Collusion in the standard-setting context – are we likely to see claims in the EU?

17.03.2014

I was interested to read elsewhere in the blogosphere about a current US antitrust case concerning the selection of technology by standard-setting organisations. A guest post by Burt Braverman on the IP Vancouver blog reports on TruePosition, Inc. v. LM Ericsson et al in which it is claimed that member companies of 3GPP and the SSO itself colluded to exclude TruePosition’s technology from the 4G standard.
The value of the global telecommunications market presumably makes such a claim attractive, but are such claims likely in the EU? Could ETSI and its members face such a claim, for example?
Purely as a matter of principle, there is no reason why such a claim could not be brought – the agreement between the SSO members as to which technology is selected is an agreement between undertakings which is potentially subject to Article 101 (just as Rambus was investigated under Article 102). It is, however, questionable how interesting a case of this kind would be to the Commission – in the absence of clear proof of collusion outside of the standard-setting meeting itself, the questions of fact in determining whether a better technology was excluded from the standard would be highly complex.
From a private action perspective, I wonder how attractive such a case would be in Europe – even if unlawful exclusion were established, computing the quantum of loss would be a hugely complex exercise, involving consideration of what licensing deals the claimant could have secured but for the exclusion. The Commission’s approach to the determination of ‘reasonable’ licence fees for the purposes of the FRAND obligation arguably also reduces the incentives to bring such litigation. The Guidelines on horizontal cooperation agreements suggest that the value the patentee can expect to capture is that which would apply in a competitive market, before the standard is set, and not the locked-in, ex post, value (para. 289). According to this approach, the claimant in a case alleging unfair exclusion from the standard (who presumably isn’t making as much from licensing as it would like) would, bizarrely, be among the most appropriate comparators for the licence fee which the company which was selected for the standard in place of the claimantshould be charging. Given the values at stake, it may well be that such an exercise in double-think (to return to the 1984 theme of myprevious post) would not be off-putting.

Sophie Lawrance

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