DOJ and FTC report on on Antitrust Enforcement and Intellectual Property Rights

With respect to standards setting, the agencies’ Conclusions were:

• Ex ante consideration of licensing terms by SSO participants can be procompetitive.

• Joint ex ante consideration of licensing terms by SSO participants is unlikely to constitute a per se antitrust violation. The Agencies will usually apply the rule of reason when evaluating joint activities that mitigate hold up by allowing potential licensees of the standard to negotiate licensing terms with IP holders. Such ex ante negotiations of licensing terms are most likely to be reasonable when the adoption of a standard will create or enhance market power for a patent holder.

• An intellectual property owner’s unilateral announcement of licensing terms does not violate section 1 of the Sherman Act.

• An intellectual property owner’s unilateral announcement of price terms, without more, does not violate section 2 of the Sherman Act.

• Bilateral ex ante negotiations about licensing terms that take place between an individual SSO member and an individual intellectual property holder outside the auspices of the SSO are unlikely (without more) to require any special antitrust scrutiny because intellectual property rights holders are merely negotiating individual terms with individual buyers.