Standard-Essential Patents and the Problem of Hold-Up

17 Pages Posted: 21 Dec 2013 Last revised: 18 Jun 2014

See all articles by Joe Kattan

Joe Kattan

Gibson, Dunn & Crutcher LLP

Chris Wood

URENCO, Inc.

Date Written: December 19, 2013

Abstract

Standard-setting organizations typically require FRAND commitments from owners of standard-essential patents in order to ensure the availability of technologies needed to practice the standard. Failure to observe these FRAND commitments can lead to “patent hold-up” when implementers of a standard are confronted with supracompetitive royalty demands from SEP owners exploiting the market power associated with the standard. This article reviews empirical evidence from several recent cases suggesting that the problem of patent hold-up is real. We then analyze a number of arguments that have been advanced to downplay the risks of patent hold-up and demonstrate that they are flawed.

Keywords: FRAND, hold-up, standard essential patents

JEL Classification: K21, L40

Suggested Citation

Kattan, Joe and Wood, Chris, Standard-Essential Patents and the Problem of Hold-Up (December 19, 2013). Available at SSRN: https://ssrn.com/abstract=2370113 or http://dx.doi.org/10.2139/ssrn.2370113

Joe Kattan (Contact Author)

Gibson, Dunn & Crutcher LLP ( email )

1050 Connecticut Avenue, NW
Washington, DC 20036
United States

Chris Wood

URENCO, Inc. ( email )

1560 Wilson Blvd.
Suite 300
Arlington, VA 22209
United States
703-682-5202 (Phone)

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