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Subject: Re: [oiic-formation-discuss] Level of detail needed in a TC Charter

On Sat, Jun 14, 2008 at 6:43 PM,  <m42tom-odf@yahoo.com> wrote:
> --- marbux <marbux@gmail.com> wrote:
>>Under antitrust law, the "audience" is the range of
>>consumers whose needs will be fulfilled by the market
>>created by the standard to be developed....
>>If we don't have that as an agreed goal, the
>>criminal penalty exposure is up to 10 years in federal
>>prison and/or a $1 million fine per participant.
>>The civil liability exposure is treble the damages
>>of all co-conspirators' acts, with each
>>co-conspirator liable for the entire amount individually.
> I'm just an interested lurker, and I'm not a lawyer, but
> this sounds like FUD to me.

See 15 U.S.C. section 1 (Sherman Act)
which reads in its entirety:

"Every contract, combination in the form of trust or otherwise, or
conspiracy, in restraint of trade or commerce among the several
States, or with foreign nations, is declared to be illegal. Every
person who shall make any contract or engage in any combination or
conspiracy hereby declared to be illegal shall be deemed guilty of a
felony, and, on conviction thereof, shall be punished by fine not
exceeding $100,000,000 if a corporation, or, if any other person,
$1,000,000, or by imprisonment not exceeding 10 years, or by both said
punishments, in the discretion of the court."

On the civil side, the15 U.S.C. 15, part of the Clayton Act,  provides
a private right of action for persons (defined elsewhere to include
any legal entity) injured by a violation of the Sherman Act.to sue for
treble the damages sustained.
It is somewhat longer and has an inapplicable exception, so I will
clip the relevant language:

"... any person who shall be injured in his business or property by
reason of anything forbidden in the antitrust laws may sue therefor in
any district court of the United States in the district in which the
defendant resides or is found or has an agent, without respect to the
amount in controversy, and shall recover threefold the damages by him
sustained, and the cost of suit, including a reasonable attorney's

On the applicability of both the Sherman Act and Clayton Acts quoted
above to  voluntary standards work, both of which upheld jury awards
of treble damages, see these two Supreme Court case decisions: Allied
Tube & Conduit v. Indian Head, Inc., 486 U.S. 492
("trade and standard-setting associations routinely treated as
continuing conspiracies of their members[;] standards of conduct in
this context are, at least in some respects, more rigorous than the
standards of conduct prevailing in the partisan political arena or in
the adversarial process of adjudication."); and American Society of
Mechanical Engineers, Inc. v. Hydrolevel Corp., 456 U.S. 556, 571
(1982), <http://laws.findlaw.com/us/456/556.html>  (standard-setting
associations liable for acts of committee officials because they are
cloaked with the parent authority of the association, notwithstanding
that the associations are non-profit corporations).

There is limited immunity for standards body TC members and and
standards organizations of standard setting organizations themselves
enacted since the Hydrolevel case that limits liability to actual
rather than treble damages if certain requirements are met and a
certification of compliance to the U.S. Justice Dept. and a similar
certificate is submitted within 90 days after a new standardization
effort is commenced. There is a compact home page for a portion of a
web site that collects the relevant statute and regulations, and
tracks which organizations have had their certifications approved by
the Dept. of Justice.

However OASIS (and Ecma) were not on the list of organizations that
have registered to take advantage of that provision as of yesterday.
It may be that the web site's list is not current or that OASIS has
its certification in process. I rattled the OASIS cage about not
having taken advantage of that provision some time back, the OASIS
Antitrust Guidelines only went up in February.

However, the partial immunity granted does not by its plain language
establish any immunity for pre-TC formation conspiratorial acts in
restraint of trade.
But I stress that the limited immunity for a standard setting
organization does not extend to others, and the law creating the
limited immunity has no effect on criminal liability. Indeed, it was
adopted as a Public Law in the same enactment as the Public Law
increasing the criminal penalties for the Sherman Act 2004 amendments.

I don't have time right now to dig out a citation and link to a case
holding that conspirator liability is joint and several, that each
conspirator is individually liable for all of the damages inflicted by
all of the co-conspirators, but that is Torts 101 stuff in law school.
I recall running across case decisions so holding under the Clayton
Act while researching other issues under it, but don't have the time
to dig one out at the moment. It isn't an issue I have ever needed to
brief because I never encountered a defense team that raised such an

Universal Interoperability Council

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