President George W. Bush recently signed into law the Standards Developing Organizations Advancement Act of 2004 (H.R. 1086), providing new shelter for standards developers from treble damage liability in current antitrust laws.

The approval amends the National Cooperative Research and Production Act of 1993, which addressed the antitrust treatment of certain joint ventures, such as standards development organizations. The new bill recognizes the assistance that SDOs provide to government agencies in developing standards for regulatory and procurement functions and allows SDOs the opportunity to submit a notice describing the scope of their work with the Justice Department and the Federal Trade Commission. That filing may avoid unnecessary and costly litigation against organizations that have no commercial interest with regard to the technical specifications contained in the standards. The act provides that the federal antitrust “rule of reason” apply to SDOs while they are developing standards, and limits attorney’s fees in any antitrust case challenging an SDO’s work.

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