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Posts Tagged: "Licensing"

Qualcomm SCOTUS Brief Charges Apple Has No Legal Leg to Stand On

On January 19, Qualcomm filed a brief in opposition to Apple’s petition for certiorari to the U.S. Supreme Court, arguing Apple failed to make the requisite evidentiary showing to obtain Article III standing. In 2017, Qualcomm filed suit against Apple, alleging Apple’s mobile devices infringed five of its patents, two of which are at issue here, U.S. Patent No. 7,844,037 (the ‘037 patent) and U.S. Patent No. 8,683,362 (the ‘362 patent). Apple counterclaimed, urging the court to invalidate those five patents. Additionally, Apple filed a simultaneous challenge to two of the patents through inter partes reviews (IPRs).

Knowledge Ecology International’s New March-In Petition is Déjà vu All Over Again – With One Twist

Some say the definition of insanity is doing the same thing over and over while expecting a different outcome. That would appear to be the case with the recent refiling of a petition by Knowledge Ecology International (KEI) to the National Institutes of Health (NIH) asking it to march in under the Bayh-Dole Act to force licensing to additional parties of the prostate cancer drug Xtandi, because of its cost. The law allows academic institutions, companies and federal laboratories to own and license inventions made with government support. Similar petitions were rejected by NIH and the Department of Defense (which funded the research on the underlying invention) in the Obama/Biden Administration for a simple reason: the law is for the commercialization of federally funded inventions; it does not allow the government to set prices for successful products.

Property Rights Groups Urge Garland and Kanter to Withdraw ‘Misguided’ Policy Statement on SEPs Subject to FRAND

On January 12, a coalition of 28 property rights groups signed a letter addressed to U.S. Attorney General Merrick Garland and Assistant Attorney General for Antitrust Jonathan Kanter asking those officials to reconsider and withdraw a draft policy statement issued in early December regarding licensing negotiations and remedies for standard-essential patents (SEPs) subject to voluntary fair, reasonable and non-discriminatory (FRAND) commitments. According to the coalition, the U.S. Department of Justice’s (DOJ) statement will only serve to bolster the fortunes of China, the major economic rival to the United States, by allowing Chinese tech implementers to infringe SEPs without respect to the rights of U.S. innovators.

One is the Loneliest Number: Analyzing the 2021 Draft Policy Statement on SEPs Subject to Voluntary F/RAND Commitments (Part II)

In Part I of this series of articles, we provided an overview of the 2013 and 2019 policy statements that preceded the 2021 Draft Policy Statement. In this Part II, we consider the language of a specific licensing commitment made to European Telecommunications Standards Institute (ETSI), and various legal pronouncements that have been made in relation thereto.

The Federal Government Should Reinstate the 2019 Policy Statement on Standard Essential Patents

The Justice Department’s December 6, 2021 Draft Policy Statement on Licensing Negotiations and Remedies for Standards-Essential Patents Subject to Voluntary F/RAND Commitments (“2021 DPS”) badly misses the mark and merits a failing grade. By contrast, the 2019 PS (issued by the Justice Department, NIST, and the U.S. PTO) is eminently sound, and merits being reaffirmed. The DPS should be viewed in the context of the benefits conferred on society by patents that read on standards, commonly referred to as standard essential patents (SEPs). Given the economic importance of SEPs, public policy should encourage investment in them and ensure that they receive adequate legal protection. Such sound policies inform the New Madison Approach (NMA), publicly described by Assistant Attorney General for Antitrust Makan Delrahim in 2018.

SEPs in Europe and Beyond: Highlights From 2021

Even as Europe and the rest of the world continued to face the unprecedented challenges of the COVID-19 pandemic in 2021, the development of 5G and other Standard Essential Patent (SEP)-enabled technology standards has continued at an unabated pace. While the year has not yet ended, more than 100,000 technical contributions have already been submitted at 3GPP meetings for 2G, 3G, 4G and 5G in 2021 – a near-record yearly contribution count. The invention and standardization of massive, complex communication technologies continues to generate significant numbers of SEPs. According to IPlytics data, the cumulative number of self-declared SEP families has surpassed 72,000 in 2021, indicating a five-fold increase in just 10 years.

When Your Trademark Licensor is in Financial Distress

Your company and its business have been built around the strength of a trademark license from a third-party licensor. You have invested heavily in the brand. Now, however, your trademark licensor is in financial distress. Bankruptcy is not beyond the realm of possibility. Perhaps the licensor has asked to renegotiate the terms of the trademark license or threatened to terminate the license once a chapter 11 bankruptcy case is filed. What are the respective rights of the distressed trademark licensor and your company, as trademark licensee, in this situation? Is your company at risk of losing everything invested in reliance on the license?

Mechanisms, Governance, and Policy Impact of SEP Determination Approaches

Standard Essential Patents (SEPs) are on the rise; the number of newly declared patents per year has almost tripled over the past five years. There were 17,623 new declared patent families in 2020, compared to 6,457 in 2015 (see Figure 1). The 5G standard alone counts over 150,000 declared patents since 2015. Similarly, litigation around SEPs has increased. One of the driving factors of recent patent litigation is the shift in connectivity standards (eg, 4G/5G, Wi-Fi) that in the past were mostly used in computers, smartphones and tablets, but are now increasingly implemented in connected vehicles, smart homes, smart factories, smart energy and healthcare applications. Another reason why litigation may rise further is the belief that large SEP owners such as Huawei, ZTE or LG Electronics may soon sell parts of their SEP portfolios, which may likely end up in the hands of patent assertion entities (PAEs). One way or another, it is anticipated that the majority of patent holders will actively monetize their SEPs covering standards such as 5G, Wi-Fi 6 or VVC in this fast-moving, high-investment environment. Any company adopting these standards must decrease operational risk and expense exposure by taking a proactive strategy towards SEPs rather than a reactive one.

