The SEP negotiation framework is a multi-faceted one since it involves Patent Law, Competition Law and Contract Law considerations. India does not have a SEP negotiation framework like the one laid down by the CJEU in Huawei v ZTE. [The Delhi High Court, in Ericsson v CCI, has made a reference to the CJEU judgment in Huawei v ZTE].
It is not that the CJEU judgment has removed all the ambiguities in the SEP negotiation framework. On the other hand, the CJEU judgment has set out a framework which is subject to the interpretation of the national courts of EU. The Federal Court of Justice of Germany (BGH) has delivered a judgment interpreting the Huawei v. ZTE framework. The judgment is quite significant considering the catena of SEP-related cases decided by various German courts. This is the first judgment of BGH on a FRAND dispute post – Huawei v. ZTE. A detailed summary is available here. This post is only meant to highlight some key aspects.
Sisvel v Haier, KZR 36/17
On 05 May 2020, the German Federal Court of Justice delivered a landmark judgment that interpreted the FRAND negotiation framework laid down by the CJEU in Huawei v. ZTE.
Key Highlights
The BGH clarified that a patent right will not ipso facto create a dominant position.[1]
The BGH cautioned that the conduct of infringer should reflect genuineness and seriousness as far as FRAND licensing negotiations are concerned.[2] For e.g, conditional declaration of willingness can indicate absence of seriousness on the part of the infringer. [3]
The infringer must be presented with sufficient (and not detailed) information which will enable the infringer to assess the allegation of infringement.[4]
The patent holder is required to provide information on computation of royalty only after the expression of willingness by the infringer. [5]
FRAND royalty rate is not an objective number; it can be a range. [6]
Portfolio licensing does not by itself indicate abuse of dominant position. It can amount to abuse of dominant position if certain conditions are met. [7]
On computation of damages, FRAND royalty can be the basis only when the infringer was a willing licensee [8]
[1] Paragraphs 56, 57, 58
[2] Paragraph 83
[3] Paragraph 96
[4] Paragraph 98
[5] Paragraph 99
[6] Paragraph 81
[7] Paragraph 78
[8] Paragraph111
