Which practice reduces antitrust risk in IP cross-licensing among competitors?

Which practice reduces antitrust risk in IP cross-licensing among competitors?

• A. Ignore jurisdictional constraints.
• B. Avoid exclusive rights among competitors and ensure parity across licensees; MFN clauses should be reviewed with counsel for constraints.
• C. Always grant exclusive rights to all competitors.
• D. Eliminate all confidentiality.

Answer: (B)

When competitors cross-license IP, antitrust risk grows if terms create exclusivity or unequal treatment that could facilitate coordination or foreclose parts of the market. The safest, most effective approach to reduce this risk is to avoid exclusive rights among competitors and to apply terms consistently to all licensees, preserving parity so no single player gains a preferred position. MFN clauses can seem like a tool to standardize terms, but they can unintentionally promote coordination or price alignment, so they should be reviewed with counsel to ensure they don’t raise antitrust concerns. Keeping confidentiality intact is normal and helps protect sensitive information; eliminating confidentiality would generally increase risk. Ignoring jurisdictional constraints or granting exclusive rights to all competitors would both heighten antitrust exposure.

When competitors cross-license IP, antitrust risk grows if terms create exclusivity or unequal treatment that could facilitate coordination or foreclose parts of the market. The safest, most effective approach to reduce this risk is to avoid exclusive rights among competitors and to apply terms consistently to all licensees, preserving parity so no single player gains a preferred position. MFN clauses can seem like a tool to standardize terms, but they can unintentionally promote coordination or price alignment, so they should be reviewed with counsel to ensure they don’t raise antitrust concerns. Keeping confidentiality intact is normal and helps protect sensitive information; eliminating confidentiality would generally increase risk. Ignoring jurisdictional constraints or granting exclusive rights to all competitors would both heighten antitrust exposure.