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   JANUARY 2013

    


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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.

 

Comments on this story may be emailed directly to Today's Engineer or submitted through our online form.

 

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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