Antitrust and Unfair Competition Law

Competition: Spring 2014, Vol. 23, No. 1



By David L. Meyer1 and Fabien Thayamballi2

Recent antitrust enforcement actions have called attention to the potential that application of the antitrust laws, like all governmental action, is limited by the constraints of the First Amendment. This is not a new development. The half-century old Noerr-Pennington doctrine reflects, at least in part, limitations placed on the reach of the antitrust laws by the First Amendment right of petition. Recent developments at the interface between antitrust and patent enforcement have brought renewed attention to the potential for antitrust enforcement to run afoul of constitutional limits.

The issue is starkly illustrated by dueling comments issued by commissioners of the Federal Trade Commission ("FTC") addressing recent agency settlements that limited the defendants’ ability to enforce their standards-essential patents in the courts by seeking injunctive relief. The commissioners disagreed on the proper application of Noerr-Pennington immunity, which shields genuine attempts to influence governmental action from antitrust liability irrespective of their effects on competition. In each case, the FTC opined that the owner of patents essential to the practice of industry standards could be subjected to liability for seeking injunctions against parties that were prepared to enter patent licenses, contrary to the owners’ prior commitments to license those patents on Fair, Reasonable, and Non-Discriminatory ("FRAND") terms. Commissioner Maureen Ohlhausen dissented in both cases, arguing that "the Noerr-Pennington doctrine precludes Section 5 liability for conduct grounded in the legitimate pursuit of an injunction or any threats incidental to it."3 The FTC majority’s response to that objection was that enforcing Section 5 does not offend the First Amendment when it merely "requires those making promises to keep them."4

Antitrust law is often invoked to regulate activities that could be regarded as within a class protected by the First Amendment. At least in some sense price fixing and other agreements in restraint of trade entail both "association" and "speech." However, since early in the last century, antitrust jurisprudence has paid little attention to First Amendment limitations, with the exception of Noerr-Pennington immunity and the occasional limits on the remedial powers of courts to regulate ongoing behavior by entities, like newspapers, for which expression is their stock in trade. If expressive conduct causes competitive harm that brings it into conflict with the antitrust laws, the conduct generally has not been treated as protected by the First Amendment. No court has suggested that the Constitution gives cartelists the privilege to utter "I agree" without consequence.

[Page 142]

This article examines how First Amendment principles can affect the application of the antitrust laws by first summarizing how courts have previously viewed the interaction between antitrust law and the First Amendment, then setting out the background behind the controversy over standards-essential patents and FRAND commitments, and finally evaluating the dueling positions articulated by the commissioners in these recent FTC matters against the principles courts have applied when assessing whether law enforcement implicates First Amendment concerns.


The antitrust laws prohibit many activities involving speech, association, and petitioning, yet the First Amendment is seldom a successful defense to liability. One commentator characterizes antitrust law as "almost wholly untouched by the First Amendment."5 There are two major exceptions to this principle: certain politically motivated boycotts receive constitutional protection, as do genuine attempts to petition the government. This state of affairs arises from the interaction of several basic First Amendment principles.

The Supreme Court recognizes certain "narrowly limited classes of speech, the prevention and punishment of which have never been thought to raise any Constitutional problem."6 As a general matter, these categories involve speech viewed as having minimal social value, but which society has a strong interest in regulating. Examples of such exceptions include obscenity, "fighting words," threats, and (until fairly recently) libel.7 The Court finds support for excluding these categories from First Amendment protection both in in the historical context of the Constitution as well as its own assessment of costs and benefits of the conduct from the perspective of First Amendment principles.8

It is well-established that price fixing and other types of "contract[s], combination[s] . . . , or conspiracies], in restraint of trade or commerce"9 are treated as unprotected speech.10 Cartelists certainly fix prices by exchanging information aloud or in writing. And any resulting prosecution will inevitably punish the cartelists, at least in part, for the content of their communications, which must yield a meeting of the minds to violate antitrust laws.11 Yet price fixing is so clearly outside the purview of the First Amendment that it serves as the Supreme Court’s paradigmatic example of why one cannot take seriously the expressive characteristics of communications that cause competitive or other harm that society has seen fit to condemn as unlawful. For example, when declining to extend First Amendment protection to an economic boycott, the Supreme Court noted that "[t]he most blatant, naked price-fixing agreement is a product of communication, but that is surely not a reason for viewing it with special solicitude."12

[Page 143]

The reasons why price fixing falls so clearly outside the protective scope of the First Amendment are instructive. Arguably, such conduct falls within several classes of unprotected speech. First, "[o]ffers to engage in illegal transactions are categorically excluded from First Amendment protection."13 As a result, the "long established criminal proscriptions" against conspiracy and solicitation pass constitutional muster because the speech involved has no social value whether or not it is part of a commercial exchange.14 In the antitrust arena, communications that amount to price fixing are themselves an integral step in the illegal act, and under this branch of First Amendment analysis can be proscribed without further judicial scrutiny.

Second, even if price fixing were not itself illegal, it surely could be framed as an incitement to "imminent lawless action"—namely, the course of illegally coordinated pricing that the agreement portends.15 Communications giving rise to an anticompetitive agreement go beyond "the abstract advocacy of illegality,"16 and are instead intended to or in fact do produce illegal restraints on competition. As is the case with conspiracy and solicitation, the social value of such incitement can be understood as clearly outweighed by society’s interest in preventing illegal anticompetitive restraints.

