Hit the Road Jack: The Auto Industry as the Next Vehicle for Predatory Infringement


While patents, patent litigation, and patent pools have been part of the automotive industry since the late-1800s, the prevalence of technology covered by standards and accompanying standard essential patents (SEPs) is much more recent. Today’s smart cars and the widespread incorporation of telecommunication and Internet of Things standards in vehicles raise concerns about how well the automotive industry will be able to adapt to this new SEP-laden future.

This article predicts that predatory infringement of SEPs for two related reasons. First, although some industries, such as telecommunications, have long dealt with SEPs, the incorporation of standardized technology is more recent in automotives. The automotive industry has experience with patents and will undoubtedly mature into a level of comfort with SEPs, but because they are late to the SEP game, it is likely that automotive SEP policy will be driven by existing precedent from other industries. This is a problem because of the second reason, which is the fact that the history of patent licensing in the automotive industry has been quite different from that in telecommunications. Although patent licenses had usually been taken at the component manufacturer or supplier level, SEPs are often licensed at the end-user or final product level. This licensing shift in the car industry, coupled with its infancy in the SEP space, create an easy road for predatory infringement to occur.