An Analysis of the Federal Circuit's Decision in Ericsson v. D-Link
Competition Policy International, CPI Antitrust Chronicle, March 2015 (1)
8 Pages Posted: 5 Oct 2015
Date Written: March 1, 2015
On December 4, 2014, the U.S. Court of Appeals for the Federal Circuit issued a decision in Ericsson v. D-Link, providing substantial guidance to lower courts on how to calculate royalty rates for standard-essential patents (“SEPs”) encumbered by a commitment to license on reasonable and nondiscriminatory (“RAND”) terms. This article analyzes that decision, providing economic commentary on (i) its key holdings with respect to the appropriate methodology, (ii) the incremental value approach, (iii) when to consider concerns about hold-up and royalty stacking, and (iv) the use of the “smallest salable patent practicing unit” (“SSPPU”).
Keywords: FRAND, SEPs, standard-essential patents, Ericsson v. D-Link, holdup, royalty stacking, smallest salable patent praticing unit, SSPPU
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