The American Antitrust Institute (AAI) has asked the Federal Trade Commission (FTC) to investigate Rembrandt IP Management over the control of a patent that is used for sending digital TV signals to consumers.
The AAI – a non-profit advocacy organization based in Washington, D.C. – said in its petition filed March 26, “In sum, FTC investigation and enforcement is necessary to prevent tens of millions of consumers from higher prices and protecting the process of the conversion to digital television.”
Rembrandt has the rights to a patent that was originally granted to AT&T-owned Paradyne. AAI said the patent is key for the Advanced Television Systems Committee’s (ATSC) digital TV standard.
AAI said that “Rembrandt has failed to abide by an obligation established by the
ATSC to license on reasonable and nondiscriminatory (RAND) terms certain technology critical to the delivery of digital systems of terrestrial broadcast television.” The original RAND commitment was with AT&T, and AAI said it was central to the Federal Communications Commission’s (FCC) adoption of the ATSC standard in establishing the process for the conversion to digital television.
According to AAI’s petition, Rembrandt brought 14 patent infringement suits against the four major TV networks, the five major cable systems, and television and equipment manufacturers seeking licensing royalties that will increase the costs of digital TV by tens of millions of dollars.
Rembrandt is seeking royalties of 0.5 percent of “all revenues derived from the use of the ATSC standard” – an amount that AAI said would dramatically increase the cost of digital TV equipment, and the cost of digital TV in general. As a result, “All consumers will pay substantially more for digital and terrestrial television services unless this conduct is enjoined,” according to AAI.
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