What happens when a standard-setting organization establishes a technical standard that can be complied with only through the use of a patented technology? This module focuses on that problem, building on a case study of the Microsoft v. Motorola litigation. Key issues involved in the case study include the problem of setting fair, reasonable, and non-discriminatory (“FRAND”) terms and deciding whether an injunction should apply. The materials in this module were created by Cynthia Laury Dahl, Practice Professor of Law and Director of the Detkin Intellectual Property and Technology Legal Clinic at the University of Pennsylvania Carey Law School.
Applicable Courses: Intellectual Property, Patents, Contracts, Regulatory Law, Technology Policy
Materials:
- Case study: Cynthia Laury Dahl, When Standards Collide with Intellectual Property: Standard Setting Organizations, Technology, and Microsoft v. Motorola
- Teaching guide: Cynthia Laury Dahl, When Standards Collide with Intellectual Property: A Teaching Guide to Standard Setting Organizations, Technology, and Microsoft v. Motorola
- Published version of teaching guide: Cynthia Laury Dahl, When Standards Collide with Intellectual Property: Teaching about Standard Setting Organizations, Technology, and Microsoft v. Motorola, 9 IP Theory 1-30 (2020)
- PowerPoint presentation: Cynthia Laury Dahl, When Standards Collide with Intellectual Property: Standard Setting Organizations, Technology, and Microsoft v. Motorola
- Overview Essay: Cynthia Dahl, Teaching Standard Essential Patents, Regul. Rev. (Aug. 23, 2022)
- Andrew Culbert (former Associate General Counsel of Microsoft in charge of intellectual property litigation; currently Partner at Perkins Coie LLP and Lecturer at the University of Washington School of Law)
- What role do standards play in the technology industry?
- What does it mean to set a FRAND licensing rate?
- Why did the dispute between Microsoft and Motorola go to court?
- How can a licensor make a FRAND offer without risking a legal challenge?
- Does the standard-setting process give rights holders what they are due?
- Kirk Dailey (former Corporate Vice President of Intellectual Property at Motorola; currently Senior Vice President of Business Development at the Marconi Group)
- Why is it important to value standard essential patents accurately?
- Why can’t standard-setting organizations decide a FRAND licensing rate?
- How did the dispute arise between Microsoft and Motorola?
- Do different industries think about FRAND licensing differently?
- Will companies continue to dispute licensing rates for standard essential patents?
- Is injunctive relief proper if a licensor proposes a licensing fee?
- Steven Fortney (former judicial clerk to Judge James L. Robart of the Western District of Washington; currently Partner at the Summit Law Group)
- Was it helpful to bifurcate the contract claims from the patent claims?
- Why did the judge decide the FRAND rate but leave the contract issue to the jury?
- What precedent guided the court?
- How does royalty analysis differ when patents are essential to a standard?
- How did the court arrive at a FRAND rate?
- Has the court’s decision affected subsequent FRAND negotiations?
- Why should law students learn about voluntary standards?
- The Hon. James L. Robart (U.S. District Court for the Western District of Washington)
- What was your reaction to learning you would preside over Microsoft v. Motorola?
- How was Microsoft v. Motorola a unique case?
- How did you come up with the approach you followed in deciding a FRAND rate in Microsoft v. Motorola?
- What makes for an appropriate comparable license when making a FRAND determination?
- Should a proper FRAND rate be based on the end product’s wholesale price?
- Why did you, as a U.S. judge, block an injunction that a German court imposed on Microsoft at the request of Motorola?
- When are injunctions a proper remedy in the context of standard essential patents?
- Now that Microsoft v. Motorola analyzed the “fair and reasonable” aspect of FRAND, will the next cases focus on analyzing the definition of “non-discriminatory”?
- What is the legacy of Microsoft v. Motorola?
