The International Telecommunication Union (ITU) announced on Friday that it will be hosting a round table discussion on patent litigation in the telecom industry, which is code for litigation between Apple, Microsoft, Nokia, Google, Samsung, HTC, and other Android device makers. The UN body establishes standards within this industry, and the round table is intended to address growing use of standards-essential patents as legal tools against competitors.
Standards-essential patents are patents that have been pledged by the patent holder to be included within a standard. This includes everything from SIM cards to radio chipsets to what constitutes various flavors of 3G, 4G, and other wireless protocols. In exchange for being part of the standard, the patent holder agrees to charge fair, reasonable, and non-discriminatory (FRAND) licensing rates.
When Apple began suing Android device makers for patent infringement over design, software, and user interface issues, companies like Samsung and Motorola Mobility hit back with their own lawsuits based on standards-essential patents. In some cases, Apple had failed to secure licensing terms, and in some cases, Apple refused to pay the licensing rates being demanded because they were higher than what other companies paid, and thus not FRAND.
The situation is, by most measures, a mess. Richard Posner, an influential U.S. federal judge, recently tossed out patent infringement claims from both Apple and Motorola and said publicly that the U.S. patent system is out of sync with the realities of how modern industries work, especially technology.
At the same time, Judge Lucy Koh recently granted two preliminary injunctions to Apple preventing the sale of two Samsung Android devices, while denying Samsung an injunction against the iPhone based on standards-essential patent claims.
In the meanwhile, lawsuits and complaints with trade regulatory bodies like the U.S. International Trade Commission continue with Apple, Microsoft, Nokia, Google, Samsung, HTC, and others continues all over the world. As we said, it’s a mess, and that’s what the ITU wants to begin addressing with its round table discussion.
From the body’s press release:
The ITU Patent Roundtable will address the worldwide surge in patent litigation and the growing lack of adherence to standards bodies’ existing patent policies. Topics include potential improvements to existing policy frameworks, entitlement to injunctive reliefs, and definitions of what constitutes a royalty base.
Discussions on the relevance of current arrangements based around reasonable and non-discriminatory (RAND) patent policies will be a key focus. RAND-based policies have thus far been an effective way of managing natural tensions between patent holders, standards implementers and end-users. However, the definition of what constitutes ‘reasonable’, and whether or not holders of SEPs are entitled to injunctive relief are now emerging as major points of contention.
Dr. Hamadoun Touré, ITU Secretary-General, added, “We are seeing an unwelcome trend in today’s marketplace to use standards-essential patents to block markets. There needs to be an urgent review of this situation: patents are meant to encourage innovation, not stifle it. Acknowledging patent holders and user requirements, as well as market needs, is a balancing act. This timely multi-stakeholder roundtable will help press for a resolution on some of the critical issues.”
The lion’s share of the focus of the announced round table appears to be abuse of the FRAND systems, but comments from other ITU members and industry representatives included with the ITU statement also show an interest in curbing patent litigation in general, and possibly reigning in the number of patents granted in the first place.
Whether anything in particular emerges from the round table remains to be seen, and it’s important to remember that the ITU is not known for its lightning-fast actions. At the very least, however, the round table is a first step from the planet’s most important telecommunications standards body towards the possibility of reform.