Third, price fixing could fall under the exception for "speech or writing used as an integral part of conduct" in violation of a valid statute.17 The precise contours of this category are unclear and perhaps analytically unsatisfying.18 Nevertheless, the Court frequently alludes to this principle when the First Amendment and the antitrust laws intersect.19 The overarching lesson is that speech in furtherance of-—or that comprises a necessary link in establishing—anticompetitive conduct merits little or no First Amendment protection.20

[Page 144]

Other First Amendment principles operate, in some circumstances, to shield from liability certain forms of expressive conduct that would otherwise violate the antitrust laws but that might be thought outside the scope of the First Amendment under the principles set out above.21 Three examples chart the scope of First Amendment protection for conduct that causes, or leads indirectly to, potential competitive harm. First, in NAACP v. Claiborne Hardware Co.,22 the Supreme Court held that boycotts motivated by political principles, rather than by parochial economic interests, enjoy a constitutional shield against the antitrust laws even if they cause economic harm. The conduct at issue was a nonviolent boycott organized to protest racial discrimination, which the Court deemed "essential political speech lying at the core of the First Amendment."23 The Court subsequently narrowed the potential reach of its holding in in FTC v. Superior Court Trial Lawyers Ass’n,24 where it withheld First Amendment protection from a boycott of new indigent criminal defense appointments by trial lawyers, reasoning that the boycott sought a fee increase for those same lawyers and thus was economically motivated.25

Second, the Noerr-Pennington doctrine26 protects genuine attempts to seek governmental action.27 One foundation for that doctrine is the canon of constitutional avoidance, under which the Court interprets federal laws on the assumption that Congress did not intend to create a potential conflict with the First Amendment right of petition.28 Under the doctrine, genuine attempts to petition the government for redress are immune from antitrust liability, even if the petitioning activity seeks an anticompetitive outcome or itself causes incidental anticompetitive harm. Noerr itself concerned lobbying for anticompetitive legislation, and the doctrine has been extended to cover efforts to seek relief from courts and administrative agencies as well.29

[Page 145]

The doctrine does not, however, protect petitioning activity that is a "mere sham to cover what is actually nothing more than an attempt to interfere directly with the business relationships of a competitor."30 Stated another way, if the objective is only to cause harm to the marketplace by virtue of the petitioner’s own conduct, rather than through the government action ostensibly being sought, Noerr-Pennington is not a shield to liability. In the litigation context, the "sham" exception denies immunity only to lawsuits that are both "objectively baseless" and subjectively intended to wield "the governmental process" as an anticompetitive weapon.31

The United States Supreme Court has also recognized the possibility in the Noerr-Pennington context of an exception for "fraud or other misrepresentations" before adjudicatory bodies.32 This is important because there is a related, third doctrine relevant to the interface between antitrust liability and expressive conduct that has particular application in the field of patent enforcement, namely the Walker Process doctrine. In Walker Process Equipment, Inc. v. Food Machinery and Chemical Corp,33 the case that spawned the doctrine, the defendant in a patent infringement suit filed an antitrust counterclaim asserting that the patent holder had obtained its patent by fraud. The Supreme Court held that proof of fraud on the Patent and Trademark Office ("PTO") would strip the patent holder of its limited "exemption from the antitrust laws."34 Similarly, an "assignee who maintains and enforces the patent with knowledge of the patent’s infirmity" could also be liable.35 The Court remanded the case for the alleged infringer to clarify the asserted antitrust violation and establish the required elements.36

Although both the acquisition and the enforcement of a patent are forms of "petitioning," Walker Process did not mention Noerr-Pennington immunity at all, and the resulting doctrine has survived and flourished despite the explicit expansion of Noerr immunity to the adjudicative setting. Indeed, the United States Court of Appeals for the Federal Circuit has interpreted Walker Process as carving out an exception to Noerr-Pennington when a patent owner seeks to enforce a patent that was procured by fraud on the PTO.37 And the Supreme Court in turn has not foreclosed the possibility that this exception could be read broadly as a prohibition on "unethical conduct" before adjudicatory bodies notwithstanding Noerr.38

[Page 146]

These and other contexts in which courts consider—implicitly or explicitly—the limits on antitrust enforcement posed by the First Amendment are subjects that could be discussed at length.39 In the balance of this article, we explore whether the First Amendment is properly viewed as limiting the ability of the antitrust agencies or courts to restrict a patent holder’s ability to seek injunctive relief that—absent some extrinsic course of conduct implicating antitrust principles—would be available under the patent laws. As we have foreshadowed in our discussion above, we conclude that depending on the nature of the underlying antitrust claim, First Amendment jurisprudence need not bar courts or antitrust agencies from prohibiting the seeking of injunctive relief.


As laid out in the introduction, the Noerr-Pennington doctrine has been invoked in recent decisions of the Federal Trade Commission concerning the enforcement of standards-essential patents ("SEPs").40 Before turning to our analysis, a bit of background is in order.