- Workshop Videos: The Future of Standard Essential Patents: Learning from Microsoft v. Motorola’s Legacy (Penn Law, March 16, 2018)
- Welcoming Remarks: Cary Coglianese, Edward B. Shils Professor of Law, University of Pennsylvania Carey Law School, and Director, Penn Program on Regulation
- Opening Keynote Address: The Hon. James L. Robart of the U.S. District Court for the Western District of Washington, Evolution, Not Revolution: The Future of Standard Essential Patents
- Panel I: Microsoft v. Motorola’s Legacy in Today’s High-Tech Business World
- Panel 2: Emerging Legal and Business Issues in Standard Essential Patents
- Closing Remarks: Christopher Yoo, John H. Chestnut Professor of Law, Communication, and Computer & Information Science, University of Pennsylvania Carey Law School, and Director, Center for Technology, Innovation & Competition
- Closing Keynote Address: The Hon. Makan Delrahim, Assistant Attorney General, Antitrust Division, U.S. Department of Justice, The “New Madison” Approach to Antitrust and Intellectual Property Law
Selected Cases
- Continental Automotive Systems, Inc. v. Avanci, LLC, No. 20-11032, 2022 U.S. App. LEXIS 17079 (5th Cir. June 21, 2022)
- HTC Corp. v. Telefonaktiebolaget LM Ericsson, 12 F.4th 476 (5th Cir. 2021)
- Optis Wireless Tech. v. Apple Inc., 2:19-CV-00066-JRG, 2021 U.S. Dist. LEXIS 110317 (E.D. Tex. Apr. 14, 2021)
- TCL Communication Technology Holdings Ltd. v. Telefonaktiebolaget LM Ericsson, 943 F.3d 1360 (Fed. Cir. 2019)
- FTC v. Qualcomm Inc., 969 F.3d 974 (9th Cir. 2020)
- Prior history: FTC v. Qualcomm Inc., 17-CV-00220-LHK, 2018 U.S. Dist. LEXIS 190051 (N.D. Cal. Nov. 6, 2018)
- Huawai v. Samsung, Shenzhen Intermediate Court (2018) (China)
- TCL Communication Technology Holdings Ltd. v. Telefonaktiebolaget LM Ericsson et al., 8:14-cv-00341, (C.D. Cal 2017)
- Unwired Planet v. Huawei, 2017 EWHC 711 (Pat) (UK)
- Xian Xidian Jietong Wireless Communication Co., Ltd (IWNComm) v SONY Mobile Communication Products (China) Co. Ltd., Beijing Intellectual Property Court (2017)
- Motorola v. Microsoft 795 F.3d 1024 (9th Cir. 2015)
- Samsung Inc. v. Apple Limited Patent Act, Sec. 100; Civil Code, Sec. 1 para. 3 IIC 46: 124 (2015) (Japan)
- Commonwealth Scientific and Industrial Research Organisation v. Cisco SystemsInc. 809 F.3d 1295 (Fed. Cir. 2015)
- Ericsson Inc. v. D-Link Systems, Inc. 773 F.3d 1201 (Fed. Cir. 2014)
- Microsoft Corp. v. Motorola, Inc., 2013 WL 2111217 (W.D. Wash 2013)
- Innovatio IP Ventures LLC Patent Litigation 2013 WL 5593609 (N.D. Ill. 2013)
Selected Executive Branch Materials
- The Department of Justice, U.S. Patent and Trademark Office and National Institute of Standards and Technology withdraw 2019 Standards-Essential Patents (SEP) policy statement, U.S. Pat. & Trademark Off. (June 8, 2022).
- Exec. Order No. 14036, 86 Fed. Reg. 36987 (July 9, 2021).
- U.S. Pat. & Trademark Off., U.S. Dep’t of Just. & Nat’l Inst. Stand. & Tech., Policy Statement on Remedies For Standards-Essential Patents Subject To Voluntary F/RAND Commitments (Dec. 19, 2019).
Selected Articles
- Rebecca Haw Allensworth, Casting a FRAND Shadow: The Importance of Legally Defining “Fair and Reasonable” and How Microsoft v. Motorola Missed the Mark, 22 Tex. Intell. Prop. L.J. 235 (2014).
- Steven M. Amundson, Recent Federal Circuit Decisions Clarify and Refine Methodologies for Determining Patent Damages, 22 B.U. J. of Sci. & Tech. L. 1 (2016).
- Steven M. Amundson, Recent Decisions Provide Some Clarity on How Courts and Government Agencies Will Likely Resolve Issues Involving Standard Essential Patents, 13 Chi.-Kent J. Intell. Prop. 91 (2013).
