The ever-increasing importance of inter-operability and standardisation has been reflected in a surge in litigation of Standard Essential Patents and FRAND issues. The UK jurisdiction has taken a leading position with its willingness to provide a global solution.

With its leading high-tech patent litigation and competition law practices, and over a decade’s experience in leading cases, Bristows is uniquely placed to advise both patent owners and implementers alike.

SEP/FRAND disputes require a particular type of expertise possessed by only a very few firms globally. At Bristows, five partners and a group of specialist associates within the patent litigation group work seamlessly with two partners and their associates in the competition law group to provide a bespoke service which is second to none.

In an area where forum shopping is of critical importance, our expertise naturally extends to the jurisdictional and international coordination aspects of the subject. Our market-leading patent litigation practice, with numerous physicists, engineers and computer scientists, can deal with the most complex technology, be it in telecoms, automotive or other sectors. Our competition team, with its deep understanding of the economic and commercial realities of licensing can frame the best possible case for an appropriate FRAND licence, whether that case needs to be made in court, before an arbitral panel, or a competition regulator.

Bristows’ clients, whether they are patentees, implementers or patent pools, trust the combined team to really ‘get’ the issues in this complex and fast-moving field.

We are familiar with many ETSI, IEEE, ITU and other standards, and the patent litigators understand the particular issues arising in the litigation of standard essential patents, such as identification of working group proposals which may form part of the prior art. The competition team understands how FRAND licences are negotiated in practice, and common issues such as hold-up / hold out, royalty stacking and privateering, as well as advising on compliance with the Huawei v ZTE CJEU regime both before and during litigation.

FRANDly Chat podcast

Are two tech-focused patent litigators have a keen interest in coffee chats and FRAND (often both at the same time). One day, it was suggested that they capture these discussions and share them with the world. So, every time there's a significant development in the UK concerning FRAND, please join them for a FRANDly Chat.

 
All information was correct at the time of recording.

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FRAND case tracker

We keep an eye on all global FRAND developments. As part of that, we have built a tool to provide a brief flavour of interesting decisions handed down by British Courts in the FRAND space. We have included all the cases in the last 15 years that we think contain useful guidance, even if they were case management judgments. We worked hard to track down some judgments that, although public, are not easily available. For each of them, we have provided a short summary, the judge(s) and a description of some of the main points. Inevitably, the list of decisions will not be entirely complete – we have left out some not-so-interesting judgments – and the summary description will omit certain important details. However, for each case you can download the full judgment to read it in detail. 

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Date

Parties

Lenovo Group Limited and others v InterDigital and others

Neutral Citation

[2024] EWHC 742 (Pat)

Judge

Zacaroli, Mr Justice

This judgment deals with the retrospective application by Lenovo to use confidential documents and information which had been disclosed in previous proceedings between the same parties.

 

The previous proceedings between Interdigital and Lenovo had resulted in the terms of a FRAND licence to the Interdigital portfolio being set by Mellor J. As part of those proceedings Interdigital disclosed to Lenovo certain confidential patent licence agreements (“PLAs”) between Interdigital and various third parties. The disclosure of the PLAs took place under a strict confidentiality protocol with the consent of the third parties whose confidential information was also being disclosed, and the PLAs were also subject to the CPR 31.22 restriction on use other than for the purpose of these first proceedings.

 

Lenovo subsequently brough a second claim against Interdigital, primarily to establish the terms of the FRAND licence following the expiry of the licence determined by Mellor J. In preparing its pleadings for the second claim, Lenovo breached CPR 31.22 and the terms of the confidentiality protocol by using three of the PLAs. Lenovo’s solicitors had included confidential information from the PLAs in a draft version of their particulars of claim, which had then been circulated to individuals who were not entitled to view that confidential information for the purposes of the second set of proceedings. Lenovo subsequently amended their particulars of claim to only refer to publicly available information.

 

In assessing whether to grant Lenovo’s retrospective application, the Judge noted that (i) the burden was on Lenovo to seek permission to use the information, (ii) the court will generally only grant permission for collateral use if there are specific circumstances which constitute a cogent reason, and (iii) the bar is even higher where retrospective permission is sought.

 

The Judge accepted Lenovo’s evidence that the breach was inadvertent, in that their solicitors had not appreciated that it was a misuse of the confidential information. Although the breach was serious, only minimal reference was made to confidential aspects of the PLAs (whose existence had been publicly disclosed in the first proceedings), and none to commercially sensitive information. The Judge also considered “most importantly… that had an application been made timeously it would have been granted” as the two separate sets of proceedings were so closely related. The Judge also noted that it would be contrary to the interests of justice to bar Lenovo from relying on the confidential information in the second set of proceedings, as those proceedings would then be at risk of continuing on “an uninformed basis and potentially a false premise”. In the circumstances, the Judge decided to allow the application and to allow Lenovo to rely on the confidential information in the second set of proceedings.

 

However, the Judge highlighted Lenovo’s failure to inform relevant third parties promptly of the breaches and their “inexcusable” delay of 6 months in applying for retrospective permission, and took the rare step of ordering Lenovo to pay Interdigital’s costs in relation to the application on an indemnity basis.

Parties

Lenovo Group Limited and others v InterDigital and others

Neutral Citation

[2023] EWHC 3212 (Pat)

Judge

His Honour Judge Hacon

This judgment deals with how the court should move forward with Lenovo’s interim licence application. At the time of the hearing, the licence entered into between Lenovo and Interdigital, following Mellor J’s judgment dated 4 July 2023, was about to expire. In the present proceedings, Lenovo seek a new FRAND licence settled by the court. An interim licence is sought to extend the existing licence (on the terms held by Mellor J subject to retrospective modification) until such time as the new FRAND determination can be heard.

 

This hearing took place in the context of parallel litigations in multiple jurisdictions across the world including Chinese, German and American actions. The German action is of particular significance as a trial is fixed for 21 March 2024 which puts Lenovo at risk of being injuncted and therefore being placed under “unfair” (in their submission) commercial pressure.

 

Lenovo's proposal was that a two-day hearing should be listed, to be heard soon enough for a decision on the interim licence application to be given before the date of the trial in Munich. InterDigital's proposal was that Lenovo's interim licence application should be stayed. HHJ Hacon refused the stay of the interim licence application. The Judge had regard to whether staying the application would be tantamount to defeating it altogether. Lenovo submitted that the point of their application was two-fold; to avoid a temporal gap in their licence and to demonstrate that Lenovo is a willing licensee to the German court. HHJ Hacon did not consider the first reason to be compelling but could not dismiss the possibility that such a demonstration may have persuasive power in the German action and would therefore lose all value if stayed.

 

HHJ Hacon was satisfied that the application could be heard in two days and considered InterDigital’s arguments presented issues that were more appropriately dealt with at the interim license application hearing itself. These arguments were that the interim license application was, in reality, an attempt to seek an anti-suit injunction “via the backdoor” (the submissions referred to Royal Bank of Canada v Cooperative Centrale Raiffeinsen-Boerenleenbank) and that the English Court should not make an order with the purpose of influencing a decision of the German court.

Parties

Lenovo Group Limited and others v Telefonaktiebolaget LM Ericsson and another

Neutral Citation

[2023] EWHC 3222 (Pat)

Judge

Meade, Mr Justice

In this directions application, it was necessary for Mr Justice Meade to determine whether Lenovo’s interim licence application would be dealt with at the same time as Ericsson’s jurisdiction challenge. The Judge characterised Lenovo’s objective in the proceedings as obtaining a worldwide determination of FRAND terms, including the rate. The interim licence application concerns what should happen in the period of time between the initiation of FRAND proceedings and their determination. The Judge noted that this question is “a new and important one which has been before the Patents Court in a number of other proceedings… [that] will require development and decision as matters go forwards”.

 

An important aspect of Lenovo’s interim licence application was a declaration that the pursuit of relief in foreign proceedings would be in breach of the nature of the obligations on a willing licensor in the circumstances of Ericsson. Lenovo submitted that the situation was urgent as, if a foreign court were to enforce the relief granted and take Lenovo off the market, they would suffer grave damage.

 

Mr Justice Meade felt that the relief sought by Lenovo had a “strong flavour of anti-suit” as it was sought for the purposes of influencing foreign courts. The Judge accepted the urgency and gravity of the situation from Lenovo’s perspective, but noted that it was a matter for the foreign court to consider what is just to do in light of the fact that Lenovo has committed to take a licence on terms to be determined by the English court, if jurisdiction can be established. While acknowledging Lenovo’s concern that it not be pressured by infringement litigation, the Judge also noted Ericsson’s concern that Lenovo has not hitherto paid money in relation to royalties for the use of Ericsson’s SEPs. 

 

The Judge ultimately agreed with Ericsson that it ought not to have to prepare for or fight the interim licence application, which, despite its name, seeks final relief, without it first being decided whether the court has jurisdiction over the defendants and over the interim licence issues. He considered that the power to do so may exist, as suggested by Morgan J in Optis v Apple, but that it is one that the Court should “exercise sparingly”.

 

There were also logistical concerns with fitting the interim licence application into the hearing listed for February 2024.  Mr Justice Meade noted that the interim licence application would involve a factual dispute as to the behaviour of the parties as well as argument regarding the legal framework of the FRAND obligations which arise from the ETSI regime. The Judge also observed that the obligations asserted by Lenovo would require significant consideration.

 

While Mr Justice Meade ordered that the interim licence application ought not to be included in the February hearing, he expressed “considerable sympathy” for Lenovo’s contention that it may be unfairly prejudiced by the existence and continuation of foreign proceedings.  In this regard he noted that Ericsson ought to expect to be held to its estimate of one month to prepare its substantive evidence on the interim licence application if Lenovo is successful in resisting the jurisdiction challenge.

Parties

InterDigital Technology Corporation and others v OnePlus Technology (Shenzhen) Co., Ltd and others

Judge

Smith, Mrs Justice Joanna

A number of applications were heard during the CMC relating to the following three issues:

  1. Whether OnePlus should be granted permission to re-designate Dr. Padilla's first expert report from "External Eyes Only" to "Highly Confidential" (HCONF), and whether Mr Xiao may replace Mr Huang in the HCONF club (the ‘Re-designation Issue’);
  2. Whether OnePlus should be granted permission to amend their responsive statement of case on FRAND by the addition of a licence agreement from 2014 with Samsung (the ‘Amendment Issue’);
  3. Whether OnePlus' application for the provision of disclosure and inspection of documents evidencing InterDigital's internal reasoning for entering comparable licence agreements at the rates agreed should be granted (the 'Disclosure Issue’).

 

OnePlus was granted permission to re-designate Dr. Padilla's first expert report. InterDigital had not objected to the application for re-designation, but the report contained information relating to the counterparties to four comparable licences. One of the counterparties had consented and another counterparty had not replied. Joanna Smith J noted that the objections provided by the remaining two counterparties were in "the briefest of terms" and the counterparties had neither explained their objections in a letter to court nor attended the hearing to make representations. The Judge considered this indicated a "low level of concern on their part". She agreed with the submission from OnePlus that "it is incumbent upon the counterparties to justify what is a rare and stringent form of order in relation to confidentiality" and that the counterparties’ responses did not provide any such justification.

 

Joanna Smith J also granted the order sought by OnePlus for the admittance of Mr Xiao in place of Mr Huang to the HCONF club, noting that objections from counterparties were in the same vague terms as to the re-designation request and again showed a very low level of concern. Joanna Smith J considered that InterDigital’s concerns were reasonable as, whilst at the time of the CMC Mr Xiao was in a litigation role, if his role were to change (for example to a role involving negotiation of licences) InterDigital might object to his inclusion in the HCONF club. The Judge therefore granted the order subject to a requirement for OnePlus to update InterDigital if Mr Xiao changes his role, within seven days of any such change.

 

OnePlus was granted permission to rely on the 2014 Samsung licence. Joanna Smith J presented several key reasons for granting this order. First, OnePlus would be prejudiced by the refusal of permission. She noted that OnePlus' expert considered the 2014 Samsung licence to play an important part in his opinion in response to InterDigital’s expert evidence. Joanna Smith J considered that the prejudice InterDigital would experience by the granting of the application did not outweigh the prejudice OnePlus would experience by its refusal

 

Second, InterDigital would not be approaching this new licence from a standing start; they have previously considered it in InterDigital Corporation v Lenovo [2023] EWHC 1583 (Pat). Indeed, various documents, such as the negotiation summary schedule, relating to that licence may be reused wholesale in this new matter, somewhat reducing the additional burden placed upon InterDigital

 

Third, whilst InterDigital may adduce new witness evidence or disclosure to address the Samsung 2014 licence, there was no good reason why OnePlus would need to file further expert evidence or other new material.

 

Joanna Smith J therefore ordered that the amendment application be permitted and that the negotiation summary schedule relating to Samsung 2014 and unredacted witness statements from the Lenovo litigation be disclosed. Additionally, permission was granted for any further evidence from InterDigital in the form of documents of witness statements necessitated by reason of the amendment.

 

OnePlus' application for provision of disclosure and inspection of documents was granted in limited form. By the time of the hearing the dispute had narrowed to consider disclosure of the “Deal Approval Documents” only. Although it was common ground that the documents are of peripheral nature, Joanna Smith J ordered their disclosure. The key reasons were: 1) InterDigital have served evidence addressing their subjective internal decision-making and internal views and assumptions at the time of entering into the comparable licences; and 2) there was no practical difficulty in producing the documents - InterDigital had indicated they could provide the documents within the requested time limit.

Parties

Panasonic Holdings Corporation v Xiaomi Technology Limited and Ors

Neutral Citation

[2023] EXCH 2249 (Pat) and [2023] EXHC 2250 (Pat) and [2023] EWHC 2872 (Pat)

Judge

Meade, Mr Justice

These hearings took place on 3 and 8 November 2023 to determine the trial sequence and timing. Xiaomi sought an expedited FRAND trial in July or October 2024 with no technical trials. Panasonic opposed the expedition and proposed February 2025 for the FRAND trial instead. Oppo opposed an expedition of the FRAND trial to July 2024 but agreed to either October 2024 or February 2025. Unlike Xiaomi, it insisted on technical trials on the basis that Panasonic’s portfolio had “not yet been tested in litigation”. The parties agreed that two technical trials could take place after the FRAND trial.

 

Mr Justice Meade granted Xiaomi’s request to expedite a FRAND hearing to October 2024, which will take place ahead of the technical trials (following the guidance in Nokia v Oppo).This constitutes a shift away from traditional trial sequencing of having the FRAND trial after technical trials on infringement and validity issues.

 

In July 2023, the Japanese electronics company Panasonic launched proceedings in the UK, Germany and the UPC against the Chinese implementers Xiaomi and Oppo, asserting infringement of four SEPs declared to be essential to the 4G standard. As part of its claim, Panasonic sought a FRAND determination by the English court. Xiaomi and Oppo filed defences seeking the revocation of Panasonic’s patents contending that they were willing licensees and Panasonic an unwilling licensor.

 

While Xiaomi was prepared to commit itself to take a FRAND licence on terms settled by the English court, Oppo was not. Xiaomi stated its primary concern was the risk of Panasonic obtaining and enforcing injunctions in the German and/or UPC proceedings ahead of the UK court’s FRAND decision. Xiaomi contended that this might have forced Xiaomi to agree to supra-FRAND rates or even leave the market in other jurisdictions.

 

The court commended Xiaomi’s readiness to commit to the court’s FRAND terms and “move efficiently towards their determination”, i.e. without the trouble of lengthy and costly technical trials.

 

At the second hearing, Panasonic did not agree to give an undertaking not to enforce any injunctions obtained at the UPC or German court pending the UK FRAND trial, even if Xiaomi were bound to enter into the UK court-determined licence. Panasonic argued that it was “a matter for the UPC and the German Court to determine whether to grant and permit enforcement of any injunctive relief” (second hearing, para 8) and thus the UPC or Germany was the appropriate forum in which Xiaomi should advance any contention that relief injunctive relief should not be granted or enforced.

 

Meade J expressed reservations about Panasonic’s position in “[preserving] its option to obtain and enforce an injunction against Xiaomi, despite the fact that Xiaomi is committed to take a FRAND licence on terms decided by [the English] court […]”.

 

Xiaomi noted that in light of Panasonic’s position, it may seek declarations in respect of Panasonic’s willingness or of an interim licence. Meade J indicated that the court would accommodate such applications but was clear that he was not expressing any opinion about the prospects of success of such routes.

 

Meade J applied the WL Gore criteria to determine whether expedition of the FRAND trial was appropriate. The Judge considered “it would be folly” to try to cram the FRAND trial into a slot in July, but considered expedition to October 2024 was justified:

  • There was good reason as the expedition would reduce the injunction risk and may bring the litigation to a faster conclusion.
  • There was no interference with the good interest of justice as, even though the expedition would invoke extra work on the court, it could be achieved “without anybody losing their place in the list”
  • There was no prejudice to Panasonic as it had agreed to abide by the judge’s decision that a trial in October was feasible; and
  • The special factors were in favour of the expedition, and to protect the court’s procedure moving towards a FRAND trial.

 

Further, Meade J recorded his assumption that a FRAND licence between Panasonic and Xiaomi “will definitely result” from the UK FRAND trial, so that the German courts and UPC could “take a decision about what to do without any doubt or equivocation at all as to what is forthcoming in the UK” if faced with an application from Panasonic for the grant and enforcement of a first-instance injunction.

 

With regard to Oppo’s request for the technical trials, Meade J agreed to list the technical trials slightly after the FRAND trial as requested but urged Oppo to take “a fresh view about whether technical trials are indeed necessary” if it becomes apparent to Oppo that it is bound to infringe at least some patents.

Parties

Nokia v Oppo

Neutral Citation

[2023] EXCH 2249 (Pat) and [2023] EXHC 2250 (Pat)

Judge

Meade, Mr Justice

These Form of Order hearings following ‘Trial E’ in these proceedings (that held that Oppo was not licenced pursuant to the ETSI Policy – see Nokia v Oppo [2023] EWHC 1912) set out to determine three issues.  

  1. Whether Oppo should be granted permission to appeal, and whether a ‘leapfrog’ appeal to the Supreme Court should be certified under s.12 Administration of Justice Act 1969 (the ‘Appeal’ issue);
  2. Oppo’s position on the election it would make between committing to the FRAND licence determined by the UK court, or be injuncted from the UK market (the ‘Remedies’ issue);
  3. The costs of Trial E (the ‘Costs’ issue).

The Appeal Issue

Oppo was granted permission to appeal. Meade J noted that its ground, that Nokia’s seeking of an injunction in the UK proceedings, was an abuse of a dominant position was exceptionally weak. However, the impact on the Chinese proceedings, and questions about there being an existing licence under French law, were deemed complex and important points of law that should be considered by a higher court.

Meade J then certified a ‘leapfrog’ appeal to the Supreme Court under s.12 Administration of Justice Act 1969. At the time, the Supreme Court had given Apple permission to appeal the ‘Optis F’ decision, although it was understood that Apple was likely to withdraw this. The Judge considered that, by giving permission to appeal, the Supreme Court had expressed an opinion that there was a point of law of general importance. It was noted that ‘‘…numerous other players in the SEP world…would be keen to know the answers to the arguments that Oppo is already licensed and the effect of parallel proceedings abroad”.

The wording of the certificate expressly allowed Oppo permission to appeal any/all other grounds that the Supreme Court did not hear to the Court of Appeal. However, if the only ground remaining was the Competition Law ground then Oppo was not given permission to appeal.

The Remedies Issue

Following the conclusion of Trial E, Oppo was expected to be in a position by the Form of Order hearing to either make its election, or otherwise explain why it could not do so. Oppo was clear that it would not make its election, and outlined three options for the court’s consideration:

  • Option A: Oppo argued that it should not be required to make an election yet, therefore no injunction should be ordered. This was because it would affect its case in the Chongqing proceedings where the parties are awaiting judgment. Oppo submitted expert evidence that said if Oppo were to undertake to the English courts, Chongqing would likely consider a judgment unnecessary. Oppo argued that the pending judgment distinguished it from Optis v Apple [2023] EWHC 1095 (Ch). Meade J did not accept this argument, and was not convinced that Chongqing would not hand down its judgment in the circumstance where a trial had already occurred. During the hearing Nokia confirmed it would not use Oppo’s undertaking to stay or dismiss the Chongqing proceedings. The Judge therefore concluded Oppo must make its election prior to seeing the terms of the FRAND licence.

As Oppo would not undertake, Meade J granted an injunction.

  • Option B: Oppo argued that if it were injuncted then the injunction should be stayed. It submitted commercial evidence on the irreparable harm it would suffer if it had to come off the market (and then re-enter, assuming a successful appeal), including switching losses from multi-year contracts, damage to its relationships with carriers, difficulty in quantifying loss during the injunction period, brand damage and reduced innovation. Although Meade J felt some of this evidence was overplayed, such as reputational harm, Nokia failed to respond to any of these submissions. Oppo had been operating on the market since 2021 without a licence, and an injunction would disturb with status quo pending the appeal. Meade J therefore stayed the injunction.
  • Option C: As the Judge had granted the injunction and stay, the final option – i.e. an injunction with no stay – was not addressed.

