[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1086 Enrolled Bill (ENR)]
H.R.1086
One Hundred Eighth Congress
of the
United States of America
AT THE SECOND SESSION
Begun and held at the City of Washington on Tuesday,
the twentieth day of January, two thousand and four
An Act
To encourage the development and promulgation of voluntary consensus
standards by providing relief under the antitrust laws to standards
development organizations with respect to conduct engaged in for the
purpose of developing voluntary consensus standards, and for other
purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,

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This title may be cited as the ``Standards Development Organization
Advancement Act of 2004''.

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TITLE I

-STANDARDS DEVELOPMENT ORGANIZATION ADVANCEMENT ACT OF 2004

The Congress finds the following:
(1) In 1993, the Congress amended and renamed the National
Cooperative Research Act of 1984 (now known as the National
Cooperative Research and Production Act of 1993 (15 U.S.C. 4301 et
seq.)) by enacting the National Cooperative Production Amendments
of 1993 (Public Law 103-42) to encourage the use of collaborative,
procompetitive activity in the form of research and production
joint ventures that provide adequate disclosure to the antitrust
enforcement agencies about the nature and scope of the activity
involved.
(2) Subsequently, in 1995, the Congress in enacting the
National Technology Transfer and Advancement Act of 1995 (15 U.S.C.
272 note) recognized the importance of technical standards
developed by voluntary consensus standards bodies to our national
economy by requiring the use of such standards to the extent
practicable by Federal agencies and by encouraging Federal agency
representatives to participate in ongoing standards development
activities. The Office of Management and Budget on February 18,
1998, revised Circular A-119 to reflect these changes made in law.
(3) Following enactment of the National Technology Transfer and
Advancement Act of 1995, technical standards developed or adopted
by voluntary consensus standards bodies have replaced thousands of
unique Government standards and specifications allowing the
national economy to operate in a more unified fashion.
(4) Having the same technical standards used by Federal
agencies and by the private sector permits the Government to avoid
the cost of developing duplicative Government standards and to more
readily use products and components designed for the commercial
marketplace, thereby enhancing quality and safety and reducing
costs.
(5) Technical standards are written by hundreds of nonprofit
voluntary consensus standards bodies in a nonexclusionary fashion,
using thousands of volunteers from the private and public sectors,
and are developed under the standards development principles set
out in Circular Number A-119, as revised February 18, 1998, of the
Office of Management and Budget, including principles that require
openness, balance, transparency, consensus, and due process. Such
principles provide for--
(A) notice to all parties known to be affected by the
particular standards development activity,
(B) the opportunity to participate in standards development
or modification,
(C) balancing interests so that standards development
activities are not dominated by any single group of interested
persons,
(D) readily available access to essential information
regarding proposed and final standards,
(E) the requirement that substantial agreement be reached
on all material points after the consideration of all views and
objections, and
(F) the right to express a position, to have it considered,
and to appeal an adverse decision.
(6) There are tens of thousands of voluntary consensus
standards available for government use. Most of these standards are
kept current through interim amendments and interpretations,
issuance of addenda, and periodic reaffirmation, revision, or
reissuance every 3 to 5 years.
(7) Standards developed by government entities generally are
not subject to challenge under the antitrust laws.
(8) Private developers of the technical standards that are used
as Government standards are often not similarly protected, leaving
such developers vulnerable to being named as codefendants in
lawsuits even though the likelihood of their being held liable is
remote in most cases, and they generally have limited resources to
defend themselves in such lawsuits.
(9) Standards development organizations do not stand to benefit
from any antitrust violations that might occur in the voluntary
consensus standards development process.
(10) As was the case with respect to research and production
joint ventures before the passage of the National Cooperative
Research and Production Act of 1993, if relief from the threat of
liability under the antitrust laws is not granted to voluntary
consensus standards bodies, both regarding the development of new
standards and efforts to keep existing standards current, such
bodies could be forced to cut back on standards development
activities at great financial cost both to the Government and to
the national economy.

