Win for Netflix and Quinn Emanuel as patent court invalidates Broadcom patent

Netflix has fought against Broadcom, previously known as Avago, over mulitple video-coding patents since 2018. The current dispute concerns Avago’s EP 2 575 366. The patent protects a video coding technology of the HEVC standard. Netflix uses the technology to encode and stream Ultra HD content.

Penalties for Netflix

In September 2023, Munich Regional Court heard the proceedings on the merits. The court issued an injunction prohibiting Netflix from using the technology (case ID: 7 O 12200/21 and 7 O 19721/22). The streaming service then implemented a workaround that, in Netflix’s opinion, no longer used the patent-in-suit.

In Broadcom’s opinion, however, the streaming provider continued to infringe the patent. The patent holder therefore filed a motion with the Munich court seeking penalties for Netflix’s lack of compliance with the injunction.

In December 2023, Munich Regional Court fined Netflix €7.05 million for its continuing infringement of EP 366. According to a press release from Broadcom, the court “set the fine at €150,000, or in the alternative 15 days of imprisonment for members of Netflix’s board of directors, for each of the 47 days that Netflix had infringed in violation of the cease-and-desist order”.

Broadcom applied for a preliminary injunction against the workaround, which the court heard in June. However, this has now been withdrawn following the nullity decision.

First null then valid

In a preliminary opinion, the German Federal Patent Court found the patent-in-suit to be valid. However, the 2nd Senate under presiding judge Monika Hartlieb has now found the patent invalid due to lack of inventive step and lack of novelty (case ID: 2 Ni 4/22). Netflix has thus averted the injunction and compulsory investigation proceedings. It is not yet clear whether Broadcom will appeal.

Parallel proceedings concerning three other patents are pending at Hamburg Regional Court.

Netflix has relied on Quinn Emanuel Urquhart & Sullivan since the beginning of the dispute. The firm is representing the client in both the infringement and nullity proceedings. Partner Marcus Grosch’s team also included Katrin Gerstenberg, Felix Trumpke, Timo Merle, Tina Liebscher, Andreas Hahne, Paul Lehmann, Nikos Yiannopoulos, Stefan Fuchs, Michael Krenz, Tamara Schneider and Felix Probstmeier.

Bart van den Broek and Andrew Lin from Hoyng ROKH Monegier in Amsterdam also provided support. They are also representing Netflix in the Dutch proceedings against Broadcom. A German team from Hoyng ROKH led by Klaus Haft is representing Netflix in parallel disputes against Broadcom regarding other patents at the Hamburg Regional Court.

Quinn Emanuel and Hoyng ROKH are also acting for Netflix in the extensive patent dispute against DivX.

Broadcom instructed its go-to law firm EIP to represent the company in all disputes against Netflix regarding various patents. Düsseldorf partner Florian Schmidt-Bogatzky has represented the client in patent disputes for years, most recently against Tesla in a lawsuit at the UPC. Here, too, he is working with Quinn Emanuel, which is representing the US car manufacturer.