalty licensing terms (e.g., grant-backs, geographical or field of use limitations, etc.)
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A FRAND commitment is also mutual in the sense that both the SEP holder and any prospective licensee are expected to negotiate in good faith towards a license on reasonable terms and conditions that reflect the economic value of the patented technology. Recommendation 3:11 The committee urges SSOs to become more explicit in their IPR policies regarding their understanding of and expectations about FRAND licensing commitments.
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Nor may the licensors tie the FRAND commitment and SEPs availability to a requirement that the licensee agree to license back unrelated SEPs or non-SEPs. Recommendation 3:4 SSOs should clarify in their policies that a holder of FRAND-encumbered SEPs may require a licensee to grant a license in return under FRAND terms to the SEPs it owns or controls (and those of its affiliates as specified in the SSO's policy)
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The committee nevertheless recommends that SSOs consider the following steps to increase transparency of SEP ownership and licensing. Recommendation 4:1 SSOs that do not have a policy requiring FRAND licensing commitments from all participants should have a disclosure element as part of their IPR policy.
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The committee makes the following suggestions for SSO policies and public policies to advance that proposition and minimize uncertainty and additional transaction costs for licensees. Recommendation 5:1 Where they have not already done so, SSOs should develop meaningful policies by which successors in interest are bound to whatever licensing commitment (e.g., FRAND)
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Recommendation 6:1 SSOs active in
industries where patent holdup is a concern should clarify their policies regarding the availability of injunctions for FRAND-encumbered SEPs to reflect the following principles: Injunctive relief conflicts with a commitment to license SEPs on FRAND terms and injuctions should be rare in these cases; Injunctive relief may be appropriate when a prospective licensee refus es to participate in or comply with the outcome of an independent adju dication of FRAND licensing terms and conditions; and Injunctive relief may be appropriate when a SEP holder has no other recourse to obtain compensation. The committee could not reach unanimous agreement on appropriate venues for adjudicating FRAND disputes.
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Patent and Trademark Office examina the facts and render injunctive relief decisions based on existing law, such as the eBay decision and/or ITC Section 337. 3 A minority of committee members endorse this alternative recommendation: SSOs should clarify that a SEP owner that has made an offer and offered to negotiate, with a prospective licensee, a license that will embody FRAND terms should be allowed to include injunctive relief in its pleadings when a FRAND dispute is brought to a court, agency, arbitration, or other tribunal that can consider equities, party conduct, reciprocity, and FRAND factors (including FRAND rates and terms)
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whether the form of the USPTO's cooperation with individual SSOs could represent a conflict of interest for the agency. The committee recommends that the USPTO take the following steps: Recommendation 7:1 In the wake of the passage and implementation of the America Invents Act, the USPTO should Clarify how the legal definition of prior art varies across jurisdictions, particularly as between the EPO and USPTO.
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However, there are signs of a growing appetite for government-supported indigenous Indian standards development efforts incorporating Indian intellectual property. In particular, the 2012 National Telecom Policy calls for numerical targets for the growth and self-sufficiency of the industry and the creation of "… a roadmap to align technology, demand, standards, and regulations for enhancing competitiveness of domestic manufacturing…" through establishment of "standards to meet national requirements, generate IPRs, and participate in international standardization bodies… making India a leading nation in the area of international telecom standardization."
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government should explore ways to promote awareness of the importance of developing IPR policies at an early stage of the development of SSOs in these and other emerging economies, and should, in conjunction with non-governmental standards entities, explore ways to offer training programs for those working to develop their organizations and policies needed for successful national standardization. Recommendation 8:2 In the meantime, the relevant agencies of the United States government, such as the United States Patent and Trademark Office, the Office of the United States Trade Representative, and the National Institute of Standards and Technology, should closely monitor and report on continuing developments in these countries and other major emerging economies regarding standard-setting and the management of intellectual property.
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