Wildanger and AsusTek successful with FRAND defence in UPC dispute against Ericsson

In two recent decisions, the Milan local division concluded the main infringement proceedings between Swedish telecommunications company Ericsson and Taiwanese computer manufacturer AsusTek. The Court, under presiding judge Pierluigi Perrotti, revoked EP 3 076 673 in its entirety and dismissed the corresponding infringement claim. In the parallel action concerning EP 2 727 342, the court found indirect infringement. However, the judges panel refused to grant an injunction or order the recall and destruction of AsusTek’s products on the grounds that the implementer’s FRAND defence was well founded (case IDs: UPC_CFI_318/2024, UPC_CFI_319/2024, UPC_CFI_728/2024 and UPC_CFI_730/2024).

Ericsson had asserted that AsusTek’s laptops, desktops and related hardware equipped with Intel and AMD processors implemented the HEVC/H.265 video decoding standard. The Swedish company contended that both patents were essential to that standard. Co-defendant Arvato Netherlands B.V., a logistics provider, was sued as an intermediary.

The Milan panel revoked EP 673, which protects a method for decoding and encoding pictures of a video sequence. It dis so on the grounds of added matter and lack of novelty. The court held that a limitation introduced into claim 1 during examination – restricting the method to pictures “belonging to a layer other than a highest layer” – was not directly and unambiguously derivable from the application as originally filed. As a consequence, the patent was not entitled to its claimed priority date, with the April 2013 HEVC standard thus forming prior art.

Successful FRAND defence

In the parallel proceedings on EP 342, which concerns reference picture signalling, the Court upheld the patent’s validity and found that AsusTek’s products indirectly infringed claims 1, 2, 4 and 5. However, the panel accepted AsusTek’s FRAND defence based on Article 102 TFEU and the CJEU’s Huawei v ZTE framework.

The Milan judges found that Ericsson holds a dominant position on the relevant market for licensing the HEVC-essential technology. The Court held that products not implementing the HEVC standard cannot remain commercially competitive, as end consumers expect devices to support widely used video decoding standards. Ericsson therefore had an obligation to negotiate on FRAND terms before seeking injunctive relief.

According to the court, Ericsson failed to comply with the first procedural step laid down in Huawei vs ZTE. The patent proprietor had not identified the patent allegedly infringed nor specified how it was infringed before commencing proceedings. Ericsson only did so on 14 June 2024, the same day it lodged its statement of claim, and later sought a conditional injunction tied to acceptance of a licence proposal. The judges held that such a conditional request cannot substitute for the notice required prior to the commencement of injunction proceedings.

The parties can appeal the decisions. It is not yet known, whether either intends to do so.

No declaration of essentiality

As a consequence, the Milan division dismissed Ericsson’s requests for a permanent injunction, recall of products from the channels of commerce, destruction of infringing products and publication of the decision. The judges panel also rejected Ericsson’s principal claim for a declaration of essentiality. They found that the UPC lacks jurisdiction to issue such declarations with erga omnes effect, though it may assess essentiality as an incidental issue.

However, the UPC granted a declaration of infringement, found AsusTek liable for damages in principle and ordered both defendants to provide information covering the period from the grant of the patent on 29 June 2016. The information order also extends to Arvato in its capacity as intermediary, notwithstanding the fact that Ericsson had withdrawn its damages claim against the logistics provider during the proceedings. The amount of damages and the relevant compensable period are reserved for subsequent proceedings.

Lengthy campaign

The two Milan decisions are part of a litigation campaign that Ericsson pursued against AsusTek before the UPC for more than two years. The campaign comprises three main actions and three applications for preliminary measures. All three PI applications were dismissed:  One by the Lisbon local division in autumn 2024, and two by the Milan division in June 2026.

In the main proceedings before the Lisbon local division, Ericsson prevailed on EP 2 819 131, though the patent had already expired. In its decision of May 2026, the Portuguese division found the patent valid and infringed. Since it had expired the judges granted only information and a declaration of liability for damages, but no injunction. An appeal is pending.

With EP 673 now revoked and EP 342 shielded by a successful FRAND defence, Ericsson has obtained no injunction against AsusTek in any of the six proceedings.

Winston Taylor for Ericsson

Ericsson relied throughout the UPC campaign on a team from Winston Taylor, led by Amsterdam-based partner Wim Maas. David Mulder and Sebastien Versaevel supported the lead partner together with associates Faziel Abdul and Yingyi Liu. The former Dutch practice of Taylor Wessing now acts as a franchisees of the Winston Taylor, which emerged after the UK offices of Taylor Wessing merged with US firm Winston & Strawn earlier this year.

Patent attorneys Teun van Berkel and Tim Korsten of AOMB advised on technical matters. They cooperated with Andreas Tonscheidt of Ericsson.

The defendants relied on a team from Wildanger led by partner Alexander Wiese together with Eva Geschke. The German firm has represented AsusTek in various European patent disputes. Niccolò Ferretti of Nunziante Magrone acted as Italian counsel. On the patent attorney side, AsusTek instructed Rudolf Reichold and Thomas Hell of Bosch Jehle.