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Welcome to The SNIP, a monthly newsletter by Urška Petrovčič, Adam Mossoff, and Devlin Hartline of Hudson Institute's Forum for Intellectual Property. The SNIP offers a brief breakdown of the latest policy issues and case developments in intellectual property.
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THE LATEST FROM HUDSON
Hudson Institute Hosts Event on Patent Licensing and the Internet of Things
On December 5, 2022, Hudson Institute Senior Fellow Adam Mossoff hosted a panel of experts to discuss the effects of patent licensing and the Internet of Things (IoT). The panel—composed of Bowman Heiden, Monica Magnusson, and Richard Vary—noted that, contrary to the arguments advanced by some interest groups, patent licensing has not adversely affected small and medium-sized enterprises (SMEs) that implement cellular technologies in their products. Rather, they emphasized that SMEs are often not involved in patent licensing, given that companies that do not reach a specific number of sold products (as is often the case for SMEs) are typically indemnified for royalty payments. Furthermore, the panelists emphasized that industry-led solutions, such as patent pools, act as brokers between patent owners and enterprises, and have established a standard for licensing agreements in the IoT industry, providing much-needed clarity to all industry participants, including SMEs.
The SNIP: Hudson panel examines the evolution of patent licensing in the Internet of Things (IoT), with a particular focus on small and medium-sized implementers.
Learn More:
WATCH: “Licensing and the Internet of Things,” Hudson Institute (December 5, 2022).
Hudson Institute Fellows and Other Professors Urge DOJ to Reject Calls to Revise Avanci’s Letter
On November 30, 2022, numerous intellectual property experts urged Assistant Attorney General Jonathan Kanter for the Antitrust Division of the U.S. Department of Justice to reject a request last October by professors and lawyers to revoke the business review letter (BRL) approving the Avanci patent pool for standard essential patents (SEPs) on mobile telecommunications like 4G and 5G. The November letter to AAG Kanter, co-authored by Adam Mossoff and Jonathan Barnett, explained that there is no evidence for the “patent holdup” theory asserted once again by the professors and lawyers. It also identified many court decisions in which courts issued injunctions to SEP owners on a finding that implementers were in fact engaging in a holdout. Lastly, contrary to the “patent troll” rhetoric repeatedly invoked in the October letter, the November letter detailed evidence confirming that patent licensing has facilitated economic growth. The November letter urged AAG Kanter to continue to engage in evidence-based policymaking.
The SNIP: Hudson Institute scholars and other patent experts send a letter to Assistant Attorney General Kanter urging evidence-based policymaking and detailing the evidence of how patent licensing has been essential to the success of the mobile revolution.
Learn More:
CASE DEVELOPMENTS
Apple and Ericsson Settle their Global 5G Patent License Dispute
On December 9, 2022, Apple and Ericsson announced a settlement of the global litigation between the two companies over Apple’s use of Ericsson’s patents on 5G. The settlement occurred during the first U.S. trial in the U.S. District Court for the Eastern District of Texas, although Ericsson had already obtained preliminary injunctions against Apple in Brazil and Colombia. Ericsson had announced its royalty rate for its 5G patent portfolio in 2017, and Apple had not yet agreed to a new license with Ericsson by 2021 for its use of Ericsson’s 5G patents after their prior 4G patent license expired in January of that year. Their dispute centered on what counts as a fair, reasonable, and non-discriminatory rate for Ericsson’s 5G patents used by Apple in its successful iPhone and iPad devices. In this respect, the case repeated many of the same issues and arguments raised in the earlier global patent dispute between Apple and Qualcomm, which was similarly settled during the first U.S. trial in 2019.
The SNIP: Ericsson and Apple reach a settlement of global 5G patent licensing dispute.
Learn More:
READ: “Ericsson and Apple End Patent-Related Legal Row with License Deal,” Anna Ringstrom, Reuters (December 9, 2022).
READ: “Ericsson, Apple Reach Global 5G Patent Deal ahead of Verdict (2),” Michael Shapiro, Bloomberg Law (December 9, 2022).
READ: “Ericsson Boosted by Settlement of Global Dispute with Apple,” Adam Houldsworth, IAM (December 9, 2022).
Supreme Court to Hear Jack Daniel’s Dog Toy Trademark Case
The U.S. Supreme Court has agreed to hear a case arising from the unauthorized use of Jack Daniel’s famous trademarks and trade dress by VIP Products, which sold a dog toy resembling the Jack Daniel’s Tennessee whiskey bottle. Jack Daniel’s sued VIP Products for trademark infringement, but the U.S. Court of Appeals for the Ninth Circuit held that VIP’s dog toy was immune from liability under the First Amendment because it was deemed to be an “expressive work” under a legal test formulated by the Second Circuit for artistic works known as the Rogers doctrine. The Rogers test does not provide for any judicial consideration of the valuable goodwill in famous trademarks or whether an unauthorized use is in fact a piracy of this goodwill. Hudson Senior Scholar Adam Mossoff and Legal Fellow Devlin Hartline worked on and joined an amicus brief filed in support of Jack Daniel’s that was joined by other intellectual property scholars, former judges, and former government officials.
The SNIP: Supreme Court to decide whether unauthorized use of Jack Daniel’s famous trademarks in a humorous dog toy is immune from liability as “expressive work” under First Amendment.
Learn More:
READ: “Supreme Court to Hear Jack Daniel’s Case Involving Trademark and Free Speech Rights,” Justia (November 23, 2022).
READ: “Jack Daniel’s Will Get Its Shot at SCOTUS Review against Dog Toy Maker,” Eileen McDermott, IPWatchdog (November 22, 2022).
READ: Amicus Brief of Scholars, Former Judges, and Former Government Officials in Support of Jack Daniel’s, Jack Daniel’s Properties Inc. v. VIP Products LLC, Case No. 22-148 (U.S. Supreme Court, January 18, 2022).
LEGISLATION & POLICY DEVELOPMENTS
WTO Delays Decision on Extending Patent Waiver to COVID-19 Treatments
In December 2022, the World Trade Organization (WTO) chose to delay its decision on extending the patent waiver to diagnostics and therapeutics for COVID-19. In June 2022, the WTO adopted an unprecedented waiver under the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) of patents on COVID-19 vaccines. In a similar unprecedented development, the Biden administration supported the patent waiver on COVID-19 vaccines; however, the U.S. now joined with nearly three dozen nations in seeking more time and information about whether to extend the waiver to patents on diagnostics and therapeutics. The Biden administration has also requested that the U.S. International Trade Commission (ITC) study the production of and access to biomedical treatments for COVID-19. Among other things, the ITC study will explore global manufacturing capacity, global market conditions, and international trade in diagnostics and therapeutic treatments for COVID-19.
The SNIP: The WTO has delayed consideration of extending unprecedented patent waiver under TRIPS, and the U.S. requests further study of global market conditions for COVID-19 medical care.
Learn More:
READ: “U.S. Asks to Extend Talks for New WTO Patent Waiver into 2023,” Bryce Baschuk, Bloomberg Law (December 6, 2022).
READ: “U.S. to Support Extension of Deadline on WTO TRIPS Ministerial Decision; Requests USITC Investigation to Provide More Data on COVID-19 Diagnostics and Therapeutics,” Office of The United States Trade Representative (December 06, 2022).
READ: “The COVID-19 Intellectual Property Waiver: Threats to U.S. Innovation, Economic Growth, and National Security,” Adam Mossoff (September 17, 2021).
