DOJ Monitoring Antitrust Implications of Patent Transfers

The U.S. Department of Justice continues to monitor the potential antitrust implications of patent portfolio transfers, particularly in high-tech industries like wireless. In recent remarks at the Fordham Competition Law Institute’s 39th annual conference on International Antitrust Law and Policy, Acting Assistant Attorney General Joseph Wayland discussed how the DOJ is working to “balance patent rights, competition and innovation in the information age.”

“It is increasingly important… in highly dynamic sectors – such as in the wireless device industry – that antitrust authorities play an active role monitoring the intersection of patent rights and standard setting with competition,” Wayland stated.

He then outlined three major ways in which the DOJ’s Antitrust Division is taking an active role in this process. They include ensuring that the market power that can be created by standard setting is not used anticompetitively; carefully reviewing the acquisition of patent portfolios; and encouraging standard setting organizations to clearly define the scope of licensing commitments required for standards essential patents.

After closing investigations into the acquisition of significant patent portfolios owned by Nortel and Motorola Mobility, Wayland indicated that the DOJ would continue to closely to monitor patents in the wireless device industry, particularly as they relate to smartphones and computer tablets, to ensure that they do not stifle competition and innovation. He specifically warned that even if patent holders are not enforcing standard-essential patents, attempts to force licensees to accept certain kinds of anti-competitive contract terms could run afoul of antitrust regulations.

As the DOJ’s antitrust chief makes clear, antitrust issues can often impact patent portfolio transfers and other licensing agreements. Therefore, it is imperative to understand the legal implications and take steps to avoid triggering an investigation. For additional information about anticompetitive legal concerns, contact me today by phone or email to schedule your free 30-minute consultation.

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