[Federal Register Volume 66, Number 224 (Tuesday, November 20, 2001)]
[Pages 58146-58147]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-28943]



Competition and Intellectual Property Law and Policy in the 
Knowledge-Based Economy

AGENCY: Federal Trade Commission.

ACTION: Notice of public hearings and opportunity for comment.


SUMMARY: The Federal Trade Commission (``FTC'' or ``Commission'') 
announces public hearings beginning in January 2002 on ``Competition 
and Intellectual Property Law and Policy in the Knowledge-Based 
Economy.'' The hearings will focus primarily on the implications of 
antitrust and patent law and policy for innovation and other aspects of 
consumer welfare. Copyright and trademark issues as they arise in 
particular high-tech contexts also may be considered. The hearings will 
be held at and administered by the FTC and co-hosted with the Antitrust 
Division of the Department of Justice.
    The knowledge-based economy has grown in economic significance over 
the past few decades. It is increasingly important that competition and 
intellectual property law and policy work in tandem to support and 
encourage ongoing innovation underlying that economy. Policies for both 
competition and intellectual property raise legal and economic 
questions that are substantially interlinked.
    Through public hearings, we seek to gather facts about, and to 
enhance the understanding of, how doctrines, practices, and policies of 
each discipline affect both initial and sequential innovation, and 
related functions, in today's economy. The goal is to promote dialogue, 
learning, and consensus building among business, consumer, government, 
legal, and academic communities on these topics. In addition to 
officials from the FTC and the Antitrust Division, business, consumer, 
judicial, Congressional, and other government representatives will be 
invited, as will representatives from the antitrust and intellectual 
property bars, economists, and academics.
    The hearings will be transcribed and placed on the public record. 
Any written comments received also will be placed on the public record. 
A public report that incorporates the results of the hearings, as well 
as other research, will be prepared after the hearings.

DATES: The hearings will begin in January 2002 and will conclude later 
in the spring. Specific dates and more specific topic listings will be 
provided in a later notice and in press releases. Any interested person 
may submit written comments responsive to any of the topics to be 
addressed; such comments should be submitted no later than the last 
session of the hearings.

ADDRESSES: When in session, the hearings will be held in Room 432 at 
the FTC headquarters, 600 Pennsylvania Avenue, NW., Washington, DC. All 
interested parties are welcome to attend. Written comments should be 
submitted in both hard copy and electronic form. Six hard copies of 
each submission should be addressed to Donald S. Clark, Office of the 
Secretary, Federal Trade Commission, 600 Pennsylvania Avenue, NW., 
Washington, DC 20580. Submissions should be captioned ``Comments 
regarding Competition & Intellectual Property.'' Electronic submissions 
may be sent by electronic mail to ``competitionandintellectualproperty@

[[Page 58147]]

ftc.gov.'' Alternatively, electronic submissions may be filed on a 3-1/
2 inch computer disk with a label on the disk stating the name of the 
submitter and the name and version of the word processing program used 
to create the document.

FOR FURTHER INFORMATION CONTACT: Matthew Bye, Office of General 
Counsel, Policy Studies, 600 Pennsylvania Avenue, NW., Room 505, 
Washington, DC 20580; telephone (202) 326-3522; e-mail: ftc.gov">mbye@ftc.gov. 
Detailed agendas for the hearings will be available on the FTC Home 
Page (http://www.ftc.gov) and through Angela Wilson, Staff Assistant, 
at (202) 326-3190.

SUPPLEMENTARY INFORMATION: The issues that juxtapose competition and 
intellectual property policy are ones that have potentially broad 
implications for the development of the U.S. economy and consumer 
welfare. Courts have recognized that ``[although] the aims and 
objectives of patent and antitrust laws may seem, at first glance, 
wholly at odds[, . . .] the two bodies of law are actually 
complementary, as both are aimed at encouraging innovation, industry, 
and competition.'' \1\

    \1\ Atari Games Corp. v. Nintendo of Am., Inc., 897 F. 2d 1572, 
1576 (Fed. Cir. 1990).