SEPs are patents on technologies that have been incorporated into an industry standard. Even if there may be multiple competing technologies capable of meeting a particular need, once an industry standard embeds a single patented technology, and the standard gains substantial traction in the marketplace, industry participants may have little practical choice but to use that technology. These industry participants thus can be "held up" by the patent holder who has through the standard-setting process acquired market power.41

Standard-setting organizations ("SSOs") often have rules designed to address the problem of patent hold-up involving SEPs, including rules requiring participants in the standard-setting process to disclose their relevant patents or to commit that they will license their patent to all users if their technology wins inclusion in the standard.42 A common formulation of these rules involves the patent owner’s commitment to license the SEP on terms that are "reasonable and nondiscriminatory" ("RAND") or "fair, reasonable, and nondiscriminatory" ("FRAND").43

[Page 147]

In January 2013, the FTC and Google reached a settlement regarding SEPs that Google had acquired through its purchase of Motorola Mobility.44 Motorola had made commitments to SSOs to license its SEPs on FRAND terms, but, according to the FTC, Motorola later refused to grant licenses to its rivals and sought injunctions against their infringing products.45 The FTC concluded that Google’s continued pursuit of injunctions against willing licensees violated Section 5 of the FTC Act.46

Commissioner Maureen Ohlhausen dissented from the decision to impose antitrust liability on Google, arguing among other things that "the Noerr-Pennington doctrine precludes Section 5 liability for conduct grounded in the legitimate pursuit of an injunction."47 In response, the other commissioners noted that Motorola had willingly given up the right to seek injunctive relief when it made its FRAND commitments.48 These opposing views mirrored those expressed in a prior FTC settlement that forbade Robert Bosch GmbH from seeking injunctions to enforce its FRAND-encumbered patents.49

This debate within the FTC spans only a few pages of text, but it raises potentially difficult questions. An SEP owner who seeks to enjoin sale of infringing products is certainly "petitioning" the courts within the meaning of the Noerr-Pennington doctrine— it is asking the court to issue an order that would in turn affect marketplace competition. And although Noerr-Pennington immunity arose in the context of Sherman Act liability, there is no doubt that the FTC Act is similarly constrained by the doctrine.50 But there is a deeper question—akin to that raised in the price-fixing context—whether the application of the FTC Act to prohibit an injunctive suit is punishing (or regulating) the petitioning or instead merely seeking redress for some underlying misconduct that threatens harm to competition. That is the question we explore below.

The first section that follows will examine whether the FTC could identify a source of antitrust liability independent of the SEP owner’s lawsuit in order to avoid infringing upon the right of petition and ultimately on the First Amendment itself. Second, we will consider whether the SEP owner’s FRAND commitment operates as a waiver of its First Amendment rights, obviating the need for Noerr-Pennington analysis or for any other First Amendment concern. The third section investigates whether established exceptions to the Noerr-Pennington doctrine might apply to allow the antitrust laws to reach the attempted enforcement of FRAND-encumbered patents. Finally, we consider, against the backdrop of our discussion of general principles involving antitrust and the First Amendment, whether there is even greater latitude for application of limitations on expressive conduct and/or petitioning in the context of remedying antitrust violations than there is for imposing liability in the first place.

[Page 148]

A. What Is The Antitrust Theory?

We first consider whether the FTC’s enforcement actions sought to impose antitrust liability on the owners of FRAND-encumbered patents because they have petitioned the courts for relief or instead on some basis other than petitioning.51 We conclude that, assuming the correctness of the factual and legal premises behind the FTC’s theory in these cases, the FTC’s case is much less about seeking from a court an order enforcing a patent, and much more about the pattern of conduct that preceded that effort.

The apparent premise of the FTC’s theory is that an SEP owner can violate the antitrust laws when it procures market power through a standards-setting process in which it either (a) acts improperly or (b) accepts limitations on the enforcement of its patent in exchange for obtaining the inclusion of its technology in the standard and then subsequently releases itself from those limitations. In either circumstance, the basis of liability would appear to have no more to do with the SEP owner’s subsequent exercise of its patent rights in court than would a price-fixer’s liability stem from its efforts to enforce the agreed upon prices in a judicial or other forum. To be sure, the SEP owner must go to court in order to exercise its power to exclude competitors, and this exercise of power may constitute petitioning, but liability arguably attaches not to that petitioning activity but to the SEP owner’s prior acts that gave it market power. 52 The SEP owner’s attempt to enforce its patent may well provide evidence of its prior antitrust violation, and it may be a necessary step in creating the injury arising from the violation, but these features do not constitute the violation itself and thus would not trigger the application of the Noerr-Pennington doctrine.53 We examine this point further as it relates to each of the FTC’s two apparent theories of liability.

Deceptive Conduct in the SSO Process. Consider first the case where the SEP owner gets its patent included in the standard through some form of alleged misconduct in the standards-setting process. This in essence was the theory in one of the leading antitrust cases in this field: Rambus Inc. v. FTC.54 In Rambus, the SEP owner allegedly deceived the SSO by failing to disclose its patents before the SSO incorporated the patented technologies into industry standards. The United States Court of Appeals for the D.C. Circuit held that the FTC had failed to demonstrate a violation of Section 2 of the Sherman Act, reasoning that the SEP owner had not inflicted "anticompetitive harm" because the FTC failed to adduce evidence that the SSO would have selected an alternative technology absent the alleged deception. Had such a showing been made, however, there is no reason to think that the Noerr-Pennington doctrine or any other aspect of First Amendment jurisprudence would have precluded liability for efforts to distort the actions of a private SSO55 just as those doctrines would not preclude liability for price fixing.56

[Page 149]

