Patent Assertion Entities: Six Actions the Antitrust Agencies Can Take

Jan 29, 2013

One of the most pressing issues confronting antitrust in 2013 (and beyond) involves patent assertion entities (“PAEs”), previously known as patent trolls. Supporters proclaim PAEs’ benefits to “invention markets.” Critics lament extortion-like demands. Into this debate tiptoes antitrust, wondering if it can play any meaningful role.

In this article, I offer six actions the antitrust agencies can take to address PAEs: (1) Offer guidance about potential harms from patent aggregation, (2) Promote transparency, (3) Prohibit transfers to PAEs that refuse to adhere to previous standards-based licensing promises, (4) Use PAEs’ distinct incentives to employ Clayton Act Section 7 when “plus” factors are met, (5) Monitor collusive activity, and (6) Consider the use of FTC Section 5.

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