Status of Trial D (the ‘FRAND trial’)

Nokia argued that, as Oppo would not commit to take a licence, it would be a waste of resources for the parties to have a licence determined with a term running until June 2024. Nokia therefore argued for the first time in its skeleton argument that the FRAND trial should be adjourned. What was needed was a resolution to determine what Oppo should pay for a meaningful period in the future. Meade J then considered three scenarios following the appeal:

  1. Trial E / Optis F reversed: In this scenario, where the injunction was stayed, Oppo would have been treated fairly. It was not legally required to make an election until the outcome of the FRAND trial therefore it was in no worse a position.
  2. Trial E / Optis F maintained, FRAND trial adjourned: If it was determined that Oppo ought to have committed to the FRAND terms unseen prior to the FRAND trial, and it was adjourned, then the parties would be back in the same position, albeit later in time.
  3. Trial E / Optis F maintained, FRAND trial not adjourned: This scenario, where Oppo would have sight of the terms of the licence, would rob Nokia of the effect of Optis F. It would result in wasted costs, only for Oppo to (potentially) reject the terms and leave the UK market.

Given Oppo had stressed that the Chongqing Court should determine the FRAND rate throughout the proceedings, Meade J did not understand Oppo’s reasoning that Trial D should proceed. It was therefore adjourned. The Judge said that had he been alerted to the fact that the licence would be expiring soon, he would have suggested earlier on in the proceedings that it be settled for a longer term.

 

 

The Costs Issue

Costs of Trial E: Meade did not make any reduction in Nokia’s awarded costs as the successful party. Oppo tried to argue that Nokia was ‘unsuccessful’ on elements on French and Chinese evidence, however, it was found that this evidence helped to reduce the disagreement on foreign law rather than Nokia being ‘unsuccessful’.

Costs of the Form of Order hearing: Meade J found that there was no basis for displacing the general presumption of costs in the case, despite Oppo being ‘successful’ on some issues such as its evidence on irreparable harm.

Parties

Nokia v Oppo

Neutral Citation

[2023] EWHC 1912 (Pat)

Judge

Meade, Mr Justice

This was Trial E in these proceedings, inserted into the schedule after Trial A at Oppo's request. Trial A had held a Nokia SEP to be valid and infringed by Oppo. In these proceedings, Oppo sought various declarations to protect itself from injunctive relief.

Oppo pointed to Clause 6.1 of the ETSI IPR Policy, under which Nokia had undertaken to ETSI that it would be prepared to grant FRAND licences to its SEPs, and the fact that it had undertaken to take a licence determined by the Chongqing Court in the parallel proceedings  (if necessary with an adjustment for the UK/EU market as determined in the English proceedings). Oppo argued that the effect of Clause 6.1 was either (i) it was already licensed via the mechanism of stipulation pour autrui in French law, in which case no infringement had occurred, or (ii) being entitled to a licence in due course made it a beneficiary under Clause 6.1 (or would do should it undertake to the English court to accept a licence on the terms determined FRAND in the parallel Chongqing proceedings, as it already had done to Nokia). It also sought declarations that Nokia was an unwilling licensor, and that its seeking injunctive relief constituted abuse of its dominant position.

Nokia sought a declaration that Oppo was not a beneficiary under Clause 6.1 and had no right to enforce Nokia’s undertaking to ETSI unless it gave its own undertaking to take a licence on terms determined FRAND by the English court.

The court found that Oppo was not already licensed. If Clause 6.1 were to create an automatic contractual relationship between the parties without any prior discussion as to terms, the validity of the contract would be vulnerable to failure for uncertainty. The court found that Clause 6.1 only required Nokia to make a FRAND offer capable of acceptance by Oppo.

Nor was Oppo a beneficiary under Clause 6.1.  Oppo had undertaken only to accept a FRAND licence as determined by the Chongqing court, not the English court. Whilst Meade J accepted that in this particular case the Chongqing court was likely to expediently set FRAND terms, as a matter of principle a defendant found by the English court to infringe should not be permitted to remain on the market unlicensed pending a decision in a foreign jurisdiction of its election; to permit this would be contrary to the English court’s obligation to provide an effective remedy. Moreover, should two courts provide alternative FRAND terms, the choice of which FRAND licence to offer should be at the patentee’s, not the implementer’s, election. However, Meade J also noted that the English Courts would try hard to prevent FRAND rate-setting in respect of overlapping geographies being conducted in two fora at once at the patentee’s election.

As Nokia was entitled to choose between alternative FRAND terms, its undertaking to grant a licence on terms determined by the English court was sufficient to make it a willing licensor and the fact that it was not prepared to commit to the result in Chongqing did not make it unwilling. The court found that Oppo was an unwilling licensee for undertaking only to take a licence on the terms set in Chongqing.

Nokia’s pursuit of an injunction was not an abuse of dominance. Once an SEP owner has committed to give a FRAND licence on terms determined by the court, it is entitled to seek an injunction against an infringer who will not commit to take such a licence.

Meade J concluded by noting that it was ever clearer that technical trials are not really what these disputes are about: what is really in issue are the FRAND terms for a licence. He cautioned against deferring FRAND trials, and in particular disclosure of comparables, as doing so is likely to impede the resolution of the dispute.

Parties

InterDigital v Lenovo & Motorola

Neutral Citation

[2023] EWHC 1578 (Pat)

Judge

Mellor, Mr Justice

This consequentials hearing followed Mr Justice Mellor’s FRAND judgment in March 2023, and addressed (i) whether interest should be paid on the FRAND lump sum payable by Lenovo ($138.7m); (ii) various issues concerning the terms of the FRAND licence; (iii) permission to appeal; and (iv) costs.

On interest, InterDigital asserted that it would be FRAND for the sum payable to include interest on royalties for past sales. This would reflect how a willing licensee should behave and reduce incentives for hold-out. It was also consistent with the approach taken by the parties experts when they converted past royalties to present value by taking into account interest rates. InterDigital sought a rate based on its comparable licences (in the range 5-10%), or in the alternative 4% per annum (the rate agreed by both parties to be FRAND for late payments) compounded quarterly. Lenovo contended that an award of interest would incentivise hold-up by encouraging licensors to make excessive demands knowing they would receive a favourable interest rate on any judgment. Further, InterDigital had no contractual right to interest under the FRAND obligation, as it was not mentioned in the ETSI IPR Policy or ETSI Guide. Should interest be awarded, Lenovo contended that it should run from November 2018 at the earliest and that the rate should be no higher than the Bank of England base rate +1% on a simple (i.e., non-compound) basis.

The Court considered that whether interest should be payable on past royalties depended on whether a willing licensor and a willing licensee would agree that interest should be payable. The court held on balance that they would and that interest should be payable, in part because InterDigital should be compensated for the delay in receiving the funds. A licensee concerned about hold-up could make payments on account and/or begin a FRAND determination itself. The court held the licence rate should apply of 4% per annum, compounded quarterly, which resulted in an interest payment of $46.2m.

On costs, the court declared Lenovo as the overall winner of the FRAND trial, noting it had been successful on all three aspects of the case and the awarded unit rate of $0.175 was closer to that sought by Lenovo ($0.16) and a 'long way' from that sought by InterDigital ($0.53). Similarly, the determined lump sum payable of $138.7m was closer to Lenovo's offer of $80 million than InterDigital's initial offer of $337m. Accordingly, InterDigital was ordered to pay Lenovo's costs of the FRAND trial, though excluding Lenovo's costs spent on the issues of foreign law and interest. On those aspects, Lenovo was ordered to pay InterDigital’s costs as it had lost on the interest arguments and the foreign law arguments appeared to be a device to avoid having to commit to the court determined licence.

Finally, the court granted InterDigital permission to appeal the FRAND judgment on several points of principle, including: (i) whether account should be taken of the subjective and/or ex post facto views of one party as to the value of its comparable licences; (ii) the consistency of various discounts offered by InterDigital with FRAND; and (iii) the court’s approach to discouraging hold-out. Lenovo was granted permission to appeal on the relevance of national limitation periods to the relationship between a willing licensor and willing licensee. In addition, both parties were given permission to appeal the question of interest.

Parties

InterDigital v Lenovo & Motorola

Neutral Citation

[2023] EWHC 1577 (Pat)

Judge

Mellor, Mr Justice

This judgment concerns the outstanding confidentiality issues following the FRAND judgment in IDC v Lenovo [2023] EWHC 539 (Pat), in particular the redactions to the public version of the FRAND judgment. The Court applied the principles set out by Mr Justice Birss in his judgment on confidentiality in Unwired Planet v Huawei [2017] EWHC 3083 (Pat).

 

The overarching principle was that all parts of a judgment should normally be publicly available, but the Court was willing generally to maintain three types of redaction: (i) where there is already sufficient information made available to understand the reasoning/ FRAND judgment; (ii) where the information could be reverse engineered to draw inferences about confidential royalty rates; and (iii) IDC’s licensing practices. In all cases, the information should be of a confidential or valuable nature and therefore should not be unilaterally made public.

 

In particular, the following redactions were maintained generally to avoid reverse engineering: various licensing rates including the certain 4G rates unpacked by InterDigital's expert known as the LER (the Licensee Effective Rate), the CBR (Common RR-Basis Rate) and the PDR (Pre-Discount Rate) (these rates are explained more fully in paragraph 300 of the FRAND judgment); effective per unit rates; certain information relevant to market share; various data relevant to the unpacking process; and the identity of a specific licensee AB. In contrast, the Court decided that the redactions should be removed where the information was already made public elsewhere; it was historic information of a low degree of confidence; and/or where information was necessary to understand the FRAND judgment and its reasoning. In the case of at least one table, certain rates were unredacted subject to anonymisation and randomisation of the order in which they were listed (as the underlying rates were important for understanding the judgment).

Parties

Optis & Unwired Planet v Apple

Neutral Citation

[2023] EWHC 1095 (Ch)

Judge

Smith, Mr Justice Marcus

This judgment concerns a determination of the terms of a FRAND licence to the Optis portfolio for Apple. It is the third substantive FRAND determination issued by the English Courts.

 

The Court determined that an annual lump sum of US$5.13 million was FRAND as between the parties. This was a global blended rate for all countries and all technologies, and covers all future Apple products that need a licence. The licence should run until the expiry of all the SEPs in the portfolio, with the Court holding that five years’ royalties was appropriate to reflect this (i.e., the forward looking portion of the licence is US$25.65 million). Additionally, Apple required a release for past infringement, with the Court calculating this based on when Optis first “asserted itself” against Apple (the past release therefore needed to cover six years, meaning the backward looking portion of the licence is US$30.78 million). Further, the Court made a provisional finding that compound interest should be paid on past due royalties at a rate of 5% per annum.

 

The Court’s approach to the FRAND determination was novel. The parties had each produced multiple comparable licences (Optis’ related to its portfolio, and Apple’s to other portfolios it had licensed). However, the Court held that the licences adduced by each of Optis and Apple were so categorically different so as not to form a single pool. Further, the expert evidence on licence unpacking of both parties was held by the Court to be overly subjective, with the Court noting that the unpacking exercise appeared simply to be an articulation of each instructing party’s case. The Judge commented that the more unpacking that was required to make a licence appear comparable, the less likely it was a good comparable.

 

Optis’ licences were additionally branded as “worse than useless” given the size of many of the counterparties and the corresponding inequality in bargaining power. The Court was concerned that some of Optis’ licences had been entered into for the purpose of establishing comparables rather than being the result of genuine negotiations. In contrast, Apple’s licences were viewed by the Court as being more reliable (although still to be “treated with caution”).

 

Data from a third party data provider was used to determine the size of the total SEP universe being licensed (the “Stack”), excluding the 5G standard, with the Court again preferring the less subjective data. The Stack was held to comprise 26,600 patent families, although a figure of 22,000 was used in the judgment to account for the Stack increasing in size over time. Optis’ share of the Stack was held to be 0.61% based on its 135 patent families, though this was reduced to 0.38% for Apple (for reasons that are redacted).

 

The Court calculated the total value of the Stack to Apple that was implied by each Apple licence (excluding outliers). These values were subject to a series of adjustments in order to calculate an average value of the Stack to Apple, which was then used to calculate the value of Optis’ portfolio to Apple.

 

The Court also addressed other disputes between the parties. Apple’s argument for a smallest saleable patent practising unit (SSPPU) approach was dismissed as “indefensible”. Optis’ top-down cross-check was held to be untenable due to the unjustified use of ad valorem and headline rates, as well as internal inconsistencies. Apple was held to have negotiated in good faith and Optis’ conduct was held not to be abusive, though the parties’ allegations of hold-up and hold-out were held to be “entirely irrelevant”.

 

Note: this summary was prepared on the basis of the May 2023 original public judgment.

Parties

InterDigital v Lenovo & Motorola

Neutral Citation

[2023] EWHC 539 (Pat)

Judge

Mellor, Mr Justice

This judgment concerns the determination of FRAND terms in this action. It is the first judgment to determine FRAND terms since the High Court decision in Unwired Planet v Huawei [2017] EWHC 2988 (Pat). This judgment will be of interest to all parties involved in FRAND negotiations given its potential impact on those negotiations in future (subject to any appeals).

 

Going into trial, the parties’ FRAND offers were $80m (Lenovo) and $336.7m (InterDigital) for a six-year licence (to the end of 2023) covering all past sales. The parties both contended that their respective offers were FRAND (with Lenovo including a +/- 15% adjustment to identify the FRAND range, said to reflect the imprecision in unpacking a blended rate for past and future sales from the comparable licences). Lenovo relied on the seven InterDigital licences with the largest counterparties as comparables (the Lenovo 7). InterDigital relied on 20 licences with smaller companies (InterDigital 20) and a top-down cross-check.

 

The Court held that neither party's offer was FRAND or within the FRAND range. Instead, based on a comparables analysis, a rate of $0.175 per device was FRAND. Based on Lenovo's sales data in the relevant period (to 31 December 2023 and all unlicensed past sales), that equated to a lump sum of $138.7m. The Court focused on one particular comparable licence (LG 2017) within the Lenovo 7, which it then adjusted (i) to account for different sales mixes by standard, and (ii) to reflect different sales mixes by geography (specifically, the split between developed and emerging markets). The issue of whether interest should be awarded was adjourned to the final order hearing.

 

On the selection of comparable licences, the Court noted that there was no evidence that the Lenovo 7, which included LG 2017, were impacted by hold-out. The Court also noted the evidence of Lenovo's expert that the Lenovo 7 accounted for nearly 98% of the cellular units licensed by InterDigital. It focused on LG 2017 in particular given the similarity to Lenovo, holding that the similarity of Lenovo to the relevant licence counterparty was a relevant factor (and that the other licences did not assist because of the difference in situation with Lenovo). In contrast, the Court concluded that the InterDigital 20 were not really comparables for numerous reasons, and also took issue with the approach InterDigital had taken to unpacking comparable licences using subjective factors (which distorted the unpacked rate).

 

On the approach to unpacking comparable licences, the Court emphasised that an objective approach should be taken. The Court was critical (on the facts) of using the subjective evidence of the licensor (for example, how it accounted internally for past and future sales in relation to licence payments). Further, the only discounts that the Court considered to be FRAND were those relating directly to the time value of money. Large volume discounts resulted in discrimination against smaller licensees and should not be considered FRAND. In particular, on the facts they appeared to have no economic justification but rather appeared designed to 'shore up' the program rates.

 

Similarly, the Court held that there was no justification for discounting past sales, which should be paid for in full. Further, the Court found that limitation periods had no role in the relationship between a "willing licensor" and a "willing licensee" and accordingly were irrelevant when looking at past sales. Equally, substantial discounts for past sales should not be used artificially to inflate unpacked future rates.

 

The Court dismissed InterDigital's top-down cross-check as of “no value” in “any of its guises”. The primary reason for this was factual: it supported InterDigital's case on its comparables analysis and the fact that the results of that analysis had been held not to be FRAND was a “solid reason” to dismiss the cross-check. The Court also criticised the cross-check as being “crude” and subject to other substantive and procedural shortcomings.

 

The Court also made a number of other interesting findings. First, it found that the price of a device that infringes the SEPs in question should be irrelevant to the royalties payable on that device (hence the rate held to be FRAND was not an ad valorem rate). Second, it found that it was important to apportion for other standards (Wi-Fi and HEVC in this case), which InterDigital's valuation expert did not do (together they were held to comprise 13% of the value of a licence). Third, it commented that a FRAND injunction ought to have been granted following the finding that a potential SEP was valid, essential and infringed, and that InterDigital was not entitled to an unqualified injunction. Fourth, although of limited relevance, the Court held that both parties had been "unwilling" at times, though ultimately that was of limited concern given the right to undertake to enter into the Court-determined FRAND licence.

 

The judgment is also notable for its postscript on the case management of FRAND cases. In particular, the Court explains that active case management is beneficial in FRAND cases, which should include agreement on a common data set to be used by both parties in their unpacking analyses, and also draws the attention of parties to the English Court's disclosure regime as a means to improve transparency in FRAND licensing negotiations.

 

A more detailed analysis document may be found here.

Parties

Kigen v Thales

Neutral Citation

[2023] EWHC 313 (Pat)

Judge

Campbell KC, Recorder Douglas

This judgment arises out of proceedings relating to the licensing of GSMA essential patents (covering the eSIM and iSIM standards). It concerns a number of case management issues, including whether the technical trial or FRAND trial should be tried first, the order of pleadings on both the technical and FRAND cases and separate disputes on the confidentiality regime and costs budgeting.

 

In Kigen v Thales [2022] EWHC 2846 (Pat), Fancourt J held that the FRAND case would be stayed until Kigen either (i) amended its particulars of claim to make clear it was claiming a FRAND licence only to the extent the patents were held to be valid and essential, or (ii) provided an undertaking to enter into a FRAND licence. Following this judgment, Kigen gave an undertaking to enter into a licence for all Thales’ relevant essential IPR in the term determined to be FRAND by the English Court. With the question as to whether Kigen would take such a licence no longer being an issue, the Court turned to the central issues put before the Court in this hearing.

 

The sequence of trials

In support of its argument that the technical trial should be heard first, Kigen’s main proposition was that a judgment on validity would have a substantial effect on what figures the Court would eventually determine to be FRAND at the FRAND trial. Referring to the overriding objective, Kigen also pointed out that a technical trial would occupy less court time and that, according to the parties’ costs budgets, a FRAND trial would be more expensive.

 

Conversely, Thales’ main reason for wanting the FRAND trial to heard first centred around its proposition that the dispute is primarily a commercial one. Thales argued that there are some issues which can only be determined at the FRAND trial and that the royalty could be structured so that if the technical trials led to revocation then the royalty rate could be reduced appropriately, with provisions for claw-back of overpaid royalty.

 

The Court held that the FRAND trial should be heard first and the technical trial stayed, essentially for the reasons set out by Thales. In particular, the Court agreed that the FRAND trial is always likely to be necessary and it would resolve issues relating to how the valuation should approach different types of units, as well as whether to use comparables or a top-down approach for setting a FRAND royalty – these topics would not be considered at all in the technical trials. Kigen came to the Court seeking a FRAND determination and gave an undertaking to enter into a FRAND licence, so the Court held that its judgment was “giving Kigen what it wants with the opportunity to have a subsequent technical trial… later if it sees fit”. If the outcome of the FRAND trial is unsatisfactory for Kigen, it is still able to pursue technical litigation and the royalty rate can be adjusted if required. The Court agreed with Thales’ observation that this adjustment could be either up or down, depending on the outcome of the technical trial; however, the crucial point is Kigen will have that option available to it.

 

The order of pleadings

With regard to both the technical and the FRAND pleadings, the Court held that for both sets of pleadings the patentee (the defendant in this case) should go first, followed by the claimant. The Court agreed with Thales’ submission that sequential pleadings would be more efficient.

 

The confidentiality regime

The issue pertaining to the confidentiality regime focussed on whether recipients of highly confidential material should be required to give an undertaking in the form of a “licensing bar” as follows:

 

“I confirm that I am not presently involved in negotiating SEP licensing (excluding ancillary legal support) and undertake not to become so involved whilst I have access to the Highly Confidential Materials (or any part of them) in accordance with the Order or for two years after the date that I cease to have access.”

 

The Court stated that (i) Thales’ evidence on this point was too weak to justify a need for this undertaking as it relied on hypothetical documents and events, (ii) the undertaking sought was of a particularly broad nature and (iii) it was too early in the litigation to make the licensing bar order sought.

 

This finding does not affect Thales’ liberty to apply for an order in relation to any specific documents in the future.

 

Costs budgeting

Most FRAND cases fall outside the scope of the High Court costs budgeting regime, because the value of the licence is claimed to exceed £10 million (the CPR threshold for costs budgeting to apply). That was not the case here, and the Court accordingly considered submissions on the application of the costs budgeting regime in this case.

Parties

InterDigital v OnePlus

Neutral Citation

[2022] EWCA Civ 166

Judge

Birss, Lord Justice

The appeal was heard by Lord Justice Bean, Lord Justice Peter Jackson, and Lord Justice Birss. Lord Justice Birss delivered the lead judgment.

 

This was an appeal from an order concerning the undertaking required from OnePlus’ in-house counsel in order to access material designated as Highly Confidential under a two-tier confidentiality regime. The High Court had ordered that the prohibition against such individuals being involved in SEP licensing for a period of two years after they ceased to have access to the documents should apply to any SEP licensing. OnePlus contended on appeal that the High Court should have ordered a narrower form of undertaking, limited to licensing discussions with particular counterparties to the InterDigital licences disclosed.

 

The Court of Appeal upheld the order of the High Court, specifically its decision to adopt a wide form of undertaking prohibiting those with access to Highly Confidential documents from engaging in any SEP licensing. The Court rejected the argument that the only unfairness that could arise would be if the relevant individual became involved in licensing negotiations with the counterparty to a licence they had seen. In the Court’s view, information about the terms of a licence between InterDigital and counterparty A also had value in the context of a licensing negotiation between OnePlus and a different counterparty B.

