U.S. DOJ closes its investigation of Samsung’s use of its SEPs

by Nicole Daniel

On February 7, 2014 the Department of Justice (“DOJ”) issued a statement declaring that it closed its investigation into Samsung Electronics Co. Ltd.’s (“Samsung”) use of its Standards-Essential Patent (“SEP”) portfolio to license industry participants to exclude certain iPhone and iPad models from Apple, Inc (“Apple”) from the US market.

On January 8, 2013 the DOJ and the Patent & Trademark Office (“PTO”) issued a joint “Policy Statement on Remedies for Standards-Essential Patents Subject to Voluntary F/RAND Commitments”. In this policy statement they jointly explained that when SEP holders try to block their competitors from selling products which implement those SEPs a number of anti-competitive issues arise. Often there is a risk that the SEP holder may use the threat of an exclusion order to obtain more onerous licensing terms than justified by the value of the technology and thereby exploit their market power obtained through the process of standards-setting.

However the U.S. Trade Representative (“USTR”) reviewed the exclusion order the U.S. International Trade Commission (“ITC”) issued at Samsung’s request against Apple in June 2013 where the import of some older iPad and iPhone models was banned and overturned it on the grounds that it was inconsistent with the public interest.

Accordingly the Antitrust Division decided that no further action is required and is closing its investigation; however it will continue to monitor developments in this area.

In its statement the DOJ emphasized that the Antitrust Division has worked closely together with the European Commission and that this cooperation underscores their common concerns that anticompetitive use of SEPs may harm competition.  According to the European Commission a decision in a similar case is expected in April 2014.