Rambus Beats FTC On Appeal
April 23, 2008 | by Geoff Duncan
Memory and interconnect developer Rambus has scored a major court victory, overturning an FTC decision that Rambus ha engaged in monopolistic behavior.
A U.S. court of appeas has overturned a 2006 decision by the Federal Trade Commission that memory and interconnect developer Rambus had violated antitrust regulations by failing to tell a the JEDEC (Joint Electron Device Engineering Committee) standards organizations that it had patented technologies it would advocating for inclusion in new chips designs. According to the appeals court, Rambus would not have engaged in monopolistic practices if its intention behind failing to disclose the patents was merely to avoid having a limit placed on royalties collected from the technology.
"Merely enabling a monopolist to charge higher prices than it otherwise could have charged [..] would not in itself constitute monopolization," the court wrote in its ruling.
"Rambus did nothing wrong during its participation in the JEDEC standard-setting organization, and now the Court of Appeals has confirmed our point of view," said Rambus' senior VP and general counsel Tom Lavelle, in a statement. ""This decision, especially combined with the jury verdict in March reaching the same conclusion, should put the issue to rest and allow us to focus on running our business."
An FTC spokesperson said no decision had been made yet on whether the agency would appeal the decision.
Some industry watchers are warning the appeals court decision could set an ugly precedent for standards organizations, effectively greenlighting obfuscation and poor disclosure in order to gain a competitive edge in standards proceedings. The decision can also be viewed as a wider judicial trends towards limiting the reach of existing federal antitrust legislation.
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Jon Worden on Apr 23rd, 2008 at 1:24 PM:
This "ugly precedent for standards organizations" could have easily been avoided. As an earlier CAFC appeals court ruling pointed out, the JEDEC patent policy had a "staggering lack of defining details. When direct competitors participate in an open standards committee, their work necessitates a written patent policy with clear guidance on the committee's intellectual property position. A policy that does not define clearly what, when, how, and to whom the members must disclose does not provide a firm basis for the disclosure duty..."