C-IP2 Celebrates the Release of Book 5G and Beyond: Intellectual Property and Competition Policy in the Internet of Things[1]
The following post comes from Jack Ring, a 3L at Scalia Law and a Research Assistant at C-IP2.
On April 15, 2024, C-IP2 scholars and contributors to 5G and Beyond: Intellectual Property and Competition Policy in the Internet of Things met for a live-streamed book launch event.[2] Professor Jonathan Barnett, one of the books two co-editors, described the book as “break[ing] the boundaries between the learning that academics have the luxury of acquiring” while being “informed by the realities of business markets” and “the insights of policy makers.” The book achieved this by purposefully bringing together decades—possibly centuries—worth of knowledge in the standardization field, including pieces from academics, policy makers, and industry practitioners.
The book’s impressive contributors include former USPTO Directors David Kappos and Andrei Iancu, former FTC Commissioner and Acting Chair Maureen Ohlhausen, former ITC Commissioner F. Scott Kieff, and J. Gregory Sidak, all of whom spoke at the event. Professors Jonathan M. Barnett and Seán M. O’Connor, the book’s co-editors, moderated and also gave remarks during the event. Beyond those who participated in a panel at the book release, chapter contributors included Mark A. Cohen, Alexander Galetovic, Thomas D. Grant, Stephen Haber, Bowman Heiden, Fabian Hoffmann, Igor Nikolic, Kristen Osenga, Jorge Padilla, Ruud Peters, Jana I. Seidl, David J. Teece, Nikolaus Thumm, Andrew Tuffin, and Lew Zaretzki. For a full list of all contributors’ titles and organizations, see the book’s “Contributors” page.[3]
The first panel included the Honorable Andrei Iancu[4] and the Honorable F. Scott Kieff.[5] Mr. Iancu, who authored the foreword to the book,[6] began with the observation that innovation in the United States is at a crossroads, with its leadership in technology and innovation being questioned for the first time. He emphasized the need for a robust patent system to incentivize innovation and technology developments. Indeed, his foreword makes this point very directly: “A patent serves little purpose if others can ignore it and the owner cannot practically stop them or secure timely and adequate compensation.”[7] In Mr. Iancu’s view, “[p]atents can and should serve [the] role” of incentivizing and overcoming the risks of innovation.[8] He closed his remarks by noting that the “bottom line is, if the United States is going to continue its technological leadership . . . our leaders absolutely must recognize that that cannot be done here without a robust patent system.” Mr. Iancu also responded to questions about the effects of eBay v. MercExchange during the panel.
Professor Kieff, who co-authored the last chapter of the book,[9] explained his chapter as looking “at concepts like invention; concepts like the difference between a reward system, a prize system, and a patent system; concepts like . . . a more predictable enforcement system and a less predictable enforcement system.” Following his opening remarks, Professor Kieff expanded on a metaphor used in his chapter about the patent system as a beacon. The chapter discusses how, in a commercialization approach to IP, the IP rights are like “‘beacons in the dark,’ drawing to themselves potential complementary users” of the IP.[10] This leads to the bargaining process and “the possibility of striking contracts with one another.”[11] Professor Kieff also responded to an audience-member comment regarding injunction bonds.
The Honorable Maureen Ohlhausen[12] spoke on the second panel about her chapter, which she co-authored with Jana Seidl.[13] Ms. Ohlhausen’s chapter focuses on the geopolitical factors surrounding IP and standards policies, particularly the interplay between IP and antitrust. It traces the roots of IP and antitrust enforcement, largely beginning in the 1970s.[14] But her panel comments focused on the current enforcement landscape by looking to recent executive orders, DOJ policy statements, and speeches by government officials. She suggested that the United States is seeing “movement towards adopting a broader antitrust liability standard across the board,” not just limited to IP. The FTC’s enforcement of IP rights through its unfair methods of competition authority—which, she explained, construes this authority as extremely broad—illustrates this point.
Ms. Ohlhausen touched on the FTC’s unfair competition rulemaking surrounding non-competes, predicting that this same authority—if upheld—would likely be used to bring antitrust and unfair competition lawsuits against SEP holders seeking injunctions.[15] Following her remarks, Ms. Ohlhausen responded to questions about the chilling effects a regulation may have on parties, even if the regulation at issue is unlikely to stand up to a court challenge and to a question about the EU’s regulatory approach.
