In two matters pending before the U.S. International Trade Commission (ITC), Matter of Certain Wireless Devices, Portable Music and Data Processing Devices, Computers and Components Thereof and In re: Certain Gaming and Entertainment Consoles, Related Software and Components Thereof, the Federal Trade Commission (FTC) and a group of major technology companies have joined forces seeking an end to injunctive relief in infringement cases involving standard-essential patents. With technology so critical, they argued, injunctions restrain competition and innovation. Threatened injunctions also lead to unreasonably high royalties that increase prices.
The FTC, supported by the technology companies, argued to the ITC that it should refrain from enjoining imported Xbox and iPhone products that have been found to infringe standard-essential patents. The holders of these patents, the agency and firms argued, should be required to license them on a fair, reasonable, and nondiscriminatory (FRAND) basis. Firms agreeing to FRAND as part of a standard setting process should be held to give up their ability to enjoin infringers. If participants cannot rely on FRAND commitments, they will be less likely to support beneficial standard setting processes.
Because the ITC cannot issue monetary damages, Verizon argued that it should require “the patent holder to [seek] remedies in federal court, where [it] should be limited to monetary damages as measured by the value of the patented invention.”
The ITC must decide whether to impose exclusion orders on the Xbox and iPhone. Whatever it decides, the issue will likely go to the Federal Circuit.