!071194 Justice Department investigating CDROM "cartel" CD LICENSING ACTIVITIES UNDER SCRUTINY The Justice Department is investigating whether Sony Corp. and Philips Electronics NV violated antitrust statutes through a practice called patent pooling. The investigation focuses on how the companies jointly charge patent-licensing fees to make and market compact disks. After cross-licensing their patents in the 1970s, the two firms have collected millions of dollars a year in fees, while ensuring that new developments in CD technology remain compatible with their products. "This whole story is a classic example of how technology that originally started in the U.S. is now completely in the hands of foreign companies that have basically used the patent system in a way it wasn't intended to be used," says the executive vice president of the largest independent U.S. disk maker. Greg Aharonian Internet Patent News Service