Federal Circuit Addresses Patent Pools and Antitrust Violations
By Sharona Hakimi – Edited by Chris Kulawik
Princo Corp. v. International Trade Commission, April 20, 2009, No. 07-1386
On April 20th, the Federal Circuit affirmed in part and vacated in part a decision by the International Trade Commission in a suit regarding a patent pool for the “Orange Book” technology used to produce recordable and rewritable CDs. At the ITC, Princo conceded that it violated six patents owned by Philips Corp, but it claimed those patents were unenforceable due to patent misuse. Writing for the Federal Circuit, Judge Dyk affirmed the ITC’s findings that Princo failed to demonstrate that Philips committed patent misuse due to unlawful tying. However, the court remanded the case to determine whether Philips misused its patents by allegedly violating antitrust laws by agreeing not to compete with Sony.
The ITC originally ruled in Certain Recordable Compact Discs & Rewritable Compact Discs (Inv. No. 337-TA-474) that CD-R and CD-RWs imported by Princo infringed on six of Philips’ patents, all of which relate to industry standard “Orange Book” CD technology. The patents at issue were jointly developed by Philips and Sony in the 1980s and early 1990s. When developing the technology and industry standards, Philips, Sony, and other companies pooled their patents and allowed Philips to grant package licenses to each company, with all of the patent owners sharing in the royalties.
Barry Herman and Alex Englehart of the ITC Law Blog summarize the decision. Patently-O explains the relevant case law and antitrust theories. The Patent Prospector recaps the case’s background, providing excerpts from both the ITC and the Federal Circuit opinions. (more…)