Kensington Antitrust Advisors Group

Update December 2009:  The EC has agreed to close its investigation of Rambus in exchange for Rambus’s agreement to issue royalty free licenses for its SDR and DDR chips and to charge 1.5% for patents necessary for later chip standards, a percentage point reduction from the company’s current royalties for DDR chips.  Ramus is not required to pay any fine, but a fine would be triggered if it fails to live up to its commitments under the agreement.  The company has stated that the EC did not find any wrong doing.

Update June 2009: The EC confirmed that its investigation of Rambus was moving toward a settlement that would entail Rambus lowering royalties for five years to its chip-technology customers.

Update May 2009: While expressing continued concern about anticompetitive activity in the standard setting process, the FTC upon remand decided that continued litigation against Rambus would not serve the public interest.

The U.S. Supreme Court let stand a DC Circuit decision holding that Rambus did not violate Section 2 of the Sherman Act by failing to disclose certain patents to a standard setting organization.  The DC Circuit held broadly that such a failure to disclose is not anticompetitive because a standard necessarily prevents competition on the relevant technology that it standardized.  Given that there were factual questions as to whether Rambus violated the standard setting body’s rules, the denial of certiorari may indicate only that the court did not believe that this case presented the issue appropriately.