Posts Tagged: "RAND"

In withdrawing the 2013 statement, the new 2019 guidance by the DOJ, NIST and the USPTO states the obvious, i.e. that there is no difference in the law between F/RAND assured standard essential patents and all other patents. While some would have perhaps liked to break the unitarity approach of the patent system so as to weaken remedies against the infringement of essential patents, a legal system that would apply a different standard to standard essential patents as opposed to other patents would violate U.S. trade obligations.

The debate on RAND terms and conditions is mostly about the reasonability of the royalty rate, less about non-discriminatory part. So, what is a “reasonable rate”? Companies that manufacture products based on a standard will demand lower rates or royalty-free licenses, claim harm from patent hold-ups and from royalty stacking. These companies will argue that it is unfair when companies that contribute technology to the standard benefit from the lock-in of the standard because it is now unavoidable to use the essential patents in their products. On the other hand, companies that participated in standards development, and own essential patents because of that investment, claim that lower royalty rates will remove the incentives for future investments in standard setting and will stifle innovation. In the confusion generated by these lobbying interest groups, it makes sense to go back to the one thing everyone seems to agree on: Standards are good.