• Dangers Lie in U.S. Government’s Conflicted Actions Toward Qualcomm, Huawei

    5G, or 5th generation wireless communication, has reached the point of determining which core technologies will be used. Suddenly, decisions about which companies will be picked are upon us. And the stakes could hardly be higher — for the companies and for our national (and American citizens’) security. The two businesses in the ring, Qualcomm and Huawei, each find themselves in a tough fight to dominate the IP-based 5G technology on which countless devices—from automobiles to mobile phones to…

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  • Three New Papers on FRAND Issues

    1.  Matthias Leistner has posted a draft on ssrn, titled FRAND Patents in Europe in the Post-Huawei Era:  A Recent Report from Germany, which will be a chapter in a forthcoming edited volume titled SEPs, SSOs and FRAND – Asian and Global Perspectives on Fostering Innovation in Interconnectivity (Hilto/Liu eds., Springer).  Here is a link to the paper, and here is the abstract:
    Since 2015, the enforcement of FRAND patents in Europe is governed by the framework laid down in the Huawei/ZTE judgment of the CJEU. Influential post-Huawei/ZTE cases have been decided in Germany and the UK. After a brief outline of the development leading to Huawei/ZTE and of the contents of the Huawei/ZTE judgment, the present paper mainly reports on recent case law from Germany (with some comparative remarks and references on case law in England, the U.S. and China). Essentially, the paper argues that the German courts have specified the framework set by Huawei/ZTE, thereby tentatively answering many of the open questions raised by the rather generally framed judgment of the CJEU. Notwithstanding some remaining problems and some contradictions between the German courts’ approach and the English High Court’s as well as the Court of Appeal’s approach in Unwired Planet/Huawei, the present paper argues that enforcement of FRAND patents in Europe has become considerably more predictable since Huawei/ZTE, and that the general framework, established by the CJEU, allows for the development of fair and workable procedural standards guiding the enforcement of SEP’s and the possible competition law defence in Europe. In addition, the paper tries to identify and specify the fundamental considerations underpinning Huawei/ZTE. This allows to consider whether and to what extent the CJEU’s Huawei/ZTE doctrine should be broadened beyond the realm of genuine SEPs, which lead to a dominant position of the right holder, in the future. Also some additional avenues for the solution of SEP problems (such as through further upstream regulation of the standardization process and institutions, contract law and/or civil procedural law) are briefly proposed, which should be further developed and tested in the future.

    I enjoyed reading the paper, which gives a thorough overview of the current state of German law on the subject, and I look forward to meeting Dr. Leistner at a forthcoming conference in Munich (the details of which I will be blogging about soon). 

    2.  Peter Georg Picht has published a paper titled Schiedsverfahren in SEP/FRAND-Streitigkeiten: Überblick und Kernprobleme (“Arbitration Proceedings in SEP/FRAND Disputes:  Overview and Key Problems”), in the January 2019 issue of GRUR (pp. 11-25).  Dr. Picht is one of the coauthors of chapter 5, “The Effect of FRAND Commitments on Patent Remedies,” in the forthcoming edited volume Patent Remedies and Complex Products:  Toward a Global Consensus (Brad Biddle, Jorge L. Contreras, Brian J. Love & Norman V. Siebrasse eds., Cambridge Univ. Press), which I have mentioned before (see here, with links to drafts of all of the chapters).  And I’ll be seeing him soon as well, both at the Munich conference and at a conference two weeks earlier in Erlangen (details coming soon).  Anyway, here is the abstract (my translation from the German):
    Alternative means for settling disputes involving intellectual property rights have gained prominence, especially with regard to FRAND-committed SEPs.  The recent past has witnessed a noticeable increase in arbitration proceedings and the development of the law in this sphere.  In this context, the present essay seeks to illuminate important aspects of SEP/FRAND arbitration proceedings and provides recommendations for the further development of the relevant legal framework.
    3.  Alexander Galetovic and Stephen Haber have posted a paper titled SEP Royalties:  What Theory of Value and Distribution Should Courts Apply?, available here.  Here is the abstract:
    Courts are often required to determine the royalty to which the owner of a FRAND-encumbered standard essential patent (SEP) is entitled. We argue that courts should use the observed royalties charged by licensors, the market rental price of assets created by investments in R&D. This “comparables” technique is used to value virtually all classes of assets and is based on the standard theory of value and distribution, price theory. Price theory explains where value comes from, how it is distributed among inputs, and how monopoly power is exploited and measured.
    We further argue that courts should discard the “bottom up” and the top down techniques. Both are based on the theory of patent holdup and royalty stacking. This theory assumes that any observed royalty is the result of “excessive royalties” wrought by the additional monopoly power conferred by standardization through patent holdup and royalty stacking. Nevertheless, the theory is incoherent and rejected by the available evidence.
    Proponents of the “bottom up” technique claim that courts should value SEPs as the incremental value of the standardized technology compared with its next-best alternative, which was discarded when the SEP became part of the standard. This has never been operationalized, however, because competing technologies never made it to market. Also, the bottom up technique is based on faulty game theory that elides R&D, assumes that competing technologies are freely available, and has absurd antitrust implications for any proprietary standard and well beyond SEP intensive industries.
    Proponents of the “top down” technique claim that courts should determine the value of SEPs by, first, determining the cumulative royalty that the entire suite of SEPs would have obtained competing with its next best alternative, and then apportioning it among SEP holders. The first step shares the conceptual and practical flaws of the bottom up technique. The second step assumes that each stage of production chain creates a fixed amount of value that is independent of the rest of the production chain and of consumer demand. This is contrary to the basic implications of standard economics.
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  • すなわち・即ち

                            目次はこちら

    すなわち・即ち

    (I.E.)
    $$ I.e. all t1 for one transceiver is synchronized with t1 for all other transceivers using a master clock. / すなわち、…

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  • U.S. Patent System Jumps to Tie for Second Place in International IP Index

    On February 7, the U.S. Chamber of Commerce’s Global Innovation Policy Center (GIPC) released the latest version of its International IP Index assessing the intellectual property environments in 50 world economies. Once again, the United States achieved the top overall ranking as the strongest intellectual property regime in the world. The country’s improved ranking in patent rights—moving from its twelfth-place ranking in 2018 to a tie for second place this year—is particularly notable….

