Published: 12/19/12
In these briefs, the IEEE, a leading standard setting organization in the computing and networking industries, explains the process through which it develops industry standards and seeks FRAND commitments from standard-setting participants to “protect implementers of a standard against patent hold-up.” According to IEEE, hold-up is “the ability of the owner of patented technology to extract higher royalties ‘after its technology has been chosen by the SSO as a standard and others have incurred sunk costs which effectively increase the relative cost of switching to an alternative standard.’” The organization also explains that FRAND commitments must be irrevocable, so that standard implements can rely upon them and “[y]ears of effort” are not wasted in the standards development process. Moreover, IEEE stressed that FRAND commitments must bind any subsequent owner of a FRAND-encumbered SEP, because “[p]ermitting a commitment to evaporate upon transfer would mean that the commitment is not worth much.” Lastly, IEEE noted that “the proposition that implementers are entitled to enforce patent commitments ought to be unquestionable.” Such ability is “critical both for ensuring voluntary compliance and providing a remedy for those circumstances in which a patent-holder fails to honor its commitment.”
Brief of Amici Curiae The Institute of Electrical and Electronics Engineers, Incorporated, VITA, OASIS (Open Organization for the Advancement of Structured Information Standards), The Open Group, and PC Industrial Computer Manufacturers Group In Support of Neither Party, Broadcom Corp. v. Qualcomm Inc., U.S. Court of Appeals for the Third Circuit (2006)
This brief makes the same points as the IEEE brief in the Ericsson case cited above. In the brief, the IEEE underscores the importance of ex ante competition as the basis for determining FRAND royalties, stating that FRAND commitments are designed “to preserve the competitive benefits of ex ante technology competition.”