Posts in Antitrust

Last week, as a part of the Virtual Patent Masters™ Program hosted by IPWatchdog, I had the opportunity to interview Makan Delrahim, who is Assistant Attorney General in charge of the Antitrust Division at the U.S. Department of Justice (DOJ). During his tenure at the Antitrust Division, AAG Delrahim has moved the policy of the federal government in a direction that is viewed as being more friendly to patent owners and innovators. For example, in December 2018, Delrahim indicated that the Antitrust Division was withdrawing its assent to the to the 2013 joint DOJ-U.S. Patent and Trademark Office Policy Statement on Remedies for Standards-Essential Patents Subject to Voluntary F/RAND Commitments (the 2013 Joint Policy Statement) during remarks delivered at the 19th Annual Berkeley-Stanford Advanced Patent Law Institute. It was the Delrahim’s view that patent remedies shouldn’t be unilaterally unavailable for one category of patent simply because the patent owner may be subject to an obligation to engage in fair, reasonable and non-discriminatory negotiations with implementers.

The U.S. Court of Appeals for the First Circuit has made brand companies think twice about creating patent thickets in the Orange Book by resuscitating an antitrust suit against Sanofi by direct purchasers of insulin glargine. In re Lantus Direct Purchaser Antitrust Litigation (Feb. 2020). The Sanofi decision provides a possible opportunity to seek antitrust liability against brand companies for abusing Food and Drug Administration (FDA) regulations. The decisions should make branded companies reconsider over-listing patents in the Orange Book, and potentially slowing down generic competition. While this decision sets the stage for further fights over what patents should not be listed as covering approved “drugs,” it also sets a clear test for courts to consider when evaluating other tactics that brands have used to create regulatory delays to stall approval of potential rival products.

On February 13, the Ninth Circuit heard oral argument in the FTC v. Qualcomm case. Counsel for Qualcomm and the Federal Trade Commission (FTC) argued primarily about whether Qualcomm’s behavior resulted in anticompetitive harm, while the attorney from the Department of Justice, which had been granted five minutes to argue on Qualcomm’s behalf, faced tough questions about claims that the district court’s injunction posed a threat to national security. While the DOJ’s intervention in this case is interesting, the best summation of the argument came from the bench when Judge Stephen Murphy, District Court Judge of the Eastern District of Michigan sitting by designation stated: “Anticompetitive behavior is prohibited under the Sherman Act. Hyper-competitive behavior is not. This case asks us to draw the line between the two.”

On January 26, CBS broadcast the 63rd Annual Grammy Awards, which celebrated America’s finest recording artists and songwriters. Drawing a global audience with performances by super stars such as Aerosmith, Blake Shelton, and Ariana Grande, the event highlighted the music industry’s talents, innovation, and extraordinary financial success. Yet, what keeps the music flowing in a thriving marketplace is the fair operation of the performing rights license marketplace made possible by vigilant antitrust enforcement. The Department of Justice, Antitrust Division (the Department) is currently reviewing the consent decrees between the federal government and two performance rights organization behemoths: ASCAP (American Society of Composers, Authors, and Publishers) and BMI (Broadcast Music, Inc.). While conducting periodic reviews of antitrust law is smart policy, altering or scrapping the music decrees would be a mistake.

The pharmaceutical industry presents some of the most important and challenging issues lying at the intersection of the patent and antitrust laws. On the one hand, patents play a crucial role in the industry, which is unique in the cost and duration of reaching the market. But on the other, a complicated regulatory regime and the event of generic entry (which dramatically lowers price and which the brand firm has interest in delaying) opens the door for potentially anticompetitive behavior. One area where this tension has surfaced in recent years has involved the settlement of patent litigation. In 2013, in FTC v. Actavis, the Supreme Court held that agreements by which brand-name drug companies pay generics to settle patent litigation and delay entering the market could have “significant anticompetitive effects” and violate the antitrust laws.