Failure to Live Up to RAND/FRAND Commitments. A different situation is presented by cases involving no misconduct by the SEP owner during the standards-setting process, but instead involving subsequent actions by the SEP owner that are alleged to be inconsistent with the RAND or FRAND commitments it or its predecessor made in the course of the process. In Broadcom Corp. v. Qualcomm, Inc., the Third Circuit held that "(1) in a consensus-oriented private standard-setting environment, (2) a patent holder’s intentionally false promise to license essential proprietary technology on FRAND terms, (3) coupled with an S[S]O’s reliance on that promise when including the technology in a standard, and (4) the patent holder’s subsequent breach of that promise, is actionable anticompetitive conduct."57

Some variant of this basic thesis, minus any allegation that the RAND promise was "intentionally false" when made, appears to undergird much of the FTC’s recent enforcement activity in this area. The core of the concern appears to be that the patent was included in the standard only because of the promise, that the promise acts as a limitation on the exercise of market power—perhaps substituting for the constraint posed by real competition—and that the SEP owner’s removal of that constraint is wrongful and enhances the owner’s effective market power. In any such case there may be difficult questions relating to the proper interpretation of the RAND or FRAND commitment, including whether it should be interpreted as a promise only about royalty rate levels or also as a commitment never to seek an injunction (such as when the potential licensee believes the SEP owner’s demand for royalties exceeds a RAND or FRAND level). But whatever the proper interpretation in a given case, there would seem a credible position that antitrust liability is predicated on the alleged breach of the prior commitment—which on this theory operates to remove a constraint on the exercise of market power—rather than the exercise of First Amendment rights. Accordingly, as with price fixing itself, the First Amendment would impose no limitation if the FTC’s theory of liability in this field were to be viewed through such a lens.

[Page 150]

B. Is There Waiver Of The Right To Petition?

To the extent the operative theory of potential antitrust liability imposes liability directly upon petitioning conduct, there is a different obstacle to the application of the First Amendment that was not directly discussed previously, namely waiver. In Google/ Motorola and Bosch, the commissioners in the FTC majority argued that the SEP owners could not assert Noerr-Pennington immunity because they had voluntarily given up their right to seek injunctions when they made their FRAND commitments.58 There appears to be a sound basis for this view. Certain constitutional rights can be waived if the waiver was voluntary, knowing, and intelligent,59 and the First Amendment right of petition is one of them.60 To the extent a FRAND commitment is properly interpreted to preclude the seeking of an injunction, a sophisticated, well-lawyered patent owner in negotiations with an SSO should recognize the limitations to which it has agreed, making waiver a powerful argument in this context.61

There may, however, be significant room for disagreement on whether a FRAND commitment in fact constitutes a promise never to seek an injunction, including in circumstances where the prospective licensee refuses to pay the royalty demanded by the SEP owner that is later proven to be consistent with FRAND terms. Imagine an SEP owner who extends identical FRAND terms to all potential licensees of its patent. A potential licensee might practice the patented technology but reject the SEP owner’s price, proposing instead a lower price that the owner is not willing to accept. When there is a dispute over the terms of a potential license, the propriety of seeking an injunction depends on how one interprets the FRAND commitment. A permissive interpretation would simply require the SEP owner to offer licenses on FRAND terms to all who wish to use the patented technology. If a potential licensee rejects the terms of the license and nevertheless uses the technology, the owner can seek an injunction without violating its FRAND commitment

[Page 151]

A more restrictive reading of the FRAND commitment, however, would suggest that the SEP owner promises not to seek injunctions so long as the infringer offers to pay a royalty that is arguably FRAND and subject to potential retroactive upward adjustment following an adjudication of the FRAND issue. Under this view the infringer would be deemed a willing licensee, and the SEP owner’s only recourse would be to sue for royalties so that a court may determine the appropriate terms for a license.

Two of the cases cited by the FTC majority in Bosch appear to favor the latter interpretation. In Microsoft Corp. v. Motorola, Inc.,62 the United States Court of Appeals for the Ninth Circuit discussed the scope of an SEP owner’s RAND commitment in the course of upholding a preliminary injunction against the enforcement of a patent injunction the SEP owner had obtained in German court. It suggested that "[w]hatever the appropriate method of determining the RAND licensing rate, it could well be that retrospective payment at the rate ultimately determined and a determination of the future rate, not an injunction banning sales while that rate is determined, is the only remedy consistent with the contractual commitment to license users of ITU standard-essential patents."63

When sitting by designation in Apple, Inc. v. Motorola, Inc.,64 Judge Posner took an even more forceful position:

Motorola counters that Apple’s refusal to negotiate with it after rejecting its initial offer of a 2.25 percent royalty warrants injunctive relief; by opting not to take a license ex ante, it argues, Apple should lose the FRAND safe harbor. But Apple’s refusal to negotiate for a license . . . was not a defense to a claim by Motorola for a FRAND royalty. If Apple said no to 2.25 percent, it ran the risk of being ordered by a court to pay an equal or even higher royalty rate, but that is not the same thing as Motorola’s being excused from no longer having to comply with its FRAND obligations. Motorola agreed to license its standards-essential patents on FRAND terms as a quid pro quo for their being declared essential to the standard. . . . It does not claim to have conditioned agreement on prospective licensees’ making counteroffers in license negotiations.65

