I, as will many other
members come Monday the 27th, agree with Michelle. The idea of defining
RAND as proposed is unnecessary and disproportionately favors one business
model over another – I refer folks to the in depth discussion we submitted
last week. This alone is a very good reason for an SDO to not get
involved, or find a better approach. This is even more important when a
consensus of the concerned membership does not support such changes.
We do not even need to get to the legal liabilities argument and
the various opinions on the matter (in the end, only one opinion
matters: outside counsel for IEEE.)
Still, the IP value
an engineer needs to make a cost/benefit decision goes far beyond the
simplicity of the price paid. The terms of a license can be more
important than the price, evidenced by the folks who follow a business plan
using an RF strategy. To them, every LOA will indicate RF. Of
course, this information can already be found on most of these company’s
websites. So how about the impact on the other part of the IEEE
membership, the non-RF folks? Or is this to be minimized or not
considered?
From:
Michelle Lee [mailto:mleelaw@nortel.com]
Sent: Friday, March 24, 2006 4:24
PM
To:
PP-DIALOG@listserv.ieee.org
Subject: Re: [PP-DIALOG] clarifying
'RAND'
Hi Scott,
With all
due respect, I disagree that the
proposed definition of "reasonable rates or terms" is necessary or
desirable for IEEE. We do not support or accept this
definition.
(1) The definition of "reasonable"
is not a clarification. It is a conceptual legal
bound on
royalties that can be earned for any IEEE standardized technologies and is an
imbalance in favour of user markets.
(2) IEEE cannot dictate a
licensing commitment by agreement or dictate
what
licensing commitment patent holders make. In my view, that is not
voluntary.
(3) The proposed
standard is based on a
philosophical view that wrongly assumes licensing on
RAND is entirely
subjective without market, business, bargaining or objective legal
constraints or incentives to act reasonably or come to reasonable
terms in negotiation.
(4) How can a new reasonable
royalty test not alter rights,
remedies or laws when it overrides
the judicial legal test
for
reasonable royalty under Georgia-Pacific
law? IEEE does not have the authority
to impose or agree upon a new test to assess
reasonable royalties for patent infringement and rights to use standardized
technologies.
(5) This test inappropriately
treats all inventions alike (at the minimum) without regard to the advancement
of the particular technology and its value add. Limiting value and royalty
earnings to less than technology owners can expect to earn in the market for
the technology is unreasonable by definition.
(6)
Licensees that wish to access and use a proprietary technology before it is a
standard that is available to all implementers are not practicing an IEEE
standard and are not similarly situated to licensees that implement the
adopted standard. Even if an assurance has been given, patent holders are not
obliged to be willing to license its technology on RAND terms before it is adopted and is essential to
practice the standard. Assessing royalties based on what parties would agree
to before the standard is adopted is therefore not suitable or
appropriate.
(7) A definition like this
will only serve to keep out advances or superior technologies from IEEE
standards. I don't see the benefits to IEEE standards (which are trying
to become more international) to ask for an agreement or policy that
eliminates or reduces incentives to attract the best technologies to IEEE
standards and the willingness
of patent holder developers
to make available
licenses in the first
place.
(8) This new test will not
reduce litigation and will likely drag IEEE into legal disputes over whether
the test is fair, unbiased and appropriate or the terms are reasonable under
it.
(9) The vast
majority of licenses are more likely pro-competitive.
How
many disputes or complaints has IEEE received or have there been over
"reasonable royalty" involving IEEE standards?
Kind regards,
Michelle
-----Original
Message-----
From: Peterson, Scott K (HP
Legal) [mailto:scott.k.peterson@HP.COM]
Sent: Wednesday, March 22, 2006
5:20 PM
To:
PP-DIALOG@listserv.ieee.org
Subject: [PP-DIALOG] clarifying
'RAND'
I
have heard concerns expressed about some sort of external impact of providing
more specificity as to what is meant by 'RAND' in the IEEE's policy. Those concerns are based on
a misunderstanding of what is being clarified.
The proposed policy change
provides greater clarity as to what licensing commitment the IEEE is asking
patent owners to voluntarily make.
It does not change the meaning of
that phrase in any more global context; for example, the proposed policy
change does not purport to change the law concerning the measure of patent
infringement damages.
______________________________
Scott K. Peterson
Senior Counsel
Hewlett-Packard
Company
165 Dascomb
Road
Andover,
MA 01810