What The Rambus Ruling Means For Intellectual Property In Standard Setting

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Anne Layne-Farrar, Feb 15, 2007

On February 5 the U.S. Federal Trade Commission (FTC) issued its final opinion in the long-running, and often convoluted, legal proceeding against Rambus, Inc., a computer technology company. The Commission began its case back in 2002, charging that Rambus had violated Section 5 of the FTC Act through the firm’s deceptive practices at the standard setting body JEDEC (Joint Electron Device Engineering Council).

JEDEC promulgates standards for the memory chip market, DRAM in particular. Rambus was a member of JEDEC and participated in DRAM working groups for nearly five years. Even though JEDEC requires its members to disclose intellectual property that might be relevant for any of its standards, during its time with JEDEC Rambus disclosed only one of its many patents and patent applications relevant for the DRAM standards. The firm then left JEDEC right before the final vote on key DRAM standards. Once the standards were introduced, Rambus reemerged to charge JEDEC members with patent infringement.

The FTC found this behavior anticompetitive, and on February 5, issued its Opinion of the Commission on Remedy and Final Order. Under the terms of this order, Rambus is barred from making “misrepresentations or omissions” to any standard setting organization. More significantly, the FTC set the maximum royalty rates that Rambus can charge firms implementing two DRAM standards. Th…

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