- Stanley M. Besen, Why Royalties for Standard Essential Patents Should Not Be Set by the Courts, 15 Chi.-Kent J. Intell. Prop. 19 (2015).
- Ashish Bharadwaj & Dipinn Verma, China’s First Injunction in Standard Essential Patent Litigation, 12 J. Intell. Prop. L. & Prac. 717 (2017).
- Michael A. Carrie, Rescuing Antitrust’s Role in Patent Holdup, 168 U. Pa. L. Rev. Online 238 (2021).
- Tommy Chen & Ian Karet, UK High Court Sets FRAND Rates: First Substantive Decision on SEP Licence Terms in Europe, 12 J. Intell. Prop. L. & Prac., 719 (2017).
- Jorge L. Contreras, A Brief History of FRAND: Analyzing Current Debates in Standard Setting and Antitrust Through a Historical Lens, 80 Antitrust L.J. 39 (2015).
- Jorge L. Contreras, Fixing FRAND: A Pseudo-Pool Approach to Standards-Based Patent Licensing, 79 Antitrust L.J. 47 (2013).
- Jorge L. Contreras, Aggregated Royalties for Top-Down FRAND Determinations: Revisiting “Joint Negotiation,” 62 Antitrust Bull. 690 (2017).
- Jorge L. Contreras, Anti-Suit Injunctions and Jurisdictional Competition in Global FRAND Litigation: The Case for Judicial Restraint, 11 N.Y.U. J. Intell. Prop. & Ent. L. 171 (2021).
- Jorge L. Contreras, From Private Ordering to Public Law: The Legal Frameworks Governing Standards-Essential Patents, 30 Harv. J. L. & Tech. 211 (2017).
- Jorge L. Contreras, Global Rate Setting: A Solution for Standards-Essential Patents?, 94 Wash. L. Rev 701 (2019).
- Jorge L. Contreras, The Global Standards Wars: Patent and Competition Disputes in North America, Europe and Asia, Keio Univ J. L. Politics & Sociology, (Mar. 2018).
- Jorge L. Contreras, The New Extraterritoriality: FRAND Royalties, Anti-Suit Injunctions and the Global Race to the Bottom Over Standards-Essential Patents, 25 B.U. J. Sci. & Tech. L. 251 (2019).
- Jorge L. Contreras, Fabian Gaessler, Christian Helmers & Brian J. Love, Litigation of Standards-Essential Patents in Europe: A Comparative Analysis, 32 Berkeley Tech. L.J. 1457 (2017).
- Jorge L. Contreras & David L. Newman, Developing a Framework for Arbitrating Standards-Essential Patent Disputes, 2014 J. Disp. Resol. 23 (2014).
- Jorge Contreras, Much Ado About Hold-Up, 2019 U. Ill. L. Rev. 875 (2019).
- Jorge L. Contreras, The New Extraterritoriality: FRAND Royalties, Anti-Suit Injunctions and The Global Race to The Bottom in Disputes Over Standards-Essential Patents, 25 B.U. J. Sci. & Tech. L. 251 (2019).
- Zachary Coots, Standardizing the Smallest-Functional Unit: A Tier-Stacking Approach to Frand Royalty Rates (January 15, 2018) http://dx.doi.org/10.2139/ssrn.3105756
- Thomas F. Cotter, Comparative Law and Economics of Standard-Essential Patents and FRAND Royalties, 22 Tex. Intell. Prop. L.J. 311 (2014).
- Thomas F. Cotter et al., Demystfying Patent Holdup, 76 Wash. & Lee L. Rev. 1501 (2019).
- Thomas F. Cotter, Is Global FRAND Litigation Spinning Out of Control?, 2021 Patently-O Patent L.J. 1 (2021).
- Elyse Dorsey & Matthew McGuire, How the Google Consent Order Alters the Process and Outcomes of FRAND Bargaining, 20 Geo. Mason L. Rev. 979 (2013).
- Damien Geradin, The Meaning of “Fair and Reasonable” in the Context of Third-Party Determination of FRAND Terms, 21 Geo. Mason L. Rev. 919 (2014).
- Damien Geradin, Moving Away from High-Level Theories: A Market-Driven Analysis of FRAND, 59 Antitrust Bull. 327 (2014).
