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Justice Department Gives Nod to EPC Gen 2 Patent Pool

A group of UHF RFID technology vendors received a business review letter approving their request to negotiate patent licensing agreements as a single entity.
By Claire Swedberg
Tags: Standards
Oct 22, 2008In a business review letter issued on Tuesday, the U.S. Department of Justice (DOJ) approved a proposal by the RFID Consortium—a group of RFID technology vendors—to begin jointly licensing patents for EPC Gen 2 passive UHF RFID tags, interrogators and printer-encoders. With the announcement, the Justice Department asserted that the proposed patent-licensing arrangement would help to lower costs of ultrahigh-frequency (UHF) RFID technology, as well as speed its adoption.

In the letter, Thomas O. Barnett, assistant attorney general in charge of the department's antitrust division, wrote, "The proposed patent-licensing arrangement has the potential to speed up the commercialization of UHF RFID technology to the benefit of competition and consumers, without harming competition or impeding innovation... The consortium's pool appears reasonably likely to yield some tangible cost savings by limiting the threat of hold-up and royalty stacking, and by lowering transaction costs."

Jason Johnson
The RFID Consortium was formed in 2005 by a group of technology vendors, with the goal of combining their RFID-related intellectual property (IP) or patents (see RFID Vendors to Launch Patent Pool). The current members consist of Motorola, Zebra Technologies, ThingMagic, Hewlett-Packard, France Telecom, LG Electronics and 3M. With the DOJ's approval, the group intends to offer a joint patent portfolio to make it easier for RFID software and hardware vendors to obtain licenses related to those patents, as well as lower the cost of that process and expedite the development of RFID technology.

Each consortium member holds one or more patents that an independent patent evaluator deemed essential to the EPC Gen 2 UHF standard. Altogether, the consortium holds a total of 10 such patents. All patent holders in these cases have granted the consortium nonexclusive rights to license their patent or patents.

The consortium will now license its patent portfolio, or pool, on reasonable and nondiscriminatory (RAND) terms to manufacturers under the management of VIA Licensing, which was named the consortium's independent licensing administrator in 2006 (see RFID Consortium Names Patent-Pool Administrator).

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