Fair Reasonable and Non-Discriminatory (FRAND) Commitment Disputes and Antitrust Law–An Analysis of Bundled Rebate Under FRAND Commitment Context
The FRAND commitment is an important tool to balance the incentives between SEPs holders and downstream implementers. However, because of its unclarity, federal courts and legal scholars are split in the issues of the royalty calculations and some other antitrust disputes. This Dissertation focuses on the issue of the FRAND commitment intertwined with the issues of bundled rebate and loyalty discount because only few scholars focus on researching this issue. The Qualcomm case is the example of this dispute. Based on this case, the research questions that interests us are: one, if the court rules that bundled rebate and loyalty discount is unlawful under antitrust law of Sherman Act Section Two, what are the effects on consumers? Two, if it is lawful, what are the effects on consumers? Three, based on the analyses and the answers of above, should we change the traditional standards for analyzing bundling or tying by the court? If yes, how do we change it? If not, why not change it? By reviewing the case law of bundling, there are several factual differences between those case laws and the Qualcomm case, no matter whether they are mandatory or persuasive to the Qualcomm case itself. Because these cases have difficulty solving our research questions, this Dissertation designs a game-theoretic model to answer the research questions. Based on the model, we find that patent bundling with competition will generate the largest consumer surplus since it may eliminate the double marginalization and incentive problems. Finally, this Dissertation recommends that the court and the government agencies should analyze the risk of double marginalization in a given bundling case, even under the FRAND commitment context. Furthermore, the benefit of bundling with patents should also be analyzed. Moreover, consumer-surplus analysis should be the core of the whole analysis under the antitrust law, based on the reasonings from the U.S Supreme Court case and the legislative history.
Antitrust law, Bundled Rebate, FRAND commitment, SEPs Licensing, Antitrust and Trade Regulation
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