Posts Tagged: "FRAND"

The Fairness of FRAND: Patent Pools, SSO Policies and the Way Forward

Standard Essential Patents (SEPs), as the name suggests, are an essential set of patents used for the implementation of a standardized technology. This set of patents renders it impossible to implement or operate standard-compliant equipment without infringement. Does that mean every patent declared by any company is essential? In a word, no. This article intends to address this aspect in detail and pave way for licensees to save costs and pay for what they use in their implementations.

What the Latest Optis Wireless v. Apple Ruling Means for Patent Infringement Damages for SEPs

In a previous article, we considered the difference between a reasonable royalty for infringement of a U.S. patent and a fair, reasonable and non-discriminatory (FRAND) rate for licensing standards essential patents (SEPs). Among other points, the article discussed the then ongoing case between Optis Wireless Technology, LLC et al. v. Apple Inc., Civil Action No. 2:19-cv-00066-JRG (E.D. Texas, September 10, 2020). Most recently, Judge Rodney Gilstrap issued an Opinion and Order as to Bench Trial Together with Supporting Findings of Fact and Conclusions of Law (“Opinion and Order”) and ordered Final Judgment be entered. This Opinion and Order sheds a little more light on the issue of damages for SEPs, including the role of exemplary damages for willful infringement, but also leaves some key questions unanswered.

Determining Essentiality: An Analysis of SEPs and Tips to Avoid Over-Declaration

A close examination of SEP databases reveals that a large number of patents that have been declared SEPs are not essential…. Patent owners are obliged to declare the patent as essential even if they are doubtful about its essentiality. Unfortunately, a few patent owners may intentionally proclaim many of their patents to be essential to gain benefits or a business advantage. In practice, there are multiple reasons potentially essential patents and patent applications might be rendered non-essential. For example, a patent could be granted with amendments that cause it to be no longer essential. Whenever implementers bargain for the licensing fees, they must examine whether certain patents are actually essential, which can stall negotiations and lead to litigation.

The New Madison Approach and the Harmonization of Antitrust and Patent Law: A Retrospective Summary

In a major 2018 speech, Justice Department Assistant Attorney General for Antitrust Makan Delrahim enunciated a “New Madison Approach” (NMA) (a tribute to James Madison’s support for a strong patent system) designed to restore greater respect for efficiency-seeking patent transactions in antitrust enforcement (a 2020 law journal commentary discusses the NMA and the reactions it has elicited, both positive and negative). Consistent with the NMA, the Trump Administration Antitrust Division took a number of initiatives aimed at reducing perceived new antitrust risks associated with widely employed patent licensing practices (particularly those touching on standardization). Those new risks stemmed from Obama Administration pronouncements that seemed to denigrate patent rights, in the eyes of patent system proponents (see here, for example). Given this history, the fate (at least in the short term) of the NMA appears at best uncertain, as the new Biden Administration reevaluates the merits of specific Trump policies. Thus, a review of the NMA and the specific U.S. policy changes it engendered is especially timely. Those changes, seen broadly, began a process that accorded greater freedom to patent holders to obtain appropriate returns to their innovations through efficient licensing practices – practices that tend to promote the dissemination of new and improved technologies throughout the economy and concomitant economic welfare enhancement.   

Understanding Damages Calculation in SEP Litigation

Courts around the world have determined appropriate methodologies for calculating damages on standard essential patents (SEPs) for which patent holders have made an assurance to license on fair, reasonable and non-discriminatory (FRAND) terms. Determinations of patent holdup, licensee holdout, use of worldwide portfolio licensing, incremental value rule, etc. are included in these decisions. The court determines damages based on the below-referenced judgments and FRAND terms when reviewing SEP infringements. Under most patent laws, infringement damages are set based on factors including actual loss due to infringement, if the actual loss is difficult to determine, gains of the infringer, and if both actual loss and gains are not available—determination of appropriate multiples of a reasonable royalty fee. 

Ericsson Wins Anti-Interference Injunction Against Samsung in Texas FRAND Case

Judge Rodney Gilstrap of the U.S. District Court for the Eastern District of Texas yesterday issued an order enjoining  Samsung Electronics from taking any action to interfere with Ericsson’s U.S. FRAND (“fair, reasonable, and non-discriminatory” terms) lawsuit against Samsung in his court. Samsung had filed a lawsuit on December 7, 2020 in the Wuhan Intermediate People’s Court of China but did not provide notice to Ericsson of the action. “Unaware of the Chinese Action,” according to Judge Gilstrap’s order, Ericsson filed a complaint against Samsung on December 11, 2020 in the Texas court, alleging that Samsung breached its obligation to license its Standard Essential Patents (SEPs) on FRAND terms, and “notified Samsung of its Complaint in this Court that same day.” Samsung subsequently asked the Wuhan court to issue an “anti-suit injunction” (ASI) to prevent it from seeking relief relating to the SEPs at issue anywhere else in the world. The Wuhan Court issued the ASI on December 25 for the “duration of the Chinese Action and until a future judgment in that Action becomes effective.” The Wuhan Court gave Ericsson notice of the ASI after it had issued on December 25. Ericsson thus asked the Texas Court for an emergency temporary restraining order (TRO) on December 28, which the court granted.