The final panel included J. Gregory Sidak[16] and the Honorable David Kappos.[17] Mr. Sidak, who authored the book’s fourth chapter, spoke first.[18] His remarks largely focused on good faith, which was one of the two main topics discussed in his chapter. He discussed the differences in the approaches to the FRAND contract between American and European lawyers and judges. This point is well-made in his chapter: “Judicial opinions in SEP cases also refer to the duty to negotiate a FRAND license in good faith, but judges so far have failed to explain that duty’s precise origin or its metes and bounds.”[19] Mr. Sidak’s chapter analyzes the different approaches taken by specific German, English, and American court decisions.[20] More generally, during his remarks, Mr. Sidak discussed the different stopping rules for American and European negotiations. The American approach is brief: “[I]f a good faith offer is made and it’s not accepted, then the game is over.” Conversely, the European approach is a more iterative back-and-forth process. Mr. Sidak emphasized the need for a “stopping rule”—which he referred to as a “closing rule” in his chapter—and analogized this to the Federal Communications Commission’s auctioning of spectrums.[21]
Mr. Kappos, who co-authored a chapter with co-editor Professor Barnett, spoke second.[22] He focused on the “next-best alternative” to a legislative correction in a post-eBay world: enhanced damages. In the chapter, he and Professor Barnett walk through four case studies of efficient infringement in action.[23] The chapter also discusses two forms of enhanced damages, attorney fee shifting and treble damages, both of which already exist.[24] In fact, as the chapter points out, the 1793 patent statute mandated treble damages, even absent a showing of willfulness, and provided judges the authority to impose a higher damages multiplier.[25] The chapter closes by attempting to balance the incentives between implementer and patent holder.
Following Mr. Sidak and Mr. Kappos’s remarks, they fielded questions about private ordering from Professor Barnett and Lew Zaretzki, who also authored a chapter in the book with Stephen Haber and the late Alexander Galetovic.[26] In response to the questions, Mr. Sidak analogized the present incentives to those faced in binding arbitrations under the Telecommunications Act of 1996. He further noted that there is an enormous and successful functioning SEP licensing market. He pointed to the fact that there are no examples of inabilities to license relevant technology. Mr. Kappos suggested that there has already been extensive private ordering, pointing to the Avanci 5G licensing regime.[27]
The book 5G and Beyond: Intellectual Property and Competition Policy in the Internet of Things is available online for free through open access at Cambridge University Press; a hard copy is also available to order at the same link. A recording of the book launch event is available on YouTube.
[1] 5G and Beyond: Intellectual Property and Competition Policy in the Internet of Things (Jonathan M. Barnett & Seán M. O’Connor eds., Cambridge Univ. Press, Dec. 2023). The book is available online through open access at https://www.cambridge.org/core/books/5g-and-beyond/AFF9EE741CD0CF1B28E8B698F985E0C1. Hard copies are available at the same link or from other booksellers.
[2] A recording of the event is available at: https://www.youtube.com/watch?v=6ir08SXj7Ts.
[3] 5G and Beyond: Intellectual Property and Competition Policy in the Internet of Things ix-x (Jonathan M. Barnett & Seán M. O’Connor eds., Cambridge Univ. Press, Dec. 2023), https://www.cambridge.org/core/services/aop-cambridge-core/content/view/23B8A5FB02B3C0C8EE9DCC22E562BA52/9781009274272loc_ix-x.pdf/contributors.pdf.
[4] Mr. Iancu’s remarks begin at 5:02. https://youtu.be/6ir08SXj7Ts?si=XLUT2BAlyzP699ic&t=303.
[5] Professor Kieff’s remarks begin at 12:32. https://youtu.be/6ir08SXj7Ts?si=We_AgSyTe2pKlfQi&t=752.
[6] Andrei Iancu, Foreword: Why Patents Are Critical for Standard-Based Technologies, in 5G and Beyond: Intellectual Property and Competition Policy in the Internet of Things xi-xiv (Jonathan M. Barnett and Seán M. O’Connor eds., Cambridge Univ. Press, Dec. 2023), https://www.cambridge.org/core/services/aop-cambridge-core/content/view/8816915941D08B63BDDD7670A574AB09/9781009274272fwd_xi-xiv.pdf/foreword.pdf.
