Posts Tagged: "Antitrust"

Historically an esoteric area of law, in recent years, antitrust policy is drawing broader attention as a tool to curb the exercise of monopolistic market power, especially by big tech behemoths. Congressional reports on both Democratic and Republican sides of the aisle, multiple legislative initiatives to reform U.S. antitrust law, and a recent book by Senator Amy Klobuchar (D-MN), Chair of the Senate Judiciary Subcommittee on Competition Policy, Antitrust, and Consumer Rights, are some indicators of this trend. Along these lines, broad outcry broke out against rumored Department of Justice (DOJ) Antitrust Division leadership appointments of candidates representing big tech interests, such as Karen Dunn (Apple, Amazon), Renata Hesse (Google, Amazon), Susan Davies (Facebook), and against Deputy Attorney General Lisa Monaco’s (Apple, Google) involvement in deliberations over the nomination of a DOJ Assistant Attorney General (AAG) for Antitrust.

The Federal Trade Commission’s (FTC’s) March 26 deadline for filing a petition for writ of certiorari at the U.S. Supreme Court has come and gone, officially ending the FTC’s opportunity to appeal its loss at the Ninth Circuit in its antitrust enforcement action against semiconductor developer Qualcomm. As federal regulators move on from this final vestige of Obama-era antitrust enforcement activity against patent-related business activities, much of the intellectual property world continues to await key appointments under President Joe Biden that will reveal the tenor of the policy debate in patents and antitrust during the current administration.

To those of us who breathe intellectual property and innovation, it sounds so obvious to say that consumers benefit greatly from the dynamic competition inventions and IP bring forth:  new products, technologies and industrial sectors. However, many who breathe antitrust hold a different perspective — it presumes a patent confers market power, that commercialization amounts to anticompetitive conduct and that the right to exclude is equivalent to monopolization by incumbent players in a static market. Assistant Attorney General for Antitrust Makan Delrahim, who left the U.S. Department of Justice (DOJ) with the changeover of administrations, bridged this gulf. Delrahim achieved this due to his background as both patent attorney and antitrust lawyer. Delrahim offered a framework he calls the New Madison Approach. The New Madison Approach advanced through the division’s amicus program.

Yesterday, Rep. Beth Van Duyne (R-TX-24) sent a letter to President Joe Biden explaining her concerns over recent reports that the leading candidate for the top antitrust post at the Department of Justice (DOJ) is likely to go to long time Democrat antitrust official Renata Hesse, who served in the DOJ Antitrust Division during the Obama Administration as a Deputy Assistant Attorney General and as Acting Assistant Attorney General. Hesse, who has gone in and out of government, has represented both Google and Amazon, companies that are facing antitrust scrutiny from the DOJ, European Union and dozens of state Attorneys General.

The Court of Justice of the European Union (CJEU) last week ruled against Qualcomm in an antitrust case over UMTS-compliant baseband chipsets. The case dates back to April 2010, when UK company Icera Inc. filed a complaint accusing Qualcomm of predatory pricing by supplying three chipsets to its customers Huawei and ZTE at below cost price…. The judgment gives the Commission the green light to seek a broad range of information in antitrust investigations, which may have implications for actions against other tech companies.

Complete Genomics, Inc., BGI Americas Corp., and MGI America’s Inc. (Complete Genomics) have filed suit against Illumina, Inc. alleging violation of federal antitrust statutes and California unfair competition laws in the U.S. District Court for the Northern District of California, San Francisco Division. The January 11 complaint contends that Illumina obtained at least three of the patents Illumina has asserted against Complete Genomics in an unlawful, anticompetitive manner. The complaint argues that two of the patents asserted by Illumina are invalid based on fraud on the United States Patent and Trademark Office (USPTO) and that there was no basis for asserting infringement with respect to the third patent.

Judge Kimberly Moore, in a comprehensive and insightful opinion dissenting from the denial of the petition for rehearing en banc in Athena Diagnostics, Inc. v. Mayo Collaborative Servs., 927 F.3d 1333 (2019), emphasized that the lack of clarity in Section 101 jurisprudence is one of the most critical issues in patent law. Sensing no interest by her colleagues in crafting an opinion with sufficient common denominators to provide instructions to trial judges on how to navigate the cross-currents created by Federal Circuit decisions post-Mayo/Alice, Judge Moore advised litigants: “Your only hope lies with the Supreme Court or Congress.” Id. at 1363. Not now. Several months after Athena, the USPTO took the initiative to issue a guidance document “October 2019 Update: Subject Matter Eligibility,” in response to requests by numerous stakeholders for more clarity and predictability. Consequently, in light of well-established Supreme Court precedent in administrative law, there is every reason for the Federal Circuit to now adopt the analysis of these Guidelines in future Section 101 cases.