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Section 2 of the National Cooperative Research and Production Act
of 1993 (15 U.S.C. 4301) is amended--
(1) in subsection (a) by adding at the end the following:
``(7) The term `standards development activity' means any
action taken by a standards development organization for the
purpose of developing, promulgating, revising, amending, reissuing,
interpreting, or otherwise maintaining a voluntary consensus
standard, or using such standard in conformity assessment
activities, including actions relating to the intellectual property
policies of the standards development organization.
``(8) The term `standards development organization' means a
domestic or international organization that plans, develops,
establishes, or coordinates voluntary consensus standards using
procedures that incorporate the attributes of openness, balance of
interests, due process, an appeals process, and consensus in a
manner consistent with the Office of Management and Budget Circular
Number A-119, as revised February 10, 1998. The term `standards
development organization' shall not, for purposes of this Act,
include the parties participating in the standards development
organization.
``(9) The term `technical standard' has the meaning given such
term in section 12(d)(4) of the National Technology Transfer and
Advancement Act of 1995.
``(10) The term `voluntary consensus standard' has the meaning
given such term in Office of Management and Budget Circular Number
A-119, as revised February 10, 1998.''; and
(2) by adding at the end the following:
``(c) The term `standards development activity' excludes the
following activities:
``(1) Exchanging information among competitors relating to
cost, sales, profitability, prices, marketing, or distribution of
any product, process, or service that is not reasonably required
for the purpose of developing or promulgating a voluntary consensus
standard, or using such standard in conformity assessment
activities.
``(2) Entering into any agreement or engaging in any other
conduct that would allocate a market with a competitor.
``(3) Entering into any agreement or conspiracy that would set
or restrain prices of any good or service.''.

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Section 3 of the National Cooperative Research and Production Act
of 1993 (15 U.S.C. 4302) is amended by striking ``of any person in
making or performing a contract to carry out a joint venture shall''
and inserting the following: ``of--
``(1) any person in making or performing a contract to carry
out a joint venture, or
``(2) a standards development organization while engaged in a
standards development activity,
shall''.

eda5e6e18bccd92fff91eebaff72fa0e47e7a9d1f514d8c597870c2f7e690c3d

Section 4 of the National Cooperative Research and Production Act
of 1993 (15 U.S.C. 4303) is amended--
(1) in subsections (a)(1), (b)(1), and (c)(1) by inserting ``,
or for a standards development activity engaged in by a standards
development organization against which such claim is made'' after
``joint venture'',
(2) in subsection (e)--
(A) by inserting ``, or of a standards development activity
engaged in by a standards development organization'' before the
period at the end, and
(B) by redesignating such subsection as subsection (f), and
(3) by inserting after subsection (d) the following:
``(e) Subsections (a), (b), and (c) shall not be construed to
modify the liability under the antitrust laws of any person (other than
a standards development organization) who--
``(1) directly (or through an employee or agent) participates
in a standards development activity with respect to which a
violation of any of the antitrust laws is found,
``(2) is not a fulltime employee of the standards development
organization that engaged in such activity, and
``(3) is, or is an employee or agent of a person who is,
engaged in a line of commerce that is likely to benefit directly
from the operation of the standards development activity with
respect to which such violation is found.''.

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Section 5 of the National Cooperative Research and Production Act
of 1993 (15 U.S.C. 4304) is amended--
(1) in subsection (a) by inserting ``, or of a standards
development activity engaged in by a standards development
organization'' after ``joint venture'', and
(2) by adding at the end the following:
``(c) Subsections (a) and (b) shall not apply with respect to any
person who--
``(1) directly participates in a standards development activity
with respect to which a violation of any of the antitrust laws is
found,
``(2) is not a fulltime employee of a standards development
organization that engaged in such activity, and
``(3) is, or is an employee or agent of a person who is,
engaged in a line of commerce that is likely to benefit directly
from the operation of the standards development activity with
respect to which such violation is found.''.

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Section 6 of the National Cooperative Research and Production Act
of 1993 (15 U.S.C. 4305) is amended--
(1) in subsection (a)--
(A) by redesignating paragraphs (1), (2), and (3) as
subparagraphs (A), (B), and (C), respectively,
(B) by inserting ``(1)'' after ``(a)'', and
(C) by adding at the end the following:
``(2) A standards development organization may, not later than 90
days after commencing a standards development activity engaged in for
the purpose of developing or promulgating a voluntary consensus
standards or not later than 90 days after the date of the enactment of
the Standards Development Organization Advancement Act of 2004,
whichever is later, file simultaneously with the Attorney General and
the Commission, a written notification disclosing--
``(A) the name and principal place of business of the standards
development organization, and
``(B) documents showing the nature and scope of such activity.
Any standards development organization may file additional disclosure
notifications pursuant to this section as are appropriate to extend the
protections of section 4 to standards development activities that are
not covered by the initial filing or that have changed significantly
since the initial filing.'',
(2) in subsection (b)--
(A) in the 1st sentence by inserting ``, or a notice with
respect to such standards development activity that identifies
the standards development organization engaged in such activity
and that describes such activity in general terms'' before the
period at the end, and
(B) in the last sentence by inserting ``or available to
such organization, as the case may be'' before the period,
(3) in subsection (d)(2) by inserting ``, or the standards
development activity,'' after ``venture'',
(4) in subsection (e)--
(A) by striking ``person who'' and inserting ``person or
standards development organization that'', and
(B) by inserting ``or any standards development
organization'' after ``person'' the last place it appears, and
(5) in subsection (g)(1) by inserting ``or standards
development organization'' after ``person''.