Earlier this afternoon, the United States Patent and Trademark Office (USPTO, National Institute of Standards and Technology (NIST) and the U.S. Department of Justice, Antitrust Division (DOJ), issued a Joint Policy Statement on Remedies for Standards-Essential Patents Subject to Voluntary F/RAND Commitments (“2019 Joint Policy Statement”). This Joint Policy Statement explains that “[c]onsistent with the prevailing law… injunctive relief, reasonable…

This week in Other Barks & Bites: the U.S. Supreme Court hears oral arguments over copyright status of the Official Code of Georgia Annotated; the Federal Circuit remands Ericsson appeal to calculate release payment in patent license; Apple, Ford and others urge the USPTO to retain policy against injunctions on companies practicing SEPs; Huawei asks the Fifth Circuit to undo the FCC’s ban preventing it from supplying U.S. networks; Sergey Brin and Larry Page relinquish executive duties at Google; U.S. antitrust regulators explore Amazon’s cloud business; Washington politicians send letter to ALI over Copyright Restatement Effort concerns; and Qualcomm challenges Judge Koh’s class action certification at the Ninth Circuit.

In November, the UIC John Marshall Law School held their 63rd Annual Intellectual Property Conference in Chicago, IL.  The program consisted of four plenary sessions and nine breakout sessions covering artificial intelligence, patents, copyrights, trademarks, trade secrets, antitrust, and in-house counsel, as well as IT and privacy developments.  Speakers came from China, Europe, and the Middle East, and represented government, industry, academia, nonprofits, and practice. IPWatchdog’s Editor-In-Chief, Eileen McDermott was there. The program kicked off with a keynote address the Honorable Chief Judge Diane Wood of the U.S. Court of Appeals for the Seventh Circuit.  Titled “Antitrust & IP: Does It Need to Be Retooled?”, Chief Judge Wood spoke about the need for procedural and substantive reform. She began by observing that “[t]he general rule has been for many years — and I think this is entirely correct — that intellectual property is property.” She noted that this approach has been encapsulated in the Department of Justice and the Federal Trade Commission’s Guidelines for the Licensing of Intellectual Property, and that “the fundamentals of antitrust analysis are the same, although the answers may be a little different.” Citing standard essential patents as an example, she said that “there may be some real synergies back and forth between the IP field and the antitrust field that would be well worth exploring,” in particular when considering how antitrust law should approach access issues involving digital platforms, as what is sought is “FRAND-type access to these platforms. ”

This week in Other Barks & Bites: the U.S. Patent and Trademark Office issues an updated AIA Trial Practice Guide following SAS Institute v. Iancu; the AM-FM Act is introduced into Congress to update copyright law for terrestrial radio stations; VoIP-Pal.com defeats remaining IPRs challenging its patents at the institution phase; the Copyright Royalty Board announces cost of living adjustments in certain royalty rates; a Senate report shows that U.S. law enforcement didn’t adequately respond to Chinese IP theft for 20 years; China outpaces the rest of the world in terms of blockchain patent filing activities; and Apple joins Intel’s antitrust actions against Fortress Investment Group’s patent assertions.

This week in Other Barks & Bites: the Federal Circuit strikes down a district court’s finding of design patent infringement on summary judgment; the USPTO advises trademark attorneys to monitor filings to prevent against the unauthorized use of their names; the U.S. Copyright Office issues final rules eliminating options for physical material submissions for newspaper and serial registrations; the U.S. Supreme Court will take up Booking.com’s appeal of the rejection of its trademark application by the USPTO; AG Barr supports the FCC’s plan to restrict Huawei and ZTE equipment purchases through the Universal Service Fund; Nirvana’s copyright case against Marc Jacobs moves past a motion to dismiss; Biogen loses $3 billion in market value after PTAB hearing; and Amazon seeks an injunction against a patent owner asserting infringement claims against Amazon Fire product retailers.

