FRAND

Haier wins partial suspension of injunction in SEP case

Düsseldorf Higher Regional Court has ruled that the FRAND conditions set out by the European Court of Justice apply to both parties in court cases. In the dispute between Sisvel and Haier regarding standard essential patents for the GPRS and UMTS standards (case IDs: I-15 U 65/15 and I-15 U 66/15), the court held that Sisvel was entitled to enforce the judgements for rendering accounts and damages. However, the court stayed the enforcement of injunctive relief.

27 January 2016 by Christina Schulze

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The Court of Appeal has overturned the ruling by Düsseldorf Regional Court, where a recall of all Haier’s infringing products was ordered. In November, the Regional Court found that the Chinese electronics manufacturer had infringed two of the claimant Sisvel’s SEPs. Haier had submitted a licence offer but judges found this was not done in a timely manner. At the time, the court did not believe it necessary to examine whether Sisvel’s license offer was FRAND compliant.

The Higher Regional Court holds this to be incorrect, ruling that the competent court must examine whether both parties have fulfilled FRAND obligations as set out by the CJEU.

Marco Scheffler

Marco Scheffler

In its judgement in the dispute between telecommunications technology providers Huawei and ZTE (C-170/13) in July 2015, the CJEU held that an SEP owner wanting to sue another company for infringement must first inform the company and specify the infringement. The alleged infringer must declare its willingness to take a licence. The SEP owner must then make a specific offer to the alleged infringer on FRAND conditions, including the licence fees.

If the alleged infringer does not accept this offer, it must make a counter-offer within a reasonable period of time on FRAND conditions and provide a bond to the court. If the parties fail to come to an agreement, the SEP owner may sue. In its judgement, the Higher Regional Court held that the patent owner must ensure that its initial offer to the alleged infringer is FRAND compliant, and that the lower court did not take this sufficiently into account.

The appeal in the main proceedings between Sisvel and Haier is still pending. Experts, however, regard the stay as a clear indication of which way it will go, as it is the first time a German court of appeal has weighed in on the interpretation of the CJEU ruling on compulsory licences.

The CJEU plays a decisive role in various patent proceedings concerning standards in mobile telecommunications, for example in the class actions brought by Unwired Planet or St. Lawrence against numerous mobile telecommunications companies before the Mannheim and Düsseldorf Regional Courts. Experts now regard the position of SEP holders as significantly weakened because they must define the conditions for a licence offer more precisely. Düsseldorf Regional Court’s November judgement constituted a more liberal interpretation of the CJEU ruling in favour of SEP holders.

Who are the counsel

In 2013, renowned patent judge Voss submitted the dispute between Huawei and ZTE to the CJEU for clarity regarding compulsory licenses. Voss applied the resulting guidelines in this ruling.

Sisvel and Haier retained their legal counsel for the first instance proceedings. Haier instructed the mixed Berlin IP firm Gulde for the first time. Sisvel is a regular client of Eisenführ’s patent attorneys and also added Arnold Ruess for this case.

The Düsseldorf law firm had recently strengthened its team with a lateral: Andreas Kramer (36) of Krieger Mes, experienced in patent infringement proceedings, joined the firm as counsel. In the past, Sisvel has also worked with other law firms such as Quinn Emanuel Urquhart & Sullivan, and Hengeler Mueller. (Co-author Mathieu Klos)

For Sisvel
Arnold Ruess (Düsseldorf): Cordula Tellmann-Schumacher (lead), Arno Riße, Marina Wehler
Eisenführ Speiser (Hamburg): Jochen Ehlers (patent attorney)

For Haier
Gulde & Partner (Berlin): Marco Scheffler (lead), Jörg Grzam, Jürgen Hengelhaupt, Sönke Lorenz (both patent attorneys)

Higher Regional Court Düsseldorf, 15th Civil Senate
Ulrike Voß (presiding judge)