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Nothing in this title shall be construed to alter or modify the
antitrust treatment under existing law of--
(1) parties participating in standards development activity of
standards development organizations within the scope of this title,
including the existing standard under which the conduct of the
parties is reviewed, regardless of the standard under which the
conduct of the standards development organizations in which they
participate are reviewed, or
(2) other organizations and parties engaged in standard-setting
processes not within the scope of this amendment to the title.

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This title may be cited as the ``Antitrust Criminal Penalty
Enhancement and Reform Act of 2004''.
Subtitle A--Antitrust Enforcement Enhancements and Cooperation
Incentives

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TITLE II

-ANTITRUST CRIMINAL PENALTY ENHANCEMENT AND REFORM ACT OF 2004

(a) In General.--Except as provided in subsection (b), the
provisions of sections 211 through 214 shall cease to have effect 5
years after the date of enactment of this Act.
(b) Exception.--With respect to an applicant who has entered into
an antitrust leniency agreement on or before the date on which the
provisions of sections 211 through 214 of this subtitle shall cease to
have effect, the provisions of sections 211 through 214 of this
subtitle shall continue in effect.

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In this subtitle:
(1) Antitrust division.--The term ``Antitrust Division'' means
the United States Department of Justice Antitrust Division.
(2) Antitrust leniency agreement.--The term ``antitrust
leniency agreement,'' or ``agreement,'' means a leniency letter
agreement, whether conditional or final, between a person and the
Antitrust Division pursuant to the Corporate Leniency Policy of the
Antitrust Division in effect on the date of execution of the
agreement.
(3) Antitrust leniency applicant.--The term ``antitrust
leniency applicant,'' or ``applicant,'' means, with respect to an
antitrust leniency agreement, the person that has entered into the
agreement.
(4) Claimant.--The term ``claimant'' means a person or class,
that has brought, or on whose behalf has been brought, a civil
action alleging a violation of section 1 or 3 of the Sherman Act or
any similar State law, except that the term does not include a
State or a subdivision of a State with respect to a civil action
brought to recover damages sustained by the State or subdivision.
(5) Cooperating individual.--The term ``cooperating
individual'' means, with respect to an antitrust leniency
agreement, a current or former director, officer, or employee of
the antitrust leniency applicant who is covered by the agreement.
(6) Person.--The term ``person'' has the meaning given it in
subsection (a) of the first section of the Clayton Act.

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(a) In General.--Subject to subsection (d), in any civil action
alleging a violation of section 1 or 3 of the Sherman Act, or alleging
a violation of any similar State law, based on conduct covered by a
currently effective antitrust leniency agreement, the amount of damages
recovered by or on behalf of a claimant from an antitrust leniency
applicant who satisfies the requirements of subsection (b), together
with the amounts so recovered from cooperating individuals who satisfy
such requirements, shall not exceed that portion of the actual damages
sustained by such claimant which is attributable to the commerce done
by the applicant in the goods or services affected by the violation.
(b) Requirements.--Subject to subsection (c), an antitrust leniency
applicant or cooperating individual satisfies the requirements of this
subsection with respect to a civil action described in subsection (a)
if the court in which the civil action is brought determines, after
considering any appropriate pleadings from the claimant, that the
applicant or cooperating individual, as the case may be, has provided
satisfactory cooperation to the claimant with respect to the civil
action, which cooperation shall include--
(1) providing a full account to the claimant of all facts known
to the applicant or cooperating individual, as the case may be,
that are potentially relevant to the civil action;
(2) furnishing all documents or other items potentially
relevant to the civil action that are in the possession, custody,
or control of the applicant or cooperating individual, as the case
may be, wherever they are located; and
(3)(A) in the case of a cooperating individual--
(i) making himself or herself available for such
interviews, depositions, or testimony in connection with the
civil action as the claimant may reasonably require; and
(ii) responding completely and truthfully, without making
any attempt either falsely to protect or falsely to implicate
any person or entity, and without intentionally withholding any
potentially relevant information, to all questions asked by the
claimant in interviews, depositions, trials, or any other court
proceedings in connection with the civil action; or
(B) in the case of an antitrust leniency applicant, using its
best efforts to secure and facilitate from cooperating individuals
covered by the agreement the cooperation described in clauses (i)
and (ii) and subparagraph (A).
(c) Timeliness.--If the initial contact by the antitrust leniency
applicant with the Antitrust Division regarding conduct covered by the
antitrust leniency agreement occurs after a State, or subdivision of a
State, has issued compulsory process in connection with an
investigation of allegations of a violation of section 1 or 3 of the
Sherman Act or any similar State law based on conduct covered by the
antitrust leniency agreement or after a civil action described in
subsection (a) has been filed, then the court shall consider, in making
the determination concerning satisfactory cooperation described in
subsection (b), the timeliness of the applicant's initial cooperation
with the claimant.
(d) Continuation.--Nothing in this section shall be construed to
modify, impair, or supersede the provisions of sections 4, 4A, and 4C
of the Clayton Act relating to the recovery of costs of suit, including
a reasonable attorney's fee, and interest on damages, to the extent
that such recovery is authorized by such sections.