 

The Court concluded that the order made at first instance was open to the judge based on the early stage in the proceedings and the limited evidence about OnePlus' structure and organisation. In particular, the Court explained that imposing a wider form of order at an early stage is sensible as it is more straightforward to relax confidentiality restrictions over the course of proceedings than to impose tighter restrictions after starting with a more liberal regime.

Parties

Nokia v Oppo

Neutral Citation

[2022] EWHC 3395 (Pat)

Judge

Meade, Mr Justice

This was a consequentials hearing following Meade J’s 9 November judgment that Oppo had infringed an implementation patent belonging to Nokia. Nokia sought an injunction and an order for an inquiry as to damages or an account of profits, at its election, with Island Records v Tring disclosure to inform that election. It also claimed various costs.

 

The court declined to grant an injunction at this stage, as Oppo had claimed to already be licensed under French law. Meade J deferred judgment on this point to Trial E, scheduled for the following spring. Whilst an injunction prior to Trial E was inappropriate, the court rejected Oppo’s additional argument that it would be disproportionate. It would be feasible for Oppo to obtain the information necessary to satisfy an injunction from Qualcomm without breaching its confidentiality, and it remained open to Oppo to seek guidance from the court if necessary. Moreover, an injunction would restrict the chips Oppo could use, but would not force it off the market.

 

Oppo argued that any damages due to Nokia would be de minimis and therefore an inquiry as to damages would be fruitless. Whilst the court agreed that Nokia’s recovery was likely to be modest, this was not sufficient to make an inquiry fruitless, and an order for an inquiry as to damages or an account of profits, at Nokia’s election, was appropriate. However, Meade J reserved his decision on a disclosure order pending Nokia’s statement of case setting out the framework for its claim. Whilst Island Records v Tring disclosure is routinely ordered in simple cases, it is not the claimant’s automatic entitlement and should be tailored to the circumstances of the case. In this case the disclosure sought was likely to be burdensome and cause substantial confidentiality issues.

 

The court made some deductions to Nokia’s costs for separable issues relating to the patent in suit. It found Nokia’s costs relating to experiments and the 1782 proceedings to be reasonably incurred and made no deduction for the fact that the experiments had revealed some non-infringement by Oppo, which Nokia had acknowledged. Meade J applied the Norwich Pharmacal relief principle that the applicant should pay the respondent’s costs and recover them at a later stage from the defendant if successful. Regarding Nokia’s post-trial costs, the court made a 50% deduction for the portion relating to the injunction that had not been granted, and reserved the remainder to Trial E.

 

Meade J refused permission to appeal, finding that Oppo had no real prospect of winning on the ground of obviousness and that the main factual point in its argument had already been rejected.

Parties

Kigen v Thales

Neutral Citation

[2022] EWHC 2846 (Pat)

Judge

Fancourt, Mr Justice

Kigen sought declarations that two UK patents were invalid and/or not essential to certain GSM standards (relating to eSim technology), and declarations (i) that Kigen was entitled to a FRAND licence to Thales' essential IPR and (ii) as to the terms of such a FRAND licence. Thales challenged the court's jurisdiction to undertake the FRAND determination in the circumstances and sought a forum conveniens stay in the alternative.

 

Thales argued that the FRAND aspects purported to be a free-standing contractual-based claim relating to the GSM standards (in particular, the FRAND declarations were claimed in addition to, not in the alternative to, the other declarations). The position in this case was different to the position before the UK Supreme Court in Unwired Planet (where FRAND was raised as a defence to an infringement action). Further, Kigen's unwillingness to undertake to the court to take a FRAND licence where the patents were both held to be invalid and/or non-essential was an abuse of process and a waste of the court's resources. Thales' preferred option was to pursue ADR.

 

The Court disagreed that there was no issue before the court that gave it jurisdiction to determine FRAND terms. On the contrary, the claim pleaded a free-standing contractual basis for a FRAND licence and sought a determination of those terms. The court's power to determine such a licence was not limited to situations where there had first been a finding of infringement. Instead, the key issue was Kigen's unwillingness to give an undertaking to take the FRAND licence and whether that was abusive. In that regard the court was concerned by the discrepancy between Kigen's pleaded case (that it wanted a FRAND licence) and that advanced at the hearing (that it was unwilling to provide the undertaking). The court held that Kigen should either amend its case to reflect its position at the hearing (i.e., that it only seeks a licence insofar as it is required after validity and essentiality are considered), or it should provide an undertaking to enter into the FRAND licence. Until such time as Kigen takes one of those actions, the FRAND case would be stayed.

 

The forum non conveniens aspects of the application were dismissed since ADR proceedings were not an alternative forum for the purposes of that application.

 

Finally, the court emphasised that it was not establishing a general rule that in the case of a free-standing claim for a FRAND licence an undertaking would be required since each case would turn on its facts. Similarly, how the case should proceed and be case managed was a matter for a future hearing notwithstanding the discussion of various options in the judgment.

Parties

Optis & Unwired Planet v Apple

Neutral Citation

[2022] EWCA Civ 1411

Judge

Arnold, Lord Justice

The appeal was heard by Lord Justice Arnold, Lady Justice Asplin, and Lady Justice Elisabeth Laing. Lord Justice Arnold delivered the lead judgment.

 

This was Apple's appeal against the High Court's declaration inter alia that (i) any person interested in implementing an ETSI standard must be entitled to have a FRAND licence on demand from a patentee which had given the relevant undertaking; (ii) a party could not be permanently deprived of that right; and (iii) a FRAND injunction should issue if Apple was unwilling to give a binding commitment to take a UK court-determined FRAND licence following one of Optis' SEPs being held valid, essential and infringed. Optis cross-appealed, seeking the right to obtain an unqualified injunction absent a binding commitment being given at the relevant time.

 

The Court upheld the first instance decision, dismissing both parties' appeals. The ETSI IPR Policy should be interpreted, in line with what was said by the UK Supreme Court in Unwired Planet v Huawei, to avoid the related issues of hold-out and hold-up. The Judge's conclusion achieved that balance whereas the interpretations contended for by both Optis and Apple did not.

 

A party seeking a licence must be prepared to take it otherwise there was the potential to promote hold-out. Further, by doing so a party was not committing to sign a 'blank cheque', as it was improbable that the English court would determine FRAND terms that were uncommercial or unviable. Equally, the suggestion that a party should become permanently disentitled to rely upon the FRAND obligation would promote hold-up. There is no reason why an implementer should not be able to change its mind, and every reason why it should be able to do so given the purpose of the ETSI IPR Policy.

 

The judgment is also notable for the judicial commentary in a postscript: "These appeals illustrate yet again the dysfunctional state of the current system for determining SEP/FRAND disputes. Apple’s behaviour in declining to commit to take a Court-Determined Licence once they had been found to infringe EP744, and their pursuit of their appeal, could well be argued to constitute a form of hold out (whether Apple have in fact been guilty of hold out is an issue for Trial E); while Optis’ contention that an unqualified injunction should be granted would open the door to hold up. Each side has adopted its position in an attempt to game the system in its favour. The only way to put a stop to such behaviour is for SDOs like ETSI to make legally-enforceable arbitration of such disputes part of their IPR policies."

Parties

Nokia v Oppo

Neutral Citation

[2022] EWCA Civ 947

Judge

Arnold, Lord Justice

The appeal was heard by Lord Justice Peter Jackson and Lord Justice Phillips. Lord Justice Arnold delivered the lead judgment.

 

This was Oppo's appeal against the High Court's declaration that (i) the English Courts should exercise jurisdiction over Nokia's claim for SEP infringement and a determination of FRAND terms, and (ii) that a stay on case management grounds in favour of a parallel FRAND rate setting action in Chongqing should not be granted. (See [2021] EWHC 2952 (Pat).)

 

The Court upheld the first instance decision. On the issue of forum (non) conveniens, the Court agreed that the claim was characterised properly as one relating to SEP infringement, in line with the joint UKSC decision in Unwired Planet and Conversant. The developments since that UKSC decision did not affect the logic of that conclusion and consequently, England was an appropriate forum.

 

The Court went on to conclude that even if the claim was characterised (incorrectly) as a dispute over global FRAND licensing terms, there was no 'natural' forum to determine such a claim and none of the factors considered favoured one forum over another. At best Chongqing was no more appropriate a forum than England.

 

On the issue of the case management stay, the Court reiterated that such first instance decisions should be afforded a high degree of deference. The High Court had made no error in its assessment and thus the Court would not reconsider the matter. However, in any event, the Court confirmed that it would have reached the same conclusion, and, if anything, would have put more weight on the factors against the grant of a stay.

Parties

Godo Kaisha IP Bridge 1 v Huawei

Neutral Citation

[2022] EWHC 1766 (Pat)

Judge

Meade, Mr Justice

This was a FRAND case management conference that dealt with a number of extant issues between the parties, including the confidentiality of comparable licences, pleading amendments and disclosure. The FRAND trial is listed for Summer 2023.

 

Huawei sought the re-designation of a number of comparable licences from 'External Eyes Only' to 'Confidential Between Parties'. The Court acknowledged the relevance to that exercise of knowing which comparable licences the parties were likely to put emphasis on, though equally this created a circular argument since it was difficult for a party to establish that without having seen the licences. The Court ordered Huawei to provide evidence on which licences they apprehend are likely to be important, and the Court would then consider the application after the provision of IP Bridge's FRAND evidence in October.

 

Huawei also sought to amend its case on alleged exhaustion of patent rights to include an alternative plea that even if there was no exhaustion as a matter of fact, a willing licensor and licensee would take into account uncertainties around exhaustion in a hypothetical negotiation. This gave rise to questions of foreign law, and the Court ordered the parties to produce statements of case on both Delaware law (as the law of the relevant licences) and Chinese law (as the primary territory where exhaustion is likely to be pleaded to have taken place).

 

The Court also granted a request by Huawei for disclosure of IP Bridge's communications with Panasonic concerning (i) IP Bridge's negotiations with Huawei, and (ii) the litigation between IP Bridge and Huawei in the UK, Germany and/or China. The Court was not satisfied that a reasonable and proportionate search had taken place since it had focused on one individual and one email account, with insufficient justification as to why that was said to be adequate.

Parties

Nokia v Oppo

Neutral Citation

[2022] EWHC 1745 (Pat)

Judge

Meade, Mr Justice

Oppo applied to admit a statement by a Qualcomm employee explaining changes made to certain chipset software and the reasons for those (connected to the recent disclosure of Qualcomm source code). Nokia opposed its introduction on the basis of its irrelevance to the issues at trial.

 

The Court admitted the statement notwithstanding its view that the content likely was not relevant to the issues at trial since it may have potential relevance should certain issues arise and, further, to not admit it would require amendment of one of the expert reports. The Court cautioned, however, that the position should be kept under review and noted there were severe questions over the weight that could be placed on the statement, not least because it would be challenging to cross-examine the witness given the absence of associated documentary material to scrutinise.

Parties

Philips v Oppo

Neutral Citation

[2022] EWHC 1703 (Pat)

Judge

Meade, Mr Justice

This was an on-notice, return hearing relating to an interim anti-anti-suit injunction (AASI) obtained by Philips, which restricted members of the Oppo, OnePlus and Realme group (Oppo) from seeking anti-suit relief from a foreign court. The interim AASI was obtained ex parte at a without notice hearing on 4 May 2022. Oppo challenged the scope of the interim AASI and offered a contractual undertaking to Philips to give notice before seeking relief from the Chinese courts that might restrain Philips from pursuing its UK action.

 

The Court agreed with Philips that Oppo’s previous history of seeking anti-suit relief, coupled with the irreversible result of obtaining such relief in the People's Republic of China, founded an adequate, imminent threat. This was notwithstanding the fact that Oppo had asserted in evidence that it had no intention to seek anti-suit relief and that it had not sought anti-suit relief in other recent UK cases in which it was a defendant. Further, a contractual undertaking was not an adequate alternative to the AASI.

 

However, the Court restricted the scope of the injunction to the People’s Republic of China and declined to include a restriction that would prevent Oppo from seeking relief that would “interfere with” the UK claim. The word risked penalising Oppo taking procedural arguments in the People's Republic of China and the UK court made it clear that any relief ought not to hinder enforcement of foreign proceedings, which the court found in this case were not imminent in time.

 

The Court therefore granted quia timet relief in the form of an AASI injunction, but indicated that it was willing to accept an undertaking to the Court instead of granting an injunction.

Parties

Optis & Unwired Planet v Apple

Neutral Citation

[2022] EWHC 422 (Pat)

Judge

Smith, Mr Justice Marcus

The hearing concerned an application for disclosure in relation to Trial E (scheduled for June/July 2022), which inter alia will determine the terms of a FRAND licence to Optis’ portfolio. Apple asserted that its own licence negotiations with counterparties would provide a helpful indication as to what the FRAND rate should be in relation to Optis’ patents. Optis sought disclosure to enable it to challenge Apple’s case, and the key question for the court was the extent of disclosure needed for that purpose.

 

The court proceeded on the basis of Apple’s threefold internal categorisation of its records of licence negotiations: (i) Personal Files, being the personal files of Apple employees engaged in the negotiations; (ii) Negotiation Records, being the records of correspondence for each licence agreement entered into, as collected by custodians of the correspondence filing it into the relevant negotiation file; and (iii) Collected Negotiation Documents, being the Negotiation Records with administrative documents removed and then reviewed for relevance by Apple’s lawyers.

 

Given the volume of documentation, both parties contended initially for a sampling approach. However, Apple argued that the process of reviewing both the Personal Files and the Collected Negotiation Documents for privilege, relevance and confidentiality would take a long time. The court agreed and ordered disclosure and inspection only of the Collected Negotiation Documents to a limited number of Optis’ lawyers, subject to a privilege review by Apple. The order included safeguards (including an undertaking from the external lawyers given access) to protect privileged documents that may inadvertently be disclosed during the process.

 

Disclosure of the Personal Files was not ordered as the court considered this to be disproportionate; not only would it be impractical, but Optis would be unlikely to gain any additional benefit from the exercise. The court cautioned against seeking further disclosure due to the potential patchiness of Apple’s collation of the Negotiation Records inherent in how they were compiled, which was “one of those things”. However, the court was careful also to state “never say never” when it came to Optis requesting further disclosure from Apple after the documents had been reviewed by both sides.

Parties

Nokia v OnePlus

Neutral Citation

[2022] EWHC 293 (Pat)

Judge

Smith, Mr Justice Marcus

This hearing concerned an application by Nokia for alternative service of the claim form by email on the first and third defendants (D1 and D3), which were based in the People’s Republic of China. Nokia had obtained permission to serve D1 and D3 out of the jurisdiction in July 2021. Service was estimated to take six to eight months under the Hague Service Convention, but in December 2021 the receiving authority in China returned the documents. The Foreign Process Section was unable to explain why the documents had been returned, though the courier employed cited issues with customs documentation (notwithstanding that no customs documentation was required for legal documents). Nokia then sought the order for alternative service.

 

The court considered there to be a two-stage test: there must be a good reason to permit alternative service (in line with CPR r.6.15), and there must be special or exceptional circumstances to depart from the Hague Service Convention given it was an international treaty.

 

The court stated that a claimant did not have to achieve ‘perfection’ in attempting service, the purpose of which was to draw the claim to the attention of a defendant. Nokia was not at fault and the Hague Service Convention process likely would take a further 12 months or more, with there being no guarantee that the same problem would not arise again. Accordingly, there was a good reason for ordering alternative service.

 

As regards there being special or exceptional circumstances, the court stated that this was a balancing act between the due administration of justice and comity: where “the interests of the former outweigh those of the latter that special circumstances or exceptional circumstances exist”. In the court’s view, granting alternative service would have only a slight effect on comity given the facts of the case. In contrast, there would be a considerable effect on the due administration of justice, with the trial date being linked to the estimated time for service. Therefore, the order for alternative service was granted.

Parties

InterDigital v Lenovo & Motorola

Neutral Citation

[2021] EWHC 3401 (Pat)

Judge

Hacon, His Honour Judge

This hearing concerned the question of whether Lenovo should be injuncted on the basis that they refused unequivocally to undertake to enter into a FRAND licence determined by the court, following the court’s finding in July 2021 that InterDigital’s EP 558 patent was valid and essential and had been infringed by Lenovo. The judgment examines the recent decision in Optis v Apple concerning the interpretation of clause 6.1 of the ETSI IPR Policy under French law and the availability of injunctive relief ([2021] EWHC 2564 (Pat)) (the Optis Decision). The parties adduced evidence from experts on French, Chinese and US law.

 

Lenovo submitted that it was prepared to commit to a FRAND licence that is “settled by the United States court incorporating a determination by the Chinese court”. Lenovo added that it would be prepared to commit to a licence settled by the UK Court “so long as a mechanism is provided for ensuring that the determination of the United States and Chinese courts in the existing proceedings are given effect”. Counsel for Lenovo explained that (i) a condition of this commitment was that InterDigital should enter into a ‘reciprocal undertaking’ that it would not oppose giving effect to the determination of the Chinese and United States courts; (ii) ensuring existing proceedings are given effect would involve a global FRAND licence settled by the UK Court taking into account Chinese and United States law and practice; and (iii) Lenovo would decide whether to accept the terms of the FRAND licence only once the judge in the FRAND trial had given his or her ruling.

 

InterDigital argued that the facts of this case were similar to those in the Optis Decision. In that case, Mr Justice Meade had held it was not the intention of clause 6.1 of the ETSI IPR Policy to permit an implementer to “have the benefit of the patentee's FRAND undertaking in terms of immunity from being sued, without the corresponding burden of taking a licence”, and that if an implementer was found to infringe an SEP then it must commit to accepting a FRAND licence or risk an injunction. InterDigital argued that Lenovo was unwilling unequivocally to commit to accept a FRAND licence despite having been found to infringe one of its SEPs, and therefore the Court should follow the Optis Decision and grant an injunction. Lenovo contended that the principles established in the Optis Decision did not apply in this case as they were made on the basis that the English courts were the only tribunal that could determine the terms of a global FRAND licence.

 

The court noted that the effect of an implementer giving an unqualified commitment to accept a FRAND licence settled by another tribunal, for example a court in another jurisdiction, had not been assessed in the Optis Decision and raised a new point of French law. Whilst Lenovo’s commitment was not unqualified, and its qualifications were vague, the court considered it was not possible to say that Lenovo’s commitment disqualified Lenovo from benefitting from InterDigital’s undertaking to ETSI. Accordingly, the court refused to grant the injunction sought, noting the issue was best disposed of at the imminent FRAND trial due to take place in January 2022, with the benefit of full argument and the cross-examination of the experts.

Parties

InterDigital v Lenovo & Motorola

Neutral Citation

[2021] EWHC 3192 (Pat)

Judge

Mellor, Mr Justice

At the pre-trial review, the court had to address issues around the confidentiality of certain comparable licence agreements and the information derived from them. Specifically, the present three-tier confidentiality regime did not include a tier that permitted Lenovo personnel to see un-redacted copies of the licence agreements relied on as comparables (and the associated evidence).

 

The court agreed with the parties that it was appropriate for there to be a tier granting access to certain LEO information to specified persons at Lenovo in the light of recent case law. This tier should allow two persons at Lenovo (a general counsel and an employee from the financial department) to have access, subject to the requirement that both should be barred from taking part in licensing negotiations for five years. However, a read-only restriction was not warranted as it would be unduly burdensome to arrange supervised access to the documents in the lead up to, and during, trial.

 

The court also refused to allow an anonymised list of unpacked effective rates and weighted averages to be re-designated as non-confidential, noting that even anonymised the document contained information that could be of value to Lenovo and third parties if it were to be made public without restriction. However, the court did allow the weighted average figures to be de-designated, and cautioned that this decision did not rule out other information in the document from being included in a public judgment in due course. Various extracts from Lenovo’s expert reports concerning anonymous weighted average per-unit rates and other analyses of the offers and comparables were also de-designated by the court on the basis that a public judgment from the FRAND trial could not be meaningful without this type of information being included.

Parties

Nokia v Oppo

Neutral Citation

[2021] EWHC 2952 (Pat)

Judge

Hacon, His Honour Judge

The hearing concerned Oppo’s application for an order that the English court either decline jurisdiction or, in the alternative, issue a case management stay of all, or at least the FRAND aspects, of the proceedings. Oppo had commenced concurrent proceedings in the People’s Republic of China (specifically the Chongqing Court) for a standalone determination of the terms of a global FRAND licence for Nokia’s SEPs.

 

On the issue of forum conveniens, Oppo argued that there had been two major developments since the UK Supreme Court considered similar issues in Conversant v Huawei & ZTE (Conversant), which meant the outcome should be different in this case. First, the Chinese courts have confirmed subsequently that they have jurisdiction to determine the terms of a global FRAND  licence. Second, post-Brexit the Brussels I Recast Regulation and the rule in Owusu (being that the English court cannot decline jurisdiction on forum non conveniens principles against defendants domiciled in the UK) no longer apply.

 

However, the court held that these developments did not alter the finding in Conversant that the English courts are the appropriate forum to hear a dispute concerning UK patents. Indeed, the court observed that these proceedings would have less in common with the Chinese proceedings than was the case in Conversant, since the latter would not involve any issues of patent essentiality, infringement or validity.

