China and ASIs

I don’t think I have previously this mentioned on this blog, but Professor Tim Holbrook and I have signed a contract with Oxford University Press to coedit an edited volume titled Research Handbook on Extraterritoriality and Intellectual Property Law.  I will have more to say about this project over the course of the next year or so, but for now will just note that we have assembled a list of about forty contributors, including ourselves, to address the many issues that may arise in evaluating the geographic scope of IP rights.

One group of such issues, of course, relates to standard-essential patents; among the relevant issues are whether courts can or should award global royalties, with or without consent of the parties, and whether they can or should award interim relief such as antisuit injunctions, anti-antisuit injunctions, or declarations concerning interim licenses.  In connection with antisuit injunctions, as readers are by now aware, a WTO arbitration panel last year ruled in favor of the EU's appeal from the original panel decision, in finding that China’s antisuit injunction policy violated TRIPS articles 28.1 and 28.2, read in light of article 1.1 second sentence (see my post here).  It is therefore notable that, as has been reported elsewhere, on April 1 the EU published an announcement that China had announced its withdrawal of the antisuit injunction policy at the WTO Dispute Settlement Body meeting in September.  The minutes of that meeting are available here, and the EU-China dispute is Item 2 (pages 6-9).  China expresses its agreement with the original panel opinion and its disagreement with the arbitration panel, before stating in paragraph 2.4 that the Supreme People’s Court had issued a notice on September 25 “stating that the so-called ‘ASI policy’, to the extent it ever existed, had been withdrawn and had no continuing effect upon how Chinese courts evaluated requests for anti-suit injunctions in the context of SEP litigation.”  The aforementioned EU announcement states that “[a]fter some initial technical issues were resolved, this notice is currently accessible online from outside China too” (if any readers can point me to it, I would appreciate it), but that “[g]iven the unwritten nature of China’s anti-suit injunction policy, the European Commission will continue to closely monitor the situation to ensure China’s full compliance . . .  and take further action, if necessary.”

In light of these developments, it was interesting to read an article by Yao Jianjun (former vice president of the Xi’an Intermediate People’s Court) in an issue of China Patents & Trademarks, No. 4, 2025, that recently came my way.  The article, appearing in English translation at pages 12-22, is titled Application of Anti-Suit Injunctions in SEP Disputes.  It provides an overview of Huawei v. Conversant, which was the first of five cases from 2020 in which a Chinese court (here, the SPC) granted an ASI (here, against the enforcement of an injunction granted against Huawei in Düsseldorf).  The author discusses where ASIs fit within Chinese civil procedure law, as well as the five conditions specified by the SPC for granting an ASI (“the impact of the enforcement of foreign judgments on Chinese litigation,” “the necessity of ASIs as a preservation measure,” the “balance of interests of both parties,” “the impact of ASI on the public interest,” and “international comity”) and how they played out on the facts of Huawei v. Conversant.  The author agrees with the court’s decision, though he also notes some of the limitations of ASIs, and cautions against the sequence of lawsuits being a dispositive factor (insofar as this would encourage races to the courthouse).  Apparently the article was written before the EU-China matter was completed, since the author references its existence but not its conclusion.

One thing I found interesting in the article, and which I plan to discuss in the essay I will be contributing to the edited volume I mentioned at the beginning of this post, is the author’s emphasis on the perceived need to counteract the impact of proceedings initiated in another country which, he writes, may “impair[ ] the legitimate rights and interests of the applicant,” thus requiring “a remedy . . . to the party that has suffered damage to the injunction” (pp. 14-15).   In this regard, he writes, if Conversant had applied to enforce an injunction in Germany, the result would have been that Huawei either would have exited the German market or would have settled with Conversant (at a rate, he says, that would have been 18.3 times higher than the rate determined by the Chinese first instance court); and that "such potential damage . . . may substantially harm Huawei's legitimate rights and interests" (p.18).  This framing of the issues bears some resemblance the "effects" test (as used, for example, in U.S. antitrust litigation), under which courts sometimes justify the exercise of prescriptive jurisdiction directed against extraterritorial conduct when such conduct has effects within the prescribing jurisdiction.  From an economic perspective, the application of the effects test is akin to the concept of internalizing an externality—though in this context, the twist is that the externality is caused by the foreign jurisdiction’s toleration or authorization of conduct which the domestic court would like to forbid.  Relevant to this point, a generation ago Professor Joel Trachtman wrote an intriguing paper titled Externalities and Extraterritoriality: The Law and Economics of Prescriptive Jurisdiction, in Economic Dimensions in International Law 642 (Jagdeep S. Bhandari et al. eds., 1997), in which he posits that, if we think of nations participating in a market for prescriptive jurisdiction, and of (in some cases) even having the ability to engage in some measure of Coasean bargaining, there is a range of possible options for allocating the right to prescribe.  Some allocations may be more efficient than others, under the circumstances at hand.  An unavoidable aspect of this framework, however, is determining exactly what counts or should count as a harmful externality—that is, one that causes cognizable harm, a topic that my colleague Claire Hill also has written about.  In the context of ASIs, of course, the country against which the ASI is directed (in effect though not in form, since the form of the injunction is inter partes) presumably believes that it is doing nothing wrong by entertaining a case that is lawfully before it, or by issuing an injunction against the infringement of domestic patent rights in accordance with domestic law; and indeed, if the WTO arbitration panel approach prevails, such conduct is in general privileged and does not cause cognizable harm under international law.  But one could also imagine an alternative rule under which the right to issue an ASI to prevent the perceived negative domestic effect (suffered by a domestic firm or by a domestic court) of a foreign injunction prevails over the foreign court's right to entertain a case or enter an injunction.  Determining which rule makes more sense from a policy standpoint might perhaps depend on how absolute the prohibition on ASIs is under the first approach, and how substantial the domestic effect must be under the second.  (Thinking of these issues from a slightly different angle, as I mention in a discussion of Professor Christopher Drahozal’s game theoretic approach to ASIs in my forthcoming book Wrongful Patent Assertion, in a given case reasonable minds may differ whether it is the country issuing the ASI, or the country against which the ASI is issued, that is deviating from the "comity" norm under which nations are largely left to determine their own domestic policies.)  At this stage, I'm not sure exactly where my analysis is going to lead, but this seems like an interesting problem for analysis through a law-and-econ lens; and if readers have any thoughts or suggestions, I’d be delighted to hear them.     

EU Requests WTO Panel to Determine Legality of Global FRAND Determinations in China

February was an unusually busy month for me, and my week-long bout with COVID didn't help, so I am behind schedule in blogging about recent events of relevance to the world of patent remedies.  One of the biggest of these was the European Union’s announcement on February 12 that it would be requesting the establishment of a WTO panel to determine whether China’s practice of establishing global FRAND royalties without consent of both parties violates the TRIPS Agreement.  The request for establishment of a panel in DS632 China-Worldwide Licensing Terms for Standard-Essential Patents is available here, and the EU's brief summary of the case here.  The WTO site for the case is here.

As previously noted on this blog, in January 2025 the EU instituted consultations with China concerning the issue of global FRAND royalties.  In addition, in July 2025 the EU prevailed in its other WTO dispute with China (DS611-Enforcement of Intellectual Property Rights), concerning China’s antisuit injunction policy, when an arbitration panel (assembled in the absence, for several years now, of a functioning WTO appellate body) concluded (contrary to the initial panel decision) that that policy violated TRIPS articles 28.1 and 28.2 as read in light of article 1.1, because it “frustrate[d] the exercise of the exclusive right of a patent owner to prevent the use of the subject of its patent without its consent” and “alter[ed] the negotiating position of SEP holders in a fundamental way.”  Much the same logic is expressed in the EU’s current request, along with additional reliance on Paris Convention 4bis (which is incorporated by reference into the TRIPS Agreement).  In particular, the EU argues that the challenged measure (of setting global FRAND rates without consent of both parties) violates the following:

Article 28.1, read in conjunction with Article 1.1, first sentence, of the TRIPS Agreement, because China's measure has as its effect to restrict the ability of the owner of a non-Chinese patent to exercise the exclusive rights conferred on it by other WTO Members under Article 28.1 of the TRIPS Agreement, i.e., to prevent third parties not having the patent owner’s consent from making, using, offering for sale, selling, or importing the patented product.

 

Article 28.2, read in conjunction with Article 1.1, first sentence, of the TRIPS Agreement, because China's measure has as its effect to restrict the ability of the owner of a non-Chinese patent to meaningfully exercise its right to conclude licensing contracts, as conferred in the territory of other WTO Members under Article 28.2 of the TRIPS Agreement, by freely negotiating and concluding licensing contracts for the non-Chinese patents.

 

Article 4bis of the Paris Convention (1967), as incorporated into the TRIPS Agreement by virtue of Article 2.1 of the TRIPS Agreement, because China’s measure undermines the principle of territoriality and restricts the possibility for the parties subject to a decision rendered in China to start or continue proceedings before the courts of the WTO Member that granted the non-Chinese patents, and thus for the courts of that WTO Member to adjudicate actions relating to those patents in their respective jurisdictions.

Two obvious points to note.  One is that, although the EU is challenging China’s policy only, it would seem that if the EU’s position turns out to be sound, the U.K.’s policy of establishing global FRAND rates without consent of both parties would be equally vulnerable.  Second, if the EU’s position on Paris Convention 4bis is sound—and there is language in DS611 that is consistent with that position, as I noted here—wouldn’t that place the CJEU’s decision in BSH v. Electrolux in jeopardy as well, to the extent that decision appears to contemplate that courts in EU member states may adjudicate patent infirngement claims arising under non-EU member state law (as discussed, e.g., here and here?)   

Judge Albright’s Order in BMW v. Onesta

As noted on this blog previously (see here and here), in December Judge Alan Albright (W.D. Tex.) issued a temporary restraining order, later converted into a preliminary injunction, ordering U.S. patent assertion entity Onesta from adjudicating claims against BMW for the infringement of U.S. patents in the Munich Regional Court.  On February 13, the judge issued his written order explaining his reasoning.  The order is available on Westlaw (2026 WL 474871) and from other sources, such as Pacer.

By way of background, one year ago the Court of Justice for the European Union issued its decision in BSH v. Electrolux.  In that case, the owner of a European Patent filed an action in Sweden, against a defendant domiciled in Sweden, for the infringement not only of the Swedish part of the patent in suit, but also for the infringement of the corresponding parts validated in nine other European Patent Convention (EPC) member states--including at least one (Türkiye) which is not an EU member.  One of the questions presented was whether the Brussels Regulation Recast conferred exclusive jurisdiction over a Turkish court in respect of the part validated in Turkey.  The court held that it did not, but rather that the Swedish court may adjudicate both the infringement and validity of the Turkish part, although the validity ruling would apply only inter partes (in other words, the effect of the ruling would not be to nullify the Turkish part as against the world).  In reaching this conclusion, the court stated that

. . . the court of the Member State in which the defendant is domiciled which is seised, as in the case in the main proceedings, on the basis of Article 4(1) of the Brussels I bis Regulation, of an infringement action in the context of which the issue of the validity of a patent granted or validated in a third State is raised as a defence, does have jurisdiction to rule on that issue if none of the restrictions referred to in paragraphs 63 to 65 of the present judgment is applicable, given that the decision of that court sought in that regard is not such as to affect the existence or content of that patent in that third State, or to cause its national register to be amended.

 

. . . As the Advocate General observed in point 62 of his Opinion of 22 February 2024 and as the parties to the main proceedings and the European Commission stated at the hearing on 14 May 2024 before the Court, that decision has only inter partes effects, that is to say, a scope limited to the parties to the proceedings. Thus, where the issue of the validity of a patent granted in a third State is raised as a defence in an action alleging infringement of that patent before a court of a Member State, that defence seeks only to have that action dismissed, and does not seek to obtain a decision that will cause that patent to be annulled entirely or in part. In particular, under no circumstances can that decision include a direction to the administrative authority responsible for maintaining the national register of the third State concerned (paras. 74-75).

The court’s reasoning does not, at least explicitly, appear to hinge on the “third State” being a party to the EPC, and thus could be cited in support of the Munich court’s jurisdiction to adjudicate claims for the infringement of a U.S. patent in an action filed against a company (like BMW) domiciled in Germany.  Then again, as Judge Albright notes in his order, the BSH “decision never expressly grants long-arm authority to divest U.S. courts of jurisdiction to enforce U.S. patents.”  Fair enough.

