The Biden Administration has received more than 1,000 responses to its draft policy paper on standard-essential patent (SEP) enforcement, 167 of which have been published. The rest was either confidential or, in many cases, just duplicative.
It's important to understand the significance of a policy statement by the U.S. federal government and many individuals' and organizations' desire to influence its content, but it's equally key to realize that the outcome is not going to constitute binding precedent. Even if there had been 10,000 or 100,000 responses instead of 1,000+, I'd still just reiterate my belief that the draft document is centrist, meaning it's neither the end of the world for SEP holders nor a breakthrough for implementers that would immunize them against injunctions. Let me quote a passage from Professor Michael Carrier's submission to the DOJ:
"The proposed statement [...] offers a balanced approach that considers the potential abuses on both sides of the table, offers an elaborate framework for good-faith negotiation, and sets forth a strongly supported approach to remedies."
I'd also like to highlight one other submission that I consider pretty balanced and centrist: the one by the High Tech Inventors Alliance. The HTIA's members like Microsoft, Oracle, and Intel invest heavily in R&D, hold many patents including lots of SEPs, but they're also large-scale implementers. They know both sides of the equation. I just don't fully agree with the idea of a bright-line rule that the ITC should never ever impose import bans on SEP-infringing products: "There is no excuse for allowing ITC exclusion orders to inflict anticompetitive harm on American consumers." I would agree that the bar should be reasonably high for a SEP-based exclusion order, but there can be circumstances that justify such import bans.
The final point in the HTIA's submission is consistent with something I've been saying, just that I approached the same question from a different angle: no matter what the U.S. will do, there are other jurisdictions in the world and SEP holders will enforce their rights elsewhere if they have to. However, U.S. governments traditionally advocate robust patent enforcement in trade talks, regardless of which party is in power. It wouldn't be easy to thread the needle by encouraging other countries to weaken SEP enforcement on the one hand while accusing some countries of free-riding on U.S. innovation in a non-SEP context. That said, I applaud the HTIA for taking a global perspective, as SEP enforcement is global (that's why this blog has a multi-jurisdictional focus).
The global nature of SEP policy explains why the DOJ has received submissions from predominantly foreign automotive companies. One of them, Honda, made a joint submission with Tesla, and Ford, which is as American as it gets, made one of its own. But those two submissions are clearly outnumbered by what the Japan Automobile Manufacturers Association (JAMA), the European Association of Automotive Suppliers (CEPLA, a French acronym), the German Association of the Automotive Industry (VDA), and Germany's Continental filed.
One common mantra of those automotive industry submissions is that SEP holders should not be entitled to an injunction against a car maker whose suppliers are willing to take a license on FRAND terms. That is the question that, on the other side of the Pond, the Dusseldorf Regional Court referred to the European Court of Justice in Nokia v. Daimler, but which never had to be answered because Daimler took a car-level license (which is also a way of answering (or obviating, if you will) the question).
Just yesterday I discovered a U.S. court filing according to which Volkswagen appears to be in the process of finalizing a patent license deal with either Acer or, more likely, the Avanci pool--in any event, at the end-product level. Interestingly, Licensing Negotiation Groups (LNGs), a VW-led initiative I criticized last summer (1, 2, 3), were apparently not needed for VW to close its 3G license deal a few years ago and to make so much progress toward a 4G license now. LNGs don't come up in those automotive industry submissions to the DOJ either, which I attribute to two factors: LNGs are more of a cartel law than SEP enforcement question, and the idea has no traction at this stage.
Neither the Obama Administration nor the Trump Administration took a position on component-level vs. end-product-level licensing of SEPs. It's hard to see why the Biden Administration should, and appears unlikely that it would, address that narrow question in a broad SEP enforcement and licensing context.
Car makers will get better results from licensing than from lobbying.
Share with other professionals via LinkedIn:
