EWHC: Acer, ASUS, and Hisense Are Entitled to Declarations of Interim Licenses

Mr. Justice Mellor's decision in Acer, Inc. et al. v. Nokia Technologies Oy is here.

 

I have grading to complete, after which I will be taking a few days off around Christmas.  Consequently, I hope to have something to say about this complex SEP decision--and about the UPC Court of Appeal's recent decision on damages in Bhagat Textile Engineers v. Oerlikon Textile GmbH & Co KG, and the Federal Circuit's decision yesterday on injunctive relief and willfulness in Wonderland Switzerland  AG v. Evenflo Co.--sometime after January 1.  This has proven to be a busy month!  Anyway, happy holidays to my readers--see you in 2026.

Judge Albright Issues Antisuit TRO Relating to Assertion in Munich of Claims for the Infringement of U.S. Patents

This dispute is reported this morning on Law360 and on ip fray.  When BSH v Electrolux came out earlier this year (see my blog post here, a more recent one noting an article about the case here, and a third I hadn't previously noted here), I predicted that before long it would cause a stir in the U.S.  Well, here we are.  It was reported recently that Onesta, an NPE, had asserted claims in the Munich I Regional Court against BMW for, inter alia, the infringement of two U.S. patents.  U.S. District Judge Albright has now issued a TRO ordering Onesta to refrain from making “any request, claim, application, or motion further pursuing or enforcing an injunction from a foreign court—including but not limited to the Munich Regional Court I—which would prohibit, deter, impose monetary fines on, or otherwise limit in any way BMW’s, and all of its corporate parents, subsidiaries, and affiliates, ability to fully and completely prosecute this action, request and enforce relief, or which would impair this Court’s ability to adjudicate any and all matters in this lawsuit”; and from making “any request, claim, application, or motion further pursuing or enforcing an injunction from a foreign court—including but not limited to the Munich Regional Court I—which would prohibit or otherwise limit in any way BMW’s, and all of its corporate parents, subsidiaries, and affiliates, ability to make, use, offer to sell, or sell within the United States or import into the United States any vehicle, product, or other item on the basis of Onesta’s United States patent.”  The TRO was granted ex parte, so there will be a further hearing.  The Law 360 article includes BMW’s complaint and motion(see pp. 13-14).

One very important issue lurking in the background, in cases like this and in the event that other litigants invoke BSH v. Electrolux in an effort to litigate claims for the infringement of U.S. patents in European courts, is whether those courts will apply U.S. or their own domestic law with regard to remedies, especially injunctive relief (which is much more limited in the U.S.--here's a decision rendered today, for example, by the Federal Circuit, which I will have to blog about at some point after I finish exam grading).  Another is whether an EU court might, at least in some cases, voluntarily stay litigation involving foreign patents so that claims involving those patents could be litigated on their home turf.  To my knowledge, civil law jurisdictions do not recognize, as a general matter, recognize the doctrine of forum non conveniens; but the BSH decision itself suggests the possibilities of at least stays pending invalidity determinations, and perhaps domestic law would allow stays more generally where there is parallel litigation in another country.  (I'd appreciate any information others may have on this issue.)  A third is whether paragraph 61 of BSH (which states that "It follows that, under the general rule laid down in Article 4(1) of the Brussels I bis Regulation, the courts of the Member State in which the defendant is domiciled have, in principle, jurisdiction in an infringement action brought against that defendant by the holder of a patent granted or validated in a third State which is domiciled in another Member State") authorizes a plaintiff such as Onesta, which if I understand correctly is domiciled in the U.S. (or is the German action being filed by a German subsidiary?  I don't think so, but if any readers know better, please correct me), to assert a claim in an EU member state against a defendant domiciled in a member state, for the infringement of a U.S. patent.  In other words, does the Brussels Regulation (Recast) apply in such a case, regardless of where the plaintiff is domiciled?  My understanding is that it does, but I would appreciate any insights from someone who is more knowledgeable than I about that very specific issue. 

Criminal Contempt in Munich

Florian Mueller has published a post on ip fray concerning a December 10 decision of the Munich I Regional Court, ordering the general manager of a patent infringement defendant to be imprisoned for one month, following the defendant’s alleged failure to comply with an Auskunft (essentially, an order for the provision of information that will be relevant to assessing damages) and a previously-imposed contempt fine of €15,000.  According to ip fray, the order likely will be stayed pending appeal (and, to be sure, may induce compliance with the Auskunft in the interim). 

To my knowledge, resort to contempt proceedings is not all that common either in Germany or the U.S.—and this use of criminal contempt is, according to ip fray, unprecedented in Germany (and would be unavailable in the UPC).  (For a good discussion of contempt proceedings in U.S. patent cases, see my former student Nina Elder’s article The Contours of Contempt in Patent Law After TiVo, Inc. v. EchoStar Corp.: An Empirical Study, 25 Minnesota Journal of Law, Science & Technology 145 (2023), previously noted on this blog here.  She describes criminal contempt in U.S. patent cases as "nearly non-existent," id. at 147 n.18 (citing John M. Golden, Injunctions as More (or Less) than “Off Switches”: Patent-Infringement Injunctions’ Scope, 90 Tex. L. Rev. 1399, 1409–10 (2012).)  On a related note, which I discuss in chapter 6 of my forthcoming book Remedies in Intellectual Property Law, the U.S. does not impose criminal sanctions for patent infringement itself—although many other countries do, at least in principle.  (Germany is one, though in practice German prosecutors rarely if ever file charges for patent infringement.)  The criminal prosecution of IP infringement may be most common in certain Asian jurisdictions, as discussed by a group of authors (Masabumi Suzuki, Su-Hua Lee, Byungil Kim, Xiuqin Lin, Prashant Reddy, Heng Gee Lim, Jyh-An Lee, and Kung-Chung Liu) in a chapter titled Civil Follow Criminal or Criminal Follow Civil Procedure as Models to Deal with IP Infringement: Asian vis-à-vis Western Approaches, in Kreation Innovation Märkte - Creation Innovation Markets:  Festschrift Reto M. Hilty 663 (Florent Thouvenin, Alexander Peukert, Thomas Jaeger & Christophe Geiger eds., Springer 2024), previously noted on this blog here—but the only jurisdiction discussed in that chapter that appears to make extensive use of criminal prosecution for patent infringement appears to be Japan.  (The TRIPS Agreement, for its part, only requires criminal sanctions for “wilful trademark counterfeiting or copyright piracy on a commercial scale,” and in most places I am aware of criminal sanctions are generally reserved for copyright and trademark infringement, and for trade secret misappropriation.)  Among the reasons for some Asian jurisdictions’ more extensive use of criminal law are, according to Suzuki et al., the perceived need for additional deterrence, in view of the practical difficulty of obtaining preliminary injunctions, enforcing permanent injunctions, and/or obtaining fully compensatory damages awards; and, relatedly, the ability of civil litigants to file criminal complaints as a means for obtaining discovery.  (For other useful sources of information on criminal IP law, see, e.g., Eldar Haber,  Criminal Copyright (Cambridge Univ. Press 2018), and other sources cited in chapter 6 of my book.)

Anyway, the German court’s resort to criminal contempt certainly is notable—and, somewhat paradoxically perhaps, contrasts with Japan, where--despite the country's heavier reliance on criminal law generally--Professor Suzuki writes that courts do not order criminal contempt for failure to comply with injunctions.  As for Germany, however, I wonder if we will see more of this, as a deterrent to perceived non-compliance with court orders?

AIPPI 2025 Study Question Q296: Preliminary Injunctions: Requirements for compensating damage suffered by defendant

One of the topics I discuss at some length in other forthcoming book, Wrongful Patent Assertion:  A Comparative Law and Economics Analysis (Oxford Univ. Press, forthcoming May 2026), is whether a patentee who obtains a preliminary injunction on the basis of a patent that subsequently is determined to be invalid or not infringed should be obligated to compensate the temporarily excluded defendant for its losses, and if so in what amount.  As I discuss in the book, practice around the world differs in many important respects.  Courts in the U.S. almost always limiting the patentee’s liability to the amount of the injunction bond it is required to post (which amount may turn out, ex post, to be undercompensatory).  The U.K. requires plaintiffs to agree to a cross-undertaking, essentially a contract obligating the payment of compensation in the event the preliminary injunction is thereafter lifted, while the CJEU has given mixed signals regarding what is permitted under EU law (see, e.g., discussion on this blog here).  Anyway, the AIPPI has made available its Resolution, its Summary Report, and the individual reports for 43 members, including not only the U.S. and the U.K. but also China, Japan, South Korea, India, several EU member states, and a smattering of countries in South America, Asia, and Middle East.  Among these members, there is substantial support for a rule that would require, as a general matter, full compensation of the defendant’s actual damages suffered as a result of the wrongly-issued preliminary injunction (as opposed to a more plaintiff-friendly approach that would limit liability to bad-faith assertions), albeit perhaps subject to some mitigating factors.  Whether or not you are an AIPPI member yourself, you can download all of the reports by going to aippi.org, clicking on “Library” and then “Search,” and then typing in “Q296.”

On this same topic, Hans-Jürgen Ahrens recently published an article titled Schadensersatz nach aufgehobener einstweiliger Verfügung wegen nichtigen Arzneimittelpatents—zugleich Besprechung von BGH GRUR 2025, 574—Glatirameracetat (Damages compensation following the lifting of a  preliminary injunction concerning an invalidated medicament patent—As well as case law of the Federal Supreme Court, GRUR 2025, 574—Glatirameracetate).  (The German case itself is related to the European Commission’s investigation of Teva relating to the drug Copaxone, which I have discussed previously here and will also be discussing, albeit briefly, in my forthcoming book.)  Here is a copy of the BGH decision itself, in which the court holds, inter alia, that the infringement defendant seeking to recover its own lost profit caused by the preliminary injunction may not also claim the infringer’s profit in excess of that lost profit—though it leaves open the question whether the defendant could choose to use any of the three methods for calculating its own actual loss, including the patentee’s profit, as the (single) method for estimating its actual loss.  For discussion of a recent British decision rejecting the argument that defendants may recover the plaintiff’s profits, see my previous blog post here.       

“FRAND Cases in Context” Due Out in January

Jorge Contreras’ new edited volume, FRAND Cases in Context (Edward Elgar Publ.) is now scheduled for publication in January.  The book will be available on an open-access basis, and for sale in hardcover.  My chapter, on the U.S. Apple v. Motorola litigation, is one of the chapters.  As the book description states, the volume “provides concise summaries and analyses of 28 leading global cases concerning the licensing of standards-essential patents on fair, reasonable, and non-discriminatory (FRAND) terms. Cases are drawn from leading jurisdictions in global FRAND disputes across Asia, Europe, North America, and South America.”  More information is available here.

 

 

UPC Court of Appeal Invokes Proportionality in Approving Injunction Carve-Out

In the joined appeals in Meril Italy Srl et al. v. Edwards Lifesciences Corp., UPC__CoA__A464/2024 et al. (Nov. 25, 2025), Panel 1 of the UPC Court of Appeals decided several important issues, most notably relating to inventive step, in regard to a claim of infringement of EP 3 646 825, for “a system comprising a prosthetic heart valve and a delivery catheter” (p.6).  For present purposes and for brevity, I will focus exclusively on the (also very important) remedy question presented, namely whether the hardship resulting from a permanent injunction directed against certain infringing products would be disproportionate, and therefore should be subject to a carve-out.  The Court concludes that the answer is yes.

To put the matter in perspective, UPCA article 63(1) states that “Where a decision is taken finding an infringement of a patent, the Court may grant an injunction against the infringer aimed at prohibiting the continuation of the infringement,” and article 64(1) states that the court “may order . . . that appropriate [corrective] measures,” such as recall, removal, and destruction, be taken.  Article 64(4) further states that “[i]n considering a request for corrective measures pursuant to this Article, the Court shall take into account the need for proportionality between the seriousness of the infringement and the remedies to be ordered, the willingness of the infringer to convert the materials into a non-infringing state, as well as the interests of third parties.”  There is no corresponding provision in article 63.  The UPCA should be interpreted in conformity with the Enforcement Directive, however, which states in article 3(2) that “remedies shall . . . be effective, proportionate and dissuasive and shall be applied in such a manner as to avoid the creation of barriers to legitimate trade and to provide for safeguards against their abuse”—though as most readers probably are aware, it has long been a matter of debate whether this provision requires courts to consider the proportionality of injunctive relief in every case, or only certain special cases, or (as some have argued) perhaps no cases at all, as long as proportionality is guaranteed “from the functioning of the patent system as a whole.”  See, e.g., Lea Tochtermann, Injunctions in European Patent Law, 11 ZGE//IPJ 257, 265 (2019). 

Anyway, in the present matter, the Munich Local Division had concluded that one of Meril’s product lines (the Meril XL devices), though infringing, should be subject to a carve-out from permanent injunctive relief and corrective measures, because for certain patients there are no good substitutes for a product of the same size; but for Meril’s intermediate-size products, the evidence did not demonstrate any “notable enhancement in patient care” (p.46 para. 192), and thus no carve-out would be appropriate.  The Court of Appeal affirms, and in doing so actually makes it a bit easier for Meril to keep the XL devices on the market.

The Court begins its discussion of these matters by stating that “Art. 64 IPCA does not merely confer on the Court the power to grant the measures requested.  The Court has no discretion” (p.45, para. 187), and that “[t]he same applies to permanent injunctions” (p.46, para. 188).  “Accordingly, where the proprietor files an infringement action and the Court finds that an intellectual property right has been infringed or is threatened to be infringed, it shall issue an order prohibiting the continuation of the infringement unless there are special reasons for not doing so” (p.46 para. 189).  However—and this, I think, is significant:

A special reason for denying an injunction may apply if, in the circumstances of the particular case, granting an injunction does not comply with the general obligations of Art. 3 of the Enforcement Directive, in particular the obligation that the remedies shall be proportionate. In addition, the Court must ensure that the application of its power under Art. 63(1) UPCA is not in conflict with fundamental rights protected by the European Union legal order or with other general principles of EU law, such as the principle of proportionality (CJEU, judgement of 29 January 2008, Promusicae, C-275/06, ECLI:EU:C:2008:54, paragraph 68; judgement of 27 March 2014, UPC Telekabel Wien, C-314/12, ECLI:EU:C:2014:192, paragraph 46; judgement of 16 July 2015, Coty Germany, C-580/13, ECLI:EU:2015:485, paragraph 34).

 

When considering the proportionality of injunctive relief and corrective measures, the Court may take into account not only the interests of the parties to the litigation but also the interests of third parties, such as patients. The Munich Local Division correctly held that the interests of the patients justify an exception to the right to injunctive relief and corrective measures if it is established that the infringing embodiment is the sole available treatment method or represents an improvement upon the available treatment methods, resulting in a notable enhancement of patient care (id. paras. 190-91).

As noted, the Court agrees that the XL devices may remain on the market, but disagrees with the Munich Local Division in one respect:

As far as Meril’s XL devices are concerned, the Munich Local Division acknowledged a legitimate interest in their availability. It established that there may be patients who can only be adequately treated with Meril’s XL devices, in view of inter alia the fact that Edwards’ products are not recommended for native annulus sizes of more than 28 mm. It therefore exempted XL devices that were scheduled for implementation in an individualized patient by 15 November 2024 from the injunction and the corrective measures. This part of the judgment is not challenged on appeal.

 

In respect of XL devices not scheduled for implementation, the Munich Local Division held that the interest in their availability is adequately addressed through Edwards’ Medical Request Portal. Via this online portal, practitioners can upload relevant patient data. A team of doctors at Edwards review the data and determine whether use of Edwards’ product is an option. If the doctors find that using Edwards’ products is not an option, Edwards will grant an exception to the injunction.

 

The Court of Appeal agrees with Meril India and Meril Germany that Edwards’ portal does not adequately address the legitimate interest in the availability of Meril’s XL devices. The availability of these products should not depend on the willingness of Edwards to maintain the portal or on the assessment by Edwards’ team of doctors. A notification of an intention to use Meril’s XL device by a physician confirming that such product is the only available treatment option for a particular patient should be sufficient. The Court of Appeal will therefore amend the injunction and orders for corrective measures accordingly and maintain them on the basis of an auxiliary request which the parties have drafted in common accord during the oral hearing in the appeal proceedings.

 

Under the amended orders, the making, offering, placing on the market and use of Meril’s XL devices, and the importing and storing of the products for those purposes, are not covered by the injunction and corrective measures, provided that a physician has submitted the required notification. Contrary to the concerns put forward by Meril India and Meril Germany, this implies that the injunction does not prohibit them from making doctors aware of the availability of the XL devices where it is the only treatment option for a particular patient (p.47, paras. 194-97).

The Court concludes this section of the judgment by noting that, although the Munich Local Division “regarded Meril India and Meril Germany as unwilling licensees,” its “findings were not decisive for the Court’s decision to grant the injunction and the corrective measures” with respect to the intermediate-sized products.  The Court of Appeal therefore does not need to review the “unwilling licensee” issue.  It also permits Edwards to publish the decision and amends the costs award.

Alba, Helmers and Love on Octane Fitness’ Effect on PAEs and Innovation

Tommaso Alba, Christian Helmers, and Brian J. Love have posted a paper on ssrn titled A Tale of Trolls and Fees:  The Role of Fee-Shifting in Patent Litigation.  Here is a link to the paper, and here is the abstract:  

Patent Assertion Entities (PAEs) are often viewed as taxing innovative activity; we show how fee shifting in patent litigation can effectively deter their more frivolous assertions, increasing exposed firms' R&D, innovation output, and startup success. Our identification relies on the U.S. Supreme Court's 2014 ruling in Octane Fitness v. ICON Health & Fitness, which broadened courts' discretion to award attorneys fees against exceptionally weak infringement claims. Using a quasi-regression discontinuity design comparing cases pending at Octane's release with those filed and decided before or after, we find that the decision increased defendants' willingness to contest weak claims and prompted plaintiffs, especially PAEs, to file stronger ones. Pending cases saw more fee awards and lower settlement as well as plaintiff success rates; subsequent PAE cases involved stronger patents and higher success rates. A difference-in-differences analysis further shows that Octane boosted innovation: public firms that were particularly exposed to PAE assertions prior to Octane increased R&D and patenting in response, and private startup firms performed better in venture capital markets.

On a somewhat related note, the Federal Circuit last week affirmed a judgment awarding fees in EscapeX IP, LLC v. Google LLC, precedential opinion by Judge Stark joined by Judges Taranto and Stoll.  The court found no abuse of discretion in view of the district court’s finding—“well-supported in the record and . . . part of the totality of circumstances,” that "EscapeX failed to conduct an adequate pre-suit investigation” (p.8).  The court also affirmed additional fees and an award pursuant to 28 U.S.C. § 1927, in connection with the patentee’s Rule 59(e) motion to amend the judgment.

My Book "Remedies in Intellectual Property Law" Is Now Available for Pre-Order

My book Remedies in Intellectual Property Law (Edward Elgar Publ. 2026) is now available for pre-order.  Publication expected sometime in January!  Details here.  I understand that there will be an eBook available as well.

 

Müller-Stoy and Lepschy on BSH v. Electrolux

Tilman Müller-Stoy and Paul Lepschy have published an article titled Practical Implications of BSH v Electrolux for resolving global patent disputes, 7/2025 GRUR Patent 331.  Here is the abstract:

Until recently, the following practical rule applied (with a few exceptional cases in the Netherlands in interim proceedings):  39 EPC Member States — theoretic need for 39 infringement actions.  This rule changed when the UPC opened its doors on 1 June 2023 offering a one-stop-shop for patent disputes in the EU, centralizing infringement and revocation proceedings for meanwhile 18 Contracting Member States.  And it changed again in spring 2025 with the ruling of the CJEU in BSH v Electrolux offering a one-stop-shop litigation solution also for the remaining nine EU Member States, the remaining 12 non-EU members of the EPC, and in fact any third state when dealing with EU-domiciled defendants.  This article analyses practical implications of the ruling on the level of national courts as well as on the UPC level from a claimant’s and a defendant’s perspective.  Some open questions are addressed and a short outlook is provided.

The article makes a number of interesting observations, among them that an EU-domiciled defendant can now be sued for the infringement of a U.S. patent.  (According to ip fray and JUVE Patent, this has now happened in at least one case pending in Munich—a good reason, perhaps, for U.S. patent professionals who don’t already do so to start reading some of the non-U.S. commentary and journals!)  The authors also suggest that some plaintiffs may try a “split strategy” of suing for an injunction in the E.U. (which might apply eBay differently from a U.S. court—assuming that remedies are considered substantive law, I assume) and for an award of damages in the U.S. (given the possibility of treble damages for willful infringement—though as the authors also note, there might a question whether an E.U. court would refuse to award treble damages on public policy grounds).  I wonder, though, if such a split strategy would be advisable, or is even possible?  The authors also discuss whether the UPC has authority under the UPCA to determine invalidity on an inter partes basis, in a case in which that would otherwise be permitted under BSH (see p. 335).

For previous posts on this blog about BSH, see, e.g., here, here, and here.

Conference on the Intellectual Property Rights Enforcement Directive

Tomorrow and Friday, the Faculty of Law, Economics and Finance at the University of Luxembourg will be presenting a conference titled Equality of Arms: Revisiting the IPR Enforcement Directive.  Here is the description:

Directive 2004/48/EC on the enforcement of intellectual property rights (IPRED) marked its 20th anniversary last year. Originally adopted to harmonise national enforcement regimes and strengthen the position of right holders, IPRED has had a significant impact across the EU—particularly in combating piracy and counterfeiting. Nevertheless, enforcement practices still vary widely among Member States. Moreover, the Directive’s right holder-centric focus has raised concerns about a potential lack of balance in the enforcement framework. In response, the European Commission (DG GROW) has launched a study on the implementation of IPRED, which also considers possible legislative amendments.

 

With a particular focus on the concept of “equality of arms”, this working conference examines whether the Directive provides a sufficiently harmonised and balanced enforcement regime—or whether its design requires reform. Bringing together leading figures from academia, legal practice, and the judiciary across multiple jurisdictions, the event will explore key issues addressed in the Commission’s study, including dynamic blocking injunctions and proportionality. It will also discuss important yet underexplored topics, such as the award and calculation of damages and unjustified enforcement of IPRs.

I have a scheduling conflict, or I would be there myself—looks like a terrific event!  For further information, see here.

Federal Circuit Vacates Lost Profits Award

The case is Inventist Inc. v. Ninebot Inc. (USA), nonprecedential opinion (released last Friday) by Judge Dyk, joined by Judges Hughes and Stark.  The patent in suit (the ’250 patent) “discloses an electrically powered self-balancing unicycle” (p.2).  The patentee alleged that two generations of defendant’s products infringed.  The district court, construing the claims, concluded that the first generation infringed as a matter of law (and the defendant “does not challenge this ruling on appeal, p.4 n.2), but that the second generation did not.  The case went to trial on damages, and a jury awarded $835,220 in lost profits and $29,593 as a reasonable royalty.  Both parties appeal certain aspects of the lower court’s judgment.  The Federal Circuit affirms the finding that the defendant’s second generation product did not infringe, but vacates the damages award; given the subject matter of this blog, I will focus on the latter.

As for damages, the defendant argues, first, that it is entitled to a new trial “because the evidence was insufficient to establish marking of Inventist’s products in compliance with 35 U.S.C. § 287(a)” (pp. 8-9); but the Federal Circuit concludes that it lacks jurisdiction to consider this argument, because the defendant “did not amend its notice of appeal to include the district court’s later ruling on the new trial motion” (p.9).  Similarly, the defendant argues that “the lost profits award cannot be sustained because “the district court’s acceptance of Inventist’s flawed lost profit theory was unsupported by the evidence and contrary to well established law,” but the appellate court says it can’t consider this issue either because the defendant “did not file a [Federal Rule of Civil Procedure] Rule 50(b) motion after the verdict, nor did it file a motion for new trial on this ground” (p.10).  However, the defendant did preserve its third damages argument, that “the district court improperly excluded evidence of noninfringing substitutes” (id.), and the Federal Circuit agrees:

            The district court excluded “any proposed evidence” of “[n]on-infringing substitutes not on sale during period of infringement” and did not instruct the jury about the second Panduit factor [absence of acceptable noninfringing substitutes]. . . . Under our precedent in Grain Processing Corp. v. American Maize-Products Co., 185 F.3d 1341, 1349 (Fed. Cir. 1999), the noninfringing substitutes need not be on sale. Evidence of “available alternatives—including but not limited to products on the market”—may be used “to preclude lost profits damages.” Id. We held that under Panduit, “[t]he ‘but for’ inquiry . . . requires a reconstruction of the market, as it would have developed absent the infringing product, to determine what the patentee would . . . have made.” Id. at 1350 (internal quotation marks omitted; second omission in original). This means that just as a patentee engages in a “hypothetical enterprise” to construct its lost profits model, “alternative actions the infringer foreseeably would have undertaken had he not infringed” must also be taken into account. Id.at 1350–51. Thus, “an available technology not on the market during the infringement can constitute a noninfringing alternative.” Id. at 1351 (citing Slimfold Mfg. Co. v. Kinkead Indus., Inc., 932 F.2d 1453 (Fed. Cir. 1991)) . . . . We agree with Ninebot that the district court erred in applying the wrong legal standard. Indeed, Inventist conceded at oral argument that the district court applied the wrong legal standard. . . .

 

However, Inventist contends that under the correct standard, Ninebot did not show that its proposed noninfringing substitute could be readily commercialized, as required by Grain Processing. In its summary judgment motion, Ninebot argued that first-generation models could be modified to become noninfringing through a “simple design change, namely removing the pads from the lateral side cover,” and referred the Court to its later unicycle models. . . . In the first joint pretrial statement, Ninebot offered several witnesses who would testify:

 

[P]urpose of protruding pad was just a battery cover. Cost of wheel cover was minimal. About $20.00–30.00 US.

 

. . . . Contrary to Inventist, no more detailed offer of proof was required. . . . . This evidence, if credited by a jury, could have been sufficient to establish the existence of noninfringing substitutes, which would have defeated the lost profits claim, and Ninebot is entitled to a new trial (pp. 11-12).

The decision doesn’t indicate how many units the defendant sold or what the plaintiff's profit margin would have been on the lost sales--and I haven't looked into the underlying record--but if the trier of fact credits the defendant’s evidence, one might imagine that the lost profits awards could be substantially reduced on appeal.

EWCA Vacates Declaration of Interim License in Samsung v. ZTE

I was taking a blogging break ever since this decision was handed down on October 31, so I hadn’t written anything about it yet.   By way of background, this summer the EWHC (Mellor, J.) granted the interim declaration (which Samsung had sought), including among others the following terms:

1. ZTE are in breach of their obligations of good faith under clause 6.1 of the ETSI IPR Policy.

2. A willing licensor in the position of ZTE, and in light of the undertaking given by Samsung, would enter into the interim cross-licence with Samsung on terms and including the sum to be paid by Samsung by way of royalty in respect of the interim licence period as set out in Confidential Annex 1 to this Order (the Interim Licence).

  
3. The terms (including the sum to be paid) of the Interim Licence are subject to adjustment and amendment so as to bring the terms into line with the terms of the final cross-licence determined to be FRAND by the Patents Court after the FRAND Trial in these proceedings (subject to any later adjustments or amendments following any appeals).

4. In the event that, within seven days of the date of this Order, ZTE refuse either 4.1 or 4.2 below, ZTE are in breach of their FRAND commitments under the ETSI IPR Policy and are unwilling licensors (and unwilling licensees).

4.1 To offer Samsung the Interim Licence and to enter into the same with Samsung; or

4.2 Give the following undertaking to the Court on condition that Samsung give the reciprocal undertaking set out above:

 

Pending any application for permission to appeal or the determination of any such appeal, ZTE undertake that they shall abide by the terms of the Interim Licence as if the same were in full force and effect and shall enter into the Interim Licence within seven days of any such appeal or permission to appeal being refused or withdrawn. If any appeal is finally allowed, ZTE shall repay any sums paid by Samsung under their undertaking given above which the Court decides should  be repaid (including interest if appropriate). 

On Halloween, however, the EWCA concluded that ZTE is not in breach of its obligation of good faith and is not an unwilling licensor/licensee.  (Meanwhile, the English courts’ willingness to grant declarations of interim FRAND licenses in some other cases remains controversial, as witness the back-and-forth between the EWHC and the UPC Mannheim Local Division in recent weeks in cases involving Amazon and InterDigital (see, e.g., here), and also the recent judgment in Warner Brothers Discovery Inc. v. Nokia Corp., [2025] EWHC 2888 (Pat.).  These cases remain works-in-progress, and I’m sure I will have something more to say about them all in due time.)

Anyway, on appeal in Samsung v. ZTE, Lord Justice Arnold writes the principal opinion, stating at the outset that this case differs from other EWCA decisions concerning interim licenses—Panasonic Holdings Corp. v. Xiaomi Tech. UK Ltd. [2024] EWCA Civ 1143, Alcatel Lucent SAS v. Amazon Digital UK Ltd. [2025] EWCA Civ 43, and Lenovo Group Ltd. v Telefonaktiebolaget Ericsson (Publ) [2025]—

 

in that the parties agree that there should be an interim cross-licence, and even agree as to the terms of the interim cross-licence, and in particular how much should be paid for it (the amount is confidential). They disagree as to whether the terms of the interim cross-licence, and in particular the amount payable, should be subject to adjustment so as to bring them into line with the terms of the final cross-licence determined to be FRAND by the Patents Court, as the Claimants (“Samsung”) contend, or so as to bring them into line with the terms of the final cross-licence determined to be FRAND by the Intermediate People’s Court of Chongqing Municipality (“the Chongqing Court”), as the Defendants (“ZTE”) contend. The appeal raises an important issue of principle: does it constitute bad faith for a SEP owner to commence infringement proceedings in multiple courts with the objective of forcing an implementer to accept determination of FRAND terms by the SEP owner’s preferred court rather than the implementer’s preferred court? Mellor J answered that question in the affirmative for the reasons given in his judgment dated 25 June 2025 [2025] EWHC 1432 (Pat) (para. 1).

The court states further that the relevant issues in such cases are whether the SEP owner is “in breach of its obligation to negotiate FRAND terms with the implementer in good faith,” whether the grant of the declaration would “serve a useful purpose,” whether it would be “contrary to comity with foreign courts,” and “[w]hat terms for an interim licence would be FRAND?” (para. 8).  Further, “the burden of proof lies on the implementer and the court must have a high degree of assurance before granting a declaration” (para. 9).

The relevant facts here, in brief, are that both parties have portfolios of certain FRAND-committed SEPs, but that when all is said and done Samsung will be a net licensee.  Samsung nevertheless was the first to file suit for a global cross-license, in the U.K., in December 2024, after which it filed an antitrust action in Frankfurt, and ZTE filed suit against Samsung in Chongqing seeking a global FRAND cross-license.  ZTE subsequently initiated proceedings in Munich, the UPC, Brazil, and Hangzhou, and Samsung countered with infringement actions in Germany, the UPC, and Hangzhou.  In July, “Samsung complained to ETSI that ZTE was in breach of the ETSI IPR Policy. On 14 October 2025 ZTE obtained an ex parte preliminary injunction from the Munich I Regional Court requiring Samsung to withdraw the complaint.  On 16 October 2025 Samsung withdrew the complaint in compliance with the injunction” (para. 37).  The parties have each offered to arbitrate but “neither had accepted the other’s offer” (para. 39).  Lord Justice Arnold then summarizes Mr. Justice Mellor’s judgment below, and proceeds to discuss ZTE’s first two grounds for appeal, namely that the lower court “was wrong to hold that ZTE had acted in bad faith” and “to treat the fact that the English courts were first seised as a decisive factor” (para. 54).  In effect, Lord Justice Arnold agrees with ZTE:

 

. . . In my judgment, unless there is a legitimate and substantiated objection to the forum in question, it does not constitute bad faith for a SEP owner to seek to force an implementer to accept determination of FRAND terms by the SEP holder’s preferred court rather than the implementer’s preferred court.