- Lee Gesmer, FTC and DOJ Face Off Over Antitrust and FRAND Licensing in FTC v. Qualcomm, ConsortiumInfo.org (Aug. 27, 2019), https://www.consortiuminfo.org/intellectual-propery/intellectual-property-rights/guest-post-ftc-and-doj-face-off-over-antitrust-and-frand-licensing-in-ftc-v-qualcomm/.
- Eli Greenbaum, No Forum to Rule Them All: Comity and Conflict in Transnational FRAND Disputes, 94 Wash. L. Rev. 1085 (2019).
- Kyle L. Greene, Standard Essential Patents and Antitrust Law: Balancing Innovation and Competition, 2019 Colum. Bus. L. Rev 1084 (2019).
- Bowman Heiden, The viability of FRAND: How the seminal landmark Microsoft ruling could impact the value of standard essential patents and the future of telecom standards, 40 Telecomm. Pol’y 870 (2016).
- Erik Hovenkamp & Jonathan S. Masur, How Patent Damages Skew Licensing Markets, 36 Rev. Litig. 379 (2017).
- Hebert J. Hovenkamp, Competition in Information Technologies: Standard Essential Patents, Non-Practicing Entities and FRAND Bidding, 1912 Fac. Scholarship Penn. L. 1912 (2012).
- Herbert Hovenkamp, FRAND and Antitrust, 105 Cornell Law Review 1683 (2020).
- Samuel Howard, FRAND, RAND, & The Problem at Hand: Increasing Certainty in Infringement Damages for Standard-Essential Patents, 27 B.U. J. Sci. & Tech. L. 204 (2021).
- Helen H. Ji, Note, District Courts Versus the USITC : Considering Exclusionary Relief for F/Rand-Encumbered Standard-Essential Patents, 21 Mich. Telecomm. & Tech. L. 169 (2014).
- John “Jay” Jurata, Jr., Glory Days: Do the Anticompetitive Risks of Standards-Essential Patent Pools Outweigh Their Procompetitive Benefits?, 58 San Diego L. Rev. 417 (2021).
- Layne S. Keele, Holding Standards for RANDsome: A Remedial Perspective on RAND Licensing Commitments, 64 Kan. L. Rev. 187 (2015).
- Robert D. Keeler, Note, Why Can’t We be (F)RANDS? The Effect of Reasonable and Non-Discriminatory Commitments on Standard-Essential Patent Licensing, 32 Cardozo Arts & Ent. L.J. 317 (2013).
- Pierre Larouche, et al., Settling FRAND Disputes: Is Mandatory Arbitration a Reasonable and Nondiscriminatory Alternative?, 10 J. Competition L. & Econ. 581 (2014).
- Anne Layne-Farrar & Michael A. Salinger, Bundling of RAND-committed patents, 45 Res. Pol’y, 1155 (2016).
- Anne Layne-Farrar et al., Pricing Patents for Licensing in Standard Setting Organisations: Making Sense of FRAND Commitments, 74 Antitrust L.J. 671 (2007).
- Mark A. Lemley, Intellectual Property Rights and Standard-Setting Organizations, 90 Cal. L. Rev. 1889 (2002).
- Mark A. Lemley & Carl Shapiro, A Simple Approach to Setting Reasonable Royalties for Standard-Essential Patents, 28 Berkeley Tech. L.J. 1135 (2013).
- Mark A. Lemley & Carl Shapiro, Patent Holdup and Royalty Stacking, 85 Tex. L. Rev. 1991 (2007).
- Mark A. Lemley & Timothy Simcoe, How Essential Are Standard-Essential Patents?, 104 Cornell L. Rev. 607 (2019).
- Peter J. Levitas, Sonnia Kuester Pfaffenroth & Matthew Tabas, Joint Statement with PTO and NIST on FRAND Injunctions Clarifies DOJ’s Position On SEP-Infringement Relief, 32 Intell. Prop. & Tech. L.J. 12 (2020).
- Benjamin C. Li, The Global Convergence of FRAND Licensing Practices: Towards “Interoperable” Legal Standards, 31 Berkeley Tech. L.J. 429 (2016).
- Douglas Lichtman, Understanding the RAND Commitment, 47 Houston L. Rev. 1023, (2010).
