by Donald E. Purcell, Chairman, 

Center for Global Standards 

Analysis

The consequences of 

silence

Development and Initiatives

Since 1996 the US Court of

Appeals for the Federal Circuit (Federal Circuit) and the

US Federal Trade Commission (FTC)

have published several decisions concerning standardization activities and

disclosure of patents, or pending patent applications, that are reasonably

necessary to comply with a standard

being developed.

These decisions provide a body

of law, advice and guidelines for individuals, firms, corporations and standards development organizations concerning development of standards and

disclosure of patents.1)

On December 1, 2008, the Federal Circuit announced its decision in

Qualcomm v. Broadcomm, 548 F.3d

1004. As stated by Circuit Judge Prost,

“[t]his patent infringement case involves

the consequence of silence in the face

of a duty to disclose patents in a standards-setting organization (“ SSO ”)”

(emphasis added). The Court’s decision affirmed in part, vacated in part,

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by permission of the 

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was first published in 

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34 ISO Focus April 2009

© ISO Focus, www.iso.org/isofocus
and does not clearly require disclosure

of patents necessary to comply with a

standard?

Third, the Qualcomm decision

stands for the proposition that failure

to disclose participation in a standards

project and failure to meet a duty to disclose patents or pending patent applications necessary to meet a standard being

developed can be very expensive. The

Federal Circuit affirmed the trial court’s

misconduct findings against Qualcomm

based upon (1) “bad faith participation”

in the joint standards venture; and (2)

“litigation misconduct . . . during discovery, motions practice, trial and posttrial proceedings.”

The Federal Circuit affirmed

the trial court’s decision to award legal

expenses against the company for failure to properly disclose its patents in

the joint venture project and for Qualcomm’s intentionally “organized plan

of repeated false claims during discovery, trial and post-trial” by the company’s attorneys and witnesses. Note that

on January 7, 2008, a Federal Magistrate issued a decision that (1) provided

an initial award of $8.5 million in legal

fees to Broadcomm, and (2) referred six

Qualcomm attorneys to the California

State Bar for possible sanctions.

1) In the Matter of Rambus Incorporated,

Docket No. 9302, (FTC Decision August 2,

2006), remanded, 522 F.3d 456 (USCA D.C.

April 22, 2008), petition for writ of certiorari

filed (US Supreme Court, No. 08-694); In

the Matter of N-Data, File No. 051 0094,

(FTC Decision January 23, 2008); In the

Matter of Chevron Corporation and Union Oil

Company of California, Docket No. 9305 (FTC

Decision June 10, 2005); Rambus v. Infineon

Technologies, 318 F.3d 1081 (USCA Fed.Cir.

January 29, 2003), reversing and remanding,

Rambus v. Infineon Technologies, 164 F.Supp.

2d 743 (USDC E.D.Va. August 9, 2001); In

the Matter of Dell Corporation, 121 F.T.C. 616

(May 20, 1996).

and remanded the decision of the trial

court in Qualcomm Inc. v. Broadcom

Corp., 539 F.Supp. 2d 1214 (USDC

S.D. Cal. Aug. 6, 2007).

The Qualcomm decision is important for several reasons. First, the Federal Circuit reaffirmed the principle of

Rambus Inc. v. Infineon Technologies

AG, 318 F. 3d 1081, 1098 (Fed.Cir.

2003) that expectations of standardization participants are a controlling factor

in a standards proceeding. As stated by

the Court, if standardization participants

treat a patent policy as requiring disclosure of patents or pending patent applications that reasonably might be necessary to comply with a standard being

developed, there is a duty for a participant to disclose such patents.

318 F.3d 1081, 1100 (Fed. Cir. 2003)

(emphasis added).

It is important to note that the

Federal Circuit found Qualcomm had

failed twice in its duty to disclose patents or pending patent applications.

Although the standards joint venture

arguably did not expressly require disclosure of patents, the Court noted that

the patent policy required participants

to use “best efforts to provide information concerning intellectual property

rights” to all participants in the standards project.

The Court relied on the expectations of joint venture participants to

establish a de facto rule of patent disclosure in a manner similar to Rambus.

In addition, the Federal Circuit found

the ITU/ISO/IEC Patent Policy specifically applied to Qualcomm, a participant in the joint venture standards

project, and this policy set forth a specific duty to disclose patents, or pending patent applications, reasonably necessary to comply with a standard being

developed.

Second, the Federal Circuit

extended a patent disclosure duty to

international joint ventures established

by SSOs. This is the first court decision

to require such disclosures in the context of an international standards setting

project. This aspect of the Qualcomm

decision raises an interesting question

– Are all international joint ventures,

consortia, or ad hoc standards groups

now subject to a de facto patent disclosure policy where a patent is found

to be reasonably necessary to comply

with a standard being developed regardless of whether there is an actual patent disclosure policy, or a patent disclosure policy exists but is ambiguous

The Federal Circuit’s Qualcomm

decision contains an extensive discussion of the legal standard set forth in

Rambus that a standardization participant’s “duty to disclose [to the SSO]

extended only to claims in patents or

applications that reasonably might be

necessary to practice the standard. In

other words, this duty encompassed

any patent or application with claims

that a competitor or other [SSO] member reasonably would construe to cover the standardized technology.” Rambus Inc. v. Infineon Technologies AG,

“In a world dominated by 

globalization, the Federal 

Circuit’s Qualcomm 

decision is an important 

landmark.” 

About the author

Donald E. Purcell is Chairman of the

Center for Global Standards Analysis.

Don Purcell is a recognized expert in

strategic relationships between

globalization, international standardization and strategic standards education

initiatives. This article represents the

Chairman’s personal views;

see www.strategicstandards.com and

www.purcellfox.com for background.

In a world dominated by globalization, international competition, engineering, science and technology, the Federal Circuit’s December 1, 2008, Qualcomm decision is an important landmark

concerning the disclosure of participation

in a standards project, and disclosure of

patents or pending patent applications

during a standards project (national or

international) that are reasonably necessary to comply with a standard being

developed. In short, the Federal Circuit

decision confirms that the consequences of silence by a participant in a standards project under such circumstances

are very significant.

“The Federal Circuit 

decision confirms that the 

consequences of silence 

are very significant.”

ISO Focus April 2009 35

© ISO Focus, www.iso.org/isofocus