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Nothing in this subtitle shall be construed to--
(1) affect the rights of the Antitrust Division to seek a stay
or protective order in a civil action based on conduct covered by
an antitrust leniency agreement to prevent the cooperation
described in section 213(b) from impairing or impeding the
investigation or prosecution by the Antitrust Division of conduct
covered by the agreement;
(2) create any right to challenge any decision by the Antitrust
Division with respect to an antitrust leniency agreement; or
(3) affect, in any way, the joint and several liability of any
party to a civil action described in section 213(a), other than
that of the antitrust leniency applicant and cooperating
individuals as provided in section 213(a) of this title.

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(a) Restraint of Trade Among the States.--Section 1 of the Sherman
Act (15 U.S.C. 1) is amended by--
(1) striking ``$10,000,000'' and inserting ``$100,000,000'';
(2) striking ``$350,000'' and inserting ``$1,000,000''; and
(3) striking ``three'' and inserting ``10''.
(b) Monopolizing Trade.--Section 2 of the Sherman Act (15 U.S.C. 2)
is amended by--
(1) striking ``$10,000,000'' and inserting ``$100,000,000'';
(2) striking ``$350,000'' and inserting ``$1,000,000''; and
(3) striking ``three'' and inserting ``10''.
(c) Other Restraints of Trade.--Section 3 of the Sherman Act (15
U.S.C. 3) is amended by--
(1) striking ``$10,000,000'' and inserting ``$100,000,000'';
(2) striking ``$350,000'' and inserting ``$1,000,000''; and
(3) striking ``three'' and inserting ``10''.
Subtitle B--Tunney Act Reform

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(a) Congressional Findings and Declaration of Purposes.--
(1) Findings.--Congress finds that--
(A) the purpose of the Tunney Act was to ensure that the
entry of antitrust consent judgments is in the public interest;
and
(B) it would misconstrue the meaning and Congressional
intent in enacting the Tunney Act to limit the discretion of
district courts to review antitrust consent judgments solely to
determining whether entry of those consent judgments would make
a ``mockery of the judicial function''.
(2) Purposes.--The purpose of this section is to effectuate the
original Congressional intent in enacting the Tunney Act and to
ensure that United States settlements of civil antitrust suits are
in the public interest.
(b) Public Interest Determination.--Section 5 of the Clayton Act
(15 U.S.C. 16) is amended--
(1) in subsection (d), by inserting at the end the following:
``Upon application by the United States, the district court may,
for good cause (based on a finding that the expense of publication
in the Federal Register exceeds the public interest benefits to be
gained from such publication), authorize an alternative method of
public dissemination of the public comments received and the
response to those comments.'';
(2) in subsection (e)--
(A) in the matter before paragraph (1), by--
(i) striking ``court may'' and inserting ``court
shall''; and
(ii) inserting ``(1)'' before ``Before''; and
(B) striking paragraphs (1) and (2) and inserting the
following:
``(A) the competitive impact of such judgment, including
termination of alleged violations, provisions for enforcement and
modification, duration of relief sought, anticipated effects of
alternative remedies actually considered, whether its terms are
ambiguous, and any other competitive considerations bearing upon
the adequacy of such judgment that the court deems necessary to a
determination of whether the consent judgment is in the public
interest; and
``(B) the impact of entry of such judgment upon competition in
the relevant market or markets, upon the public generally and
individuals alleging specific injury from the violations set forth
in the complaint including consideration of the public benefit, if
any, to be derived from a determination of the issues at trial.
``(2) Nothing in this section shall be construed to require the
court to conduct an evidentiary hearing or to require the court to
permit anyone to intervene.''; and
(3) in subsection (g), by inserting ``by any officer, director,
employee, or agent of such defendant'' before ``, or other
person''.
Speaker of the House of Representatives.
Vice President of the United States and
President of the Senate.

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Standards Development Organization Advancement Act of 2004 — HR. 1086

Other Sections

TITLE I

TITLE II

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