The United States Department of Justice, Antitrust Division, (DOJ) has recently released a statement concerning the potential anticompetitive impact of a patent pool involving universities concerning patents involving “autonomous vehicles, the “Internet of Things,” and “Big Data.” The DOJ finds that the pool is “unlikely to harm competition.” The Press Release states:
The Justice Department’s Antitrust Division announced
today that it has completed its review of a proposed joint patent licensing
pool known as the University Technology Licensing Program (UTLP). UTLP is
a proposal by participating universities to offer licenses to their physical
science patents relating to specified emerging technologies.
As part of its review, the division interviewed potential
participants and considered its prior guidance on patent pools. The
department has concluded that, on balance, and based on the representations in
UTLP’s letter request, the proposed joint patent licensing program is unlikely
to harm competition.
“University research is a key driver of innovation,” said
Acting Principal Deputy Assistant Attorney General Michael Murray for the
Antitrust Division. “In the physical science area, however, some
university research may never be commercialized due to the costs associated
with negotiating multiple licenses and combining the complementary university
patents that may be necessary for cutting-edge implementations. To the
extent that UTLP makes it easier for universities to commercialize inventions
that may be currently unlicensed and under-utilized, industry participants,
university researchers, and ultimately the public can benefit.”
Currently 15 participating universities intend to cooperate
in licensing certain complementary patents through UTLP, which will be
organized into curated portfolios relating to specific technology applications
for autonomous vehicles, the “Internet of Things,” and “Big Data.” The
overarching goal of UTLP is to centralize the administrative costs associated
with commercializing university research and help participating universities to
overcome the budget, institutional relationship, and other constraints that
make licensing in these areas particularly challenging for them.
UTLP has incorporated a number of safeguards into its program
to help protect competition, including admitting only non-substitutable
patents, with a “safety valve” if a patent to accomplish a particular task is
inadvertently included in a portfolio with another, substitutable patent.
The program also will allow potential sublicensees to choose an individual
patent, a group of patents, or UTLP’s entire portfolio, thereby mitigating the
risk that a licensee will be required to license more technology than it needs.
The department’s letter notes that UTLP is a mechanism that is intended
to address licensing inefficiencies and institutional challenges unique to
universities in the physical science context, and makes no assessment about
whether this mechanism if set up in another context would have similar
procompetitive benefits.
Under the Department of Justice’s business review procedure,
an organization may submit a proposed action to the Antitrust Division and
receive a statement as to whether the Antitrust Division currently intends to
challenge the action under the antitrust laws based on the information
provided. The department’s conclusions in this business review apply only
to UTLP. They are not applicable to any other agreements or initiatives
relating to patent licensing by universities or other entities. The
department reserves the right to challenge the proposed action under the
antitrust laws if the actual operation of the proposed conduct proves to be
anticompetitive in purpose or effect.
Copies of the business review request and the department’s
response are available on the Antitrust Division’s website at https://www.justice.gov/atr/business-review-letters-and-request-letters,
as well as in a file maintained by the Antitrust Documents Group of the
Antitrust Division.
The DOJ Business Review Letter is available, here. The universities' request letter for review is available, here.
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