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Title: "Rethinking RAND: SDO-Based Approaches to Patent Licensing Commitments"
Author: Jorge Contreras American University - Washington College of Law
Source: ITU Patent Roundtable, Geneva, Oct. 10, 2012
Publication Date: October 10 2012
Free/Fee: Free Access
Reads: 2498
Abstract: So-called &quot;reasonable and nondiscriminatory&quot; (RAND) licensing commitments have been utilized by standards-development organizations (SDOs) for years in an attempt to alleviate the risk of patent hold-up in standard-setting. These commitments, however, have proven to be vague and offer few assurances to product vendors or patent holders. A recent surge of international litigation concerning RAND commitments has brought this issue to the attention of regulators, industry and the public, and many agree that a better approach is needed. In this paper, I identify seven &quot;first principles&quot; that underlie the licensing and enforcement of standards-essential patents (SEP)s. These can be summarized as follows: (1) certainty is preferable to uncertainty concerning the cost of implementing a technical standard, (2) there is a meaningful upper limit on reasonable royalty rates, (3) information regarding RAND terms should be available before adoption of a standard, (4) individual RAND commitments must be constrained by the aggregate royalty burden on a standard, (5) non-SEPs need not be bundled with SEPs, (6) SEPs should not be used to block implementation of a standard unless the recovery of monetary compensation is impossible, and (7) RAND commitments should travel with the relevant patent.
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