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FTC, DOJ Update Their Guidelines for the Licensing of Intellectual Property

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In January of 2017, the Federal Trade Commission (FTC) and the United States Department of Justice (DOJ) officially updated their guidelines for licensing of intellectual property. This is the first time these guidelines have been updated since the mid 1990s. Here, our South Florida business law attorneys discuss these updates as well as the implications for affected companies.

Four Things You Need to Know About the New IP Licensing Guidelines

  1. The Guidelines Were Updated Because the Law Has Evolved

A modernization of the IP licensing guidelines was overdue. Key aspects of both antitrust law and intellectual property law have changed over the last two decades. Important Supreme Court decisions such as Leegin Creative Leather Products Inc. v. PSKS Inc., along with the passage of the Defend Trade Secrets Defense Act (DTSA), needed to be accounted for in new guidelines.

    2. They Impact How Agencies Make Decisions

DOJ and FTC enforcement guidelines are extremely important because they affect how these agencies will review and analyze any related legal issues. Of course, federal agencies do not have the final say on how to interpret the law. However, under the Chevron Doctrine, U.S. courts give considerable deference to agency interpretation of the law. Indeed, unless an agency decision is deemed to be ‘unreasonable’, it is assumed that their view will hold up in court.

  1. Copyright, Patents and Trade Secrets are Affected

The updated guidelines apply to copyrights, patents and trade secrets. The guidelines do not impact trademarks. The inclusion of trade secrets is particularly notable, as trade secret protections rights have expanded dramatically since the previous guidelines were issued in the 1990’. If your company either licenses any of these types of intellectual property, or has purchased such a license,  it is important that you have an understanding of how the guidelines could apply to your business.

  1. IP Licensing is Still Considered to Be ‘Pro-Competitive’

As a general rule, the FTC and the DOJ view IP licensing as ‘pro-competitive’. This means that the agencies do give some deference to companies to transfer their IP rights to other parties. Though, it is important to note that the agencies make it very clear that they will apply an effects-based analysis to any IP transactions. Licensing agreements that are viewed to be harmful to overall competition could potentially run afoul of the law. A merger does not need to occur for agencies to review an IP licensing agreement. If your Florida business is engaging in the buying or selling of intellectual property, it is imperative that you work with an experienced attorney who can both ensure that the deal protects your best interests and that it is acceptable in the eyes of regulators.

Get Business Law Help Today

At Pike & Lustig, LLP, our West Palm Beach business litigation attorneys have extensive experience intellectual property issues. To set up a free review of your case, please do not hesitate to call our team today at 561-291-8298 (West Palm Beach) or 305-697-9799 (Miami). We look forward to assisting you.

Resources:

justice.gov/atr/IPguidelines/download

law.cornell.edu/wex/chevron_deference

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