The House Subcommittee on Antitrust, Commercial, and Administrative Law yesterday heard from Joseph Simons, Chairman of the Federal Trade Commission, and Makan Delrahim, Assistant Attorney General in the Department of Justice’s Antitrust Division as part of the Subcommittee’s fourth hearing in its “Online Platforms and Market Power” series. The latest hearing focused on the perspectives of the antitrust authorities, while previous hearings have examined the effects of the big tech companies on innovation and entrepreneurship; online platforms’ effect on a free and diverse press; and the role of data and privacy in competition. While both Delrahim and Simons said they are aggressively investigating and monitoring dominant platforms like Facebook and Google, they warned against overreach. Subcommittee Chair David Cicilline (D-RI) expressed his concern that, over the past decade, the largest tech firms have acquired more than 436 companies, “many of which were actual or potential competitors,” without intervention from antitrust enforcement authorities. The last major monopolization case was brought in 2001 against Microsoft, Cicilline noted. “This has created a de facto antitrust exemption for online platforms.,” he said, questioning whether the failure lies in the need for congressional action to amend and strengthen existing laws, a lack of agency resources to effectively combat the problem, or simply a lack of will to enforce the laws on the books.

This week in tech and innovation hearings in Washington, D.C., the U.S. House of Representatives gets underway on Wednesday by exploring rulemaking at the Environmental Protection Agency (EPA), regulating online platforms through antitrust law, preparing the medical workforce for innovation and checking the progress of NASA’s plans to put American astronauts on the Moon and Mars. Later in the week, House committees focus on innovation in water and geothermal energy as well as the impact of big tech on small businesses across America. Over in the Senate, the Senate Environment Committee holds a hearing to look at expanding commercial nuclear power and the Senate Commerce Committee will mark up various pieces of legislation, including one bill that would reauthorize compulsory licenses for satellite broadcasts under STELAR despite Copyright Office opposition to such reauthorization. Elsewhere in D.C., The Brookings Institution holds an event today to discuss potential biases that can develop through the use of algorithms in AI technologies.

While there are a number of falsehoods being spread about the CASE Act by those who philosophically oppose any legislation that will help the creative community, there are a few honest critiques that are based on simple misunderstandings about the bill rather than malice. Take, for instance, an article published earlier this week on this blog which characterizes the CASE Act’s intentions as noble, but argues that there are “three gaping holes” that make for bad policy…. The CASE Act will not bring an end to copyright infringement, nor is it intended to. Subversive parties that intend to infringe and skirt the law are unlikely to be brought to justice under the CASE Act. But the CASE Act is good policy for achieving what it is intended to do: provide an alternative to federal court where consenting parties who presently cannot afford to, might finally get their day in court.

This week in technology and innovation hearings taking place in Washington, D.C., subcommittees in the House of Representatives discuss the worker pipeline for the clean energy sector and ways to promote C-Band spectrum auctions on Tuesday. Then on Wednesday, the Senate IP Subcommittee holds a hearing on preventing the issuance of poor quality patents, which is likely to include some contentious viewpoints on the U.S. patent system. Other Senate hearings this week focus on innovation in water security as well as national security issues in the 5G supply chain. Elsewhere, The Brookings Institution explores the role of the Federal Trade Commission in consumer data privacy legislation and closes out the week with an event that takes a look at ways to mitigate the risks of artificial intelligence technologies.

This week in Other Barks & Bites: new patent collective for video technology launched; inventor rally to be held during live IPR hearing at AIPLA meeting; the White House indicates that the first phase of the U.S.-China trade deal will focus on IP; the USPTO shifts burden of proving patentability in PTAB motions to amend to the petitioner after Aqua Products; the House of Representatives passes the CASE Act in a 410-6 vote; the EU invalidates the three-dimensional trademark to the Rubik’s Cube; Power Integrations settles its patent infringement litigation against ON Semiconductor; Intel files an antitrust suit against SoftBank over patent acquisition and assertion activities; Amazon.com posts its first year-over-year earnings loss in more than two years; and the Federal Circuit overturns Google’s challenge to a Philips patent on appeal from the PTAB.