- Daryl Lim, Standard Essential Patents, Trolls, and the Smartphone Wars: Triangulating the End Game, 119 Penn St. L. Rev. 1 (2014).
- Spyros Makris, The European Commission’s Communication on Standard Essential Patents: A Step Forward Towards the Digital Single Market and The Internet Of Things?, 10 George Mason Journal of International Commercial Law 1 (2019).
- Kassandra Maldonado, Breaching RAND and Reaching for Reasonable: Microsoft v. Motorola and Standard-Essential Patent Litigation, 29 Berkeley Tech. L.J. 419 (2014).
- Douglas Melamed, & Carl Shapiro, How Antitrust Law Can Make FRAND Commitments More Effective, 127 Yale L.J. 2110 (2018).
- Lizaveta Miadzvedskaya, Encouraging FRAND-ly Negotiations: A Comparison of The United States and European Approaches to Allowing Injunctive Relief in Cases Involving FRAND-Encumbered Standard-Essential Patents, 18 Wash. U. Global Stud. L. Rev. 723 (2019).
- Fredrick Nilsson, Appropriate Base to Determine a Fair Return on Investment: A Legal and Economic Perspective on FRAND, 13 J. Intell. Prop. L. & Prac. 414 (2018).
- Chryssoula Pentheroudakis & Justus A. Baron, Licensing Terms of Standard Essential Patents: A Comprehensive Analysis of Cases, JRC Science for Policy Report (2017).
- Sonia Kuester Pfaffenroth, Peter J. Levitas & Dylan S. Young, DOJ Changing its Antitrust Approach to FRAND and SEPs, 31 Intell. Prop. & Tech. L.J. 3 (2019).
- Aminta Raffolovich & Steven Schwartz, Antitrust Analysis of FRAND Licensing Post-FTC v. Qualcomm, 31 J. Antitrust & Unfair Competition L. Sec. Cali. Law. Ass’n 138 (2021).
- Srividhya Ragavan et al., FRAND v. Compulsory Licensing: The Lesser of the Two Evils, 14 Duke L. & Tech. Rev. 83 (2015).
- Matt Rosenberg & Jake Berdine, A Reasonable Approach to Reasonableness: A Proposal to Improve RAND Application in Patent Arbitration Proceedings, 44 AIPLA Q.J. 459 (2016).
- Andre Schevciw, The ‘Unwilling Licensee’ in the Context of Standards Essential Patent Licensing Negotiations, 47 AIPLA Q. J. 369 (2019).
- Edward Sherry et al., FRAND Commitments in Theory and Practice: A Response to Lemley and Shapiro’s ‘A Simple Approach,’ (April 13, 2016).
- Gregory Sidak, Apportionment, Frand Royalties, and Comparable Licenses after Ericsson v. D-Link, 2016 U. Ill. L. Rev., 1809 (2016).
- Ian Simmons, Scott Schaeffer, Brian P. Quinn & Eric Rodriguez, The Future of the Past: Taking Stock of SEP Policy at the Outset of the Biden Administration, 35 Antitrust 82 (2021).
- Daniel F. Spulber, Licensing Standard Essential Patents with FRAND Commitments: Preparing for 5G Mobile Telecommunications, 18 Colo. Tech. L.J. 19 (2020).
- Richard H. Stern, Who Should Own the Benefits of Standardization and the Value It Creates?, 19 Minn. J.L. Sci. & Tech. 107 (2018).
- Daniel G. Swanson & William J. Baumol, Reasonable and Nondiscriminatory (RAND) Royalties, Standards Selection, and Control of Market Power, 73 Antitrust L.J. 1 (2005).
- David J. Teece, The “Tragedy of the Anticommons” Fallacy: A Law and Economics Analysis of Patent Thickets and FRAND Licensing, 32 Berkeley Tech. L.J. 1489 (2017).
- Pat Treacy & Matthew Hunt, Litigating a ‘FRAND’ patent license: the Unwired Planet v Huawei judgment, 13 J. Intell. Prop. L. & Prac., 124 (2017).
- David J. Teece & Edward Sherry, A Public Policy Evaluation of RAND Decisions in the U.S. Courts, 1 Criterion J. Innovation, 113.
- Christopher S. Yoo, Public Good Economics and Standard Essential Patents, Fac. Scholarship Penn. L. 1371 (2014).