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A Survey of IEEE Standards in Patent Litigation
By Rodney R. Sweetland, III, and Michael G. McManus
Introduction
The role of industry standards
in patent litigation has become mainstream news.
As one of the most important Standard Setting
Organizations (SSOs) in the world,
IEEE’s standards have a major impact in
litigation. Accordingly, inferences can be made
about technological trends in litigation by the
frequency with which IEEE standards appear in
reported decisions. This article will provide a
high-level survey of decisions in which IEEE
standards have been at issue, by the family of
the standard.
The Function and Controversy
of Standard Essential Patents in Litigation
A patent that reads on a
standard becomes more valuable because
standards-compliant devices necessarily infringe
that patent. The owner of an essential patent
may collect a royalty from every company in the
field. In order to prevent the owners of
patents essential to the practice of a standard
from seeking a disproportionate royalty after
adoption of the standard (sometimes called
“patent holdup”), a standard setting committee
may request a letter of assurance. In the past,
letters of assurance generally obliged the
patent owner to grant licenses on reasonable and
nondiscriminatory (“RAND”) terms without
elucidation as to what was “reasonable.” This
led to uncertainty as to what royalty rate a
patent owner could seek and contributed to
litigation. That is, there was often
controversy as to whether a royalty sought by
the patent owner was too high to be considered
“reasonable,” and therefore a breach of its RAND
commitment.
IEEE recently adopted a new
form letter of assurance that may resolve some
such ambiguity. The more recent form letter of
assurance permits (but does not require) the
patent owner to specify a maximum royalty. This
is intended to give the relevant committee and
the industry clarity as to the scope of
potential royalties that may be demanded.
IEEE Standards in U.S.
District Court Decisions
IEEE standards have been at
issue in 42 district (trial court-level)
decisions. Of these, 31 have involved the
802.11 family standard (Standard for Information
technology — Telecommunications and information
exchange between systems Local and metropolitan
area networks — Specific requirements Part 11:
Wireless LAN Medium Access Control (MAC) and
Physical Layer (PHY) Specifications).
Three decisions have involved
the 802.3 standard (Standard for Information
technology — Telecommunications and information
exchange between systems — Local and
metropolitan area networks — Specific
requirements Part 3: Carrier Sense Multiple
Access with Collision Detection (CSMA/CD) Access
Method and Physical Layer Specifications
Amendment 8: MAC Control Frame for
Priority-based Flow Control). In four other
cases, the 1394 standard was at issue (Standard
for a High-Performance Serial Bus).
The remaining four decisions
concern separate standards: 524 (Guide to the
Installation of Overhead Transmission Line
Conductors); 802.1 (Standard for Local and
Metropolitan Area Networks Virtual Bridged Local
Area Networks); 802.20 (Standard for Local and
metropolitan area networks — Part 20: Air
Interface for Mobile Broadband Wireless Access
Systems Supporting Vehicular Mobility — Physical
and Media Access Control Layer Specification);
and 902 Guide for Maintenance, Operation, and
Safety of Industrial and Commercial Power
Systems).
IEEE Standards in Federal
Circuit Decisions
IEEE standards have played a
role in only three cases in the U.S. Court of
Appeals for the Federal Circuit, the appellate
court with jurisdiction over patent appeals.
This number should increase as the FRAND (Fair,
Reasonable, and Non-Discriminatory) decisions that have gained so much attention in
the legal, popular and engineering press work
their way through the appellate process. Two of
the cases involved the 802.11 standard and one
the 1394 standard, with a reference to the 802.3
standard (Standard for Information technology —
Telecommunications and information exchange
between systems — Local and metropolitan area
networks — Specific requirements Part 3: Carrier
Sense Multiple Access with Collision Detection (CSMA/CD)
Access Method and Physical Layer Specifications
Amendment 8: MAC Control Frame for
Priority-based Flow Control).
IEEE Standards in the
International Trade Commission (“ITC”)
As a major forum for patent
litigation, U.S. International Trade Commission
Section 337 proceedings have also implicated a
fair number of IEEE standards. A section 337
proceeding at the ITC is designed to prevent the
importation of articles of commerce that
infringe U.S. intellectual property rights. As
a preponderance of manufacturing in the
electrical arts has been outsourced, the
majority of electrical products, thus, are
subject to exclusion by the ITC if found to be
infringing a U.S. patent.
Unsurprisingly, the 802.11
standard is also most prevalent at the ITC.
Seven ITC cases have involved the 802.11
standard alone, with an additional case
involving the 802.11 in combination with the
802.1 standard. Two cases have involved the
802.1 standard. One case has involved the 802.3
standard and two cases involved both the 802.1
and 802.3 standards.
Conclusion
IEEE standards are at the tip of
the spear of patent litigation. The influence
of the IEEE Standards Board, therefore, extends
into the sphere of legal policy and
adjudication. This is most evident in the realm
of wireless networking, which comprises the
majority of decisions involving IEEE.
Rodney R. Sweetland, III and
Michael G. McManus are patent litigation
partners in the Washington, D.C. office of Duane
Morris LLP where they are co-chairs of the ITC
Practice Group.
Comments may be submitted to
todaysengineer@ieee.org.
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