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Gil
Thanks
for the information. I am not personally familiar with the NDS cases, nor
any specifics regarding the equitable standards related defenses being asserted
in them (e.g., the arguments made, the facts upon which they are based, or the
opportunity for the court(s) to consider them). I know there are
cases where estoppel and implied license defenses have succeeded. It is,
however, always important as I am sure you agree to pay close attention to
the details of each situation and not draw conclusions from cases still in the
throws of litigation.
I,
too, look forward to seeing you on March 27. There is a lot to talk
about. I hope we are all afforded the opportunity to make sure that all
issues are fully aired.
Speak
to you later today.
Richard S. Taffet, Esq.
Bingham McCutchen LLP
399 Park
Avenue
New York, New York 10022-4689
T: (212) 705-7729
F: (212) 702-3603
email:
richard.taffet@bingham.com
cell: (914)
582-2477
Richard, though Cisco is not involved in the assertion by
Negotiated Data Systems of the patent it acquired (indirectly) from National
Semiconductor that is (per NDS) essential to practice the IEEE 802.3u ethernet
autonegotiation standard, my understanding is that the estoppel argument
has not so far proven successful in that case. This has
exposed some of Cisco's ethernet switching competitors to time
consuming and expensive litigation and no doubt driven up what the
various companies that NDS is pursuing will pay.
Given that background, while I hope that you are right that the
estoppel argument would prevail in court, I agree with Jeff Fromm that
the better course is for IEEE to revise its rules to create some
prospective certainty regarding the survival of LoAs despite subsequent
transfers of the patent that is the subject of an
LoA.
I
look forward to a lively discussion on this list serve and at the March
27 meeting.
Gil Ohana
Director, Antitrust and
Competition
Cisco Systems,
Inc.
300 E. Tasman
Drive
MS 10/2
San Jose, CA
95134
United States of
America
Phone: +1 408 525
2853
Mobile: +1 408 203
5301
E-mail:
gilohana@cisco.com
Jeff
I think we may have to look a little deeper at the question
regarding the effect of the LoA on a transferee of the patent. I
haven't updated the research recently, but I am pretty sure the law says
a transferee of a license takes it with such incumberances as existed
pre-transfer. Separate and apart from a contract analysis, the LoA by
the patent owner could form the basis of an estoppel argument if the patent
owner sought to enforce the patent contrary to the representations in the LoA,
assuming the other elements of an estoppel defense could be shown. (They
might very well be because a good argument could be made that the
representation was material and reliance was reasonable.) If so,
the a transferee would face the same estoppel issues, regardless
of the contractual relationship of the original patent owner to the
SDO or prospective licensees. (NB: Your analysis even suggests
that no enforceable contractual relationship might arise under the law of many
jurisdictions, because as you say the LoA would only be an agreement to
agree.)
In
short, as in most open SDOs like the IEEE, trying to do much just creates more
problems.
Amy,
Concerning your
question in #3 below – unfortunately, a LoA as envisioned would not be
binding on a transferee of the patent. The LoA is not a license, but a
contract obligation to license (an agreement to agree). As such it is
only a contract right between the transferor, the IEEE and the intended
third-party beneficiaries, and is therefore binding on the transferor
only. If the LoA were an actual patent license, then it would run with
the patent.
Jeff
From: Amy
Marasco (LCA) [mailto:amarasco@MICROSOFT.COM]
Sent: Friday, March 03, 2006 6:23
PM
To:
PP-DIALOG@listserv.ieee.org
Subject: Re: [PP-DIALOG] LOA: Essential
Patent Claims
Hi
-
Thank you for the
opportunity to provide comments on the draft Letter of Assurance. We
recognize that many of the related issues are very complicated, and we
appreciate the IEEE’s recognition of the need to conduct a thorough review
of them and to involve a broader sample of IEEE company members who will be
significantly impacted by them.
We have the
following comments to offer on the latest draft of the Letter of
Assurance:
1.
With regard to definition of “Essential Patent Claims”, the definition in
the LoA says that it is any claim that “may be essential to create a
compliant implementation….” First, we agree with the previous comments
submitted by Mike Sirtori and attached hereto. We also would note that
this definition uses the word “essential” to define essentiality, and we are
not sure that that is helpful; alternate language such as “claims which
would necessarily be infringed by an implementation of an IEEE
Standard” might be better. The issue is further complicated by the
fact that the definition pulls in both the mandatory and optional portions
of the proposed standard.
2.
The definition of “Organizational Knowledge” is very confusing. I
cannot tell from this definition who would be the person or people at my
company who are responsible for “oversight and management” of the IP
portfolio in the area related to the standard. I also do not
understand what would constitute “knowledge”, as any patent manager usually
would not be someone who would be reviewing proposed standards. Is
this language meant to impose a duty on IP executives to read multiple draft
standards? And further to assert that they can attest to the “individual
knowledge” held by a number of employees participating in the standards
work? It seems to me that the people most likely to be able to identify
a link between the text of the draft standard and possible essential patents
that we may have would be only those people actually and directly
participating in the technical development of the standard at IEEE. We
would propose that the participants’ knowledge be the operative trigger for
box
1. The person who signs the form on behalf of the
company should be someone who can bind the company with respect to the
statements made in the form, but that person likely is not someone with
“personal knowledge”.
3.
With regard to the notice of assignment/transfer provision in the signature
section, I am concerned that this would be difficult, if not impossible to
comply with, especially in the context of a blanket LoA. It does not
really map to the reality of how complex patent transactions take
place. Is it not the case that, given the perpetual nature of the
patent assurance, any subsequent transfer would be subject to any legally
binding commitments already made?
Many
thanks,
Amy
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