The FTC’s citation to these cases indicates that it interprets the FRAND commitment as a promise not merely to offer licenses on FRAND terms, but also to forgo injunctive relief entirely. In essence, the FRAND commitment itself is a license, with the FRAND terms to be determined later through negotiation or litigation.66

[Page 152]

Even if a FRAND commitment is properly viewed as a promise to forgo injunctive relief, the Google/Motorola case presents a twist that may complicate the waiver analysis. Although Motorola may have waived its right of petition when it entered its FRAND commitment, arguably Google’s only action was its acquisition of Motorola along with its SEPs. But as Google was Motorola’s successor and thus charged with knowledge that its SEPs were encumbered by a FRAND commitment, this step likely was sufficient to waive any First Amendment rights Google had with respect to the enforcement of those patents.67

C. Potential Application Of Exceptions To Noerr-Pennington Immunity

If the SEP owner has preserved its First Amendment rights, and the theory of the antitrust violation is the SEP owner’s attempt to seek an injunction rather than some previous misconduct, antitrust regulators may avoid the Noerr-Pennington doctrine only if the SEP owner’s petitioning activity falls within one of the doctrine’s exceptions. Two exceptions are relevant here: (1) the exception for "sham" litigation articulated in Prof’l Real Estate Investors, Inc. v. Columbia Pictures Indus., Inc.,68 and (2) the "fraud" exception, which has its origins in Walker Process Equipment, Inc. v. Food Machinery & Chemical Corp.69

For litigation to be a "sham," it must be both "objectively meritless" and subjectively intended as a means of wielding "the governmental process—as opposed to the outcome of that process—as an anticompetitive weapon."70 The enforcement of FRAND-encumbered patents would not meet these criteria where there is a reasonable basis to dispute the applicability of the FRAND commitment, perhaps in many circumstances including the situation where a potential licensee refuses the SEP owner’s terms.71Moreover, typically one would think the SEP owner is not merely attempting to burden its rivals through the litigation "process"—but instead is genuinely seeking a favorable judicial "outcome." Only if the court issues an injunction can the SEP owner exclude its rivals.

The Supreme Court has, however, left open the possibility of other exceptions to Noerr-Pennington immunity. In its decision articulating the two-part test for "sham" litigation, the Court noted that "unethical conduct in the setting of the adjudicatory process often results in sanctions" but concluded that it "need not decide here whether and, if so, to what extent Noerr permits the imposition of antitrust liability for a litigant’s fraud or other misrepresentations."72 Significantly, the Court cited Walker Process, which establishes the principle that the enforcement or attempted enforcement of patents obtained by fraud may constitute a Sherman Act, Section Two violation.73

[Page 153]

Even a broad "fraud" exception, however, may not apply to efforts to enforce FRAND-encumbered patents. What is the fraud? If the patent was procured properly, Walker Process itself does not apply. And the court is certainly not being defrauded: its injunction will presumably not issue until after the licensee seeks to avoid an injunction by invoking the FRAND encumbrance. In some cases there may be facts suggesting that the SEP owner who allegedly breaches its FRAND commitment misled the SSO, but it has not misled the PTO or the court from which it seeks an injunction.

Even if one extended Walker Process to apply to conduct directed at the SSO— perhaps on the theory that the market power being exercised was procured improperly— it is not obvious that the SEP owner has deceived the SSO in a manner that amounts to fraud, at least in the circumstance where there is no allegation that the patent holder lied about the existence of its patent. Every contracting party leads its counterparty to believe that it will perform, but a breach of contract is not normally treated as fraudulent. Thus, if a contract is interpreted as a promise to perform or pay damages, neither party is deceived as to the possibility of non-performance. A party’s failure to perform generally amounts to fraud only where a party enters a contract with no intention of performing, and a plaintiff alleging fraud must prove that state of mind.74

D. First Amendment Limits in the Remedial Context

The First Amendment has implications for antitrust remedies as well as antitrust liability. A court order enjoining the SEP owner from enforcing its FRAND-encumbered patents at least superficially resembles a prior restraint on the right of petition. Nevertheless, in this context, the First Amendment is likely to impose only minimal (if any) restrictions on the expansive powers of courts (and agencies) to remedy antitrust violations.

In Nat’l Soc. of Prof’l Engineers v. United States75 the Supreme Court addressed a district court order that prohibited a trade association of civil engineers from "adopting any official opinion, policy statement, or guideline stating or implying that competitive bidding is unethical."76 The society claimed that the order was a prior restraint on speech and association and thereby violated its First Amendment rights.77 The Court disagreed, concluding that the injunction could legitimately curtail rights that would otherwise have been constitutionally protected in order to remedy the antitrust violations.78 If the engineering society feared that the injunction covered "legitimate paths of expression," it had the burden of bringing its claims to the district court’s attention and moving to modify the decree.79

[Page 154]

It is well-established that in the course of remedying proven antitrust violations, courts may enter orders prohibiting conduct that would not violate the antitrust laws.80 When market power is acquired through improper means, a court would typically act within its remedial powers if it sought to excise the ill-gotten power entirely. If that power arises from an industry standard, and the inclusion of the SEP in the standard is a bell that cannot readily be unrung, one conceivable remedial option would be to prohibit any enforcement of the patent in question. If that would be a permissible remedy—an issue on which we express no opinion—the less draconian approach of regulating how the patent may be enforced (i.e., via a request for injunction as opposed to only money damages) would appear to be unobjectionable. Not surprisingly, perhaps, courts have upheld consent orders that require SEP owners to cease and desist from efforts to enforce FRAND-encumbered patents.81


Although the Noerr-Pennington doctrine—and First Amendment principles more broadly—can be a powerful shield against antitrust liability for petitioning or other expressive conduct, the proper application of the antitrust laws typically will turn on proof of anticompetitive harm to competition, not solely on the defendant’s constitutionally protected conduct. Determining whether a particular application of the law nonetheless threatens to infringe protected speech or petitioning requires a rigorous assessment of the antitrust theory and the nature of the expressive conduct in question.

