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Mar 1, 2009 (Vol. 29, No. 5)

Standard Setting Increasingly Under Siege

Before Joining an SSO, Firms Need to Be Fully Cognizant of the Established Policies

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    Steven B. Pokotilow

    During the standard-setting process, it often is advantageous to incorporate the latest technological advances into the standard. In the pharmaceutical and biotechnological fields, standardization of laboratory techniques (such as ultrahigh-throughput screening) may involve patented fluid delivery systems, vessel design, genetic markers, antibodies, or bioinformatic tools.

    A standard is captured when a rogue member of a standard-setting organization (SSO) influences the SSO to select a standard requiring the use of that member’s intellectual property, with the intention of extracting excessive royalty payments from the industry once the standard is adopted industry-wide. 

    Once the standard is widely adopted, the rogue member may assert its patent rights against industry participants, thus holding up the industry that adopted the standard. This can be a no-win situation for the industry as it could force participants to agree to arguably excessive royalty payments, incur the cost and delay of adopting a new standard, or face costly patent litigation.

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    Amy E. Wilson, Ph.D.

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