STOP PRESS – AG Opinion in Huawei v ZTE published today

20.11.2014

**For a more detailed commentary, see here.**

The Court of Justice of the European Union (‘CJEU’) has this morning published Advocate General Wathelet’s opinion in the Huawei v ZTE preliminary reference proceedings. An English language press-release is available here. The full opinion can be read in 19 official EU languages here, although it is not yet available in English. We are currently digesting the opinion, our initial impression is that the AG Wathelet’s approach is somewhat more nuanced and even-handed than that of the European Commission in its Motorola infringement decision.

AG Wathelet proposes that the European Court adopt a ‘middle-course’ between that taken by the German courts and that of the European Commission. The AG accepts that seeking an injunction on a FRAND-encumbered patent can amount to an abuse of dominance in some circumstances. The AG also makes a number of ‘implementer-friendly’ statements in line with the European Commission’s approach. For example, he confirms that an implementer can show itself to be a ‘willing licensee’ by agreeing to a third party determination of FRAND terms. Also, he confirmed that an implementer should be free to challenge the validity, use and essentiality of the patent in dispute without being considered an ‘unwilling licensee’.

However, the AG is also somewhat more nuanced than that of the Commission. For example, he recognises that an implementer’s approach to negotiations may be dilatory and that seeking an injunction in such circumstances is legitimate. He also states that it is legitimate for the patentee to ask the implementer either to provide a bank guarantee for the payment of royalties or to deposit a provisional sum at the court or arbitration tribunal in respect of its past and future use of the patent. This requirement will go some way to ensuring that implementers do not abuse the negotiation process.

We will follow-up with further comments shortly.