FTC Compels Rambus to License Patented Technology and Limits Royalty Rates

Morrison & Foerster LLP

Following its decision last summer that Rambus had violated the antitrust laws by deceiving an industry-wide standard-setting organization, the Federal Trade Commission (FTC) issued its remedial order yesterday.[1] The Commission’s long-awaited order is significant because it (1)

places specific limits on Rambus’ licensing and patent enforcement activities and (2) sets forth a framework that U.S. courts can follow when fashioning a remedy in future antitrust cases that involve deceptive conduct before standard-setting organizations. Specifically, the FTC’s order (1) compels Rambus to license its patented technology on certain specified terms; (2) places limits on the maximum royalty rates that Rambus can collect for use of its

patents; and (3) imposes other significant conduct remedies that limit Rambus’ ability to engage in future deceptive conduct relating to standard-setting organizations. The Commission did not require Rambus to surrender past royalties; nor did it limit Rambus’ royalties on DDR2 SDRAM technology. Rambus has said it will appeal the decision.

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