 

As regards the case management stay, a variety of arguments were raised by the parties, including the risk of irreconcilable judgments, the relative speed of proceedings, the relative experience of the different courts (including in relation to cross-licensing) and the relevance of the likely level of the rates that would be set. However, the court was unpersuaded by these arguments, holding that none of the factors tipped the balance of justice one way or the other and holding that the Chongqing Court - if and when it ruled on royalty rates – will do so justly, and therefore its rates will be FRAND. Accordingly, the circumstances of the case were not rare or compelling enough in nature so that the balance of justice would favour a stay in this case, and Oppo’s application for a stay was dismissed.

Parties

Godo Kaisha IP Bridge 1 v Huawei

Neutral Citation

[2021] EWHC 2826 (Pat)

Judge

Mellor, Mr Justice

This hearing concerned two applications. First, Huawei sought the re-designation of two of the three comparable licences relied upon by IP Bridge from ‘External Eyes Only’ (EEO) to ‘Confidential Between Parties Information’. Second, Huawei sought security for costs in the sum of £8,128,000 (for multiple trials) on the bases that (i) IP Bridge was resident out of the jurisdiction in Japan (which is not a state bound by the relevant Hague Convention); and (ii) there was reason to believe that IP Bridge will be unable to pay Huawei’s costs if ordered to do so.

 

On confidentiality, IP Bridge adopted a neutral stance. The counterparties to the licences in issue (A and C) opposed Huawei’s application, although Counterparty A decided not to make oral submissions. In contrast, Counterparty C sought actively to keep the EEO designation in relation to Licence C or, in the alternative, that additional restrictions be imposed on Huawei’s access to Licence C at a hearing held in private.

 

The Court held that Licence A should be re-designated as requested by Huawei. As regards Licence C, the Court held that, notwithstanding its sensitivity, a limited number of Huawei employees should have access to the document to allow Huawei to respond fully and properly in relation to it. However, access was limited to two of Huawei’s legal counsel who were not involved in licensing negotiations and who were required to undertake to Counterparty C that they would not, for a period of five years, participate in or advise upon any present, ongoing or future licensing negotiations involving Counterparty C and Huawei. Further, the Court limited the access of the Huawei personnel to a read-only environment under the supervision of Huawei’s solicitors.

 

On security for costs, the Court held that Huawei had failed to establish a basis for an order for security for costs. Issues around IP Bridge’s corporate structure and various trust arrangements were satisfactorily remedied by an undertaking from IP Bridge that it will pay any costs order made against it. This would (on the evidence) be enforceable in Japan. Further, the evidence did not establish that there was a reason to believe that IP Bridge would be unable to pay Huawei’s costs if ordered to do so, though the situation may need to be re-examined were IP Bridge to lose multiple technical trials.

Parties

Optis & Unwired Planet v Apple

Neutral Citation

[2021] EWHC 2564 (Pat)

Judge

Meade, Mr Justice

This trial concerned the question of whether Apple was an 'unwilling licensee', the impact of that (if any), the proper interpretation of clause 6.1 of the ETSI IPR Policy and whether an injunction should be granted now following the finding that Optis had at least one valid and essential patent (subject to any appeal).

 

On clause 6.1, the Court held that "the right interpretation of clause 6.1 is that any person interested in implementing an ETSI standard must be entitled to have a licence on FRAND terms on demand to a patentee which has given the relevant undertaking”. This meant Apple was not too late, and not permanently deprived of the right, to enforce Optis' FRAND obligation.

 

However, the Court also held that even presuming the competition arguments due to be heard in Trial E in Apple's favour, that entitlement was "to have and take a licence, and to operate under a licence”. Clause 6.1 did not change the fact that a party without a licence may be injuncted, and Apple needed to choose whether to invoke the contractual defence now that an injunction, albeit the Court held it should be limited to a FRAND injunction, was imminent. Apple's other arguments on the discretionary nature of injunctions did not alter this.

 

Further, the fact a party was committing to a licence the terms of which had not been decided was held not to be inconsistent with FRAND policy. Companies make such decisions concerning future liabilities for multi-territorial patent decisions, and have the capabilities and information to do so to a reasonable degree.

 

As regards SEP owners, the Court held there are various factors of relevance to whether a FRAND injunction should be granted, and it was necessary to consider all of them. However, with some exceptions, the fact that a SEP owner was willing to give a binding commitment to accept the Court's FRAND determination (and to explain its FRAND position as part of that process) was a strong factor in favour of an injunction, not least because such a commitment would generally curtail the effect of any abuse that had occurred. The other factors the Court considered relevant in this case also militated in favour of an injunction. The fact that Optis had not expressly claimed a FRAND injunction did not prevent the Court from ordering this, rather than a full injunction.

 

As a final matter, the Court noted that it was impossible to conclude whether Apple's contingent undertaking would or would not apply at this time. (Apple's undertook to accept the FRAND terms determined by the Court, but only if it was later found that it was necessary for it to have given such an undertaking, and it was not too late for it to do so.)

Parties

Philips v Xiaomi

Neutral Citation

[2021] EWHC 2170 (Pat)

Judge

Mellor, Mr Justice

Philips commenced proceedings against Xiaomi alleging infringement of multiple SEPs, having obtained permission to serve the overseas Xiaomi defendants outside the jurisdiction. Philips also sought various declarations relating to FRAND.

 

Xiaomi challenged jurisdiction and/or sought a case management stay in favour of a second-filed French action it had brought against Philips and ETSI. That French action sought various declarations relating to FRAND, including a declaration that Xiaomi was already licensed to Philips’ SEPs under French law under the terms of the ETSI IPR Policy. The main arguments focused on questions of claim characterisation, forum and the issue of a stay.

 

Xiaomi contended that the action should properly be characterised as a dispute over global FRAND licensing terms, seeking to distinguish it from Conversant v Huawei [2020] UKSC 37 on the basis that (i) Philips had claimed that Xiaomi was an ‘unwilling licensee’, and (ii) Xiaomi already had the benefit of a FRAND licence under French law. Therefore, Xiaomi argued that England was not the appropriate forum, and the French Court should instead have jurisdiction to decide the dispute.

 

The Court rejected Xiaomi’s characterisation of the claim, finding  that England was the appropriate and only forum for the claim. The alleged differences to the claim in Conversant v Huawei [2020] UKSC 37 were immaterial to the characterisation of the claim. In particular, the ‘unwilling licensee’ issue was just one of a number of alternative heads of possible relief. In any event, Xiaomi’s arguments were undermined by (i) its reservation of its right to dispute essentiality and validity of each of the SEPs in suit, and (ii) the fact that it had not been suggested pre-issue that Xiaomi already had the benefit of a FRAND licence under French law. The court also observed that the French courts could not establish the invalidity of EP(UK) patents, and that it was uncertain whether the French courts would determine the terms of a FRAND licence.

 

The Court also denied Xiaomi’s request for a case management stay. The outcome of the French proceedings would be uncertain and cause considerable delay to the English proceedings. The UK patents in issue are time-limited rights that would expire before the French proceedings are resolved. In contrast, it was clear that the English courts could and would determine FRAND licence terms and would do so in a shorter timeframe.

Parties

Optis & Unwired Planet v Apple

Neutral Citation

[2021] EWHC 2080 (Pat)

Judge

Smith, Mr Justice Marcus

Apple sought permission from the court to produce one of its own recent SEP licences with an unnamed third party (T). The application was required as the terms of the licence with T prevented such an act, and T objected.

 

The court noted that there was a difference between a party seeking disclosure and/or inspection of a document (which was not the case here, with Optis not taking part in the application), and a party that wished to override the confidentiality provisions in a licence to deploy it to advance its own interests.

 

The court held that it was essential that the existence and broad nature of the licence be disclosed to Optis so that it can, if so advised, seek inspection of it in due course. However, in this instance, the question was whether the court should grant an order to permit Apple to produce the licence where that would otherwise be a breach of the licence.

 

The court refused Apple's request, noting that (i) significant weight attached to the confidentiality obligations (particularly where they were agreed after Apple ought to have been aware of the need to produce the licence in this case); (ii) Optis had no apparent interest in seeing the licence; and (iii) it was unclear that the licence was as relevant and important a comparable as Apple claimed. The court concluded by noting that were Optis to seek inspection, the court would be minded to accede to that application.

 

A further request from Apple for an anonymity order over the identity of T, interestingly opposed by T, was refused by the court.

Parties

Optis & Unwired Planet v Apple

Neutral Citation

[2021] EWHC 1739 (Pat)

Judge

Meade, Mr Justice

This was a technical trial concerning Optis’ European Patent (UK) 2 229 744 B1, which the court held valid and infringed. However, of particular interest was the argument relating to the equitable doctrine of proprietary estoppel.

 

Apple contended that proprietary estoppel prevented Optis from enforcing its SEP or alternatively restricted the relief Optis could obtain. The basis for this was said to be that the predecessor in title (Ericsson) had not declared the existence of the application for the patent until after the date on which the associated technical proposal (known as a TDoc) had been successfully incorporated into the LTE standard and the relevant technical specification (TS 36.322) was frozen. Apple claimed that this meant that the relevant working group looking at that aspect of the standard had been denied the chance to seek an alternative unpatented solution and, in any event, it was a breach of Clause 4.1 of ETSI’s IPR Policy, which required contributors to use reasonable endeavours to inform ETSI of essential IPR in a timely fashion.

 

The court rejected this defence, noting that the requirements for proprietary estoppel had not been established (being an assurance, reliance on that assurance and consequential detriment). In particular, no member of the working group reasonably would have been under the impression that the TDoc was free of any IPR. It was common, with good reason, for companies to file patent applications in very similar terms to a TDoc just before providing the TDoc to a working group to avoid issues with prior disclosure anticipating the application. Further, it was well-known that many declarations were made after a specification was frozen and that ETSI standards were commonly subject to numerous IPRs.

 

In any event, there had been no reliance or detriment even if there were an assurance. The overall goal of the working group was to arrive at the best technical solution, and knowing about any patent application would not have changed the working group’s actions, since the TDoc was the best technical solution they were aware of at the time.

 

The court also held that there was no breach of Clause 4.1 of ETSI’s IPR Policy as most declarants did not declare before the specification was frozen and the working group would have been aware of this common practice. Furthermore, Clause 4.1 had moved from being a hard-edged rule to a more flexible standard, with late declarations not being considered a problem provided that FRAND licences would be made available.

 

The judgment may also be of interest as it sets out an analysis of the law of proprietary estoppel (paragraphs 321 to 352), the relevant French law (paragraphs 353 to 392) and a detailed account of the history of ETSI’s IPR policy (paragraphs 452 to 498).

Parties

Mitsubishi & Sisvel v OnePlus, Oppo & Xiaomi

Neutral Citation

[2021] EWHC 1541 (Pat)

Judge

Mellor, Mr Justice

This case management hearing concerned primarily Xiaomi's application to dismiss Sisvel, the pool administrator, from the action. The patent owned by the pool administrator had been held not to be infringed/essential.

 

The Court considered relevant recent English jurisprudence, as well as German jurisprudence concerning the right of a SEP owner to insist on a (FRAND) pool licence. The Court observed that (i) pool licences were agreed in the real world and (ii) the refusal of a pool licence by an implementer in favour of a bilateral licence where the pool related to a particular standard would require justification. Accordingly, it was at least arguable that the court may find that the pool licence was FRAND at the FRAND trial.

 

There were clear advantages in having a pool administrator as a party, not least for disclosure, evidence and confidentiality purposes. Whilst the legal basis on which Sisvel could remain formally a claimant was unclear, this was an evolving area of law and Sisvel's removal from the action at this stage would not be in accordance with the overriding objective. The judge at the FRAND trial could consider the implications of a pool licence and the position of a mere administrator in due course.

 

The judgment also addresses the Claimants' position on essentiality for its FRAND case. The Claimants had changed their case from asserting a 100% essentiality rate based on the results of an individual patent family review process to a proposal that (i) the Defendants identify patents where essentiality was disputed based on a random selection from 135 claim charts and (ii) the parties adduce technical evidence on those disputed patents for the trial judge to consider as part of a hypothetical negotiation.

 

The Court denied the application given there was insufficient time to accommodate the exercise before trial. The parties agreed the Claimants should serve a further detailed statement of case on essentiality setting out their case in light of this decision, after which there may need to be another CMC.

 

Also of interest is the Court's comment that it might have entertained the Claimants' proposal if it had been made in good time so the case could be managed properly provided (i) a relevant comparison could be made with the industry stack, (ii) it would be proportionate, (iii) it would require a limited number of experts, and (iv) the task of the trial judge would be manageable.

Parties

Godo Kaisha IP Bridge 1 v Huawei

Neutral Citation

[2021] EWHC 1261 (Pat)

Judge

Caddick QC, Mr Nicholas

The First and Second Defendants were domiciled in the People's Republic of China (the "PRC Defendants").Chief Master Marsh had previously granted an order (i) permitting service of the claim out of the jurisdiction on the PRC Defendants and (ii) granting permission for such service to be effected by alternative means.The PRC Defendants applied to set aside the order insofar as it permitted service by alternative means.

 

The PRC was a signatory to the Hague Service Convention and accordingly such an order was only justified in exceptional or special circumstances. Delay per se was insufficient unless it interfered with the due administration of justice. That was not the case here as the PRC Defendants had agreed to accept service voluntarily should it take longer than eleven months to effect service under the Hague Service Convention.

 

Other factors raised by the Claimant including (i) being kept out of remuneration; (ii) the need for an injunction; and (iii) the unsatisfactory outcome of the claim proceeding against the UK-domiciled defendant in the interim, were normal in litigation of this type and therefore could not be exceptional. The court also considered the allegation that the defendants were 'holding-out' from taking a FRAND licence, holding that whilst this could amount to an exceptional circumstance if proved to be correct, the difficulty the court faced was that it was not in a position to determine it until the dispute over FRAND was resolved.

 

The court accordingly concluded that the factors in this case, whether taken in isolation or collectively, did not amount to the sort of exceptional circumstances that were required in order to justify a departure from service in accordance with the Hague Service Convention. Accordingly, the court set aside the order insofar as it permitted service by alternative means.

Parties

Mitsubishi & Sisvel v OnePlus, Oppo & Xiaomi

Neutral Citation

[2021] EWHC 889 (Pat)

Judge

Mellor, Mr Justice

This case management hearing concerned the parties case on the alleged essentiality of the patents in the MCP Pool. In particular, the Claimants contended that the patents in the MCP Pool should have an assumed essentiality rate of 100%. The Defendants disputed that and sought further information.

 

The Court agreed that the Claimants should provide disclosure evidencing their methodology for choosing the patents for inclusion into the MCP Pool, noting that such methodology was highly relevant to whether the Court could rely on the Claimants' asserted 100% essentiality ratio.

 

The Court also observed that neither the Claimants nor the Xiaomi Defendants had, as yet, pleaded their case on essentiality at a level of detail sufficient to enable the court either (a) to case manage that part of the case or (b) to make appropriate findings of fact at trial. (This issue was also the subject of previous hearings in this action.)

 

The Court therefore ordered those parties to exchange further statements of case addressing the alleged essentiality ratios. Further, the Court particularised five subjects that the Claimants' statement of case must address (set out at paragraph 26 of the judgment), and confirmed that the statement of case must set out precisely the findings of fact that the Claimants will be asking the Court to determine at trial. The Xiaomi Defendants' response would need to be at a similar level of detail.

Parties

Vestel v Access Advance & Koninklijke Philips

Neutral Citation

[2021] EWCA Civ 440

Judge

Birss, Lord Justice

The appeal was heard by Lord Justice Nugee and Lady Justice Elisabeth Laing. Lord Justice Birss delivered the lead judgment.

 

This was an appeal from an order declaring that the court had no jurisdiction over Vestel’s claims against Access Advance (the administrator of a patent pool concerning the H.265 (HEVC) standard) and Philips (a member of that pool sued on its own behalf but also as an alleged representative of the pool members). Vestel claimed that the Defendants had abused their dominant positions inter alia by making allegedly non-FRAND offers. The relief sought included a determination of FRAND terms.

 

An appeal against the Judge’s finding that Vestel had not suffered any jurisdictionally relevant direct damage in the UK was dropped shortly in advance of the appeal hearing, along with Vestel’s claim that the Defendants had abused their dominant positions. The appeal therefore considered only Vestel’s reformulated (on appeal) case that it should be entitled to a FRAND declaration under the Court’s inherent jurisdiction to grant declaratory relief. Vestel also sought to limit its claim so that it concerned only UK patents (but maintained its assertion that a FRAND licence to such patents would be of global scope).

 

The Court of Appeal dismissed the appeal, holding that the inherent declaratory jurisdiction of the court cannot be engaged unless it is based on the existence or non-existence of a legal right (in addition to satisfying the ‘useful purpose’ requirement). Although Vestel had highlighted that the rules of the ITU (which administered the H.265 (HEVC) standard) were of relevance, Vestel did not assert it had a legally enforceable right to a FRAND licence. Further, it did not plead any legal standard against which the matter could properly be judged. The Court held that the claim had no reasonable prospect of success.

 

Further, the Court of Appeal held that neither the tort gateway (in the case of Access Advance) or Article 7(2) Brussels I Recast (in the case of Philips) applied in this case. It was not a claim for a declaration of non-liability for the tort of patent infringement. As regards the property gateway (in the case of Access Advance), the Court held the absence of a legal claim meant that gateway also did not apply.

Parties

Mitsubishi & Sisvel v OnePlus, Oppo & Xiaomi

Neutral Citation

[2021] EWHC 493 (Pat)

Judge

Mellor, Mr Justice

This was a FRAND CMC. The Claimants were relying on comparable licences, and suspected the Defendants intended to run a case involving inter alia an analysis of the proportion of truly essential patents in the pool. The Claimants requested further information (via an RFI) on this issue, with the Defendants replying that this was a matter for expert evidence.

 

The Judge ordered the Defendants to respond to several questions in the RFI, noting that it was not acceptable to leave the matter to expert evidence. Although FRAND cases throw up particular challenges when identifying the boundary between what must be pleaded and what constitutes evidence, it was important to avoid the risk of expert evidence being 'ships passing in the night'.

 

The Judge concluded by reiterating that "the methodology proposed to be employed in any essentiality review must be pleaded as soon as possible so that the evidence required to prove the results of such a review can be identified and suitable case management directions can be given in good time".

Parties

IPCom v Vodafone

Neutral Citation

[2021] EWCA Civ 205

Judge

Arnold, Lord Justice

The appeal was heard by Lord Justice Lewison and Lady Justice Asplin. Lord Justice Arnold delivered the lead judgment.

 

The point of particular interest on this appeal is IPCom's appeal against the finding that Vodafone had a defence of crown use to the infringement of IPCom's SEP. The Government had selected Vodafone to provide a system giving emergency services precedence on network channels during high traffic period, called MTPAS.

 

The crux of the appeal was whether, to invoke the defence of crown use, the Government had to provide (i) express authorisation to work the patent; (ii) authorisation to do an act where that act necessarily infringes the patent; or (iii) authorisation to do a particular act even if that does not necessarily involve infringing the patent. IPCom contended for (ii) whereas Vodafone contended, and the Judge found at first instance, that (iii) was sufficient.

 

The Secretary of State for Defence (SoSD) intervened in that appeal (as the relevant Government department liable to pay IPCom compensation based on the crown use). SoSD contended that (i) was required save that it could take the form of an express authorisation to 'work any patent'.

 

The CoA allowed the appeal and overturned the finding that Vodafone had a defence of crown use. Further, although it was not necessary to determine the point, the Court stated that interpretation (ii) is to be preferred for no fewer than 13 reasons (set out in the judgment at paragraphs to 150 to 165).

Parties

InterDigital v Lenovo & Motorola

Neutral Citation

[2021] EWHC 89 (Pat)

Judge

Birss, Mr Justice

This hearing considered issues of FRAND disclosure, specifically the data required to 'unpack' comparable licences. In particular, Lenovo sought disclosure of confidential royalty reports for the InterDigital licences said to be relevant.

 

The Court refused to order disclosure of the royalty reports as it held it would be disproportionate.

 

The Court accepted that licences are inevitably complex and that data are required to ‘unpack’ them. However, the Court held the public information available in this case was adequate for that purpose in this case. In a FRAND trial, evidence on comparable licences is used to estimate the value of a licensed portfolio and having further information, for example from the royalty rates, would not turn a “‘mere’ estimate into a ‘true’ or ‘precise’ statement of the value” of the licensed portfolio.

 

The Court also highlighted that, when considering the proportionality requirement of disclosure, account should be taken of the value of the supposed improvement in accuracy against the costs of achieving that improvement (including time, procedural delays and money). The Court also raised concerns about the confidential information of third parties contained in the royalty reports (one third party licensee has already indicated it would resist disclosure if sought), which also had a bearing on proportionality. Although the information could be treated as 'Legal Eyes Only', the Court stated that “(T)here is a significant value in terms of open justice in producing a decision in this case based on information which is publicly available.”

 

The Court also considered an argument by InterDigital that the royalty reports are irrelevant, because they relate to a period after conclusion of the licence, but considered it went too far to say that such information was "incapable of having relevance". By contrast, he did not consider it relevant to assess whether the agreed royalties had actually been paid by the third parties, as there was no pleading that the royalties were a sham.

 

The Court also refused InterDigital’s request for a schedule of licences to which Lenovo was a party as it would be disproportionate, particularly due to third party confidentiality. There was sufficient evidence from the InterDigital licences themselves on the licensing issues in dispute.

