
Fred D. Zemel
Partner
201-896-7065 fzemel@sh-law.comFirm Insights
Author: Fred D. Zemel
Date: October 28, 2016
Partner
201-896-7065 fzemel@sh-law.comThe Department of Justice (DOJ) and Federal Trade Commission (FTC) are proposing amendments to Antitrust Guidelines for the licensing of intellectual property. According to the agencies, the IP Licensing Guidelines, which were issued in 1995, should be updated to reflect current statutory and case law.
The IP Licensing Guidelines outline the FTC and DOJ’s antitrust enforcement policy with respect to the licensing of intellectual property protected by patent, copyright, and trade secret law. As highlighted in the proposed updates, the agencies may “impose licensing requirements to remedy anticompetitive harm or, in the case of a merger, to prevent the substantial lessening of competition.”
The revised IP Licensing Guidelines also reconfirm that DOJ/FTC enforcement policy is guided by three basic principles:
Many of the proposed updates reflect decisions of the U.S. Supreme Court. In light of the Court’s decision in Verizon Communications v. Trinko, 540 U.S. 398 (2004), the guidelines now state: “The antitrust laws generally do not impose liability upon a firm for a unilateral refusal to assist its competitors, in part because doing so may undermine incentives for investment and innovation.” At the same time, the agencies also advise that although market power does not obligate IP property owners to license their property, the agencies may still impose licensing requirements to remedy anticompetitive harm or to prevent the substantial lessening of competition as the result of a merger.
In accord with the Supreme Court’s decision in Leegin Creative Leather Products v. PSKS, 551 U.S. 877 (2007), the new guidelines state that “the Agencies will apply a rule of reason analysis to price maintenance in intellectual property licensing agreements.” While the updated IP Guidelines no longer presume that such vertical price restraints are per se anticompetitive, the agencies highlight that the per se rule may still apply to some horizontal pricing arrangements.
The updated guidelines also reflect regulatory changes. Keeping in line with the 2010 Horizontal Merger Guidelines, relevant market definition is no longer the mandatory first step in analyzing a license’s competitive impact. However, it is still considered a key factor.
The updated IP Licensing Guidelines have been amended to reflect the Defend Trade Secrets Act of 2016, which created a federal cause of action for trade secret misappropriation. The proposed changes also incorporate changes to the terms of both patent and copyrights, which occurred just after the guidelines were issued in 1995.
Finally, the proposed updates retain the concept of “innovation markets,” but gives them a new name. In a largely semantic change, the guidelines now refer to them as “Research and Development Markets” to more accurately reflect how these markets have been defined in enforcement actions.
As reflected above, the agencies’ updated guidance does not significantly alter their enforcement approach. Accordingly, the updated IP Licensing Guidelines fail to address several important (albeit controversial) issues, including patent infringement suits by non-practicing entities, violations of commitments to license standard-essential patents on fair, reasonable and non-discriminatory (FRAND) terms, and pay-for-delay patent settlements.
Do you have any questions? Would you like to discuss the matter further? If so, please contact me, Fred Zemel, at 201-806-3364.
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Business partnerships, much like marriages, function exceptionally well when partners are aligned but can become challenging when disagreements arise. Partnership disputes often stem from conflicts over business strategy, financial management, and unclear role definitions among partners. Understanding Business Partnership Conflicts Partnership conflicts place significant stress on businesses, making proactive measures essential. Partnerships should establish detailed […]
Author: Christopher D. Warren
*** The original article was featured on Bloomberg Tax, April 28, 2025 — As a tax attorney who spends much of my time helping people and companies who have large, unresolved issues with the IRS or one or more state tax departments, it often occurs to me that the best service that I can provide […]
Author: Scott H. Novak
On January 28, 2025, the Trump Administration terminated Gwynne Wilcox from her position as a Member of the National Labor Relations Board (NLRB or the Board). Gwynne Wilcox, a union side lawyer for Levy Ratner, was confirmed to the Board for an original term in 2021 and confirmed again for a successive five-year term expiring […]
Author: Matthew F. Mimnaugh
Breach of contract disputes are the most common type of business litigation. Therefore, nearly all New York and New Jersey businesses will likely have to deal with a contract dispute at least once. Understanding when to file a breach of contract lawsuit and how long you have to sue for breach of contract is essential […]
Author: Brittany P. Tarabour
Closing your business can be a difficult and challenging task. For corporations, the process includes formal approval of the dissolution, winding up operations, resolving tax liabilities, and filing all required paperwork. Whether you need to understand how to dissolve a corporation in New York or New Jersey, it’s imperative to take all of the proper […]
Author: Christopher D. Warren
Commercial leases can take a variety of forms, which is often confusing for both landlords and tenants. Understanding the different types, especially the gross lease structure, is important when selecting the lease that best suits your needs. One key distinction between lease types is how rent is calculated and paid. This article addresses the two […]
Author: Robert L. Baker, Jr.
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.
Let`s get in touch!
Sign up to get the latest from the Scarinci Hollenbeck, LLC attorneys!