 

If (and I emphasise if) there is a legitimate and substantiated objection to determination of FRAND terms by the forum in question, then there may (and I emphasise may) in an appropriate case be a remedy by way of an anti-suit injunction. In the present case, however, both parties have laudably refrained from seeking anti-suit injunctions . . . .

 

Whether or not anti-suit relief would be available if there were a legitimate and substantiated objection to determination of FRAND terms by the Chongqing Court, Samsung have not substantiated any legitimate objection to this. . . .

 

If it is not illegitimate for the Chongqing Court to determine FRAND terms, I do not see how it can be bad faith for ZTE to use legal proceedings which it is not suggested are not otherwise properly open to ZTE to put pressure on Samsung to agree to that course. Such conduct is unattractive, and I should not be taken to endorse it, but that is not sufficient to constitute bad faith.

 

As I have explained in numerous judgments, a SEP portfolio will typically include patents which subsist in multiple jurisdictions. Patents are territorial, but the contractual defence provided by the FRAND obligation is global. It follows that the possibilities both of parallel SEP infringement proceedings and parallel FRAND determinations in multiple jurisdictions are inherent in the current system.  The principled answer to this might be that the court first seised should determine what terms are FRAND, but that answer has a number of negative consequences. One of these is that it encourages forum shopping by pre-emptive commencement of proceedings. As the judge recognised, forum shopping is to some extent inevitable in this context, but it should be discouraged rather than encouraged. Even if the English courts consider that jurisdiction should be exercised by the court first seised, this cannot be said to be an answer that commands universal assent: as I pointed out in Nokia v OPPO, there are no internationally agreed jurisdictional rules applicable to FRAND disputes. If the principle of ceding jurisdiction to the court first seised was internationally accepted, the Chongqing Court would have declined jurisdiction as the court second seised. The fact that the English courts were first seised is therefore not a sufficient basis for a conclusion that ZTE have acted in bad faith. Given that ZTE were otherwise entitled to bring the infringement proceedings of which Samsung complain, there is nothing else to support the conclusion that ZTE have acted in bad faith.

 

I would add that another problem which this case illustrates is that, if jurisdiction is not ceded to the court first seised, the court first seised is not guaranteed to be the first to decide. As the parties agreed during the course of argument, the consequences of this will have to be worked out in due course (paras. 70-75).

Although Lord Justice Arnold does not reach ZTE’s other two grounds for appeal, he does close by stating that “comity is a real concern in this case” (para. 78).

In a brief concurring opinion (with which Lord Justice Arnold expresses agreement), Lord Justice Birss makes some interesting points:

 

. . . this case is quite different from the previous cases concerned with interim licences in a FRAND context. In this dispute there are two competent courts both seised with the issue of making a global FRAND determination as between these two parties. The judge rejected Samsung’s criticisms of the Chongqing Court and there is no appeal from that conclusion. The judge also found (and again there is no appeal) that the behaviour of ZTE which was said to be in bad faith was not directed to extracting supra-FRAND rates. . . .

 

Rather, as the judge held, what ZTE were doing was directed at trying to force Samsung to agree to a FRAND determination in Chongqing rather than London. To “force” ZTE to reconsider was the reason for making the interim licence declarations below. A striking aspect of ZTE’s case on this appeal was that a flaw with the scheme of the declarations and interim licence made by the judge was, conversely, that it was not just designed to force ZTE to reconsider Chongqing, it has the effect of forcing ZTE to agree to a FRAND determination in London instead. Despite counsel for Samsung’s best efforts to submit to the contrary, in my judgment there is a significant degree of symmetry between the positions of the two parties in this case (para. 82-83).

Lord Justice Birss also contends that “[t]he concept of an interim licence is inherent in” Huawei v. ZTE, in which 

the CJEU identified the idea that in some circumstances it might be for the implementer, in advance of a final resolution of the dispute between the SEP holder and the implementer, to provide appropriate security for the royalties which will end up being due in a licence agreement. . . .  Once that principle is identified, one is entitled to ask: what is it that the implementer is getting in return for the financial commitment they are making? Although not spelled out explicitly by the CJEU, the answer is fairly simple. The implementer is demonstrating their willingness to pay for the licence, once the terms can be agreed or resolved, and so, in the meantime the SEP holder ought not to be able to take the implementer’s products off the market by means of an injunction. In other words what the implementer gets in return for the financial commitment is, at least implicitly, a form of licence pending the final resolution of the dispute. It could be called an interim licence. Assuming the sum being committed or paid is calculated on a global basis, then the willingness of the implementer which it embodies is also global in nature. . . .

 

The difficulty in this case is that the terms of the interim licence itself and the declarations made are designed to seek to fore on party to do something they clearly do not wish to do and have no intention of doing. . . (paras. 84, 86). 

Lord Justice Jackson agrees with both judgments (para. 89).