Parties

Mitsubishi & Sisvel v Archos, Nuu, OnePlus, Oppo & Xiaomi

Neutral Citation

[2020] EWCA Civ 1562

Judge

Floyd, Lord Justice

The appeal was heard by Lord Justice Males and Lord Justice Lewis. Lord Justice Floyd delivered the lead judgment.

 

This was an appeal against the order following [2020] EWHC 2641 (Pat), in which the High Court had inter alia dismissed applications (i) by Oppo to add individuals involved in FRAND licensing negotiations into a ‘High Confidential Material’ (HCM) confidentiality club and (ii) by Xiaomi for the blanket re-designation of all ‘Attorney’s Eyes Only’ (AEO) documents to HCM.

 

The Court of Appeal dismissed the appeal, noting that the documents in question contained highly valuable confidential information belonging to third parties. Further, given the breadth of the disclosure in the case and the stage of the proceedings, a large number of the documents would be of limited relevance. In those circumstances, it was appropriate to limit access.

 

The Court also agreed with the first instance judge that a limited number of AEO documents should be downgraded to HCM, subject to additional undertakings being provided by the relevant individuals to the licence counterparties.

 

However, in the case of Xiaomi, the Court of Appeal held that the undertakings to be entered into by relevant individuals should be amended to allow those individuals to participate in FRAND litigation and settlement negotiations (although not FRAND licensing more generally).

Parties

IPCom v HTC

Neutral Citation

[2020] EWHC 2941 (Pat)

Judge

Birss, Mr Justice

HTC was subject to an injunction, having stated it would only sell 'workaround' phones in the UK, so the FRAND inquiry had been dismissed and a damages inquiry ordered. IPCom claimed lump sum damages based on a royalty being applied to the sale of any 2G, 3G or 4G phone worldwide. HTC applied to strike out the claim for damages insofar as it concerned phones not sold in the UK.

 

The Court granted the application, striking out IPCom's claim insofar as it was based on anything other than a claim for royalties attributable to sales of or other dealings in 2G, 3G or 4G phones in the UK.

 

Whilst the Court accepted that the question of damages by way of notional royalty was a heavily fact dependent issue, and thus generally not suitable for strike-out, it felt that the claim to ‘global damages’ must fail on a point or points of principle and law.

 

The Court considered a number of arguments, but in essence it concluded that foreign phone sales were not acts caused by the acts of infringement in the UK. Further, there was a difference between damages and the determination of what is FRAND (reference was made to the UK Supreme Court decision in the joined Unwired Planet and Conversant appeals).

 

The Court allowed the claim in relation to non-infringing phones sold in the UK to remain given that the High Court in Unwired Planet had considered that a UK portfolio approach may be valid. The Court did, however, state that its present view was absent a concession or agreement the Court could likely only award damages for infringement of individual UK patents found valid and infringed.

Parties

Mitsubishi & Sisvel v Archos, Nuu, OnePlus, Oppo & Xiaomi

Neutral Citation

[2020] EWHC 2641 (Pat)

Judge

Norris, Sir Alastair

This hearing primarily addressed issues of confidentiality arising in relation to disclosed licence agreements, specifically whether a number of documents should be 'downgraded' from Attorneys' Eyes Only (AEO) to 'Highly Confidential Material' (HCM) as contended for by Oppo and Xiaomi. The practical impact was then designated individuals at those companies could then see the documents.

 

The Court refused Xiaomi's general request to have all AEO material re-classified as HCM. However, the Court granted Oppo's more specific request to have six AEO documents re-classified as HCM, which were licences of apparently comparable IP to well-resourced counterparties.

 

The Court recognised the need for AEO regimes generally, but noted that they should be exceptional. Whilst it was therefore unwilling to simply do away with the AEO regime, some comparable licences had been identified by Oppo's solicitors as of likely relevance to its case. Oppo had a right to then understand why those identified licences would or would not be relied upon in due course, which meant it had to see the AEO material.

 

The Court also noted that the Claimant's request for a more particularised pleading from the Defendants necessitated the earlier and more extensive provision of sensitive material than may otherwise be the case.

 

The Court required the individuals to whom such information was to be disclosed to undertake not to engage in licensing negotiations between their company and the counterparties to the re-designated licences.

Parties

Koninklijke Philips v TCL

Neutral Citation

[2020] EWHC 2553 (Ch)

Judge

Mann, Mr Justice

TCL had sought a FRAND determination from the French Courts and now sought a stay of Philips’ earlier English proceedings.

 

Philips objected to staying the English proceedings, maintaining that the applications before the English and French courts have the same purpose of determining the terms of a FRAND licence. TCL claimed that the English action relates to patent infringement, whilst the French action was contractual (the French Court having previously found that both judgments did not contain the same cause of action).

 

The Court dismissed TCL's application for a stay.

 

The Court reliance upon the recent comments of the UK Supreme Court in the Unwired Planet and Conversant appeals and emphasised that the English Courts are well used to construing foreign contracts (and can determine FRAND terms under a worldwide licence if appropriate).

 

The Court also focused on the relative timing of proceedings, with the English proceedings being advanced with a trial of FRAND issues due imminently (November 2020). In contrast, a French trial was only expected in late 2022 or early 2023, with the Court commenting that a two year difference is very material in commercial terms.

 

The Court also considered that there is still a proximity between the English proceedings and the determination of FRAND terms, given the latter related to the nature of the relief to be granted in respect of UK patent infringement. Whilst there was a potential for inconsistent judgments, that had to be balanced against the desirability of the prompt resolution of a commercial dispute.

Parties

Optis & Unwired Planet v Apple

Neutral Citation

[2020] EWHC 2425 (Pat)

Judge

Birss, Mr Justice

Apple applied for a reference to the CJEU on various FRAND issues. The specific questions are set out in §12, but in summary they relate to a SEP owner's obligations under Huawei v ZTE, the interaction between a parties' behaviour and entitlement to an injunction / Article 102 TFEU, the impact of willingness or unwillingness to accept an as yet undetermined Court-set FRAND licence by a party and the relevance of the Enforcement Directive.

 

The Court focused primarily on question 3 as raising the key issue. It concerned whether a SEP owner may use an expression of willingness to accept a Court-set FRAND licence to render its behaviour compatible with Article 102 TFEU irrespective of various other behaviours.

 

The Court declined to refer the questions to the CJEU for reasons of timing. In particular, the Court did not wish to cause delay to the listed UK trial that would be considering various related issues (which had been scheduled for July 2021 following prior argument).

 

The Court also referred to the recent UK Supreme Court decision, which showed that the English Courts could adequately address issues of this kind without a CJEU reference.

Parties

Unwired Planet v Huawei and Conversant Wireless Licensing v Huawei & ZTE

Neutral Citation

[2020] UKSC 37

Judge

Reed, Lord Justice

The appeal was heard by Lord Reed, Lord Hodge, Lady Black, Lord Briggs and Lord Sales. All members of the panel contributed to the judgment.

 

The UKSC considered at length a number of issues relating to SEPs and FRAND across the Unwired and Conversant cases. The bullet points below are a very brief summary of the key findings.

 

The contractual arrangements created by ETSI’s IPR Policy gave the English courts jurisdiction to determine a global FRAND licence even without the parties’ consent. The English courts were not ruling on the validity and infringement of foreign patents by doing so (though in appropriate cases it may be argued that it was FRAND to include an adjustment mechanism based on challenges to essentiality/validity brought in a foreign jurisdiction).

 

In the Conversant case, no alternative forum was available since it had not been demonstrated that the Chinese courts would accept jurisdiction to set a global FRAND licence.

 

The ‘ND’ limb of FRAND was ‘general’ in nature, rather than ‘hard-edged’; patentees were free to offer discounts beneath a generally available reasonable rate, implying that the courts should determine royalty rates for portfolios rather than individual licensees.

 

The FRAND undertaking imports a single unitary obligation that terms are “fair, reasonable and non-discriminatory”, which extends to the process by which the parties negotiate a licence.

 

The lower courts’ interpretation of the CJEU’s Huawei v ZTE framework as a ‘safe harbour’, rather than mandatory process, was upheld.

 

The availability of  injunctive relief where an implementer declines to enter into a FRAND licence was a necessary component of the balance between hold-up and hold-out. Damages in lieu would not be an adequate substitute for an injunction as it could create an incentive for country-by-country hold out.

Parties

Optis & Unwired Planet v Apple

Neutral Citation

[2020] EWHC 2033 (Pat)

Judge

Birss, Mr Justice

The Court listed a new trial in 2021 to dispose of a number of discrete FRAND-related issues, primarily including as to whether Apple was a wiling or unwilling licensee (and thus able to rely upon Optis' FRAND undertaking) due to a failure to commit to take a licence on FRAND terms settled by the Court.

 

The Court considered it did not prejudice Apple to schedule these issues in an earlier separate trial in this manner (the FRAND trial at the time being listed for Summer 2022), which did not amount to a preliminary issues hearing, and disposing of these issues may promote settlement.

 

The Court said it was unclear whether this amounted to expedition, but that such a question was irrelevant given it was appropriate to determine these issues at the stage the Court was now listing them to be determined.

Parties

Mitsubishi & Sisvel v Archos, Nuu, OnePlus, Oppo & Xiaomi

Neutral Citation

[2020] EWHC 2177 (Pat)

Judge

Mann, Mr Justice

The Court considered a variety of FRAND-related case management issues.

 

The Court refused to order disclosure of the Defendants' comparable licences, but on the basis only that the application was not foreshadowed nor supported by evidence. The Court said it was highly likely that such documents would need to be disclosed in due course, but it would have misgivings making such an order given the manner in which the issue had arisen.

 

The Court ordered (initial) disclosure of pool assignment documents claimed to be relevant to patent valuation by the Defendants, but only on the basis that the Defendants had to address the relevance of such documents in their amended pleading.

 

The Court declined to order the Claimants to further particularise the basis on which their offers were said to be FRAND beyond what was already pleaded.

 

The Court ordered the parties to produce a definitive FRAND 'position statement' eight weeks before trial.

 

The Court also considered timetabling and various confidentiality issues, including around the application of lawyers’/attorneys’ eyes only regimes.

Parties

InterDigital v Lenovo & Motorola

Neutral Citation

[2020] EWHC 1318 (Pat)

Judge

Birss, Mr Justice

The Court held a CMC, which also addressed inter alia whether to postpone listing a non-technical FRAND trial pending various parallel actions in the USA (brought by both InterDigital and Lenovo) and in the People's Republic of China (brought by Lenovo).

 

The Court refused to postpone the listing of the FRAND trial pending the US and Chinese proceedings (scheduling it in Autumn 2021, after the first two of five technical trials).

 

The Court stated that whilst the international position was important, scheduling the FRAND trial to take the international proceedings into account would cause an unnecessary delay (likely of several years). The Court took into account that the foreign proceedings had been commenced relatively recently, noting that whilst such proceedings may have a bearing they were not a trump card.

 

As regards the fact that the Supreme Court had not yet handed down its judgment in the conjoined Unwired and Conversant appeals, the Court stated that it had taken into account the uncertainty of the outcome of those appeals in making its case management decisions.

Parties

Conversant Wireless Licensing v Huawei & ZTE

Neutral Citation

[2020] EWHC 741 (Pat)

Judge

Hacon, His Honour Judge

This was the continuation of an adjourned PTR, at which the Court considered whether to adjourn the listed FRAND trial due to the Covid-19 pandemic; in the interim, Conversant had advanced a proposal as to how it might proceed, involving the exchange of rounds of detailed written submissions and a series of short hearings via Skype on specific issues.

 

The Court considered at length the UKSC judgment in Al Rawi, which considers the fundamental requirements of a common law trial, and commended the making of practical and imaginative proposals given the present health climate.

 

However, the Court determined that neither the CPR nor the (Covid-19) Guidance of the Lord Chief Justice or the Chancellor permitted a trial of such substantial scope to be conducted largely on paper, and that there were a number of issues that required cross-examination in the usual way. The Court was also swayed by the outstanding UK Supreme Court jurisdiction judgment, which may mean considerable time and cost would be wasted if the trial went ahead.

 

The Court accordingly vacated the trial for re-listing at a later date.

 

A dispute over the precise re-listing date and the length of the re-listed trial was later resolved in [2020] EWHC 989 (Pat).

Parties

Conversant Wireless Licensing v Huawei & ZTE

Neutral Citation

[2020] EWHC 728 (Pat)

Judge

Hacon, His Honour Judge

The Court held a pre-trial review in advance of a trial of FRAND issues listed in a 5-day window commencing 27 April 2020, including (a) whether the trial should proceed given the Covid-19 pandemic, (b) ZTE's application for LEO disclosure of presently redacted information and (c) Conversant's application to strike out and/or disallow parts of ZTE's expert evidence.

 

Following detailed submissions, the Court adjourned the question of whether the trial should be re-listed to 25 March 2020, with the Judge noting "at the moment I am persuaded that this trial should be adjourned, but I will give Conversant the opportunity to convince me otherwise", on the basis that Conversant had had insufficient notice of the application.

 

As regards the question of disclosure, the Court determined that as a basic principle of justice at least ZTE's lawyers and experts should have an opportunity to see and comment on any material that could have an effect on ZTE's interests at trial.

 

Finally, the Court gave retrospective permission to ZTE to adduce a short additional expert report, and dismissed the application by Conversant to strike out large parts of another expert report filed on ZTE's behalf.

Parties

Optis & Unwired Planet v Apple

Neutral Citation

[2020] EWHC 214 (Pat)

Judge

Morgan, Mr Justice

The Court considered various case management issues relating to trial management, as (i) the Defendants sought to have aspects of their defence concerning non-disclosure / estoppel determined at a separate trial rather than at the forthcoming technical trial(s), and (ii) the Claimants sought to have an earlier trial of one of the patents in suit (the other having already been listed early given the imminent expiry of the patent).

 

The Court decided that it was not appropriate to separate issues into separate trials unless there was good reason to do so and there was a "clear, predictable and workable line" as to what would be tried when. The estoppel defence would therefore remain in the technical trial(s).

 

The Court also saw the potential merit in having two technical trials first as if the Claimant was successful on one of them then that could avoid the need for further technical trials (which would avoid using the Court's resources unnecessarily).

 

The Court addressed the length of the existing (technical trial) listing in October, preserving it and extending its duration to accommodate the estoppel defence, and also ordered the parties to provide statements of case on infringement/essentiality (Claimants) and validity (Defendants).

Parties

Conversant Wireless Licensing v Huawei & ZTE

Neutral Citation

[2020] EWHC 256 (Pat)

Judge

Birss, Mr Justice

Conversant applied inter alia for disclosure of the Defendants' SEP licence agreements (and related agreements) 12 weeks prior to trial citing in particular that one Defendant was relying on a single comparable licence in its defence. It was agreed the case was proceeding under CPR PD51U (which governs disclosure under a pilot scheme).

 

The Defendants argued that (i) the application was an attempt to re-litigate the same request denied by the Court at a previous CMC, (ii) the request was not necessary for the just disposal of proceedings, necessary or proportionate, and (iii) in any event the request could not be accommodated prior to trial.

 

The Court denied the application on the basis it was not reasonable or proportionate having regard to the timetable of the case (the Court also noted there was no pleading supporting the case).

 

The Court observed, however, that had the submissions and evidence before it now been before it at the previous hearing, it may have granted the application. The Court also clarified that third party comparable licences were capable of having some evidential value, albeit secondary to that of licences to the portfolio in question, or its parent portfolio. The Court observed that depending upon the pleaded case and evidence in a particular case, disclosure of such third party licence agreements may be appropriate depending upon the circumstances.

Parties

Koninklijke Philips v AsusTek (Asus) & HTC

Neutral Citation

[2020] EWHC 29 (Ch)

Judge

Smith, Mr Justice Marcus

ASUS sought to withdraw from the UK market in advance of a listed FRAND trial. It applied to strike out parts of Philips' pleadings so that its participation in the FRAND trial would be unnecessary if ASUS agreed to pay back damages for past infringement of Philips’ UK patents at Philips’ standard royalty (on the basis this would be damages calculated by reference to its sales in the UK).

 

ASUS relied in particular on decisions in the recent TQ Delta v ZyXel proceedings (when the Court of Appeal cancelled a RAND trial after ZyXel waived its right to a RAND licence, submitted to an injunction and paid damages).

 

Philips contended that: (i) past damages would be payable on global sales, and (ii) if damages were limited to UK sales, a significant uplift in the royalties payable should be awarded. (It was these aspects of Philips’ claim ASUS applied to strike out.)

 

The Court noted that unlike in the TQ Delta v ZyXel proceedings, the quantum of damages payable for past infringement was in issue in this case. The key question was the extent to which the FRAND terms to be declared by the Court should be ‘read across’ into the assessment of appropriate damages based on a counterfactual licence.

 

The Court found that any automatic linkage between the declared licence and counterfactual licence would be liable to be struck out inter alia as automatically including past sales in other jurisdictions when assessing damages would risk usurping the jurisdiction of other courts. However, the Court also found that it would be equally wrong to disregard the terms of the declared licence when quantifying the SEP holder’s loss. The Court concluded that the matter was not suitable for strike out and needed to be determined at trial.

Parties

Mitsubishi & Sisvel v Archos, Nuu, OnePlus, Oppo & Xiaomi

Neutral Citation

[2019] EWHC 3477 (Pat)

Judge

Caddick QC, Mr Nicholas

The Court had to consider various case management issues, including on statements of case, disclosure, cost budgeting and trial listing.

 

In particular, the Court considered the impact of two actions commenced by Xiaomi in the Beijing Intellectual Property Court, which the Court understood to be (i) an action to determine FRAND terms for the Claimants' Chinese patents and (ii) an antitrust action.

 

In that regard, the Court considered the comments by Henry Carr J and others in the Conversant litigation, which also involved Chinese FRAND proceedings. The Court determined that whilst it may be helpful to take into account relevant foreign actions in listing the FRAND trial, it was not appropriate to include an order linking the setting of the English trial date to the Chinese proceedings. Further, given the lack of information about the Chinese proceedings available to the Court at the hearing, the appropriate step was simply to list the FRAND trial a reasonable period of time after the last technical trial. Should future developments in China potentially justify moving the FRAND trial date, an application with supporting evidence would be required.

Parties

Optis & Unwired Planet v Apple

Neutral Citation

[2019] EWHC 3538 (Pat)

Judge

Nugee, Mr Justice

Apple applied to strike out the FRAND claim brought against it by Optis, alleging that Optis had failed to comply with the criteria set out by the CJEU in Huawei v ZTE (as interpreted in Unwired Planet) by failing to make a FRAND offer and by negotiating only with Apple Inc. and not the other Apple entities claimed against. Apple alleged this conduct amounted to an abuse of a dominant position.

 

The Court held that Apple may be correct that Optis had not made a FRAND offer, and even that the terms offered were so unfair and unreasonable that offering them constituted an abuse. However, he could not reach such a conclusion at this stage of the proceedings and it was a serious issue that needed to be tried on the merits. Optis also had a reasonable prospect (at the very lowest) of persuading the Court at trial that it had negotiated with Apple Inc. on the understanding that the negotiations were on behalf of all relevant Apple companies and that that was sufficient to comply with the notice requirements set out in Huawei v ZTE.

 

The Court accordingly dismissed Apple’s application. (Apple’s application also included other grounds based on matters heard by the UK Supreme Court in the Unwired Planet and Conversant appeals. These grounds weren’t addressed at the hearing, but Nugee J extended the time for Apple to appeal the dismissal of its application until after hand down of the UK Supreme Court judgment.)

Parties

Conversant Wireless Licensing v Huawei & ZTE

Neutral Citation

[2019] EWHC 3471 (Pat)

Judge

Nugee, Mr Justice

The Defendants sought further directions in advance of the FRAND trial listed from 27 April 2020. This judgment concerns the Defendants' request for directions regarding (i) the scope of the technical exercise that may be conducted at the trial (should it be for all claimed relevant families, or a narrower subset that excluded families with a negative judicial finding or where a patent had expired/lapsed) and (ii) the rate of invalidity as part of that exercise.

 

Nugee J refused to limit the technical exercise to a narrower set of relevant families, preferring to leave everything in issue for the Judge at the FRAND trial to consider.

 

However, on validity Nugee noted that the Court’s task at the FRAND trial will be to decide the terms that a willing licensor and willing licensee would agree in a hypothetical negotiation, and as “it is possible that arguments as to likely validity will be relevant, or may be relevant, to the FRAND determination”, he permitted the Defendants to serve evidence on validity should they wish to do so.

Parties

IPCom v Xiaomi Technology & MyTech Retail Distribution

Neutral Citation

[2019] EWHC 3074 (Pat)

Judge

Hacon, His Honour Judge

Xiaomi launched mobile devices onto the UK market in November 2018 and following negotiations IPCom issued infringement proceedings in August 2019. Xiaomi challenged jurisdiction.

 

IPCom alleged that Xiaomi was seeking to ‘hold-out’ until the patent in suit (which had previously been successfully litigated) expired, and issued an application for an interim injunction prohibiting the sale of UMTS devices unless Xiaomi undertook to enter into a FRAND licence if was found to infringe the patent at trial.

 

IPCom argued that without the injunction, it would suffer irreparable harm, as it would lose the opportunity to seek a global licence on terms settled by the court.

 

The Court denied the application, noting IPCom “has no absolute right to force Xiaomi to enter into a licence" and "no absolute right to the royalties which would be due under any licence”. If Xiaomi did not elect to take a licence, there will never be an opportunity for IPCom to obtain either a global or UK licence and, in those circumstances, IPCom could not suffer irreparable harm.