When the Secret Enables the Brand: The Long-Lasting Listerine License

Question: how do you make money from a secret formula for a product that smells and tastes horrible and that no one wants? Answer: you make everyone believe they have a medical problem that only this stuff can solve. Back in 1879, Joseph Lawrence, a St. Louis doctor, was experimenting with surgical disinfectants. This was a new thing. In the 1860s, a British surgeon named Joseph Lister was the first to perform surgery antiseptically, using carbolic acid as a disinfectant. Inspired by Lister, Lawrence came up with a compound of alcohol and essential oils that seemed to kill whatever bugs it touched. To honor Lister (and presumably to take advantage of his fame), Lawrence named the concoction “Listerine.”

CAFC Emphasizes the Importance of Contract Principles in Arbitrability Determination

On November 12, the United States Court of Appeals for the Federal Circuit (CAFC) affirmed the decision of the U.S. District Court for the Northern District of California that compelled arbitration and dismissed Rohm Semiconductor USA’s declaratory judgment action without prejudice, holding that an arbitrator must determine arbitrability. In 2007, Rohm Japan and MaxPower Semiconductor entered into a technology licensing agreement (TLA). According to the TLA, Rohm Japan and its subsidiaries were permitted to use certain power-related technologies of MaxPower developed under a Development and Stock Purchase Agreement in exchange for royalties paid to MaxPower. In 2011, the TLA was amended to include an agreement to arbitrate “any dispute, controversy, or claims arising out of or in relation to this Agreement or at law, or the breach, termination, or validity thereof.” Further, the amendments provide that arbitration must be conducted “in accordance with the provisions of the California Code of Civil Procedure (CCCP).”

Judge Upholds UK Power to Set FRAND Terms

A judge has affirmed the ability of the UK courts to settle FRAND terms of a patent license covering foreign patents, despite the defendants challenging the court’s jurisdiction. But in his judgment, published on November 4 20201, His Honour Judge Hacon noted that the current framework for settling a global license between owners of standard essential patents (SEPs) and implementers “is plainly not satisfactory.” He explained: “[I]t does encourage expensive parallel litigation in several jurisdictions and more uncertainty than is necessary. I doubt that it can be sustained in the long term.” The case is one of many that SEP owners have brought before the courts since the UK Supreme Court judgment in the Unwired Planet and Conversant litigation established English courts’ jurisdiction to set global FRAND terms in August 2020.

The Use of ‘For the Avoidance of Doubt’ in IP License Agreements: Please Stop!

The phrase “for the avoidance of doubt” must be a Microsoft Word shortcut that comes standard in some legal IT package. Why do we say that? Well, we recently received an IP licensing agreement from an attorney working at a large law firm located in a large city, serving a large client, and presumably charging a large hourly fee. It seemed as though every 50th word in the agreement was “for the avoidance of doubt.” Now, this is not a personal attack on this particular attorney or law firm. We have seen the phrase used way too often and do not understand why. Perhaps this is just a phrase that makes agreements sound more legalese or maybe the attorneys in question think it makes certain provisions in the agreement more “airtight?” Nonetheless, we ask all of you to please stop!

IP/Antitrust Policy Changes are Afoot in the Biden Administration’s DOJ

The intersection of intellectual property (IP) and antitrust law is again a hot debate after a recent speech by the U.S. Department of Justice Antitrust Division’s (“DOJ” or “Division”) Economics Director of Enforcement, Jeffrey Wilder, titled Leveling the Playing Field in the Standards Ecosystem: Principles for a Balanced Antitrust Enforcement Approach to Standards-Essential Patents. Before we dive in on the key takeaways from the speech, and our thoughts on potential ramifications, it bears briefly mentioning how we got here.

The Role of Standard-Essential Patents for the Auto Industry

Most market experts predict dramatic changes in the auto industry because of shifting consumer preferences, new business models and emerging markets. The sector also looks set to be heavily affected by new sustainability and environmental policy changes, as well as by upcoming regulations on security issues. These forces are predicted to give rise to disruptive technology trends, such as driverless vehicles, electrification and interconnectivity. Forecast studies posit that the smart car of the near future will be constantly exchanging information with its environment. Car-to-X or car-to-car communication systems will enable communication between cars, roadsides and infrastructure, while mechanical elements will soon be embedded into computing systems within the internet infrastructure. The auto industry is one of the first sectors to rely on Internet of Things (IoT) technologies, which connect devices, machines, buildings and other items with electronics, software or sensors. Interconnectivity across multiple vehicle parts and units relies on the specification of technology standards such as 4G or 5G, Wi-Fi, video compression (HEVC/VVC), Digital Video Broadcasting (DVB) and Near Field Communication (NFC) or the wireless charging Qi standard to name a few.

CAFC Affirms Northern District of California on Interlocutory Appeal in Micron Infringement Suit

On August 26, the U.S. Court of Appeals for the Federal Circuit (CAFC) affirmed the U.S. District Court for the Northern District of California’s decision in an interlocutory appeal brought by MLC Intellectual Property, LLC (MLC) regarding orders that precluded certain opinions of MLC’s damages expert in its infringement suit against Micron Technology, Inc. (Micron). The orders precluded the expert from 1) characterizing specific license agreements as reflecting a 0.25% royalty; 2) discussing a reasonable royalty rate when MLC failed to provide essential information and documents related to its damages theory when requested prior to expert discovery; and 3) discussing the royalty base and rate because the expert did not apportion for non-patented features.