The Meaning of Frand, Part II: Injunctions
11 The Journal of Competition Law & Economics 201 (2015)
69 Pages Posted: 6 Jun 2018
Date Written: 2015
Under what conditions may the holder of standard-essential patents (SEPs) seek to enjoin an infringing implementer without breaching the SEP holder’s contract with the standard-setting organization (SSO) to provide access to those SEPs on fair, reasonable, and nondiscriminatory (FRAND) terms? I show that the SEP holder’s contractual obligations still permit it to seek an injunction. A FRAND commitment requires the SEP holder to offer a license for the SEPs on FRAND terms (or otherwise to grant implementers access to the SEPs). Extending an offer containing a price within the FRAND range discharges the SEP holder’s contractual obligation. Thereafter, the SEP holder may seek to enjoin an implementer that has rejected a FRAND offer. This analysis indicates the imprudence of categorically banning injunctions for the infringement of SEPs, as some scholars have advocated and as one of the world’s most significant SSOs — the Institute of Electrical and Electronics Engineers (IEEE) — actually did in 2015 in amendments to its bylaws. Such a ban would invite opportunism by implementers and is unnecessary. Courts already can prevent opportunism by SEP holders by conditioning an injunction on the implementer’s actual or constructive rejection of a FRAND offer.
Keywords: FRAND, Standard-Essential Patent, SEP, RAND, IEEE, SSO
JEL Classification: K00, K12, K21, K41, L12, L63, O34
Suggested Citation: Suggested Citation