Technical standards are an important component of the process of turning intellectual property into marketable products. Usually participants in a standard-setting organization are required to agree to license any of their intellectual property that is incorporated into a standard on Fair, Reasonable and Non-Discriminatory (FRAND) terms. Licenses with specific royalty rates are generally negotiated after the standard has been established. A frequent difficulty in the process of negotiating these licenses is defining a FRAND royalty, an issue that often results in litigation. This program discussed the meaning of FRAND in the context of licensing a patent in a standard, and how FRAND would compare to reasonable royalties under Georgia-Pacific, a case that describes the factors that courts should consider in determining a reasonable royalty on a patent. Panelists from NERA Economic Consulting and from Weil, Gotshal & Manges discussed the economics of standards and FRAND; what happens when these issues get taken up in the courts; and the impact of these considerations on the bylaws, rules and operations of standard-setting organizations.
WilmerHale Partner Jason Kipnis was a featured speaker at this event.