ANTITRUST ANALYSIS OF FRAND LICENSING POST-FTC v. QUALCOMM
By Aminta Raffalovich and Steven Schwartz1
A great deal of recent attention is being paid to the Ninth Circuit’s decision in Federal Trade Commission ("FTC") v. Qualcomm.2 On one side of the debate are those, like the FTC and various amici, who reject the view expressed by the Ninth Circuit and consider the licensing behavior by Qualcomm as a quintessential antitrust violation. That argument views Qualcomm’s licensing behavior as a blatant example of the illegal exercise of monopoly power.
On the other side of the debate are those, like the Antitrust Division of the Department of Justice and still other amici, who decry the District Court’s decision3 as an inappropriate extension of the antitrust laws into a non-antitrust arena and applaud the Ninth Circuit’s decision as drawing reasonable boundaries around the application of antitrust laws.
What complicates the assessment of the decision in Qualcomm is the context in which the behavior at issue occurs. The patent overhang and, in particular, the standard-setting and essential-patent context make the analysis differentâand arguably more challengingâthan a typical analysis of pricing or licensing behavior in a vertical setting.