[Page 155]



1. David Meyer is Partner and Co-Chair of the Global Antitrust Law Practice Group at Morrison & Foerster LLP, Vice-Chair of the Transportation & Energy Committee and former Vice-Chair of the Exemption and Immunities Committee of the American Bar Association’s Section of Antitrust Law. This article appeared originally in the Fall 2013 issue of Icarus, the journal of the Media and Technology Committee of the ABA’s Antitrust Section.

2. Fabien Thayamballi was an Associate at Morrison & Foerster until August 2013 and is now clerking for District Judge Ronnie Abrams of the United States District Court for the Southern District of New York. The opinions expressed herein are those only of the authors.

3. In the Matter of Motorola Mobility LLC and Google, Inc., Dissenting Statement of Commissioner Maureen K. Ohlhausen at 1, FTC File No. 121-0120 (Jan. 3, 2013) ("Google dissent"); see also In the Matter of Robert Bosch GmbH, Statement of Commissioner Maureen K. Ohlhausen at 1-2, FTC File No. 121-0081, (Nov. 26, 2012) at 1-2, available at

4. In the Matter of Motorola Mobility LLC and Google, Inc., Statement of the Federal Trade Commission at 4-5, FTC File No. 121-0120 ( Jan. 3, 2013) ("Google decision") (citation omitted); see also In the Matter of Robert Bosch GmbH, Statement of the Federal Trade Commission, at 2-3, FTC File No. 121-0081 (Nov. 26, 2012) at 2-3.

5. Frederick Schauer, The Boundaries of the First Amendment: A Preliminary Exploration of Constitutional Salience, 117 HARV. L. REV. 1765, 1781-82 (2004).

6. Chaplinsky v. State of New Hampshire, 315 U.S. 568, 571-72 (1942); see also United States v. Stevens, 559 U.S. 460, 468-69 (2010).

7. See Stevens, 559 U.S. at 468-69.

8. Stevens, 559 U.S. at 469-72.

9. 15 U.S.C. § 1 (Sherman Act § 1).

10. See, e.g., Sorrell v. IMS Health, Inc., 131 S. Ct. 2653, 2665 (2011) (citing Giboney v. Empire Storage & Ice Co., 336 U.S. 490, 502 (1949)).

11. See, e.g., In re Processed Egg Products Antitrust Litig., 902 F. Supp. 2d 704, 710 (E.D. Pa. 2012).

12. FTC v. Superior Court Trial Lawyers Ass’n, 493 U.S. 411, 431 (1990).

13. See e.g., United States v. Williams, 553 U.S. 285, 297 (2008) (citations omitted).

14. Id. at 298.

15. See Brandenburg v. Ohio, 395 U.S. 444, 447 (1969) (discussing the exception for incitement to "imminent lawless action"). "Incitement" may be a subset of "offers to engage in illegal transactions." See Williams, 553 U.S. at 297.

16. See Williams, 553 U.S. at 298-99 (citations omitted) (discussing the difference between a proposal or request to engage in illegal activity and the abstract advocacy of illegal activity).

17. Giboney v. Empire Storage & Ice Co., 336 U.S. 490, 498 (1949); see also Stevens, 559 U.S. at 467-68.

18. See Eugene Volokh, Speech as Conduct: Generally Applicable Laws, Illegal Courses of Conduct, "Situation-Altering Utterances," and the Uncharted Zones, 90 Cornell L. Rev. 1277, 1314-1326 (2005).

19. See, e.g., Superior Court Trial Lawyers Ass’n, 493 U.S. at 428 n.12 (citing Giboney); NAACP v. Claiborne Hardware Co., 458 U.S. 886, 912 (1982) (same); Nat’l Soc. of Prof’l Engineers v. United States, 435 U.S. 679, 697 (1978) (same); Giboney, 336 U.S. at 501-02.

20. One commentator suggests that the communication of prices should be analyzed under the Court’s "commercial speech" precedents. See Stephen G. Thompson, Antitrust, the First Amendment, and the Communication of Price Information, 56 Temple L.Q. 939 (1983). It is clear, however, that the regulation of price fixing would not still run afoul of the relevant test, which protects only speech that "concern[s] lawful activity." See id. at 974-75.

21. There is immense doctrinal complexity in the application of the First Amendment to conduct having both a propensity to cause societal harm and some social value related to free expression. For example, reasonable and content-neutral "restrictions on the time, place, or manner of protected speech" are upheld under certain circumstances even when they may limit the speaker’s practical opportunities to communicate. See Ward v. Rock Against Racism, 491 U.S. 781, 791 (1989).

22. 458 U.S. 886 (1982).

