National FRAND Rate-Setting Legislation: A Cure For International Jurisdictional Competition In Standards-Essential Patent Litigation?

Abstract

Courts have increasingly been asked to adjudicate disputes over the level of fair, reasonable and nondiscriminatory (“FRAND”) royalty rates that holders of standards-essential patents (“SEPs”) are permitted to charge manufacturers of standardized products. Courts making these determinations may assess FRAND rates only as to SEPs issued in their own countries (the “national FRAND approach”) or as to all SEPs worldwide that would be included in a license had it been negotiated by the parties (the “global FRAND approach”). These competing approaches are discussed, along with some of the international jurisdictional issues that they have raised and potential legislative solutions that could address these issues. One of these is the proposed U.S. Standards Essential Royalty Act (SERA), which would prohibit the recognition of foreign-set FRAND rates for U.S. patents and establish a U.S. rate-setting tribunal for U.S. patents.

Keywords: patent, FRAND, antirust injunction, legislation, antitrust,SERA, Standards Essential Royalty Act