    Yet the question of how to balance intellectual property and 
competition policy in particular circumstances has generated 
significant debate and discussion over the decades. During the 1970's, 
federal antitrust enforcement received justified criticism for certain 
policies--since revised \2\--overly hostile to the appropriate use of 
patents. More recently, some have questioned whether certain 
intellectual property policies, practices, and doctrines incorporate a 
proper appreciation of competitive issues, including ways in which 
intellectual property protection may impede--rather than encourage--
innovation. Others have raised questions on whether certain antitrust 
approaches are properly appreciative of the need to promote innovation. 
The intersection of antitrust and intellectual property law continues 
to present difficult questions, and the debate may have intensified as 
the knowledge economy has increased in its importance to consumer 

    \2\ See generally, U.S. Department of Justice and Federal Trade 
Commission, Antitrust Guidelines for the Licensing of Intellectual 
Property (1995).

    Thus, a series of hearings to explore the issues raised in this 
ongoing debate is timely. We approach these issues with open minds and 
in a spirit of learning. The hearings that are announced in this notice 
will, it is hoped, further fact gathering, learning, dialogue, and 
discussion among the affected parties, and will result in a greater 
understanding of and consensus about the approaches to policy in these 
areas that are most likely to benefit U.S. consumers.
    The hearings will include consideration of the following general 
issues. This list is not exhaustive, and parties submitting written 
comments do not have to address each issue.

General Issues for Consideration

    What roles do competition and intellectual property law and policy 
play in fostering initial and follow-on innovation? From a practical 
business perspective, how does each contribute to or impede ongoing 
innovation? What do empirical studies show?
    What is the frequency of cross-licensing, patent pooling, and other 
arrangements for the transfer or joint use of intellectual property? 
Does their use or usefulness vary across industries? What business 
reasons most typically underlie their creation? What intellectual 
property and competition issues do they typically raise? Have the 
guideposts for antitrust analysis established by the DOJ/FTC Antitrust 
Guidelines for the Licensing of Intellectual Property proved useful?
    To what extent does commercialization of new technology require 
multiple licenses from multiple patentees--that is, to what extent do 
``patent thickets'' exist? How do they affect both practices with 
respect to intellectual property and competition among innovator 
companies? How should policymakers take this into account?
    What competition issues arise in the settlement of patent disputes 
and in the context of other agreements, such as standard setting, that 
involve patent rights? What should be the standards for assessing the 
antitrust significance of a unilateral refusal to deal, an issue 
recently addressed by the Federal Circuit's decision in CSU v. Xerox? 
\3\ To what extent has the Federal Circuit become an increasingly 
important source of antitrust doctrine?

    \3\ In re Independent Service Organizations Antitrust 
Litigation, 203 F. 3d 1322, 1327 (Fed. Cir. 2000), cert. denied, 
CSU, L.L.C. v. Xerox Corp., 121 S.Ct. 1077 (2001).

    To what extent do questions about the scope and types of patents 
(e.g., business methods patents), and the procedures and criteria under 
which they are issued, raise competition issues? To what extent do 
substantive and procedural rules, both at agency and judicial levels, 
have implications for initial and sequential innovation, competition, 
and appropriability? What are the facts in this area?
    To what extent is the assessment of these and other intellectual 
property-related questions different for new technologies? How does the 
globalization of the economy affect the assessment of these and related 
issues? What further insights can be offered to both intellectual 
property and antitrust doctrine from economics and other disciplines?
    To what extent should, and if so, how might, fact gathering and 
other learning from the hearings be incorporated into competition and 
intellectual property practices, doctrine, and procedures?
    The hearings will be transcribed and placed on the public record. 
Any comments received also will be placed on the public record. A 
public report that incorporates the results of the hearings, as well as 
other research, will be prepared after the hearings.
    By direction of the Commission.

Donald S. Clark,
[FR Doc. 01-28943 Filed 11-19-01; 8:45 am]