Tagredj _Sisvel

1Copyright © 2009 Sisvel S.p.A. All Rights Reserved

Dr Mustapha TagredjChief Licensing Advisor to the board of Sisvel

ITN Infrastruce, Telematics and Navigation

October 15, 2009Lingotto Fiere – Torino

Patent pool for GALILEO?An efficient tool to solve IPR issues

for new innovative technologies


Who is Sisvel?

• Founded in 1982 by Roberto Dini to spin-off from Indesit a significant portfolio of television patents, Sisvel is a dynamic and full service patent managing company

• Sisvel is a truly independent company with roots in the industry: the initial shareholders of Sisvel were the most important Italian manufacturers of television sets

• Sisvel is one of the oldest and, with a team of over 80 professionals, one of the largest administrators of IP Rights

• Sisvel is a European company, but operates as a multinational with subsidiaries and offices on three continents

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SISVEL S.P.A.None, Italy

SISVEL (Hong Kong) Ltd.Hong Kong

SISVEL JapanTokyo, Japan

SISVEL US, Inc.Audio MPEG, Inc.

Alexandria, VA

Edico, SrlRome, Italy

SISVEL Germany GmbHStuttgart, Germany

SISVEL Technology, SrlNone, Italy

A Global Licensing Organization

Sisvel Today


Some current licensing programs managed by Sisvel

In operation

MPEG Audio

Facilitation



Increasing awareness of IPR issues


From innovation to intellectual property

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• Innovation results in intellectual property

• All rights resulting from intellectual activity in the industrial, scientific, literary or artistic fields

literary, artistic and scientific works inventions in all fields of human endeavour scientific discoveries industrial designs trademarks, service marks, and commercial names designations


Political Institutions are aware of thesignificance of IP rights licensing

“With a world market estimated at being 11.4 billion euro in 2009, mobile TV offers Europe the possibility of combining its strengths in the mobile communications sector with the wealth and differences that characterize the European audiovisual sector.I am prepared to give strong support to European standardised solutions, such as DVB-H, on the condition that they provide certainty about technology licensing terms and conditions. Without this certainty and predictability, it will be impossible to invest with confidence in new innovative technologies. Industry should therefore foster work in this direction.”

Viviane Reding(Telecommunications European Commissioner)

GALILEOaccess rights and right of use

Access rights For project purposes(participants only)

For use purposes

To Background(held by participants prior to the grant agreement)

Royalty-free, unlessotherwise agreedbefore signature the grant agreement

Subject to agreement, royalty free or on fairand reasonableconditions?Third party rights?To Foreground

(results generated by project)

Royalty-free



Benefits from a Patent Pool for GALILEO

Overview of Patent Pools

A “Patent Pool” is a portfolio of patents essential to the same standard but owned by different parties

The purpose of any Patent Pool is to facilitate licensing of the patents in the portfolio

Pools are based on one or more agreements to:

establish the rules of the pool

name a licensing administrator to manage and operate the pool

provide the licensing administrator with the necessary rights to grant non-exclusive licenses to third parties



Benefits of Patent Pools for New Innovative Technologies

• Lower transaction costs by offering licensees “One stop shopping” to acquire necessary licenses

• Provide certainty and predictability to the market on the levelof royalty rates

• Ensure uniform and non-discriminatory licensing of essential patents through an independent professional administrator

• Decrease likelihood of duplicative investments to “invent around”

• Defensive tool against NPEs

• Pro-competitive

Patent pools have substantial pro-competitive effects, including:

Clearing blocking patents that would otherwise prevent competitive entry into a field;

Establishing a single reasonable royalty rate (that, according to economic theory, will be lower than the cost of separately negotiated licenses);

Reducing royalty stacking and hold up behavior; and

Lowering costs for POs in collecting royalties (with benefits for Licensees as well) and increasing efficiency of the system.

Patent Pools are Pro-Competitive


• U.S. Courts and antitrust enforcement agencies have upheld pools on the basis of their pro-competitive effects

– For example, a Federal District Court dismissed antitrust claims against a patent pool for video disc technology that included four direct competitors. Matsushita Elec. v. Cinram Int’l, 299 F. Supp. 2d 370 (D. Del. 2004)

• However, any collaboration among competitors also raises potential antitrust risk

– For example, the FTC took legal action in Summit/VISX, alleging that a patent pool eliminated price competition among its members

– Expert antitrust counsel should always be part of the formation process of any patent pool

Patent Pools are Pro-Competitive (cont.)



Independent administrator

• The independence of the administrator (including the administrator’s controlling shareholders) helps safeguard patent pools from potential antitrust risk.

• For example, the U.S. Department of Justice recently emphasized the importance of an independent administrator in the letter quoted below.

If the Consortium does not engage an independent licensing administrator and the Consortium’s administrative committee must act as the licensing administrator, the Department would be concerned that the Consortium’s current structure does not adequately safeguard licensees’ sensitive business information from being accessed and used by licensors to harm competition. Therefore, we decline to state our enforcement intentions should the Consortium not retain an independent licensing administrator…

U.S. Department of Justice, Business Review Letter regarding the UHF RFID Patent Pool, dated October 21, 2008


Key Elements forPatent Pools Formation


Key Elements

• Completeness – need to incorporate the maximum number of essential patents into the Patent Pool (e.g. patent calls)

• Credibility – need to obtain credible independent essentiality evaluation in all relevant countries (e.g. USA, EU, JP, KR, and CN)

• Harmony – need to reach a balance between Patent Owners that are both licensees and licensors and Patent Owners that are strictly licensors


Key Elements (cont.)

• Reliability – sound mechanism to properly allocate royalties among the Patent Owners and the Pool Administrator

• Legality – follow antitrust guidelines & best practices – for example, adopt a strict evaluation of essentiality to avoid bundling essential patents with non-essential patents

• Effectiveness – procedures for resolving differences of opinion to expedite patent pool formation

• Independence of Administrator

• Establishing Contractual Relationship between Patent Holders and Administrator (Master Agreement)

• A Patent Pool on New Innovative Technologies offers the following benefits:• One stop shopping: increase of efficiency• Certainty, predictability, reasonability of royalty rates • Defense against NPS• Uniformity and non discrimination: pro-competitiveness• Royalty staking reduction

• Independence of the Administrator is a key element for the success of the patent pool

• A patent pool on GALILEO is highly recommended

Conclusions



Thank You


www.sisvel.com

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