Background

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CHAPTER I

BACKGROUND

In 1995, the Antitrust Division of the U.S. Department of Justice

(DOJ or the Division) and the Federal Trade Commission (FTC or the

Commission) issued the Antitrust Guidelines for the Licensing of

Intellectual Property (Intellectual Property Guidelines or Guidelines).

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The purpose of the Guidelines was to provide a statement of the

enforcement agencies’ current antitrust policy with respect to the

licensing of patents, copyrights, trade secrets, and know-how.

Since 1995, disputes in a ntitrust cases involving intellectual property

have given rise to fundamental questions about the circumstances under

which exploitation of intellectual property rights is subject to challenge

under the antitrust laws: Is there an irreconcilable conflict between the

antitrust laws and intellectual property laws? Is intellectual property

different from other types of property? Does the antitrust laws’ goal of

preserving competition in high-tech markets promote or retard long-term

innovation in the economy?

Certainly, the DOJ’s case against Microsoft Corporation

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took center

stage in this debate, but it is only o ne of several antitrust decisions since

1995 affecting intellectual property. In the nearly 15 years since the

Guidelines were issued, the courts and the enforcement agencies have

also made f ar-reaching decisions on such issues as when a patent holder

can be required to license its intellectual property, the circumstances in

which conduct relating to a patent pool can be challenged as an unlawful

price-fixing cartel, and when settlements of patent infringement disputes

can be challenged as an unlawful antitrust conspiracy. The outcomes of

these cases have not always been in harmony.

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On numerous key issue s,

1. See U.S. Dep’t of Justice & Fed. Trade Comm’n, Antitrust Guidelines for

the Licensing of Intellectual Property (1995) [hereinafter IN TELLECTUAL

PROPERTY GUIDELINES or GUIDELINES], reprinted in 4 Trade Reg. Rep.

(CCH) ¶ 13,132 and Appendix A to this book.

2. United States v. Microsoft Corp., 253 F.3d 34 ( D.C. Cir. 2001) (en banc)

(per curiam).

3. Compare Image Technical Servs. v. Eastman Koda k Co., 125 F.3d 1195

(9th Cir. 1997) (holding a refusal to deal actionable when justification for

refusal pretextual) with In re Indep. Serv. Orgs. Antitr ust Litig., 203

F.3d 1322 (Fed. Cir. 2000) (refusing to invalidate refusal to deal).