Acquisition of Intellectual Property Rights (§ 5.7)

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CHAPTER VII

ACQUISITION OF INTELLECTUAL PROPERTY

RIGHTS (§ 5.7)

The U.S. antitrust agencies apply merger standards,

1

as reflected in

the 1992 Horizontal Merger Guidelines, to outright sales of intellectual

property rights and the grant or transfer of exclusive licenses to such

rights, defining an exclusive license as one that is exclusive even as to

the licensor.

2

Specifically, in the Guidelines, the agencies state that

exclusive licenses “are most appropriately analyzed by applying the

principles and standards used to analyze mergers, particularly those in

the 1992 Horizontal Merger Guidelines.”

3

T he Guidelines further state

1 . The acquisition of intellectual property rights may also c onstitute a

“concentration” under EU merger control rules, provided that these assets

“constitute a business with a market turnover.” See Commission

Consolidated Jurisdictional Notice under Council Reg ulation (EC) No

139/2004 on the control of concentrations between under takings, 2008 OJ

C95/1, para. 24. Exclusive licenses that do not involve a dditional assets

may constitute a “concentration” “if the licenses are e xclusive at least in a

certain territory and the transfer of such licenses will co nstitute a

turnover-generating activity.” Id. In addition, the acq uisition of

intellectual property rights and licenses to intellectual p roperty rights may

in certain circumstances constitute an abuse of a dominant position. See

Tetra Pak Rausing v. Commission, [1990] ECR II -309.

2. Intellectual property statutes treat the grant of an excl usive license as a

transfer of ownership of intellectual property. 35 U.S. C. § 261 (patents);

17 U.S.C. § 201(d)(2) (copyrights). One magistrate j udge ruled that

short-term exclusive copyright licenses to syndicated a rticles lack the

characteristics of asset acquisitions that Congress i ntended to cover under

§ 7 of the Clayton Act and, therefore, should not be s ubject to the statute.

Paddock Publ’ns v. Chicago Tribune Co., No. 93 C 7493, 1994 U.S. Dist.

LEXIS 13696 (N.D. Ill. 1994) (magistrate reco mmendation). The district

judge, in adopting the recommendation, did not re ach the applicability of

§ 7 but appeared to assume that a short-term license was not an “asset”

covered by § 7, while a perpetual license might be an “asset.” Paddock

Publ’ns v. Chicago Tribune Co., 1995-2 Trade Cas. (CCH) ¶ 71,255

(N.D. Ill. 1995).

3. U.S. Dep’t of Justice & Fed. Trade Comm’n, Antitrus t Guidelines for the

Licensing of Intellectual Property § 5.7 (1995) [hereinafter