23. Id. (quoting Henry v. First Nat. Bank of Clarksdale, 595 F.2d 291, 303 (5th Cir. 1979)).

24. 493 U.S. 411 (1990).

25. Id. at 426. The Court has suggested that the distinction between political and economic boycotts derives from the test for regulations of expressive conduct articulated in United States v. O’Brien, 391 U.S. 367 (1968). See Superior Court Trial Lawyers Ass’n, 493 U.S. at 429-31; Claiborne Hardware Co. , 458 U.S. at 911-13.

26. Eastern Railroad Presidents Conference v. Noerr Motor Freight, Inc., 365 U.S. 127 (1961); United Mine Workers v. Pennington, 381 U.S. 657 (1965).

27. Prof’l Real Estate Investors, Inc. v. Columbia Pictures Indus., Inc., 508 U.S. 49, 56-57 (1993).

28. David McGowan and Mark A. Lemley, Antitrust Immunity: State Action and Federalism, Petitioning and the First Amendment, 17 Harv. J.L. & Pub. Pol’y 293, 298 (1994).

29. Prof’l Real Estate Investors, 508 U.S. at 56-57 (citing California Motor Transport Co. v. Trucking Unlimited, 404 U.S. 508 (1972)).

30. Noerr Motor Freight, 365 U.S. at 144.

31. Prof’l Real Estate Investors, 508 U.S. at 60-61.

32. Id. at 61 n.6.

33. 382 U.S. 172 (1965).

34. Id. at 176-77.

35. Id. at 172 n.5.

36. Id. at 177-78.

37. See, e.g., In re Indep. Serv. Organizations Antitrust Litig., 203 F.3d 1322, 1326-28 (Fed. Cir. 2000).

38. Prof’l Real Estate Investors, 508 U.S. at 61 n.6.

39. The Noerr-Pennington doctrine itself has been the subject of extensive commentary and debate. See, e.g. , McGowan, supra note 28.

40. Glenn G. Lammi, FTC’s Standards-Essential Patent Settlement: The Real "Elephant" in the Room?, Forbes: Washington Legal Foundation (Jan. 8, 2013), (last visited Sept. 21, 2013).

41. Daryl Lim, Misconduct in Standard Setting: The Case for Patent Misuse, 51 IDEA 559, 559, 561-64 (2011); Janice M. Mueller, Patent Misuse Through the Capture of Industry Standards, 17 Berkeley Tech. L.J. 623, 623, 631-35 (2002).

42. Mueller, supra note 41, at 635-36; Broadcom Corp. v. Qualcomm Inc., 501 F.3d 297, 313 (3d Cir. 2007).

43. Mueller, supra note 41, at 635-36.

44. Lammi, supra note 40.

45. Steve Lohr, On Google, F.T.C. Sets Rules of War Over Patents, N.Y. Times (Jan. 4, 2013), (last visited Sept. 21, 2013).

46. Id.; Lammi, supra note 40.

47. Google dissent, supra, at 3.

48. Google decision, supra, at 4-5.

49. Bosch dissent, supra, at 1-2; Bosch decision, supra, at 2-3.

50. Indeed, the Noerr-Pennington doctrine’s First Amendment roots have been cited as a basis for applying the doctrine in numerous contexts other than antitrust law. See In re Innovatio IP Ventures, LLC Patent Litig., 921 F. Supp. 2d 903, 912-13 (N.D. Ill. 2013) (collecting cases).

51. In its Google decision, the FTC identified Google’s continued pursuit of injunctions as one element of its "unfair" conduct under Section 5 of the FTC Act. See Google decision, supra, at 1. This section does not explore that aspect of the decision.

52. Although the Noerr-Pennington doctrine immunizes deceptive practices before legislative bodies, it does not tolerate the deception of administrative agencies or courts, and it certainly does not apply to private organizations like SSOs. See Allied Tube & Conduit Corp. v. Indian Head, Inc., 486 U.S. 492, 501 (1988); Broadcom Corp. v. Qualcomm Inc., 501 F.3d 297, 308 (3d Cir. 2007).

53. Cf. Prof’l Real Estate Investors, 508 U.S. at 75 (Stevens, J., concurring in the judgment) (citing cases for the proposition that "a manufacturer’s successful action enforcing resale price maintenance agreements, restrictive provisions in a license to use a patent or a trademark, or an equipment lease, may evidence, or even constitute, violations of the antitrust laws").

54. 522 F.3d 456 (D.C. Cir. 2008).

55. See Allied Tube, 486 U.S. at 501; Broadcom, 501 F.3d at 308.

56. Indeed, deceptive conduct has been perceived as being outside the protection of the First Amendment, at least where economical matters are involved. See United States v. Alvarez, 132 S. Ct. 2537, 2547-48 (2012) (plurality op.); id. at 2554-55 (Breyer, J., concurring, joined by Kagan, J.).

57. Broadcom, 501 F.3d at 314. In Broadcom, the alleged violation was that the SEP owner breached its commitment by licensing its technology on non-FRAND terms, rather than by seeking injunctions against willing licensees. The case thus did not explicitly raise any "petitioning" issue though Noerr cases were discussed as part of the Broadcom court’s reasoning behind this holding. See id. at 308, 313.

58. Google decision, supra, at 4-5; Bosch decision, supra, at 2-3.

59. See Overmyer Co. v. Frick Co., 405 U.S. 174, 185-86 (1972) (discussing constitutional due process rights as well as constitutional rights pertaining to criminal procedure).