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  • Mayer Brown Cybersecurity and Data Privacy Report

    The law firm of Mayer Brown has published its 2019 Outlook: Cybersecurity and Data Privacy Report.  The 20 page Report warns that cybersecurity breaches are likely to increase in 2019.  Helpfully, the Report provides an overview of numerous new and potentially forthcoming regulatory changes in the United States and other countries.  For example, the Report covers U.S. Department of Transportation and Federal Drug Administration regulation.  The Report also raises the National Association of Insurance Commissioners model data security law that was adopted by the state of South Carolina, Ohio and Michigan.  The Report also covers some potential differences in law across countries such as maintaining privilege and preserving documents in anticipation of litigation.  On trade secrets, the Report notes:

    Trade Secret Theft. Companies should expect the current Administration to remain focused on the threat to American economic prosperity and national security posed by economic espionage in 2019. In 2015, China and the United States publicly committed to not engage in the cyber-enabled theft of intellectual property for commercial gain. Recent statements from senior administration officials and high-profile indictments brought by the Department of Justice indicate the view of some leading government officials that China has failed to adhere to that commitment. For example, the Department of Justice indicted two Chinese nationals associated with the Chinese Ministry of State Security of numerous hacking offensives associated with a global campaign to steal sensitive business information. Congress is also likely to consider legislative responses to trade secret theft and economic espionage. These actions suggest that 2019 is likely to see further disputes with China over cyber theft of trade secrets. Companies—especially those in industries that have previously been targeted by espionage campaigns— are likely to benefit from tracking developments in this space.

    President Trump noted that he is continuing to push China on cybersecurity issues concerning trade secret theft in his recent State of the Union address:

    We are now making it clear to China that after years of targeting our industries, and stealing our intellectual property, the theft of American jobs and wealth has come to an end.

    Therefore, we recently imposed tariffs on $250 billion of Chinese goods — and now our Treasury is receiving billions of dollars a month from a country that never gave us a dime. But I don’t blame China for taking advantage of us — I blame our leaders and representatives for allowing this travesty to happen. I have great respect for President Xi, and we are now working on a new trade deal with China. But it must include real, structural change to end unfair trade practices, reduce our chronic trade deficit, and protect American jobs.

    Mayer Brown has also issued a discussion of the European Union Agency for Network and Information Security (“ENISA”) 2018 Threat Landscape Report. 

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  • Mayer Brown Cybersecurity and Data Privacy Report

    The law firm of Mayer Brown has published its 2019 Outlook: Cybersecurity and Data Privacy Report.  The 20 page Report warns that cybersecurity breaches are likely to increase in 2019.  Helpfully, the Report provides an overview of numerous new and potentially forthcoming regulatory changes in the United States and other countries.  For example, the Report covers U.S. Department of Transportation and Federal Drug Administration regulation.  The Report also raises the National Association of Insurance Commissioners model data security law that was adopted by the state of South Carolina, Ohio and Michigan.  The Report also covers some potential differences in law across countries such as maintaining privilege and preserving documents in anticipation of litigation.  On trade secrets, the Report notes:

    Trade Secret Theft. Companies should expect the current Administration to remain focused on the threat to American economic prosperity and national security posed by economic espionage in 2019. In 2015, China and the United States publicly committed to not engage in the cyber-enabled theft of intellectual property for commercial gain. Recent statements from senior administration officials and high-profile indictments brought by the Department of Justice indicate the view of some leading government officials that China has failed to adhere to that commitment. For example, the Department of Justice indicted two Chinese nationals associated with the Chinese Ministry of State Security of numerous hacking offensives associated with a global campaign to steal sensitive business information. Congress is also likely to consider legislative responses to trade secret theft and economic espionage. These actions suggest that 2019 is likely to see further disputes with China over cyber theft of trade secrets. Companies—especially those in industries that have previously been targeted by espionage campaigns— are likely to benefit from tracking developments in this space.

    President Trump noted that he is continuing to push China on cybersecurity issues concerning trade secret theft in his recent State of the Union address:

    We are now making it clear to China that after years of targeting our industries, and stealing our intellectual property, the theft of American jobs and wealth has come to an end.

    Therefore, we recently imposed tariffs on $250 billion of Chinese goods — and now our Treasury is receiving billions of dollars a month from a country that never gave us a dime. But I don’t blame China for taking advantage of us — I blame our leaders and representatives for allowing this travesty to happen. I have great respect for President Xi, and we are now working on a new trade deal with China. But it must include real, structural change to end unfair trade practices, reduce our chronic trade deficit, and protect American jobs.

    Mayer Brown has also issued a discussion of the European Union Agency for Network and Information Security (“ENISA”) 2018 Threat Landscape Report. 

    Continue Reading ...