Makan Delrahim, the Assistant Attorney General for the Department of Justice’s (DOJ’s) Antitrust Division, has received much-deserved acclaim from fellow intellectual property hawks for his commitment to re-framing the Antitrust Division’s relationship with intellectual property law through a “New Madison” lens. Madison, the founder of the Constitution’s Patent and Copyright Clause, understood the nuanced relationship between the two. Over the last few years, Delrahim has gone to great lengths to restore his vision. It would be a shame if one significant oversight over music industry policy in the coming weeks incites a blemish on his otherwise impeccable three-year track record.

It is difficult to talk about political issues in the current environment in the United States but looming for the patent and innovation community is a potential disaster. While it will undoubtedly upset many, the truth is that there is currently no official President-Elect and there won’t be until the Electoral College votes in the middle of December. In no fewer than six swing states, the vote was so close that President Trump and his lawyers have launched a series of lawsuits that have already made their way to the United States Supreme Court. Much more litigation relating to the election can be expected and proof will be necessary to back up the allegations of the Trump campaign if anything major news outlets are reporting will be changed. In the meantime, it should be fairly uncontroversial to say that President Trump has an uphill battle. It is also absolutely factual to say that Vice President Biden is proceeding as if he is President-Elect.

The European Commission has formed a preliminary view that Amazon has breached Article 102 of the Treaty on the Functioning of the European Union by distorting competition in online retail markets. It announced on November 10 that it had sent a Statement of Objections to the e-commerce company. Article 102 (formerly Article 82 TEC) prohibits “any abuse by one or more undertakings of a dominant position within the internal market or in a substantial part of it.” Amazon is said to be dominant in France and Germany, its biggest markets in the EU. The Commission said that Amazon systematically relies on non-public business data of independent sellers on its marketplace to the benefit of its own competing retail business. This data includes the number of units of products ordered and shipped, sales revenues, and the number of online visits made to offers.

The U.S. Department of Justice and Attorneys General from 11 U.S. states filed a complaint on Tuesday in the United States District Court for the District of Columbia against Google, alleging the company is “unlawfully maintaining monopolies in the markets for general search services, search advertising, and general search text advertising in the United States through anticompetitive and exclusionary practices.” The complaint maintains that Google has for years entered into exclusionary agreements and used anticompetitive practices to “lock up distribution channels and block rivals,” and comes after more than a year of investigation.

The 2019 USPTO-NIST-DOJ Joint Policy Statement on Standard-Essential Patents Subject to Voluntary RAND or FRAND (fair, reasonable and non-discriminatory) commitments “intended to solve [judicial] misinterpretation, and to encourage balance in our patent ecosystem, and to further strengthen patent rights,” USPTO Deputy Director Laura Peter said in her keynote at a recent IP-antitrust event. Peter delivered the remarks at an event hosted by the Eagle Forum Education & Legal Defense Fund, a conservative public policy and grassroots organization founded by the late Phyllis Schlafly, titled, “Inventing Dynamic Competition: Intellectual Property, Antitrust, and Competition” September 30 in Washington, D.C.

Several weeks ago, the Antitrust Division of the U.S. Department of Justice announced a positive Business Review Letter (BRL) concluding an eight-month review of Avanci’s new platform for licensing 5G standard essential patents. “In sum, the proposed 5G Platform has the potential to yield efficiencies by reducing transaction costs and streamlining licensing for connected vehicles,” wrote Assistant Attorney General Makan Delrahim, who heads the DOJ Antitrust Division. “Together these efficiencies may allow cellular standards-essential patent owners and vehicle manufacturers to focus resources elsewhere, such as investment in further research and development in emerging 5G technologies and applications. This possibility could enhance competition in these technologies, improve safety, and benefit American consumers.” The finding that the Avanci 5G platform could enhance competition is critically important for Avanci, and positively affects the technology licensing landscape.

The U.S. Court of Appeals for the Ninth Circuit today vacated a decision of the U.S. District Court for the Northern District of California finding that Qualcomm had engaged in unlawful licensing practices and reversed a permanent, worldwide injunction against several of Qualcomm’s core business practices. In May 2019, Judge Lucy Koh issued a 233-page order finding that Qualcomm had engaged in unlawful licensing practices and ordered in part that Qualcomm “must make exhaustive SEP licenses available to modem-chip suppliers on fair, reasonable, and non-discriminatory (“FRAND”) terms and to submit, as necessary, to arbitral or judicial dispute resolution to determine such terms…[and] submit to compliance and monitoring procedures for a period of seven (7) years.” Koh’s ruling was widely criticized, and today’s unanimous opinion was a total reversal of her findings.

On May 1, Representative and House Judiciary Committee Chairman Jerrold Nadler (D-NY) and a bipartisan coalition of members of the Subcommittee on Antitrust, Commercial and Administrative Law signed a letter addressed to Amazon CEO Jeff Bezos. The letter focuses on antitrust issues posed by Amazon’s alleged use of third-party seller data to develop products competing with those sellers, allegations that directly contradict testimony offered by Amazon last year during a House Antitrust Subcommittee hearing. It also calls upon Bezos to testify before the House Judiciary Committee to clear up any discrepancies between the recent Wall Street Journal article and Amazon’s prior testimony to Congress on the subject of third-party seller data.