Parties

IPCom v Lenovo Technology & Motorola Mobility

Neutral Citation

[2019] EWHC 3030 (Pat)

Judge

Hacon, His Honour Judge

US members of the Lenovo group filed proceedings in the US Northern District of California for declarations of non-infringement and the adjudication of terms for a global FRAND licence to IPCom’s portfolio.

 

Subsequently, IPCom issued infringement proceedings in the UK against UK Lenovo entities. The US Lenovo companies responded by filing a motion for an anti-suit injunction and, in response, IPCom sought an anti-anti-suit injunction against the UK Lenovo companies (seeking that they be prevented from sanctioning or assisting the US anti-suit motion).

 

The Court granted IPCom’s application. The Judge noted that “it would be vexatious and oppressive to IPCom if it were deprived entirely of its right to litigate infringement and validity of EP '268”. The Judge set out his concern that "the judge in the United States is very likely to obtain the impression that the anti-suit injunction sought has the approval and support of the UK Companies" and found that "it would not be conscionable for the UK Companies to endorse the impression already given to the US court that they sanction the US anti-suit motion in so far as it affects proceedings in this court."

Parties

Vestel v HEVC Advance & Koninklijke Philips

Neutral Citation

[2019] EWHC 2766 (Ch)

Judge

Hacon, His Honour Judge

Vestel (specifically its Turkish parent company and UK subsidiary) brought an abuse of dominance claim seeking a determination of FRAND terms from the HEVC Advance patent pool and one of its members, Philips (which owned a number of SEPs in the pool).

 

HEVC Advance and Philips challenged the Court's jurisdiction to hear the claim.

 

The Court granted the applications, setting aside the claim as against both HEVC Advance and Philips. In particular, the Court determined that there was no likelihood of Vestel suffering the damage it alleged it would suffer as a result of any alleged abuse inter alia because Vestel would have the option of taking FRAND terms determined by the Court before being injuncted.

 

The judgment considers various aspects of European law (as regards the claim against Philips) and various jurisdictional gateways (as regards the claim aganst HEVC Advance) in relation to an implementer brought FRAND dispute.

 

The Court expressly did not decide the question of whether the Court could exercise an inherent jurisdiction to decide FRAND terms by means of declaratory relief as that was considered a matter for another day and, in the instance of this case, another jurisdiction.

Parties

Conversant Wireless Licensing v Huawei & ZTE

Neutral Citation

[2019] EWHC 1982 (Pat)

Judge

Hacon, His Honour Judge

The application concerned requests for disclosure by the parties.

 

Conversant's sought licence agreements primarily relating to 3G and/or 4G patents as Huawei was relying on a third party licence granted by Nokia and it argued it needed the disclosure to establish if the licence was comparable. Conversant's application was refused as the Court felt such licences were no help in resolving the issues in Unwired Planet and there are significant costs involved in this sort of disclosure. Conversant could argue about the comparable nature of the licence relied on by Huawei at trial.

 

Huawei and ZTE sought disclosure of documentation relating to Conversant's purchase of the portfolio, including valuations and revenue estimates. The Court allowed this application as it would assistance to the Court in determining the market value of the patents at the time.

Parties

TQ Delta v ZyXel Communications

Neutral Citation

[2019] EWCA Civ 1277

Judge

Floyd, Lord Justice

The appeal was heard by Lord Justice Lewison and Lord Justice Floyd. Lord Justice Floyd delivered the lead judgment.

 

This was the appeal against the order requiring the RAND trial to proceed notwithstanding the RAND waiver by ZyXel.

 

The Court of Appeal overturned the first instance decision, noting that it disagreed that there was still a real commercial dispute between the parties notwithstanding the RAND waiver.

 

The Court of Appeal felt the concerns raised by the Court at first instance could be addressed in other ways or were speculative.

 

The Court of Appeal also refused to declare that ZyXEL was not a "willing licencee" on the basis that the term had no common meaning and it would be an exercise in "jurisdictional imperialism" to do so.

Parties

TQ Delta v ZyXel Communications

Neutral Citation

[2019] EWCA Civ 1277

Judge

Lewison, Lord Justice

The appeal was heard by Lord Justice Lewison and Lord Justice Floyd. Lord Justice Floyd delivered the lead judgment.

 

This was the appeal against the order requiring the RAND trial to proceed notwithstanding the RAND waiver by ZyXel.

 

The Court of Appeal overturned the first instance decision, noting that it disagreed that there was still a real commercial dispute between the parties notwithstanding the RAND waiver.

 

The Court of Appeal felt the concerns raised by the Court at first instance could be addressed in other ways or were speculative.

 

The Court of Appeal also refused to declare that ZyXEL was not a "willing licencee" on the basis that the term had no common meaning and it would be an exercise in "jurisdictional imperialism" to do so.

Parties

Optis & Unwired Planet v Apple

Neutral Citation

[2019] EWHC 1742 (Pat)

Judge

Morgan, Mr Justice

Optis applied for directions and Apple applied for a stay of the proceedings / to challenge the Court's jurisdiction.

 

The Court determined that the pending Supreme Court FRAND appeal was not grounds for staying the FRAND part of the action.

 

However, the Court determined that Apple did not need to serve a defence on the FRAND issues. As regards other issues, the Court required draft defences to be served by two Apple entties, but not Apple Inc (the parent company). Finally, the Court listed a CMC for early 2020, when the position was likely to be clearer, and declined to list any trials.

Parties

IPCom v Vodafone

Neutral Citation

[2019] EWHC 1255 (Pat)

Judge

Birss, Mr Justice

This concerned an application for expedition by IPCom and a jurisdiction challenge by Vodafone.

 

The Court ordered a degree of expedition as regards the patent trial to ensure it was scheduled before the expiry of the patent, but refused the schedule the FRAND trial before the expiry of the patent (which the Court felt would be impossible).

 

The Court also noted that there was a real risk that if the patent was upheld as valid and essential and there is no undertaking to accept whatever licence the Court ultimately determined to be FRAND prior to expiry of the patent then Vodafone may be injuncted.

 

The jurisdiction challenge, which related to a stay application under Article 30 of the Recast Brussels Regulation (based on co-pending German proceedings), was compromised before the hearing. However, the Judge observed obiter (i) the fact the co-pending proceedings involved different group companies was unlikely material since FRAND licences often operate at a group level, (ii) since the FRAND obligation was international there was an obvious risk of irreconcilable decisions but (iii) in the present case there was a real issue on the Court’s discretion since in practice it was clear the [FRAND] issue was, in fact, highly unlikely to have fallen to be decided in the co-pending proceedings.

Parties

TQ Delta v ZyXel Communications

Neutral Citation

[2019] EWHC 1089 (Pat)

Judge

Birss, Mr Justice

The Court considered whether an implementer was able to waive their right to rely on the RAND undertaking in response to an allegation of patent infringement, and thereby avoid a RAND determination.

 

The Court held that there were still arguable issues in relation to the effect of the RAND waiver and the right time to decide them would be at the RAND trial itself. As a result the Court considered that there was still a real commercial dispute and that the RAND trial should proceed.

 

Note this was overturned on appeal.

Parties

TQ Delta v ZyXel Communications

Neutral Citation

[2019] EWHC 745 (Pat)

Judge

Carr, Mr Justice Henry

This was the consequential hearing following judgment on a patent trial, when a patent was found valid, essential and infringed. ZyXel had previously elected not to enforce the RAND undertaking.

 

ZyXel argued that the injunction would be disproportionate given its impact and the fact that the patent was due to expire in circa three months' time. However, the Court granted the injunction.

 

The Court also refused ZyXel's application for a stay on the basis of the prejudice it would cause to customers as the Court felt the evidence in support was insufficient.

Parties

TQ Delta v ZyXel Communications

Neutral Citation

[2019] EWHC 353 (Pat)

Judge

Carr, Mr Justice Henry

This application primarily concerned a dispute over the date of a RAND trial.

 

During the course of the judgment, the Court makes a number of observations about such trials, as well as related pleadings and evidence.

 

The unavailability of counsel was not a good enough reason to avoid a particular date.

Parties

Conversant Wireless Licensing v Huawei & ZTE

Neutral Citation

[2019] EWCA Civ 38

Judge

Floyd, Lord Justice

The appeal was heard by Lord Justice Patten, Lord Justice Floyd and Lord Justice Flaux. Lord Justice Floyd delivered the lead judgment.

 

This was the appeal against the order of Mr Justice Henry Carr dismissing parts of the Defendants' jurisdiction challenges at first instance (though part of the appeal was held over to any further appeal on the basis of the recent Court of Appeal ruling in the Unwired Planet litigation).

 

The Court of Appeal upheld the first instance decision. In particular, the Court confirmed that the UK was the forum conveniens for the claim, which was correctly characterised as a UK patent claim, and has jurisdiction to grant a global FRAND licence even where UK sales only account for less than 1% of the sales on which royalties are claimed.

 

The Court refused to admit new evidence of Chinese law (in particular a set of Guidelines issued by the Courts of Guangdong Province, China). The Court felt the evidence was prima facie admissible under the first Ladd v Marshall criteria, but did not meet the second criteria of having an influence on the outcome of the decision.

Parties

Conversant Wireless Licensing v Huawei & ZTE

Neutral Citation

[2019] EWCA Civ 38

Judge

Flaux, Lord Justice

The appeal was heard by Lord Justice Patten, Lord Justice Floyd and Lord Justice Flaux. Lord Justice Floyd delivered the lead judgment.

 

This was the appeal against the order of Mr Justice Henry Carr dismissing parts of the Defendants' jurisdiction challenges at first instance (though part of the appeal was held over to any further appeal on the basis of the recent Court of Appeal ruling in the Unwired Planet litigation).

 

The Court of Appeal upheld the first instance decision. In particular, the Court confirmed that the UK was the forum conveniens for the claim, which was correctly characterised as a UK patent claim, and has jurisdiction to grant a global FRAND licence even where UK sales only account for less than 1% of the sales on which royalties are claimed.

 

The Court refused to admit new evidence of Chinese law (in particular a set of Guidelines issued by the Courts of Guangdong Province, China). The Court felt the evidence was prima facie admissible under the first Ladd v Marshall criteria, but did not meet the second criteria of having an influence on the outcome of the decision.

Parties

Conversant Wireless Licensing v Huawei & ZTE

Neutral Citation

[2019] EWCA Civ 38

Judge

Patten, Lord Justice

The appeal was heard by Lord Justice Patten, Lord Justice Floyd and Lord Justice Flaux. Lord Justice Floyd delivered the lead judgment.

 

This was the appeal against the order of Mr Justice Henry Carr dismissing parts of the Defendants' jurisdiction challenges at first instance (though part of the appeal was held over to any further appeal on the basis of the recent Court of Appeal ruling in the Unwired Planet litigation).

 

The Court of Appeal upheld the first instance decision. In particular, the Court confirmed that the UK was the forum conveniens for the claim, which was correctly characterised as a UK patent claim, and has jurisdiction to grant a global FRAND licence even where UK sales only account for less than 1% of the sales on which royalties are claimed.

 

The Court refused to admit new evidence of Chinese law (in particular a set of Guidelines issued by the Courts of Guangdong Province, China). The Court felt the evidence was prima facie admissible under the first Ladd v Marshall criteria, but did not meet the second criteria of having an influence on the outcome of the decision.

Parties

TQ Delta v ZyXel Communications

Neutral Citation

[2018] EWHC 3651 (Pat)

Judge

Arnold, Mr Justice

This was a pre-trial review, which covered inter alia (i) ZyXel’s application to exclude various aspects of TQ Delta’s evidence on the basis that it fell outside of TQ Delta’s pleaded case on RAND; and (ii) TQ Delta’s application to amend its statement of case on RAND to introduce a new allegedly comparable licence.

 

The primary evidence that ZyXel sought to exclude was (i) an essentiality review carried out by TQ Delta’s expert using a team to assist them, and (ii) an alternative calculation in response to ZyXel’s top-down case. (ZyXel also sought to exclude evidence relating to the entities that should be covered by the licence, but the Judge allowed TQ Delta to amend its case on that issue given it caused no real prejudice.)

 

On the essentiality review, the Judge concluded that the approach taken by TQ Delta was unacceptable since, if the patent review had been done by multiple experts, TQ Delta ought to have applied to adduce evidence from the required number of experts (and tender them all for cross-examination). The Judge also criticised the essentiality review as being “impenetrable” due to the lack of reasoning. The Judge concluded that the defects could not be remedied in a reasonable period of time, and so excluded the evidence. On the alternative calculation, the Judge concluded that TQ Delta’s pleading was inadequate to cover it. Evidence that directly undermined ZyXel’s proposed calculations should remain, but evidence that presented an alternative licence calculation should be excluded, unless TQ Delta amended its statement of case.

 

On TQ Delta’s application, the Judge agreed that the comparable licence that TQ Delta had applied to include was “plainly relevant” to TQ Delta’s case but stated that it would be prejudicial to ZyXel to allow it into the case given the proximity of the trial and availability of ZyXel’s experts.

 

The Judge accordingly gave TQ Delta a choice: it could proceed in the current trial listing with a slimmed down version of its case, which would not include the additional licence or the alternative calculation, or the RAND trial could be adjourned to allow it to amend its pleadings to include those aspects.

Parties

Unwired Planet v Huawei

Neutral Citation

[2018] EWCA Civ 2344

Judge

Floyd, Lord Justice

The appeal was heard by Lord Justice Kitchen, Lord Justice Floyd and Lady Justice Asplin. Lord Justice Floyd delivered the lead judgment.

 

This was the appeal against the order following the main first instance judgment in which the Court set a global FRAND licence.

 

The Court of Appeal dismissed all three grounds of Huawei's appeal, holding that (a) the Court can set a global FRAND licence; (b) Unwired Planet's offer was non-discriminatory provided it did not exceed the fair and reasonable 'benchmark' rate; and (c) the Huawei v ZTE negotiation framework set by the CJEU does not present a set of prescriptive rules, but rather presents the patentee with a 'safe harbour' against a finding of abuse of dominance.

Parties

Apple v Qualcomm

Neutral Citation

[2018] EWHC 2711 (Ch)

Judge

Morgan, Mr Justice

This hearing followed an earlier judgment ([2018] EWHC 1188 (Pat)) considering a jurisdiction challenge, at which time the Judge had directed the parties to file evidence on the issue of loss within the jurisdiction. This evidence went to whether Gateway 9 was engaged on Apple’s application to serve its claim insofar as it related to allegations that Qualcomm had abused its dominant position out of the jurisdiction. Qualcomm did not file any new evidence, but Apple filed a witness statement by a financial director of Apple in response to evidence given before an earlier hearing in March, as well as an application for permission to re-amend the Particulars of Claim.

 

The court considered that Mr Roman’s evidence meant there was a plausible evidential basis for the claim under Gateway 9. The fact that it related to what Apple would have done had the tort been committed (even if that situation had not materialised) was permissible and evidence at the interlocutory stage was inevitably more limited. However, Qualcomm argued that Mr Roman's evidence should not be admitted since Apple had delayed and it was an abuse of process for Apple to file evidence at a hearing that was for Qualcomm to answer Apple.

 

The court agreed that the evidence ought to have been provided under the directions in relation to the earlier hearing in March. Apple had therefore failed effectively to comply with a rule, which was a serious and significant breach with no justification. However, the procedural context was unusual, Qualcomm had also provided evidence for today’s hearing, and Apple was likely to be able to “start again”. There was therefore no procedural reason to reject Mr Roman's witness statement. Further, it would be procedurally worse in terms of delay and cost to disallow the statement when realistically that was only a more expensive way of probably reaching the same result.

 

The Court accordingly assumed jurisdiction and permitted several requested amendments to the particulars of claim.

Parties

Unwired Planet v Huawei

Neutral Citation

[2018] EWCA Civ 2344

Judge

Asplin, Lady Justice

The appeal was heard by Lord Justice Kitchen, Lord Justice Floyd and Lady Justice Asplin. Lord Justice Floyd delivered the lead judgment.

 

This was the appeal against the order following the main first instance judgment in which the Court set a global FRAND licence.

 

The Court of Appeal dismissed all three grounds of Huawei's appeal, holding that (a) the Court can set a global FRAND licence; (b) Unwired Planet's offer was non-discriminatory provided it did not exceed the fair and reasonable 'benchmark' rate; and (c) the Huawei v ZTE negotiation framework set by the CJEU does not present a set of prescriptive rules, but rather presents the patentee with a 'safe harbour' against a finding of abuse of dominance.

Parties

Conversant Wireless Licensing v Huawei & ZTE

Neutral Citation

[2018] EWHC 2549 (Ch)

Judge

Carr, Mr Justice Henry

Conversant applied for an anti-suit injunction to restrain ZTE's pursuit of Chinese FRAND proceedings.

 

The application was compromised by way of an amendment to ZTE's Chinese compliant and the provision of undertakings from ZTE and Conversant (the latter relating to Conversant's bringing of proceedings in Germany).

 

The judgment accordingly only considers costs, which were awarded to Conversant with a small discount.

Parties

TQ Delta v ZyXel Communications

Neutral Citation

[2018] EWHC 1515 (Ch)

Judge

Carr, Mr Justice Henry

The Court considered a dispute over whether individuals at ZyXel could have access to certain confidential information disclosed in the proceedings (specifically license agreements), rather than such information being restricted to an External Legal Eyes Only confidentiality club.

 

The Court determined that the confidential information should be disclosed to named ZyXEL representatives. The Court considered that 'exceptional circumstances' were required to warrant an External Legal Eyes Only tier for confidential information, and such circumstances were not present here.

Parties

Apple v Qualcomm

Neutral Citation

[2018] EWHC 1188 (Pat)

Judge

Morgan, Mr Justice

This decision concerns a conjoined jurisdiction challenge and strike out application by Qualcomm (depending on the specific defendant entity) in relation to Apple's claim alleging abuse of a dominant position (Article 102 TFEU) and seeking various declarations pertaining to Qualcomm's FRAND / ETSI obligations (there were also a number of related claims relating to patent non-infringement and patent exhaustion).

 

The Court refused jursidiction / granted summary judgment as regards Apple's claim alleging breach of Qualcomm's FRAND undertaking in part on the basis that the UK Qualcomm subsidiary did not give any FRAND undertakings, or own any of the patents, and so could not serve as an anchor defendant.

 

The UK was plainly the approrpriate forum for a claim alleging a breach of Article 102 TFEU (and a multiplicity of proceedings was to be expected where conduct has given rise to alleged breaches of laws in multiple jurisdictions) but the question of whether Apple had a plausible evidential basis for suffering loss within the UK under jurisdictional gateway 9 (the Court having dismissed the other gateways relied upon).

Parties

Conversant Wireless Licensing v Huawei & ZTE

Neutral Citation

[2018] EWHC 1216 (Ch)

Judge

Carr, Mr Justice Henry

This was the consequential hearing following judgment dismissing (in part) the jurisdiction challenges brought by Huawei and ZTE.

 

Huawei and ZTE were given permission to appeal the decision at first instance (that the Court had and should exercise jurisdiction to hear the claim and that England was the forum conveniens for that claim).

 

The Court refused to stay the substantive proceedings pending that appeal, ordering the listing of trials and the provision of draft pleadings.

Parties

Conversant Wireless Licensing v Huawei & ZTE

Neutral Citation

[2018] EWHC 808 (Pat)

Judge

Carr, Mr Justice Henry

Huawei and ZTE challenged the jurisdiction of the Court, alleging that the Court did not have or should not exercise jurisdiction over the claim and that England was not the forum conveniens for the claim as the claim sought the determination of a global FRAND licence. The Chinese parent companies also sought declarations that they had not been properly served with proceedings.

 

The Court held that the claim was properly characterised as a UK patent infringement claim.

 

The Court accordingly found that it had jurisdiction to determine the claim and that England was the forum conveniens for such a claim.

Parties

Unwired Planet v Huawei

Neutral Citation

[2017] EWHC 3083 (Pat)

Judge

Birss, Mr Justice

This judgment addresses the confidentiality of the main judgment and reiterates the strong principle that a judgment should be publically available in full with any redaction requiring both important reasons and cogent, specific evidence supporting it.

 

The judgment also annexes the licence terms that were agreed by the parties would accord with the main judgment save that the scope of the licence was limited to the UK (the Court expressly reiterated that it did not endorse this licence as FRAND in light of the main judgment).

Parties

Unwired Planet v Huawei

Neutral Citation

[2017] EWHC 2831 (Pat)

Judge

Carr, Mr Justice Henry

Unwired Planet applied for an anti-suit injunction to stop Huawei pursuing proceedings in China.

 

The application was compromised on the basis of undetakings whereby each party agreed not to commence new claims in Germany, Mexico and China in relation to Unwired Planet's portfolio without notice to the other party until final determination of these English proceedings.

 

The judgment concerns costs only, and the Court awarded Unwired Planet 60% of it's recoverable costs (which in turn were 70% of its claimed costs).

Parties

Unwired Planet v Huawei

Neutral Citation

[2017] EWHC 1304 (Pat)

Judge

Birss, Mr Justice

This is the remedies judgment following the main Unwired Planet decision (in which the Court determined the terms of a global FRAND licence). It was the first time the Court has granted - but stayed pending appeal - a 'FRAND injunction'.

 

A FRAND injunction was an ordinary injunction that will automatically cease to have effect if the defendant enters into a FRAND licence, and this was the appropriate relief where the court has settled a FRAND licence but the defendant has not entered into it.