[7] Id. at xiii.
[8] Id. at xii.
[9] F. Scott Kieff & Thomas Grant, Patents and Competition: Commercializing Innovation in the Global Ecosystem for 5G and the Internet of Things, in 5G and Beyond: Intellectual Property and Competition Policy in the Internet of Things 242-262 (Jonathan M. Barnett and Seán M. O’Connor eds., Cambridge Univ. Press, Dec. 2023), https://www.cambridge.org/core/services/aop-cambridge-core/content/view/B32E45469995B5649034AAE47660EAE8/9781009274272c11_242-262.pdf/patents_and_competition.pdf.
[10] Id. at 249.
[11] Id.
[12] Ms. Ohlhausen’s remarks begin at 37:46. https://youtu.be/6ir08SXj7Ts?si=W28CIZSO5wQ_M7jr&t=2266.
[13] Maureen Ohlhausen & Jana Seidl, Antitrust Convergence on Substantive Norms for SEP Licensing Negotiations: Should and Could It Be?, in 5G and Beyond: Intellectual Property and Competition Policy in the Internet of Things 33-50 (Jonathan M. Barnett and Seán M. O’Connor eds., Cambridge Univ. Press, Dec. 2023), https://www.cambridge.org/core/services/aop-cambridge-core/content/view/A97F752332F8BD95A9E98D87E5C9F070/9781009274272c2_33-50.pdf/antitrust_convergence_on_substantive_norms_for_sep_licensing_negotiations.pdf.
[14] See id. at 34-35.
[15] Just over a week after Ms. Ohlhausen made her remarks, the FTC released its final rule on non-competes. See Press Release, FTC Announces Rule Banning Noncompetes, Fed. Trade Comm’n (Apr. 23, 2024).
[16] Mr. Sidak’s remarks begin at 58:33. https://youtu.be/6ir08SXj7Ts?si=REhrf3tx5ufwoGGJ&t=3511.
[17] Mr. Kappos’s remarks begin at 1:03:23. https://youtu.be/6ir08SXj7Ts?si=njsiknZV9UjEQCer&t=4103.
[18] J. Gregory Sidak, The Fair Division of Surplus from a FRAND License Negotiated in Good Faith, in 5G and Beyond: Intellectual Property and Competition Policy in the Internet of Things 79-108 (Jonathan M. Barnett and Seán M. O’Connor eds., Cambridge Univ. Press, Dec. 2023), https://www.cambridge.org/core/services/aop-cambridge-core/content/view/0FE57AE13642207F55C1DB5FCAE74470/9781009274272c4_79-108.pdf/fair_division_of_surplus_from_a_frand_license_negotiated_in_good_faith.pdf.
[19] Id. at 80.
[20] Id. at 80-81, 86-88.
[21] Id. at 82-86.
[22] Jonathan M. Barnett & David J. Kappos, Restoring Deterrence: The Case for Enhanced Damages in a No-Injunction Patent System, in 5G and Beyond: Intellectual Property and Competition Policy in the Internet of Things 129-52 (Jonathan M. Barnett and Seán M. O’Connor eds., Cambridge University Press, Dec. 2023), https://www.cambridge.org/core/services/aop-cambridge-core/content/view/7300CC1E1279179F57B099E478E3170F/9781009274272c6_129-152.pdf/restoring_deterrence.pdf.
[23] Id. at 138-42.
[24] Id. at 134-38.
[25] Id. at 144.
[26] Alexander Galetovic, Stephen Haber & Lew Zaretski, Cellular SEP Royalties: What Should Competition Policy Be?, in 5G and Beyond: Intellectual Property and Competition Policy in the Internet of Things 53-78 (Jonathan M. Barnett and Seán M. O’Connor eds., Cambridge Univ. Press, Dec. 2023), https://www.cambridge.org/core/services/aop-cambridge-core/content/view/8755988D408D15C5BD5F64C7DAFA9696/9781009274272c3_53-78.pdf/cellular_sep_royalties_and_5g.pdf.
[27] Avanci 5G Vehicle, Avanci, https://www.avanci.com/vehicle/5gvehicle/ (last visited Apr. 22, 2024).