In any event, in granting the ASI, Judge Albright goes through the Fifth Circuit’s test for granting an ASI, which is largely similar to what other U.S. circuits require.  First, it is undisputed that the parties to the U.S. and Munich actions are the same, and the U.S. action (BMW’s action for a declaratory judgment of patent misuse, noninfringement, and invalidity) would dispose of the relevant issues in Munich.  Second, the Munich action would “frustrate a policy of the forum issuing the injunction” or, alternatively, would “cause prejudice or offend other equitable principles.”  In this regard, he writes that “[a]llowing the Munich proceedings to continue threatens the United States' policy interest in adjudicating its own patents and protecting litigants' jury rights in infringement cases. Similarly, proceedings in the Munich court necessarily deprive BMW of critical defendant rights available only here—e.g., fact discovery; invalidity consideration with erga omnes effect; and juries as a bulwark against the improper grant or assertion of U.S. patents. . . .  [E]nsuring that U.S. patent infringement claims are adjudicated in U.S. courts is ‘necessary to provide full justice to the parties’ in this case because BMW seeks a jury trial on the infringement claims” (citation omitted).  Further, in Judge Albright’s reading, the Paris Convention “expressly affirms the independence of each country’s patent system and reserves the ‘provisions . . . relating to . . .  jurisdiction’ to each member state” (quoting Voda v. Cordis Corp., 476 F.3d 887, 898-99 (Fed. Cir. 2007)).  In addition, although there is case law authorizing the adjudication of U.S. copyright claims in foreign courts (and, I would note, vice versa), the court notes that “[u]nlike with copyrights, receiving patent protections in the U.S. requires a rigorous application and examination process”; and he cites the act of state doctrine, which in general counsels against second-guessing the exercise of another state’s sovereign authority.  Third, the court finds that an ASI would not offend international comity because “comity is implicated by ‘public international issues,’ but not ‘private’ disputes” (though one might ask, if that is the case, why courts should bother considering comity at all in the context of deciding whether to grant an ASI in a private dispute).  He does note, however, that

 

There are factors present in this case that are abnormal in the ASI context. For instance, the Court is unaware of any cases where an ASI has been granted to terminate the first filed proceedings between the parties. Moreover, this case features the unusual argument by Onesta that BMW would be inconvenienced by defending in a forum outside of its domicile, while BMW seeks courts outside its domicile. . . . But there is no recognized first-filed principle. See Laker Airways Ltd. v. Sabena, Belgian World Airlines, 731 F.2d 909, 927 (D.C. Cir. 1984) (“The mere filing of a suit in one forum does not cut off the preexisting right of an independent forum to regulate matters subject to its prescriptive jurisdiction.”); Microsoft Corp. v. Motorola, Inc., 696 F.3d 872, 887 (9th Cir. 2012) (“The order in which the domestic and foreign suits were filed ... [is] not dispositive.”). And making sure that U.S. patents are tried in U.S. courts, which regularly apply U.S. patent law is more “convenien[t]” for the courts of each sovereign. . . .Finally, given Onesta's domicile in the United States and BMW's desire to litigate here, the Court finds that neither party would be inconvenienced by doing so. . . .

It will be interesting to see what happens on appeal if the parties do not settle the matter or at least agree to some procedure for resolving it--though I suspect that under U.S. law it may be difficult to overturn the decision on appeal.  Nevertheless, here are a few random thoughts:

1.     The court invokes the United States’ interest in adjudicating its own patents and protecting litigants’ rights to a jury trial, to fact discovery, and to an invalidity determination with erga omnes effect.  But of course all of those things would be unavailable in a case in which a foreign court adjudicates foreign copyright rights, about which the court is more sanguine.  And is it really true that the adjudication of U.S. patent infringement claims in a U.S. court is “necessary to provide full justice to the parties” because BMW seeks a jury trial?  To my knowledge, no other country in the world provides jury trials in patent infringement actions (or discovery to the same extent the U.S. does, for that matter); does that mean that every country’s system is unjust?  I suppose the response would be no, it’s just that actions for the infringement of U.S. patent rights come with a guarantee of right to trial by jury, as a matter of U.S. constitutional law (and regardless of whether the party requesting a jury is the plaintiff or the defendant, domestic or foreign), and therefore the Munich court’s inability to convene a jury would render its decision on U.S. patent infringement claims unjust.  But again, if that is true, why isn’t it true for copyright claims—or other instances in which foreign courts might make determinations under U.S. law?

2.  A more serious problem, in my view, is that in countries such as Germany infringement and validity determinations are bifurcated—determined by different courts in different proceedings—such that a judgment of infringement may be entered with regard to a patent later determined to be invalid (the “injunction gap”).  Moreover, injunctive relief in favor of the prevailing patentee is near-automatic, indeed often viewed as being part of the claim for relief, rather than merely a remedy as in Anglo-American law.  See my new book, p.10 n.23 (stating that “in common law systems the law of remedies is viewed as something of a stand-alone discipline, albeit one that may be applied in different ways in relation to different bodies of private law.  In civil law countries such as Germany, by contrast, rights and remedies are viewed as being more closely connected, such that, as indicated in the text above, the infringement of a patent (for example) almost always results in the entry of an injunction. See Franz Hofmann and Franziska Kurz, Introduction to the “Law of Remedies,” in Law of Remedies: A European Perspective 3, 5 (Franz Hofmann and Franziska Kurz eds., Intersentia Ltd. 2019) (stating that “[u]nlike in common law countries, the question is not: which remedies are available to cure a wrong? Instead, German lawyers comprehend the legal system as a compilation of ‘subjective rights’”).”  So if a German court were to decide the infringement action against BMW, would it have to depart from its standard practice and consider whether the U.S. patent is valid?  Would the availability of an injunction be determined under German or under U.S. (eBay) law?  Beats me—but I can see why BMW, despite not being “inconvenienced” by litigating in its home forum, might prefer to take its chances in Texas, despite the possible risk of a larger damages award under U.S. law, if the case were to proceed that far.