 

The Court also granted permission to appeal to the Court of Appeal on all three of the grounds advanced by Huawei.

Parties

Unwired Planet v Huawei

Neutral Citation

[2017] EWHC 711 (Pat)

Judge

Birss, Mr Justice

This is the well known Unwired Planet judgment, in which, for the first time, the High Court assessed what offers are FRAND and determined the rates and terms of a global licence.

 

On the facts of the case, the Court held that a UK portfolio licence was not FRAND and the FRAND licence between Unwired Planet and Huawei was a worldwide licence. The Court determined a UK licence in case it was wrong about that, however, which included uplifts to reflect the issue of roaming and to compensate the patent holder for the inefficiencies of country-by-country licensing.

 

The Court held that there is only one set of licence terms which are FRAND in any given set of circumstances, and as a result the 'Vringo Problem' did not actually exist.

 

The Court determined that an implementer who refuses to take a licence on terms found by the court to be FRAND has chosen to have no licence and accordingly if they are found to infringe a valid patent, they may injuncted (as happened to Huawei).

Parties

Samsung v Ericsson & Unwired Planet

Neutral Citation

[2016] EWCA Civ 489

Judge

Lloyd, Sir Timothy

The appeal was heard by Lord Justice Tomlinson, Lord Justice Kitchin and Sir Timothy Lloyd. Lord Justice Kitchin delivered the lead judgment.

 

The Patents Court had struck out one of Samsung's competition law defences, namely the allegation that Ericsson had allegedly failed fully to transfer the FRAND undertaking given by Ericsson (to ETSI) to Unwired Planet. Samsung argued that Ericsson's non-discrimination obligation would be circumvented by the transfer. The High Court had struck this out on the basis that it was enough for Unwired Planet to make its own FRAND declaration to ETSI.

 

The Court of Appeal overturned the decision. It held there was an arguable case that the agreement (under which the SEPs had been transferred to Unwired Planet by Ericsson) may be void under Article 101 TFEU because of the failure to ensure Unwired Planet would respect Ericsson's non-discrimination obligation (such that "[Unwired Planet] could not obtain more favourable terms from its licensees than Ericsson could itself have obtained").

 

The Court also recognised the relationship between the defence that had been struck out and other competition law defences in the case, and in particular that "it is arguable that the matters complained of act together to allow Ericsson to circumvent its own FRAND obligations by increasing licence fees and weakening the competition between Ericsson and other users of its SEPs."

Parties

Samsung v Ericsson & Unwired Planet

Neutral Citation

[2016] EWCA Civ 489

Judge

Kitchin, Lord Justice

The appeal was heard by Lord Justice Tomlinson, Lord Justice Kitchin and Sir Timothy Lloyd. Lord Justice Kitchin delivered the lead judgment.

 

The Patents Court had struck out one of Samsung's competition law defences, namely the allegation that Ericsson had allegedly failed fully to transfer the FRAND undertaking given by Ericsson (to ETSI) to Unwired Planet. Samsung argued that Ericsson's non-discrimination obligation would be circumvented by the transfer. The High Court had struck this out on the basis that it was enough for Unwired Planet to make its own FRAND declaration to ETSI.

 

The Court of Appeal overturned the decision. It held there was an arguable case that the agreement (under which the SEPs had been transferred to Unwired Planet by Ericsson) may be void under Article 101 TFEU because of the failure to ensure Unwired Planet would respect Ericsson's non-discrimination obligation (such that "[Unwired Planet] could not obtain more favourable terms from its licensees than Ericsson could itself have obtained").

 

The Court also recognised the relationship between the defence that had been struck out and other competition law defences in the case, and in particular that "it is arguable that the matters complained of act together to allow Ericsson to circumvent its own FRAND obligations by increasing licence fees and weakening the competition between Ericsson and other users of its SEPs."

Parties

Samsung v Ericsson & Unwired Planet

Neutral Citation

[2016] EWCA Civ 489

Judge

Tomlinson, Lord Justice

The appeal was heard by Lord Justice Tomlinson, Lord Justice Kitchin and Sir Timothy Lloyd. Lord Justice Kitchin delivered the lead judgment.

 

The Patents Court had struck out one of Samsung's competition law defences, namely the allegation that Ericsson had allegedly failed fully to transfer the FRAND undertaking given by Ericsson (to ETSI) to Unwired Planet. Samsung argued that Ericsson's non-discrimination obligation would be circumvented by the transfer. The High Court had struck this out on the basis that it was enough for Unwired Planet to make its own FRAND declaration to ETSI.

 

The Court of Appeal overturned the decision. It held there was an arguable case that the agreement (under which the SEPs had been transferred to Unwired Planet by Ericsson) may be void under Article 101 TFEU because of the failure to ensure Unwired Planet would respect Ericsson's non-discrimination obligation (such that "[Unwired Planet] could not obtain more favourable terms from its licensees than Ericsson could itself have obtained").

 

The Court also recognised the relationship between the defence that had been struck out and other competition law defences in the case, and in particular that "it is arguable that the matters complained of act together to allow Ericsson to circumvent its own FRAND obligations by increasing licence fees and weakening the competition between Ericsson and other users of its SEPs."

Parties

Vringo Infrastructure v ZTE

Neutral Citation

[2015] EWHC 1704 (Pat)

Judge

Birss, Mr Justice

At the CMC, Vringo sought disclosure of comparative licences held by ZTE to provide evidence of the going rate of SEP licences in the relevant technology area. ZTE sought disclosure of comparative licences granted by Vringo, as well as its predecessor in title, Nokia.

 

A significant dispute arose over who had 'control' of the licences, given Nokia and ZTE's parent company (ZTE Corporation) were both not parties to the case.

 

The Court invited the parties to negotiate over the issue, given there was significant time to do so, and to come back to Court in one month if they failed to agree. The Court indicated, however, that in its view the most appropriate outcome would be for both sets of licences to be disclosed.

Parties

Vringo Infrastructure v ZTE

Neutral Citation

[2013] EWHC 1591 (Pat)

Judge

Birss, Mr Justice

At this CMC, Vringo asked the Court to set a trial on FRAND issues before the trials of the patents in suit.

 

The Court dismissed the application. Whilst it was sympathetic to Vringo's argument (since it would likely be a cheaper and more efficient way of resolving the dispute), there was a fundamental issue over whether the portfolio had any value at all, which could only be addressed by assessing validity and essentiality. Further, the FRAND trial would not bring the proceedings to an end as only Vringo had agreed to be bound by it.

 

It was in this judgment that the Court first grappled with what later became known as the 'Vringo problem', namely if FRAND is a range and both parties offered a rate within that range, both parties would be willing licensees and therefore it was questionable whether the Court should order an injunction.

Parties

Nokia v IPCom

Neutral Citation

[2012] EWHC 1446 (Ch)

Judge

Roth, Mr Justice

This concerned IPCom's application for an injunction, which was compromised on the basis that Nokia had agreed to take a licence on FRAND terms (the judgment itself is primarily about costs).

 

However, in this fact specific judgment, the Court indicated that the application for an injunction was 'inappropriate' and the correct course was to proceed to a determination of the FRAND terms.

 

IPCom had also applied for summary judgment / strike out in relation to Nokia's objections to an injunction being granted, and following the above no order was made on this application.

Parties

Unwired Planet v Huawei

Neutral Citation

[2018] EWCA Civ 2344

Judge

Kitchin, Lord Justice

The appeal was heard by Lord Justice Kitchen, Lord Justice Floyd and Lady Justice Asplin. Lord Justice Floyd delivered the lead judgment.

 

This was the appeal against the order following the main first instance judgment in which the Court set a global FRAND licence.

 

The Court of Appeal dismissed all three grounds of Huawei's appeal, holding that (a) the Court can set a global FRAND licence; (b) Unwired Planet's offer was non-discriminatory provided it did not exceed the fair and reasonable 'benchmark' rate; and (c) the Huawei v ZTE negotiation framework set by the CJEU does not present a set of prescriptive rules, but rather presents the patentee with a 'safe harbour' against a finding of abuse of dominance.

Parties

Koninklijke Philips v Harvard International & MPEG LA

Neutral Citation

[2009] EWHC 1600 (Pat)

Judge

Lewison, Mr Justice

At a previous case management conference, the Court had divided the case into three parts, namely the patent issues, the licence issues and the FRAND issues. The patent issues were stayed, and there would be separate trials in relation to the licence issues (first) and the FRAND issues (second).

 

This judgment concerns Philips' application to have the FRAND issues and the licence issues tried together instead of separately.

 

The Court decided that there was not a sufficiently strong case to justify varying or revoking the judge's order. A number of the issues raised were inherent in the order, rather than being due to any change in circumstances, there was little pleaded overlap between the two issues and the case would become unmanageable if the licence and FRAND issues were tried at the same time.

Parties

Nokia v IPCom

Neutral Citation

[2009] EWHC 1017 (Pat)

Judge

Floyd, Mr Justice

IPCom asked the court to order a preliminary issue hearing to determine the FRAND licence terms prior to hearing the validity and infringement actions (which were already listed).

 

The Court refused and held that the existing patent trials should take place first.

 

The Court was concerned about the "radical change of course", the risk of wasted resources spent on the patent actions already and whether, when determining the FRAND rate, the court would have to consider whether validity, infringement and essentiality of the patents was a factor which should be taken into account.

Parties

Unwired Planet v Huawei and Conversant Wireless Licensing v Huawei & ZTE

Neutral Citation

[2020] UKSC 37

Judge

Hodge, Lord Justice

The appeal was heard by Lord Reed, Lord Hodge, Lady Black, Lord Briggs and Lord Sales. All members of the panel contributed to the judgment.

 

The UKSC considered at length a number of issues relating to SEPs and FRAND across the Unwired and Conversant cases. The bullet points below are a very brief summary of the key findings.

 

The contractual arrangements created by ETSI’s IPR Policy gave the English courts jurisdiction to determine a global FRAND licence even without the parties’ consent. The English courts were not ruling on the validity and infringement of foreign patents by doing so (though in appropriate cases it may be argued that it was FRAND to include an adjustment mechanism based on challenges to essentiality/validity brought in a foreign jurisdiction).

 

In the Conversant case, no alternative forum was available since it had not been demonstrated that the Chinese courts would accept jurisdiction to set a global FRAND licence.

 

The ‘ND’ limb of FRAND was ‘general’ in nature, rather than ‘hard-edged’; patentees were free to offer discounts beneath a generally available reasonable rate, implying that the courts should determine royalty rates for portfolios rather than individual licensees.

 

The FRAND undertaking imports a single unitary obligation that terms are “fair, reasonable and non-discriminatory”, which extends to the process by which the parties negotiate a licence.

 

The lower courts’ interpretation of the CJEU’s Huawei v ZTE framework as a ‘safe harbour’, rather than mandatory process, was upheld.

 

The availability of  injunctive relief where an implementer declines to enter into a FRAND licence was a necessary component of the balance between hold-up and hold-out. Damages in lieu would not be an adequate substitute for an injunction as it could create an incentive for country-by-country hold out.

Parties

Nokia v InterDigital

Neutral Citation

[2006] EWCA Civ 1618

Judge

Jacob, Lord Justice

The appeal was heard by Lord Justice Waller and Lord Justice Carnwath. Lord Justice Jacob delivered the lead judgment.

 

This was an appeal by InterDigital against the order of the High Court declaring that the court had jurisdiction over the claim and refusing InterDigital’s application for summary judgment (see [2006] EWHC 802 (Pat)). Nokia’s claim seeks declarations to the effect that a number of InterDigital’s patents were not essential to the 3G standard. InterDigital contended that the High Court had erred in the exercise of its discretion to accept jurisdiction; that the appropriate remedy for Nokia was a declaration of non-infringement under s71 Patents Act 1977; that Nokia lacked a sufficient claim of right to give rise to the court’s declaratory jurisdiction; and the declaration sought would not serve any real purpose.

 

The court dismissed the appeal. No error of principle had been identified in the reasoning of the first instance Judge, who was in a unique position to exercise discretion due to his knowledge of the subject matter and ability to form an authoritative opinion on its merits. Whilst the Court will normally decline to grant a declaration in favour of a party against whom no claim has been formulated, there was a real reason to do so in this case. Interdigital’s argument that Nokia had no claim of right was commercially unrealistic, since Nokia had a manifest and real commercial interest in the decision. An interest in making 3G phones, which had to comply with the standard, was clearly sufficient and the threats of competition law proceedings or a flood of similar claims were not sufficient reasons to decline jurisdiction. Further, the fact that 3G standards are set globally does not preclude a national court from exercising jurisdiction in respect of the matters before it. Finally, a declaration of non-infringement was inappropriate where what was sought was a declaration that none of the patents were essential to comply with the 3G standard. The existence of s.71 Patents Act 1977 was no reason to exclude the general jurisdiction.

Parties

Nokia v InterDigital

Neutral Citation

[2006] EWHC 802 (Pat)

Judge

Pumfrey, Mr Justice

InterDigital sought to set aside service of a claim against it on the basis the Court had no jurisdiction (or should strike it out). The claim sought declarations of non-essentiality in relation to certain of InterDigital's patents.

 

InterDigital asserted that representations of essentiality to a third party could not amount to an "assertion of a claim of right" (and so the Court lacked jurisdiction to grant declaratory relief) or alternatively such discretion should not be exercised in Nokia's favour for six reasons.

 

Nokia argued estoppel (on the basis of another case between the parties seeking similar relief was proceeding to trial) or alternatively that InterDigital had misunderstood the Court's declaratory jurisdiction.

 

The Court dismissed the application. The Judge observed that "it is wrong for a member of ETSI who has made a declaration of essentiality to suggest that it is either unprepared or unwilling to have the substance of the declaration tested". This was reinforced by presentations made to Nokia in which InterDigital asserts essentiality. The Court also noted that each of the six discretionary reasons was inappropriate to determine at this stage, and that each had "a flavour" of the grounds advanced in the earlier action when the declarations had been allowed to proceed to trial.
- The Court also noted that there was not a real possibility that Nokia would infringe notwithstanding a declaration of non-essentiality given how the standard operated and, in any event, none of the patents in suit had been identified as patents where this may be an issue.

Parties

Unwired Planet v Huawei and Conversant Wireless Licensing v Huawei & ZTE

Neutral Citation

[2020] UKSC 37

Judge

Brigg, Lord Justice

The appeal was heard by Lord Reed, Lord Hodge, Lady Black, Lord Briggs and Lord Sales. All members of the panel contributed to the judgment.

 

The UKSC considered at length a number of issues relating to SEPs and FRAND across the Unwired and Conversant cases. The bullet points below are a very brief summary of the key findings.

 

The contractual arrangements created by ETSI’s IPR Policy gave the English courts jurisdiction to determine a global FRAND licence even without the parties’ consent. The English courts were not ruling on the validity and infringement of foreign patents by doing so (though in appropriate cases it may be argued that it was FRAND to include an adjustment mechanism based on challenges to essentiality/validity brought in a foreign jurisdiction).

 

In the Conversant case, no alternative forum was available since it had not been demonstrated that the Chinese courts would accept jurisdiction to set a global FRAND licence.

 

The ‘ND’ limb of FRAND was ‘general’ in nature, rather than ‘hard-edged’; patentees were free to offer discounts beneath a generally available reasonable rate, implying that the courts should determine royalty rates for portfolios rather than individual licensees.

 

The FRAND undertaking imports a single unitary obligation that terms are “fair, reasonable and non-discriminatory”, which extends to the process by which the parties negotiate a licence.

 

The lower courts’ interpretation of the CJEU’s Huawei v ZTE framework as a ‘safe harbour’, rather than mandatory process, was upheld.

 

The availability of  injunctive relief where an implementer declines to enter into a FRAND licence was a necessary component of the balance between hold-up and hold-out. Damages in lieu would not be an adequate substitute for an injunction as it could create an incentive for country-by-country hold out.

Parties

Unwired Planet v Huawei and Conversant Wireless Licensing v Huawei & ZTE

Neutral Citation

[2020] UKSC 37

Judge

Sales, Lord Justice

The appeal was heard by Lord Reed, Lord Hodge, Lady Black, Lord Briggs and Lord Sales. All members of the panel contributed to the judgment.

 

The UKSC considered at length a number of issues relating to SEPs and FRAND across the Unwired and Conversant cases. The bullet points below are a very brief summary of the key findings.

 

The contractual arrangements created by ETSI’s IPR Policy gave the English courts jurisdiction to determine a global FRAND licence even without the parties’ consent. The English courts were not ruling on the validity and infringement of foreign patents by doing so (though in appropriate cases it may be argued that it was FRAND to include an adjustment mechanism based on challenges to essentiality/validity brought in a foreign jurisdiction).

 

In the Conversant case, no alternative forum was available since it had not been demonstrated that the Chinese courts would accept jurisdiction to set a global FRAND licence.

 

The ‘ND’ limb of FRAND was ‘general’ in nature, rather than ‘hard-edged’; patentees were free to offer discounts beneath a generally available reasonable rate, implying that the courts should determine royalty rates for portfolios rather than individual licensees.

 

The FRAND undertaking imports a single unitary obligation that terms are “fair, reasonable and non-discriminatory”, which extends to the process by which the parties negotiate a licence.

 

The lower courts’ interpretation of the CJEU’s Huawei v ZTE framework as a ‘safe harbour’, rather than mandatory process, was upheld.

 

The availability of  injunctive relief where an implementer declines to enter into a FRAND licence was a necessary component of the balance between hold-up and hold-out. Damages in lieu would not be an adequate substitute for an injunction as it could create an incentive for country-by-country hold out.

Parties

Unwired Planet v Huawei and Conversant Wireless Licensing v Huawei & ZTE

Neutral Citation

[2020] UKSC 37

Judge

Black, Lady Justice

The appeal was heard by Lord Reed, Lord Hodge, Lady Black, Lord Briggs and Lord Sales. All members of the panel contributed to the judgment.

 

The UKSC considered at length a number of issues relating to SEPs and FRAND across the Unwired and Conversant cases. The bullet points below are a very brief summary of the key findings.

 

The contractual arrangements created by ETSI’s IPR Policy gave the English courts jurisdiction to determine a global FRAND licence even without the parties’ consent. The English courts were not ruling on the validity and infringement of foreign patents by doing so (though in appropriate cases it may be argued that it was FRAND to include an adjustment mechanism based on challenges to essentiality/validity brought in a foreign jurisdiction).

 

In the Conversant case, no alternative forum was available since it had not been demonstrated that the Chinese courts would accept jurisdiction to set a global FRAND licence.

 

The ‘ND’ limb of FRAND was ‘general’ in nature, rather than ‘hard-edged’; patentees were free to offer discounts beneath a generally available reasonable rate, implying that the courts should determine royalty rates for portfolios rather than individual licensees.

 

The FRAND undertaking imports a single unitary obligation that terms are “fair, reasonable and non-discriminatory”, which extends to the process by which the parties negotiate a licence.

 

The lower courts’ interpretation of the CJEU’s Huawei v ZTE framework as a ‘safe harbour’, rather than mandatory process, was upheld.

 

The availability of  injunctive relief where an implementer declines to enter into a FRAND licence was a necessary component of the balance between hold-up and hold-out. Damages in lieu would not be an adequate substitute for an injunction as it could create an incentive for country-by-country hold out.

Parties

Mitsubishi & Sisvel v Archos, Nuu, OnePlus, Oppo & Xiaomi

Neutral Citation

[2020] EWCA Civ 1562

Judge

Males, Lord Justice

This was an appeal against the order following [2020] EWHC 2641 (Pat), in which the High Court had inter alia dismissed applications (i) by Oppo to add individuals involved in FRAND licensing negotiations into a ‘High Confidential Material’ (HCM) confidentiality club and (ii) by Xiaomi for the blanket re-designation of all ‘Attorney’s Eyes Only’ (AEO) documents to HCM.

 

The Court of Appeal dismissed the appeal, noting that the documents in question contained highly valuable confidential information belonging to third parties. Further, given the breadth of the disclosure in the case and the stage of the proceedings, a large number of the documents would be of limited relevance. In those circumstances, it was appropriate to limit access.

 

The Court also agreed with the first instance judge that a limited number of AEO documents should be downgraded to HCM, subject to additional undertakings being provided by the relevant individuals to the licence counterparties.

 

However, in the case of Xiaomi, the Court of Appeal held that the undertakings to be entered into by relevant individuals should be amended to allow those individuals to participate in FRAND litigation and settlement negotiations (although not FRAND licensing more generally).

Parties

Mitsubishi & Sisvel v Archos, Nuu, OnePlus, Oppo & Xiaomi

Neutral Citation

[2020] EWCA Civ 1562

Judge

Lewis, Lord Justice

This was an appeal against the order following [2020] EWHC 2641 (Pat), in which the High Court had inter alia dismissed applications (i) by Oppo to add individuals involved in FRAND licensing negotiations into a ‘High Confidential Material’ (HCM) confidentiality club and (ii) by Xiaomi for the blanket re-designation of all ‘Attorney’s Eyes Only’ (AEO) documents to HCM.

 

The Court of Appeal dismissed the appeal, noting that the documents in question contained highly valuable confidential information belonging to third parties. Further, given the breadth of the disclosure in the case and the stage of the proceedings, a large number of the documents would be of limited relevance. In those circumstances, it was appropriate to limit access.

 

The Court also agreed with the first instance judge that a limited number of AEO documents should be downgraded to HCM, subject to additional undertakings being provided by the relevant individuals to the licence counterparties.

