Patent Ambushing

Patent speak is constantly enriched. By now we know what Patent Trolls” or Patent Vultures are, don’t we? In fairytales of Hans Christian Andersen these ugly creatures are portrayed as friendly or mischievous dwarfs or as giants, that live in caves, or under bridges and scare and threaten innocent by passers. In patent world we use the term for owners of patents that have no business other than ownership of patents for the sole purpose of going after parties whom they believe use the patented technology. They threaten to sue unless licenses are paid. Intel called them once ‘Patent Extortionists’ and had to fight off a libel suit. In the meantime patent terminology becomes more and more belligerent. What to think of “patent ambushing” ? Pretty hefty, don’t you think? A “patent ambush” involves the ability of a company to turn its patented technologies into (technical) standards by withholding information on their patent claims with respect to a proposed standard from competitors (as well as the standard setting bodies and their participants).

The idea is to do whatever you can to make your proprietary technology the “standard”. That helps when you have to go after those who (must) use the standard to collect license fees. The “ambush” is that parties who are discussing which standard to select are “lured” into accepting a technology that is held (via patents) by one party, who actively takes part in the standard discussions, remaining silent on his own proprietary position.

An example. Intel recently called for the Institute of Electrical and Electronics Engineers (IEEE) to drop its Ultra Wide Band (UWB) wireless networking standard and adopt Intel’s own Wi-Media standard. As part of the campaign for adoption, the chip giant has taken its own standard to the more commercially friendly European Computer Manufacturers Association (ECMA), whose members are manufacturers rather than engineers, which has just rubber-stamped the proposal. Under rules of some Standard Organizations (SSOs), parties, like in this example Intel, have to declare their patents that cover the Intel Wi-Media technology. Would they not do that while having a proprietary IPR on this technology, one would call such a practice “patent ambushing”. Clearly – no interest to be involved in a libel suit – this is just an example. Intel knows the rules of the game.

A party that had to learn the lesson the hard way, is Rambus. They failed to declare IPRs that were essential to the JDEC standard setting procedure. In June 2005 the European Commission announced it would investigate the IPR policy of ETSI, the standard setting body for the telecommunications sector. Since then the Commission shows an increasing interest in IPR policies of standard setting bodies. Recently ETSI announced it would amend their existing IPR policy. On December 12 the EU Commission announced that they welcomed the ETSI policy change (to be published on the ETSI website by the end of January 2006). I am not sure whether the EU Commission have already found out about Sisvel’s actions trying to squeeze out MP3 license fees (see my November 22/23 blogs), while their principal, Philips, was part of the standard setting process that led to the Audio MP3 standard (ISO/IEC 11172-3 part 3: Audio of March 1993).

Little doubt that the last word on this has not yet been said. Let’s see.

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