Rambus, Inc.
The FTC Has a Bigger Agenda?

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By cryptscrypt
August 15, 2006

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Long ago...I believe it was Nic that said the FTC may have a larger agenda than merely Rambus vs. the MM's. We discussed the FTC's desire to expand the limits of their authority and power. The other day I was having a discussion with an attorney, which renewed this line of thinking.

Intellectual property is property that exists solely because of government. IP exists because of the laws relating to patents and their enforcement. This attorney posited the question "Are IP rights unlimited?" He said the Supremes have answered this question in the negative. Sorry but I do not have a case citation. The next question then is what are the limits of intellectual property rights? Does an IP holder have the right to charge whatever royalty he wants...regardless of the greater good of society at large? This attorney said the Supremes have not answered this question or any question really that relates to the limitations on IP rights except to say that the right is not unlimited.

This may be precisely the area the FTC is seeking to "move into" in their attempt to expand their power and influence. In the case of certain critical IP, that effects the society at large, the FTC is saying government grants the IP right and government will now step into certain situations and have a say in what kind of a royalty rate is acceptable (to the government). Meaning that the government is not going to allow an IP holder to use his IP right to extract a royalty on a key technology that is good for him but harmful for they others in the industry or consumers in general.

I'm certainly not saying that the rates Rambus is seeking are damaging to the MM's but you can bet this is exactly the song the Micron lobby machine has been, and still is singing to anyone in government who will listen.

The ramifications of this are significantly larger than Rambus. An area of similarity that has long been recognized is the regulation of new pharmaceutical drugs.

If the FTC is successful in getting Rambus to "come to the table" and negotiate their royalty rates, the precedent setting effect of this could be very significant. The FTC will have succeeded in enlarging the sphere of their influence regardless of their congressional charter.

If viewed in this light, it may not be surprising that the commissioners brushed aside the ALJ's findings in their entirety and beckoned Rambus to the bargaining table. What they really seek is an extension of their influence into the undefined region of what governmental limits can be placed on the rights of intellectual property holders.

Just some thoughts....


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