 

However, in the case of Xiaomi, the Court of Appeal held that the undertakings to be entered into by relevant individuals should be amended to allow those individuals to participate in FRAND litigation and settlement negotiations (although not FRAND licensing more generally).

Parties

IPCom v Vodafone

Neutral Citation

[2021] EWCA Civ 205

Judge

Lewison, Lord Justice

The point of particular interest on this appeal is IPCom's appeal against the finding that Vodafone had a defence of crown use to the infringement of IPCom's SEP. The Government had selected Vodafone to provide a system giving emergency services precedence on network channels during high traffic period, called MTPAS.

 

The crux of the appeal was whether, to invoke the defence of crown use, the Government had to provide (i) express authorisation to work the patent; (ii) authorisation to do an act where that act necessarily infringes the patent; or (iii) authorisation to do a particular act even if that does not necessarily involve infringing the patent. IPCom contended for (ii) whereas Vodafone contended, and the Judge found at first instance, that (iii) was sufficient.

 

The Secretary of State for Defence (SoSD) intervened in that appeal (as the relevant Government department liable to pay IPCom compensation based on the crown use). SoSD contended that (i) was required save that it could take the form of an express authorisation to 'work any patent'.

 

The CoA allowed the appeal and overturned the finding that Vodafone had a defence of crown use. Further, although it was not necessary to determine the point, the Court stated that interpretation (ii) is to be preferred for no fewer than 13 reasons (set out in the judgment at paragraphs to 150 to 165).

Parties

IPCom v Vodafone

Neutral Citation

[2021] EWCA Civ 205

Judge

Asplin, Lady Justice

The point of particular interest on this appeal is IPCom's appeal against the finding that Vodafone had a defence of crown use to the infringement of IPCom's SEP. The Government had selected Vodafone to provide a system giving emergency services precedence on network channels during high traffic period, called MTPAS.

 

The crux of the appeal was whether, to invoke the defence of crown use, the Government had to provide (i) express authorisation to work the patent; (ii) authorisation to do an act where that act necessarily infringes the patent; or (iii) authorisation to do a particular act even if that does not necessarily involve infringing the patent. IPCom contended for (ii) whereas Vodafone contended, and the Judge found at first instance, that (iii) was sufficient.

 

The Secretary of State for Defence (SoSD) intervened in that appeal (as the relevant Government department liable to pay IPCom compensation based on the crown use). SoSD contended that (i) was required save that it could take the form of an express authorisation to 'work any patent'.

 

The CoA allowed the appeal and overturned the finding that Vodafone had a defence of crown use. Further, although it was not necessary to determine the point, the Court stated that interpretation (ii) is to be preferred for no fewer than 13 reasons (set out in the judgment at paragraphs to 150 to 165).

Parties

Vestel v Access Advance & Koninklijke Philips

Neutral Citation

[2021] EWCA Civ 440

Judge

Nugee, Lord Justice

The appeal was heard by Lord Justice Nugee and Lady Justice Elisabeth Laing. Lord Justice Birss delivered the lead judgment.

 

This was an appeal from an order declaring that the court had no jurisdiction over Vestel’s claims against Access Advance (the administrator of a patent pool concerning the H.265 (HEVC) standard) and Philips (a member of that pool sued on its own behalf but also as an alleged representative of the pool members). Vestel claimed that the Defendants had abused their dominant positions inter alia by making allegedly non-FRAND offers. The relief sought included a determination of FRAND terms.

 

An appeal against the Judge’s finding that Vestel had not suffered any jurisdictionally relevant direct damage in the UK was dropped shortly in advance of the appeal hearing, along with Vestel’s claim that the Defendants had abused their dominant positions. The appeal therefore considered only Vestel’s reformulated (on appeal) case that it should be entitled to a FRAND declaration under the Court’s inherent jurisdiction to grant declaratory relief. Vestel also sought to limit its claim so that it concerned only UK patents (but maintained its assertion that a FRAND licence to such patents would be of global scope).

 

The Court of Appeal dismissed the appeal, holding that the inherent declaratory jurisdiction of the court cannot be engaged unless it is based on the existence or non-existence of a legal right (in addition to satisfying the ‘useful purpose’ requirement). Although Vestel had highlighted that the rules of the ITU (which administered the H.265 (HEVC) standard) were of relevance, Vestel did not assert it had a legally enforceable right to a FRAND licence. Further, it did not plead any legal standard against which the matter could properly be judged. The Court held that the claim had no reasonable prospect of success.

 

Further, the Court of Appeal held that neither the tort gateway (in the case of Access Advance) or Article 7(2) Brussels I Recast (in the case of Philips) applied in this case. It was not a claim for a declaration of non-liability for the tort of patent infringement. As regards the property gateway (in the case of Access Advance), the Court held the absence of a legal claim meant that gateway also did not apply.

Parties

Vestel v Access Advance & Koninklijke Philips

Neutral Citation

[2021] EWCA Civ 440

Judge

Laing, Lady Justice Elisabeth

The appeal was heard by Lord Justice Nugee and Lady Justice Elisabeth Laing. Lord Justice Birss delivered the lead judgment.

 

This was an appeal from an order declaring that the court had no jurisdiction over Vestel’s claims against Access Advance (the administrator of a patent pool concerning the H.265 (HEVC) standard) and Philips (a member of that pool sued on its own behalf but also as an alleged representative of the pool members). Vestel claimed that the Defendants had abused their dominant positions inter alia by making allegedly non-FRAND offers. The relief sought included a determination of FRAND terms.

 

An appeal against the Judge’s finding that Vestel had not suffered any jurisdictionally relevant direct damage in the UK was dropped shortly in advance of the appeal hearing, along with Vestel’s claim that the Defendants had abused their dominant positions. The appeal therefore considered only Vestel’s reformulated (on appeal) case that it should be entitled to a FRAND declaration under the Court’s inherent jurisdiction to grant declaratory relief. Vestel also sought to limit its claim so that it concerned only UK patents (but maintained its assertion that a FRAND licence to such patents would be of global scope).

 

The Court of Appeal dismissed the appeal, holding that the inherent declaratory jurisdiction of the court cannot be engaged unless it is based on the existence or non-existence of a legal right (in addition to satisfying the ‘useful purpose’ requirement). Although Vestel had highlighted that the rules of the ITU (which administered the H.265 (HEVC) standard) were of relevance, Vestel did not assert it had a legally enforceable right to a FRAND licence. Further, it did not plead any legal standard against which the matter could properly be judged. The Court held that the claim had no reasonable prospect of success.

 

Further, the Court of Appeal held that neither the tort gateway (in the case of Access Advance) or Article 7(2) Brussels I Recast (in the case of Philips) applied in this case. It was not a claim for a declaration of non-liability for the tort of patent infringement. As regards the property gateway (in the case of Access Advance), the Court held the absence of a legal claim meant that gateway also did not apply.

Parties

Nokia v Oppo

Neutral Citation

[2022] EWCA Civ 947

Judge

Phillips, Lord Justice

The appeal was heard by Lord Justice Peter Jackson and Lord Justice Phillips. Lord Justice Arnold delivered the lead judgment.

 

This was Oppo's appeal against the High Court's declaration that (i) the English Courts should exercise jurisdiction over Nokia's claim for SEP infringement and a determination of FRAND terms, and (ii) that a stay on case management grounds in favour of a parallel FRAND rate setting action in Chongqing should not be granted. (See [2021] EWHC 2952 (Pat).)

 

The Court upheld the first instance decision. On the issue of forum (non) conveniens, the Court agreed that the claim was characterised properly as one relating to SEP infringement, in line with the joint UKSC decision in Unwired Planet and Conversant. The developments since that UKSC decision did not affect the logic of that conclusion and consequently England was an appropriate forum.

 

The Court went on to conclude that even if the claim was characterised (incorrectly) as a dispute over global FRAND licensing terms, there was no 'natural' forum to determine such a claim and none of the factors considered favoured one forum over another. At best Chongqing was no more appropriate a forum than England.

 

On the issue of the case management stay, the Court reiterated that such first instance decisions should be afforded a high degree of deference. The High Court had made no error in its assessment and thus the Court would not reconsider the matter. However, in any event, the Court confirmed that it would have reached the same conclusion, and, if anything, would have put more weight on the factors against the grant of a stay.

Parties

Nokia v Oppo

Neutral Citation

[2022] EWCA Civ 947

Judge

Jackson, Lord Justice Peter

The appeal was heard by Lord Justice Peter Jackson and Lord Justice Phillips. Lord Justice Arnold delivered the lead judgment.

 

This was Oppo's appeal against the High Court's declaration that (i) the English Courts should exercise jurisdiction over Nokia's claim for SEP infringement and a determination of FRAND terms, and (ii) that a stay on case management grounds in favour of a parallel FRAND rate setting action in Chongqing should not be granted. (See [2021] EWHC 2952 (Pat).)

 

The Court upheld the first instance decision. On the issue of forum (non) conveniens, the Court agreed that the claim was characterised properly as one relating to SEP infringement, in line with the joint UKSC decision in Unwired Planet and Conversant. The developments since that UKSC decision did not affect the logic of that conclusion and consequently England was an appropriate forum.

 

The Court went on to conclude that even if the claim was characterised (incorrectly) as a dispute over global FRAND licensing terms, there was no 'natural' forum to determine such a claim and none of the factors considered favoured one forum over another. At best Chongqing was no more appropriate a forum than England.

 

On the issue of the case management stay, the Court reiterated that such first instance decisions should be afforded a high degree of deference. The High Court had made no error in its assessment and thus the Court would not reconsider the matter. However, in any event, the Court confirmed that it would have reached the same conclusion, and, if anything, would have put more weight on the factors against the grant of a stay.

Parties

Nokia v InterDigital

Neutral Citation

[2006] EWCA Civ 1618

Judge

Carnwath, Lord Justice

The appeal was heard by Lord Justice Waller and Lord Justice Carnwath. Lord Justice Jacob delivered the lead judgment.

 

This was an appeal by InterDigital against the order of the High Court declaring that the court had jurisdiction over the claim and refusing InterDigital’s application for summary judgment (see [2006] EWHC 802 (Pat)). Nokia’s claim seeks declarations to the effect that a number of InterDigital’s patents were not essential to the 3G standard. InterDigital contended that the High Court had erred in the exercise of its discretion to accept jurisdiction; that the appropriate remedy for Nokia was a declaration of non-infringement under s71 Patents Act 1977; that Nokia lacked a sufficient claim of right to give rise to the court’s declaratory jurisdiction; and the declaration sought would not serve any real purpose.

 

The court dismissed the appeal. No error of principle had been identified in the reasoning of the first instance Judge, who was in a unique position to exercise discretion due to his knowledge of the subject matter and ability to form an authoritative opinion on its merits. Whilst the Court will normally decline to grant a declaration in favour of a party against whom no claim has been formulated, there was a real reason to do so in this case. Interdigital’s argument that Nokia had no claim of right was commercially unrealistic, since Nokia had a manifest and real commercial interest in the decision. An interest in making 3G phones, which had to comply with the standard, was clearly sufficient and the threats of competition law proceedings or a flood of similar claims were not sufficient reasons to decline jurisdiction. Further, the fact that 3G standards are set globally does not preclude a national court from exercising jurisdiction in respect of the matters before it. Finally, a declaration of non-infringement was inappropriate where what was sought was a declaration that none of the patents were essential to comply with the 3G standard. The existence of s.71 Patents Act 1977 was no reason to exclude the general jurisdiction.

Parties

Nokia v InterDigital

Neutral Citation

[2006] EWCA Civ 1618

Judge

Waller, Lord Justice

The appeal was heard by Lord Justice Waller and Lord Justice Carnwath. Lord Justice Jacob delivered the lead judgment.

 

This was an appeal by InterDigital against the order of the High Court declaring that the court had jurisdiction over the claim and refusing InterDigital’s application for summary judgment (see [2006] EWHC 802 (Pat)). Nokia’s claim seeks declarations to the effect that a number of InterDigital’s patents were not essential to the 3G standard. InterDigital contended that the High Court had erred in the exercise of its discretion to accept jurisdiction; that the appropriate remedy for Nokia was a declaration of non-infringement under s71 Patents Act 1977; that Nokia lacked a sufficient claim of right to give rise to the court’s declaratory jurisdiction; and the declaration sought would not serve any real purpose.

 

The court dismissed the appeal. No error of principle had been identified in the reasoning of the first instance Judge, who was in a unique position to exercise discretion due to his knowledge of the subject matter and ability to form an authoritative opinion on its merits. Whilst the Court will normally decline to grant a declaration in favour of a party against whom no claim has been formulated, there was a real reason to do so in this case. Interdigital’s argument that Nokia had no claim of right was commercially unrealistic, since Nokia had a manifest and real commercial interest in the decision. An interest in making 3G phones, which had to comply with the standard, was clearly sufficient and the threats of competition law proceedings or a flood of similar claims were not sufficient reasons to decline jurisdiction. Further, the fact that 3G standards are set globally does not preclude a national court from exercising jurisdiction in respect of the matters before it. Finally, a declaration of non-infringement was inappropriate where what was sought was a declaration that none of the patents were essential to comply with the 3G standard. The existence of s.71 Patents Act 1977 was no reason to exclude the general jurisdiction.

Parties

Optis & Unwired Planet v Apple

Neutral Citation

[2022] EWCA Civ 1411

Judge

Asplin, Lady Justice

The appeal was heard by Lord Justice Arnold, Lady Justice Asplin, and Lady Justice Elisabeth Laing. Lord Justice Arnold delivered the lead judgment.

 

This was Apple's appeal against the High Court's declaration inter alia that (i) any person interested in implementing an ETSI standard must be entitled to have a FRAND licence on demand from a patentee which had given the relevant undertaking; (ii) a party could not be permanently deprived of that right; and (iii) a FRAND injunction should issue if Apple was unwilling to give a binding commitment to take a UK court-determined FRAND licence following one of Optis' SEPs being held valid, essential and infringed. Optis cross-appealed, seeking the right to obtain an unqualified injunction absent a binding commitment being given at the relevant time.

 

The Court upheld the first instance decision, dismissing both parties' appeals. The ETSI IPR Policy should be interpreted, in line with what was said by the UK Supreme Court in Unwired Planet v Huawei, to avoid the related issues of hold-out and hold-up. The Judge's conclusion achieved that balance whereas the interpretations contended for by both Optis and Apple did not.

 

A party seeking a licence must be prepared to take it otherwise there was the potential to promote hold-out. Further, by doing so a party was not committing to sign a 'blank cheque', as it was improbable that the English court would determine FRAND terms that were uncommercial or unviable. Equally, the suggestion that a party should become permanently disentitled to rely upon the FRAND obligation would promote hold-up. There is no reason why an implementer should not be able to change its mind, and every reason why it should be able to do so given the purpose of the ETSI IPR Policy.

 

The judgment is also notable for the judicial commentary in a postscript: "These appeals illustrate yet again the dysfunctional state of the current system for determining SEP/FRAND disputes. Apple’s behaviour in declining to commit to take a Court-Determined Licence once they had been found to infringe EP744, and their pursuit of their appeal, could well be argued to constitute a form of hold out (whether Apple have in fact been guilty of hold out is an issue for Trial E); while Optis’ contention that an unqualified injunction should be granted would open the door to hold up. Each side has adopted its position in an attempt to game the system in its favour. The only way to put a stop to such behaviour is for SDOs like ETSI to make legally-enforceable arbitration of such disputes part of their IPR policies."

Parties

Optis & Unwired Planet v Apple

Neutral Citation

[2022] EWCA Civ 1411

Judge

Laing, Lady Justice Elisabeth

The appeal was heard by Lord Justice Arnold, Lady Justice Asplin, and Lady Justice Elisabeth Laing. Lord Justice Arnold delivered the lead judgment.

 

This was Apple's appeal against the High Court's declaration inter alia that (i) any person interested in implementing an ETSI standard must be entitled to have a FRAND licence on demand from a patentee which had given the relevant undertaking; (ii) a party could not be permanently deprived of that right; and (iii) a FRAND injunction should issue if Apple was unwilling to give a binding commitment to take a UK court-determined FRAND licence following one of Optis' SEPs being held valid, essential and infringed. Optis cross-appealed, seeking the right to obtain an unqualified injunction absent a binding commitment being given at the relevant time.

 

The Court upheld the first instance decision, dismissing both parties' appeals. The ETSI IPR Policy should be interpreted, in line with what was said by the UK Supreme Court in Unwired Planet v Huawei, to avoid the related issues of hold-out and hold-up. The Judge's conclusion achieved that balance whereas the interpretations contended for by both Optis and Apple did not.

 

A party seeking a licence must be prepared to take it otherwise there was the potential to promote hold-out. Further, by doing so a party was not committing to sign a 'blank cheque', as it was improbable that the English court would determine FRAND terms that were uncommercial or unviable. Equally, the suggestion that a party should become permanently disentitled to rely upon the FRAND obligation would promote hold-up. There is no reason why an implementer should not be able to change its mind, and every reason why it should be able to do so given the purpose of the ETSI IPR Policy.

 

The judgment is also notable for the judicial commentary in a postscript: "These appeals illustrate yet again the dysfunctional state of the current system for determining SEP/FRAND disputes. Apple’s behaviour in declining to commit to take a Court-Determined Licence once they had been found to infringe EP744, and their pursuit of their appeal, could well be argued to constitute a form of hold out (whether Apple have in fact been guilty of hold out is an issue for Trial E); while Optis’ contention that an unqualified injunction should be granted would open the door to hold up. Each side has adopted its position in an attempt to game the system in its favour. The only way to put a stop to such behaviour is for SDOs like ETSI to make legally-enforceable arbitration of such disputes part of their IPR policies."

Parties

InterDigital v OnePlus

Neutral Citation

[2022] EWCA Civ 166

Judge

Jackson, Lord Justice Peter

The appeal was heard by Lord Justice Bean, Lord Justice Peter Jackson, and Lord Justice Birss. Lord Justice Birss delivered the lead judgment.

 

This was an appeal from an order concerning the undertaking required from OnePlus’ in-house counsel in order to access material designated as Highly Confidential under a two-tier confidentiality regime. The High Court had ordered that the prohibition against such individuals being involved in SEP licensing for a period of two years after they ceased to have access to the documents should apply to any SEP licensing. OnePlus contended on appeal that the High Court should have ordered a narrower form of undertaking, limited to licensing discussions with particular counterparties to the InterDigital licences disclosed.

 

The Court of Appeal upheld the order of the High Court, specifically its decision to adopt a wide form of undertaking prohibiting those with access to Highly Confidential documents from engaging in any SEP licensing. The Court rejected the argument that the only unfairness that could arise would be if the relevant individual became involved in licensing negotiations with the counterparty to a licence they had seen. In the Court’s view, information about the terms of a licence between InterDigital and counterparty A also had value in the context of a licensing negotiation between OnePlus and a different counterparty B.

 

The Court concluded that the order made at first instance was open to the judge based on the early stage in the proceedings and the limited evidence about OnePlus' structure and organisation. In particular, the Court explained that imposing a wider form of order at an early stage is sensible as it is more straightforward to relax confidentiality restrictions over the course of proceedings than to impose tighter restrictions after starting with a more liberal regime.

Parties

InterDigital v OnePlus

Neutral Citation

[2022] EWCA Civ 166

Judge

Bean, Lord Justice

The appeal was heard by Lord Justice Bean, Lord Justice Peter Jackson, and Lord Justice Birss. Lord Justice Birss delivered the lead judgment.

 

This was an appeal from an order concerning the undertaking required from OnePlus’ in-house counsel in order to access material designated as Highly Confidential under a two-tier confidentiality regime. The High Court had ordered that the prohibition against such individuals being involved in SEP licensing for a period of two years after they ceased to have access to the documents should apply to any SEP licensing. OnePlus contended on appeal that the High Court should have ordered a narrower form of undertaking, limited to licensing discussions with particular counterparties to the InterDigital licences disclosed.

 

The Court of Appeal upheld the order of the High Court, specifically its decision to adopt a wide form of undertaking prohibiting those with access to Highly Confidential documents from engaging in any SEP licensing. The Court rejected the argument that the only unfairness that could arise would be if the relevant individual became involved in licensing negotiations with the counterparty to a licence they had seen. In the Court’s view, information about the terms of a licence between InterDigital and counterparty A also had value in the context of a licensing negotiation between OnePlus and a different counterparty B.

 

The Court concluded that the order made at first instance was open to the judge based on the early stage in the proceedings and the limited evidence about OnePlus' structure and organisation. In particular, the Court explained that imposing a wider form of order at an early stage is sensible as it is more straightforward to relax confidentiality restrictions over the course of proceedings than to impose tighter restrictions after starting with a more liberal regime.

Experience

IPCom (patent owner): litigating numerous patents from a portfolio of ETSI declared essential patents against Nokia and others (over a period of more than a decade).

Samsung & Google (implementers): defending proceedings by Unwired Planet under a portfolio of five declared ETSI essential patents and one feature patent to successful settlements.

Philips (patent owner):

  • litigation against ASUS and HTC concerning three ETSI declared essential patents including a licence defence (rebutted) and FRAND issues
  • defending proceedings by Vestel for abuse of dominant position regards patents declared essential to HEVC.

ZTE (implementer): litigation by Conversant in respect of four ETSI declared essential patents involving jurisdictional challenges (which the Supreme Court heard in October 2019) as well as standard SEP litigation and FRAND issues.

Samsung: working with Samsung as both implementer and patent owner on competition issues involving FRAND before the European Commission.

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