1995 Antitrust Guidelines for Licensing Intellectual Property
Antitrust Guidelines for the Licensing of Intellectual Property
This research is about the adequacy of the 1995 patent licensing antitrust guidelines by the Department of Justice (DOJ) and Federal Trade Commission (FTC). In 1995, the DOJ and FTC adopted new guidelines for the licensing of intellectual property rights. The goal is for intellectual property licensing to not violate antitrust laws. The 1995 Antitrust Guidelines for the Licensing of Intellectual Property (IP Guidelines) provide DOJ and FTC antitrust enforcement policy.
In the past, practitioners attempted to predict the enforcement initiatives relative to their licensing. The IP Guidelines do not provide practitioners with a sufficient level of comfort (Hamilton, 2002).Unfortunately, these Guidelines are inadequate. They misunderstand the nature of intellectual property markets and provide insufficient guidance in the most difficult areas. The Guidelines include a special treatment of a newly defined “innovation market”. This is flawed and lack a focus on license-misuse activity that creates entry barriers. Antitrust and patent law practitioners have heavily debated the IP Guidelines.
2001 Hearings on Competition in the Knowledge Based Economy
To address these concerns, in November 2001, the agencies held hearings. The hearings were entitled “Competition and Intellectual Property Law and Policy in the Knowledge-Based Economy”. Hearings were held between February and November 2002 (Muris, 2001). They took place over 24 days at the University of California’s Haas School of Business and in Washington, DC. Incredibly, this involved more than 300 panelists of representatives of high-tech industries and law firms. The independent inventor community, leading patent and antitrust organizations, and scholars also participated.
2003 FTC report on promoting innovation
In October 2003, the FTC issued a report. The report was entitled “To Promote Innovation: The Proper Balance of Competition and Patent Law and Policy”. It focused on the patent law system. Going forward, a second report by both agencies was to be forthcoming. This one served to make similar recommendations for the antitrust law enforcement system. Problem areas included: (1) license misuse, (2) standards setting misconduct and (3) the improper acquisition of intellectual property rights.
License misuse is the refusal to grant intellectual property licenses. Also, there can be misconduct during industry standards setting. There can be improper acquisition of broad intellectual property rights through patent settlement agreements. These involved patent pools, cross-licenses, and generic drug market entry. Further, generic drug entry has attracted a great deal of interest. This is in light of the diversion of distribution from wholesalers to the multi-billion-dollar internet shadow market. This also involved a controversial Medicare Bill (Gaul, 2003). To summarize, the patent licensing antitrust guidelines are important to practitioners. Read more about whether the FTC has addressed these three common types of issues. Read more here…