Transcript Standards Setting Organizations Groups of industry professionals  Represented by Corporations  Experts in the field  “The public”  Other interested parties 

Standards Setting Organizations
Groups of industry professionals

Represented by
Corporations
 Experts in the field
 “The public”
 Other interested parties

Standards Setting Organizations
Help ensure interoperability

Avoids standards battle
VHS/BETAMAX
 HD-DVD/Blu-Ray


Creates common standards
120V / 60Hz outlet
 NTSC

JEDEC
A part of the Electronic Industries
Alliance
Created in 1960
Oversees
Semiconductor Devices
 Integrated Circuits

JEDEC Members
2400 participants
270 companies
Intel
 Apple
 Texas Instruments
 Cisco
 IBM

Membership Dues
$4000.00, one committee
$6000.00, two committees
$8000.00, three committees
$10,000.00, four or more committees
Why Join?
Seat at the table
Can create value for company’s IP
Prevents others from monopolizing the
field
Rambus
SDRAM and RDRAM are essentially the same. The
only difference is the manufacturer.
SDRAM
RDRAM
Rambus Majority
Reasonable expectation

That a license is needed to implement the
standard
NOT

Individual limitations
As long as

Claim also includes limitations not needed
to practice the standard.
Rambus Dissent
Court engaged in inappropriate de novo
review
Substantial evidence supported jury’s
finding
Majority rule is “impossibly complex”
Desmarais’ Answers
Heller
Q: What would you have done differently?
 A: Spend more effort on an element in the
attempted monopolization claim.

But in retrospect the Fed. Cir. would reverse for
the same reasons it reversed the fraud.
 It appeared that the Fed. Cir. reweighed the
facts and came to a different conclusion


See Prost’s dissent
Desmarais’ Answers
Olin
Q: What other claims did you make against
Rambus?
 A:

Fraud
 Rico
 Antitrust
 State law breach of contract

Desmarais’ Answers
Pearson:
Q: Under Vornado, would you have artfully
pleaded to avoid patent issues?
 A: “No, our fraud claim was a common law
Virginia action that happened to be
in Federal Court because of the patent
complaint.”
 I’m not sure this answered the Q.

Desmarais’ Answers
Frostick


Q: How far into the trial did the JMOLs happen?
A: JMOL occurred at several points.



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Infringement claims dismissed pre-trial and at the end of
Rambus’ presentation
Rambus won on contract and attempted monopolization
at the end of Infineon’s presentation, but before jury
verdict.
Jury found for Infineon on fraud (SDRAM, DDR-SDRAM)
Jury found for Rambus on RICO
Rambus lost JMOL on SDRAM fraud, won on DDRSDRAM
Desmarais’ Answers
Cohen
Q: Did majority fairly characterize the
“related to” standard? If not, what is the fair
limit of disclosure duty?
 A: No. Two prongs

Related to: Broad disclosure so that there could
be discussions about what standard to adopt
 Required licensing: Only when a patent was
necessary to practice the standard

Desmarais’ Answers
Yates
Q: How does the disclosure duty affect the
decision making process?
 A: Depends on the SSO and the
expectation of its members. JEDEC
believes that “early disclosure was
necessary to the process to encourage
adoption of the standard with full
knowledge of the consequences”

Desmarais’ Answers
Cleary


Q: How often were settlement negotiations held?
What were proposed terms?
A: Rambus demanded a 3.5% royalty (approx.
$1B) Infineon refused.


Sued 7 days later
Court ordered settlement talks




With trial judge
Retired judge
Rambus refused to budge and upset both judges
Claimed to want to make example of Infineon
Desmarais’ Answers
Hawkins
Q: What do you think are the real world
implications of the Fed. Cir.’s disclosure
standard?
 A: Unworkable. People on standard’s
committees are not lawyers. Leads to far
fewer disclosures and the kind of activity
that JEDEC’s policy sought to discourage.

Desmarais’ Answers
Edsenga
Q: Was Rambus worried about industry
backlash from the litigation?
 A: Rambus is a patent holding company.
Their business model is based on having
blocking patents that the industry needed.
Pleasing the industry was not their
concern.

On Remand
Dist. Ct. found for Infineon on discovery
issue (ruled from the bench)
This effectively destroyed a large portion of
Rambus’ case
 Settlement reached 1 month later

Infineon agrees to pay 5.85M per quarter for 2
years
 Infineon gets early access to new Rambus
patents and technologies

Licensing Issues
Contractual License

Remedy is expectation damages
AI is not allowed to practice the standard
 Unlikely to prevent monopolization

Implied License

Remedy is a reasonable royalty

AI can continue to practice the standard
Antitrust
Attempted Monopolization
Intent to monopolize
 Anticompetitive conduct in furtherance of
the intent
 Probability of successful monopolization

Equitable Estoppel
3 Prongs

Misleading conduct


Reasonably infer


that leads the AI to
the PO does
Not intend to enforce

the patent against the AI
Class Comments
Antitrust

The two intent prongs (monopolize and
conceal) are usually difficult to prove.
Heller, Olin: What facts show intent as
opposed to mistake or other excuse?
Class Comments
Equitable Estoppel

Equitable doctrines are notoriously hard to
win. How would you argue this?
Cohen, Hawkins: Equity claims are (as
Hawkins noted) considered weaker.
Why did you choose this over antitrust?
Optimal SSO Policies
What are the IP rights the SSO wants to
address?
Get consent of members in writing
Require licensing
Require members to comply with policy
Class comments
Amend JEDEC’s patent policy

Pearson:


Change language to make it unequivocal that
members must disclose IP and grant licenses
Cleary:

Include language about creating a presumption
of fraud for failure to disclose
QUESTIONS?