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ARTICLE · 31 AUGUST 2017

FTC Challenges Trade Association's Rules Restricting Access To Jointly Developed Technology

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This enforcement action raises important issues for trade organizations and professional associations as well as others that engage in competitor collaborations and joint research and development efforts.

United StatesAntitrust/Competition Law

On August 18, 2017, the Federal Trade Commission (FTC) announced a consent decree settling charges that the National Association of Animal Breeders (NAAB) violated Section 5 of the FTC Act by adopting restrictions on its members' use of certain technology rights held by NAAB. 1 The technology, jointly developed by NAAB and the Department of Agriculture, is a genetic testing technology that predicts the transmission of commercially valuable traits by cattle sold for breeding. While NAAB had exclusive rights to the technology, the FTC alleged that it "acted as a combination of its Members" when it prohibited individual members from using the technology with respect to bulls they did not own, at least in part. The FTC alleged that NAAB's rules were a method of unfair competition under the Act that unlawfully "impeded" the development of a market for the sale of access to the technology and "dampened" competition in cattle transactions conducted without access to the

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