Published: 7/11/12
In this testimony, the U.S. Justice Department’s Antitrust Division explains the potential for standardization to enable SEP holders to engage “in one form of what is known as patent hold-up, such as by excluding a competitor from a market or obtaining an unjustifiably higher price for its invention than would have been possible before the standard was set.” The testimony explains that FRAND commitments are designed to prevent patent hold-up. Standard implementers benefit from FRAND commitments by being able to license SEPs on FRAND terms. SEP holders benefit as well: “[A] patent holder that also sells products and services related to the standard benefits from expanded marketing opportunities, and patent holders that focus on licensing their inventions benefit from an expanded source of revenue.”