Judge Rader Champions Chinese Courts, Samsung Responds to Ericsson in ED of TX/China FRAND Suit

In contrast to his one time colleague, former Federal Circuit Chief Judge Randall Rader earlier this month filed a Declaration supporting Samsung Electronics in its Opposition to Ericsson, Inc.’s Application for Anti-Interference Injunction relating to Samsung’s lawsuit in the Wuhan Intermediate People’s Court of China. Retired Federal Circuit Judge Paul Michel recently filed an amicus brief supporting Ericsson in the case and calling into question the procedures of the Wuhan court.

Former CAFC Chief Judge Michel Backs Ericsson in FRAND Dispute

On January 5, the Honorable Paul R. Michel filed an amicus brief in support of Ericsson’s Emergency Application for an Anti-Interference Injunction related to Samsung’s lawsuit filed in the Wuhan Intermediate People’s Court of China (the Wuhan Action). In response to Ericsson’s motion filed on December 28, 2020, the United States Federal District Court for the Eastern District of Texas issued a temporary restraining order against Samsung in the FRAND (fair, reasonable and non-discriminatory licensing rates) lawsuit. Michel’s brief addressed the “substantial notice and due process concerns associated with [an] anti-suit injunction issued by the Wuhan Court.”

Ericsson Wins Temporary Restraining Order Over Samsung in ED TX FRAND Litigation

Earlier today, Judge Rodney Gilstrap of the United States Federal District Court for the Eastern District of Texas issued a temporary restraining order against Samsung in a FRAND (fair, reasonable and non-discriminatory licensing rates) lawsuit filed by Ericsson on December 11, 2020. The Order gives Samsung until January 1, 2021 to file any opposition to the continuation of the temporary restraining order, and gives Ericsson until January 5, 2021 to respond if, or more likely when, Samsung, files an objection. At first glance to the trained eye this seems shocking, but as is so often the case in the world of standard essential patents (SEPs) and FRAND, there is much more than meets the eye.

The Top Five European Patent Developments of 2020

It’s the time of year to reflect upon the cases and trends that have shaped IP over the past 12 months. Here are our picks for the top five in patents from Europe. First, it’s been a year of ups and downs for the EU’s attempt to create a Unitary Project and Unified Patent Court. (UPC) In March, Germany’s Federal Constitutional Court said that the Act of Approval of the UPC Agreement in the country was void as not enough members were present at the vote. Following the UK government’s decision that it would withdraw from the project, the Court’s decision was seen as potentially a terminal blow.

FRAND-Related Statements for Cellular Wireless SEPS: Implementer Obligations (Part V)

This is the fifth and final article in a series of articles analyzing statements made by various entities in the cellular industry regarding licensing Standard Essential Patents (SEPs) on a Fair, Reasonable and Non-Discriminatory (FRAND) basis. The fourth article focused on the obligations of SEP owners in the process of FRAND licensing. This article considers the obligations of implementers.

Damages for Patent Infringement versus FRAND Licensing Rates

During a recent panel discussion at IP Watchdog’s SEP 2020 Conference, a question arose as to the difference, if any, between a reasonable royalty for infringement of a U.S. patent and a fair, reasonable and non-discriminatory (FRAND) rate for licensing standards essential patents (SEPs). The following discusses this question and highlights some recent related judicial developments. According to an article titled “The Effect of FRAND Commitments on Patent Remedies”, appearing in the Utah Law Faculty Scholarship (hereinafter “Contreas et al.”), “there appears to be nothing in U.S. law that compels courts to utilize either the Georgia-Pacific framework, or patent damages law in general, to determine royalties complying with an SEP holder’s FRAND commitment”. The authors further note that “these two concepts (patent damages and FRAND royalty rates) arose via different historical pathways and are intended to achieve different goals”; the former being rooted in statutes and case law, the latter being contractual in origin.

SEP Owner Obligations: Analyzing FRAND Statements for Cellular Wireless SEPS (Part IV)

This is the fourth in a series of articles analyzing statements made by various entities in the cellular industry regarding licensing Standard Essential Patents (SEPs) on a Fair, Reasonable and Non-Discriminatory (FRAND) basis. The third article considered the royalty base to which FRAND rates apply. This article focuses on statements made regarding the obligations of SEP owners in the process of FRAND licensing.

FRAND Royalty Base Statements and Cellular Wireless Standard Essential Patents (Part III)

This is the third in a series of articles analyzing statements made by various entities in the cellular industry regarding licensing Standard Essential Patents (SEPs) on a Fair, Reasonable and Non-Discriminatory (FRAND) basis. The previous article considered unconditional offers to license on a FRAND basis, arbitration of FRAND terms and conditions, specific FRAND rates, the application of such rates, and portfolio licensing. This article focuses on statements regarding the FRAND royalty base.

Analyzing FRAND-Related Statements for Cellular Wireless SEPS (Part II)

This is the second in a series of articles analyzing statements made by various entities in the cellular industry regarding licensing Standard Essential Patents (SEPs) on a Fair, Reasonable and Non-Discriminatory (FRAND) basis. The first article focused on statements relating to transparency. This article looks at statements regarding unconditional offers to license on a FRAND basis, arbitration of FRAND terms and conditions, specific FRAND rates, the application of such rates, and portfolio licensing.