DOJ Statement in Disney’s Case Against InterDigital Urges Caution in Applying Antitrust Law to SEPs

The United States Department of Justice (DOJ) filed a Statement of Interest on Monday in Disney Enterprises, Inc. v. InterDigital, Inc., et al., an antitrust case filed by Disney in August 2025 that alleged “abusive licensing practices,” monopolization of the video compression and streaming markets and Sherman Act violations by InterDigital. The DOJ’s statement opined that patents, including standard essential patents (SEPs), do not necessarily confer market power to the patentee.

Disney’s August lawsuit alleged that InterDigital and its related entities have engaged in anticompetitive behavior in the licensing of their SEPs, which are necessary for implementing video streaming technologies. Disney claimed that InterDigital’s licensing practices violated antitrust laws under Sections 1 and 2 of the Sherman Act, and InterDigital filed a motion to dismiss the complaint or stay the litigation.

The DOJ’s statement did not take a position on the outcome of InterDigital’s motion but offered its perspective on the proper application of antitrust law to standards-development activity, emphasizing that patent and antitrust laws were intended to promote innovation and consumer welfare.

In February 2025, InterDigital filed a patent infringement complaint against Disney and its related entities in the United States District Court for the Central District of California, alleging infringement of five patents related to video streaming technologies. InterDigital claimed that Disney’s video streaming services, including Disney+, Hulu, and ESPN+, infringed patents covering advanced video codec technologies for efficient transmission of video compression and streaming. InterDigital had reached out to Disney in July 2022 to discuss licensing of its patented technologies but was unable to reach an agreement.

Disney thus filed suit in the United States District Court for the District of Delaware, characterizing InterDigital’s patent enforcement as part of an anticompetitive scheme to extract supra-RAND (reasonable and non-discriminatory) royalties from companies that used standard essential patents.

Market Power

“A patent does not necessarily confer market power upon the patentee,” the DOJ argued, citing the Supreme Court’s holding in Illinois Tool Works Inc. v. Independent Ink, Inc.. This principle applies even to patents defined as “essential” to a technology standard, according to the filing.

Disney alleged that InterDigital has undertaken numerous commitments pursuant to standards development organization (SDO) policies, including obligations to disclose “‘any known patent’ during the standard-setting process, as well as be ‘bound to the ITU…for the benefit of third-party implementers to offer to license on RAND terms.’” The DOJ argued that fair, reasonable and non-discriminatory (FRAND) commitments and legal principles tended to limit InterDigital’s ability to exercise market power.

Disney’s complaint outlined specific legal principles that limited patent holder pricing power in RAND disputes, such as that patent holders “cannot charge a premium” based on SEP status; “the total royalty must be reasonable”; demands must be assessed considering “the total number of SEPs included in the standard”; and patent-exhaustion law prevented holders from extracting “multiple royalties for the use of the same patented invention from firms at different points in the supply chain.”

Disney also alleged both InterDigital and its co-defendants “submitted numerous declarations to the ITU and its associated SSOs promising to license its SEPs to implementers of the Compression Standards on RAND terms,” the filing asserted.

Harm to the Competitive Process

Antitrust claims require an allegation of harm to the competitive process, rather than harm to a single competitor, the DOJ’s statementnoted. ”Tohold otherwise could reduce the incentives for patent holders to participate in procompetitive standards-development activity, chill innovation, and deter protected petitioning activity.”

Disney’s complaint focused on InterDigital’s allegedly supra-RAND licensing demands but the DOJ explained that “charging high prices does not by itself constitute exclusionary conduct.” The statement cited Supreme Court precedent in Verizon Communications Inc. v. Law Offices of Curtis V. Trinko, LLP that ‘“the mere possession of monopoly power, and the concomitant charging of monopoly prices, is not only not unlawful; it is an important element of the free-market system.’”

Antitrust law was not intended to serve as a readily available remedy for contract disputes, the DOJ stated. Breakdowns in negotiations fell outside the scope of the Sherman Act, and a disputed term in a commercial agreement did not constitute an antitrust violation.

Disney’s complaint did not allege that InterDigital’s conduct has resulted in harm to competition, such as the exclusion of competitors or a reduced supply of video streaming services. Allowing antitrust liability based on RAND commitment violations would have created a “sea of doubt” in the standards development process, the DOJ warned.

According to the statement, the contract remedies, such as those sought by Disney in its counterclaims to InterDigital’s infringement suit pending in California, could have been sufficient to redress any breached RAND commitment.

Noerr-Pennington Immunity

InterDigital’s litigation activities were protected by the Noerr-Pennington doctrine, which safeguards the “First Amendment right ‘to petition the Government for a redress of grievances.’” The doctrine provided immunity from antitrust liability for conduct incidental to petitioning the government.

Disney claimed to have suffered “the litigation fees and costs” from “foreign and domestic proceedings brought against it by InterDigital,” including ‘the threat of an injunction in significant foreign markets’ along with other ‘litigation tactics’…that ‘inflict antitrust injury on Disney Enterprises in the form of substantial costs of litigation’ and ‘threaten to erode [their] global market share.’”

While acknowledging a “sham” litigation exception to Noerr-Pennington, the filing argued Disney had not alleged supporting facts. To qualify as “sham” litigation, a suit must be both “objectively baseless” and involve a patent obtained by fraud. The DOJ contended that InterDigital’s claims were not objectively baseless, as patent holders “should not face antitrust liability and treble damages for seeking judicial redress—including injunctive relief—for infringement of such patents.”

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