60. See, e.g., Leonard v. Clark, 12 F.3d 885, 889-90 (9th Cir. 1993) (citing Overmeyer, 405 U.S. at 185-86). In Leonard, the Portland firefighters’ union sought the invalidation of a provision of its collective bargaining agreement with the city. The union claimed that the provision, which shifted any increased payroll costs resulting from union-endorsed legislation back onto the union, violated its First Amendment right of petition. Avoiding the issue of whether the provision actually infringed upon the union’s petitioning rights, the Ninth Circuit held that the union had waived any such rights when it signed the collective bargaining agreement. The fact that the union was advised by counsel and had explicitly objected to the provision during negotiations with the city reinforced the court’s conclusion that the waiver was knowing, voluntary, and intelligent. See Leonard, 12 F.3d at 889-90. Also of relevance is Cohen v. Cowles Media Co., in which the Supreme Court found that a promissory estoppel action based on a promise made to keep a source confidential did not violate the First Amendment, reasoning from cases, including those involving antitrust, that hold that the media is not exempt from generally applicable laws. 501 U.S. 663, 665, 669 (1991).

61. Cf. Apple, Inc. v. Motorola Mobility, Inc., 886 F. Supp. 2d 1061, 1078 (W.D. Wis. 2012) (holding that Noerr-Pennington immunity did not bar a breach of contract claim against a patent holder in part because the patent holder had "waived some of its petitioning rights through contract"). However, the court in Apple did not consider whether the patent holder’s declaration to SSOs that it would license SEPs on FRAND terms waived its Noerr-Pennington immunity with respect to the antitrust claims. As the case concerned essentially the same facts as the FTC’s Google investigation, Commissioner Ohlhausen cited it in her dissent. See Google dissent, supra, at 1.

62. 696 F.3d 872 (9th Cir. 2012).

63. Id. at 885.

64. 869 F. Supp. 2d 901 (N.D. Ill. 2012).

65. Id. at 914.

66. Cf. Mark A. Lemley, Intellectual Property Rights and Standard—Setting Organizations, 90 CAL. L. REV. 1889, 1924-25 (2002) (discussing the possibility of treating a FRAND commitment as the grant of an "implied license"). Of course, if one views the FRAND commitment as an implied license, and as a result the SEP owner has no hope of obtaining an injunction, then the danger that the SEP owner will acquire market power appears to be greatly reduced.

67. See 6 Am. Jur. 2D Assignments § 128 (2001) ("Assumption of the liabilities may be implied from the acceptance of the benefits under the contract. For example, when an assignee takes over a going business, his or her intention to assume the obligations of the contract relating to the business may be found from his or her acquiescence in the terms of the contract.").

68. 508 U.S. 49 (1993).

69. 382 U.S. 172 (1965).

70. Prof’l Real Estate Investors, 508 U.S. at 60-61.

71. In addition, one recent district court decision held that because the question of how to resolve RAND licensing disputes is "muddled," the owner of a RAND-encumbered patent could maintain plausible infringement claims and therefore was not subject to antitrust liability under the "sham" exception to Noerr-Pennington. See In re Innovatio IP Ventures, LLC Patent Litig., 921 F. Supp. 2d 903, 914-17 (N.D. Ill. 2013). The court recognized, however, that RAND commitments have been held to preclude injunctive relief; consequently, its determination that the "sham" exception did not apply relied heavily on the fact that the SEP owner could plausibly sue for damages (i.e., a RAND royalty). Id. at 916-17. If the principles laid down by the FTC in Google/Motorola and Bosch and by the Ninth Circuit and Northern District of Illinois in the Motorola cases are widely adopted, it will become more difficult for SEP owners to contend that seeking an injunction is not objectively and subjectively baseless.

72. Prof’l Real Estate Investors, 508 U.S. at 61 n.6.

73. Id.

74. 37 Am. Jur. 2D Fraud and Deceit § 90 (2001).

75. 435 U.S. 679 (1978).

76. Id. at 696-97.

77. Id. at 697 & n.25. The engineering society also argued that the injunction barred lobbying activities in violation of the Noerr-Pennington doctrine, but the Court found that the injunction did not prohibit such activity. Id. at 699 n.27.

78. Id. at 697-98. Although the Court’s language suggests that an antitrust remedy could impinge on otherwise valid First Amendment rights, it cites an example (price fixing) and a case (Giboney) that concern categories of speech unprotected by the First Amendment.

79. Id. at 698-99.

80. See, e.g., Nat’l Soc. of Prof’l Engineers, 435 U.S. at 697-98; United States v. Paramount Pictures, 334 U.S. 131, 148 (1948); see also New York v. Microsoft, 224 F. Supp. 2d 76, 108, 110 (D.D.C. 2002) (agreeing with the principle that the remedy for an antitrust violation may address otherwise lawful conduct based on a discussion of Supreme Court cases but interpreting these cases as requiring that the conduct in quest ion must be closely related to, or be the same class or t ype as, the a nticompetitive conduct in question).

81. Broadcom Corp., 501 F.3d at 311.

Forgot Password

Enter the email associated with you account. You will then receive a link in your inbox to reset your password.

Personal Information

Select Section(s)

CLA Membership is $99 and includes one section. Additional sections are $99 each.