Research Study on the Way of System for Early Disputes Resolution over Standard
Essential Patents (Summary)
I. Purpose of the Research Study
The spread of IoT (Internet of Things) in recent years has caused significant
changes in license negotiation of standard essential patents. On the other hand,activities by the so-called patent trolls have been recognized as social problems in theUnited States, and such concerns have been voiced that these possibly have spreadalso in the Europe and Asia.
The research study is aimed to (1) examine the actual situation of patent trolls andpossibility of institutional measures, and (2) organize basic way of thinking of how toproceed with appropriate license negotiation over standard essential patents andcalculation methods of reasonable royalties so as to formulate guidelines on licensing
negotiations for standard essential patents.
II. Contents of the Research StudyIn the research study, literature surveys such as relevant literature, previous
reports on research studies, judicial precedents or the like, domestic interviews survey
and consideration in an ad hoc committee were conducted.
The committee was comprised of 11 members in total, namely 3 academic experts,
5 industry experts, 2 attorneys at law, and 1 patent attorney, and five committee
meetings were held.
<Agenda>1st meeting: examination and consideration of issues on patent trolls
2nd meeting: examination and discussion I of the issues on way of thinking ofappropriate license negotiation and reasonable royalty over standard essential patents
3rd meeting: examination and discussion II of the above issues
4th meeting: opinions on the draft guidelines on license negotiation over standard
essential patents
5th meeting: consideration of the draft report
III. Summary
1. The actual state of patent trolls and situation of handlings under present
institutions
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Regarding patent trolls, the actual state, the prediction of future activities and thepossibility of institutional handlings were complied as follows.
(1) Actual state of patent trolls<Japan>In the committee, such recognition was shared that the patent trolls are currently not
active in any industry in Japan.
<the United States>
Patent trolls were active since the late 1990’s in the United States, but in recent years
it has been reported that number of warnings or litigations by patent trolls isdecreasing. Also in the committee, it was pointed out by several committee membersthat the number of cases related to patent trolls in the United States decreased
significantly in 2016 than the previous year.
<Other countries>
In Europe, the number of litigations by NPEs (Non Practicing Entities) is increasing,and it is said that the ration of the litigations by NPEs is high particularly inGermany. In China and India, while litigations by NPEs have been confirmed, nopositive activity thereof have been observed.
(2) Prediction of future activities of patent trolls<Japan>Currently, specific threats such as the activities of patent trolls have intensified inJapan have not been confirmed. Meanwhile, concerns about future risks of patenttrolls is expressed, particularly in such industries that have little involvement withthe telecommunications industry so far. However, at the moment, there is no sign thatthe activity of patent trolls will intensify in the future more than those in the UnitedStates, Germany and China.
<the United States>
Due to the influence of the recent institutional reforms and court precedents, numberof litigations by patent trolls is on a downward trend in the United States. However,2since it has been also pointed out that the value of patents in the United States
became too low, and there will be possible swing-back, it is necessary to keep eyes on
the situation surrounding the patent trolls in the United States also in the future.
<Other countries>
Within Europe, there is the increasing possibility of disputes by patent trolls,
especially in Germany. In China, although the activities of patent trolls are currently
not be confirmed explicitly, its large market size is considered attractive for patenttrolls, the activity may become intensified in the future.
(3) The institutional measures to patent trolls in Japan
Under the existing institutions, there is a possibility to apply restriction under
antimonopoly law or the doctrine of abuse of rights under civil law to injunction basedon patent law. However, no case has been confirmed that these were actually applied
to patent trolls in Japan.
As the conclusion of the committee, such opinions were dominated that it isunlikely also in the future for the patent trolls to become a problem in Japan where
the patent system is functioning in a well-balanced manner, and patent trolls can be
sufficiently dealt with under the current institutions.
2. Consideration on guidelines for licensing negotiations involving standard essentialpatents(1) Opinions for preparing the draft guidelines
The 2nd and 3rd meetings of the committee conducted "examination and discussion
on issues on appropriate licensing negotiations involving standard essential patents
and way of thinking of reasonable royalty", and the outcomes were organized as“Opinions for preparing the draft guidelines (see Table 1).
Table 1: The outcomes of opinions for preparing the draft guidelines (shown items
only)(1) "the purpose of the guidelines"(2) "licensing negotiation methods"(i) "good faith"(ii) "efficiency"3(3) "royalty calculation methods"(i) "reasonable royalties"(4) European communication(2) Opinions on the draft guidelines
At the 4th meeting, the draft guidelines proposed by the Japan Patent Office wasdistributed and discussed as entitled "the opinions on the draft guidelines on licensing
negotiations involving standard essential patents", so that the outcomes wereorganized as "opinions on the draft guidelines" (see Table 2).
Table 2 Outcomes of consideration of opinions on the draft guidelines (shown items
only)(1) "purpose of the guidelines"(i) "issues and background surrounding standard essential patents"(ii) "nature of the guidelines"(2) "licensing negotiation methods"(i) "good faith"(ii) "efficiency"(3) "royalty calculation methods"(i) "reasonable royalties"(ii) "non-discriminatory royalties"(iii) "others"(4) guidelines general(i) the overall impression of the guidelines(ii) the title of the guidelines(iii) the table of contents/index

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