5 reasons why patent disclosure in standards setting orgs doesn’t work (and what to do instead)...
TRANSCRIPT
5 REASONS WHY PATENT DISCLOSURE IN STANDARDS SETTING ORGS DOESN’T WORK(AND WHAT TO DO INSTEAD)
BRAD BIDDLE
VISITING SCHOLAR, LEWIS AND CLARK LAW SCHOOL
HTTP://BIDDLE.US
1. Over-disclosure
2. Under-disclosure
3. Timing
4. Action
5. Cost
1. Licensing commitments
2. Disclosure obligations
EXAMPLE: ETSI
EXAMPLE: ANSI
(1) Inclusion decisions; (2) facilitate licensing
EXAMPLE: IEEE
DisclosureLicensing commitment
Letter of Assurance Blanket LoA
EXAMPLE: MOST CONSORTIA
Licensing commitmentonly
USB, PCI-SIG, etc.
OBSERVATION: MANY STANDARDS DEVELOPED W/O DISCLOSURE
Estimate: >50% of the 250+ standards in a laptop developed w/o a disclosure obligation
http://standardslaw.org/How_Many_Standards.pdf
1. OVER-DISCLOSURE
ESSENTIALITY STUDIES
FOSS Patents blog (2013)
Jurata & Smith (2013)
RPX (2014)
Cyber Creative (2013)
PA Consulting (2012)
PA Consulting (2006)
Fairchild (2007)
Fairchild (2008)
0% 20% 40% 60% 80% 100%
EssentialNon-essential
INCENTIVES FOR OVER-DISCLOSURE
1. Antitrust risks
2. Licensing negotiation leverage
3. Marketing/PR
4. Preserve enforcement rights
5. Uncertainty & timing
2. UNDER-DISCLOSURE
FACTOR #1: “KNOWLEDGE”Organization Scope Standard
IEEE Personal “personally aware”
W3C Personal “not required to contact” others
IETF Personal “reasonably and personally known”
ITU/ISO/IEC Corporate? “known to the participating party”
ETSI Corporate “reasonable endeavors… to investigate”
VITA Corporate “good faith and reasonable inquiry”
Companies will have patents that are not disclosed
FACTOR #2: IPR RULES DON’T APPLY TO EVERYONE
3. TIMING
LATE DISCLOSURES COMMON, E.G.:
Org Specs # of disclosures
# received post spec finalization
%
IEEE 801.11a, b, g, n, ac, ad 109 44 40%
ETSI 3GPP TS 24.008 Release 8 (LTE)
81 81 100%
ETSI 3GPP TS 24.008 Release 11 (LTE)
96 93 96%
EXPLANATIONS FOR LATE DISCLOSURE
1. Impossible to determine essentiality early
2. ‘Just-in-time’ patenting
3. Gamesmanship
Huge disconnect between theory and practice
4. ACTION
THE ACTION DILEMMA
• A disclosed SEP might be highly impactful
• Impossible for engineers to judge
• Difficult for lawyers to coordinate & to judge
W3C: PAGs take up to 24 months to resolve issues
ETSI: 170,000 disclosures, 100s per month no impact
at working level
5. COST
SOME MATH:• 1 disclosure = 12 hours of patent lawyer / patent
agent / engineer time
• 12 hours @ $250 / hour = $3,000
• 167,270 disclosure documents in ETSI database
• 167,270 x $3,000 = $501,810,000
• # of ICT standards orgs: 500+
+ RISKS:• Over-disclose unwanted RAND or RF
commitment
• Under-disclose antitrust or non-enforcement risk
• “Reasonable endeavors” compliance program
• 3rd party disclosure = intentional infringement ‘knowledge’?
1. Over-disclosure
2. Under-disclosure
3. Timing
4. Action
5. Cost
Undermine licensing facilitation goal
Undermine inclusion decision goal
“AND WHAT TO DO INSTEAD”
STEP 1:
Licensing commitmentonly
STEP 2: • More predictable and efficient RAND
commitments
o Injunctionso Royaltieso IPR policy innovation needed
STEP 3: • Patent remedies reform
o Address non-participant problemo Broader than standardso ICT v. pharma
BRAD [email protected]