3.  As many readers know, German courts generally disapprove of other states granting ASIs directed against the litigation of disputes or the enforcement of judgments in German courts.  That perspective may not matter so much here, however, if the German court itself would prefer not to have to decide some of the questions above, or if it would be inclined in any event to stay the adjudication of the U.S. patents pending proceedings in the U.S. (something the CJEU expressly suggested as a possibility in a case in which an E.U. court is asked to adjudicate a claim arising under another E.U. member state’s law).  But let’s imagine, just for the sake of argument, a case in which an E.U. court was asked to adjudicate a claim for the infringement of a U.S. patent and was not willing to cede jurisdiction to the U.S. court that enjoins the E.U. plaintiff from proceeding in the E.U.; maybe the E.U. court issues an AASI in response.  Which country is violating the comity norm:  the country issuing the ASI (which, one could agree, indirectly interferes with the operation of a foreign court), or the court that claims the right to adjudicate foreign patent claims (which, one could argue, indirectly interferes with the operation of its counterpart)?  Note that the WTO arbitration award last summer in the dispute between the EU and China can be read as disapproving both of ASIs (that is, disapproving of them beyond the context of the Chinese ASI policy at issue) and of the adjudication of foreign IP rights.  See my post on the WTO decision here, points 6b and 6c.  Then again, what precedential value, if any, does a WTO arbitration award have?

4.  There is some non-binding authority under U.S. law that might disagree with the position staked out by Judge Albright in BMW.  For example, section 211 of the American Law Institute’s 2007 Principles of the Law—Intellectual Property, titled “Subject-Matter Jurisdiction over Claims,” recommends that, in general, “a court is competent to adjudicate claims arising under foreign laws pertaining to the subject matter of these Principles,” as long as it has subject matter and personal matter jurisdiction under local law, and as long as “[a] judgment holding registered rights granted under the laws of another State invalid is effective only to resolve the dispute between or among the parties to the action.”  Similarly, in her dissent in Voda v. Cordis, 476 F.3d 887 (Fed. Cir. 2007), Judge Pauline Newman disputed, among other things, the characterization of patent grants as “acts of state” (as opposed to ministerial acts) for purposes of the act of state doctrine, and also did not believe that the Paris Convention or TRIPS Agreement “prohibits resolution by a national court of private disputes that include foreign patent rights.  She wrote:

The panel majority raises the specter that foreign courts might adjudicate United States patent rights, proposing that if our courts are permitted to decide questions under foreign patent law, other countries will feel free to decide questions of United States patent law. Cordis too sounds the alarm, stating that creative litigants will choose exotic foreign forums to resolve complex patent issues, and that the district court's decision will open the door to international chaos. I doubt that a United States district court is an exotic foreign forum; and it is not new for courts in other countries to apply the law of other nations when warranted. . . . All nations have recognized their obligation to provide a judicial forum to address disputes involving their citizens; no warrant has been shown to remove foreign patents from this purview.

Judge Newman’s dissent did not expressly grapple with Paris Convention articles 2(3) and 4bis, however, though perhaps an argument could be made that neither provision necessarily or inherently entails exclusive adjudicatory jurisdiction.  Whether that is the correct reading of the Convention, I’m not sure.  

New EC Study on IPRED

There already has been a lot going on in the IP world this year, especially in relation to SEPs  in the U.K., Germany, and China; and unfortunately, I am still a bit underwater for a variety of reasons--including the fact I’m teaching one-and-a-half-new courses this semester; the release of my new book Remedies in Intellectual Property Law; and going through edits (and very soon, page proofs) for my other new (forthcoming) book, Wrongful Patent Assertion.  As I work on catching up on the backlog, I thought I should mention the recent publication of the European Commission‘s Follow-up study on the application of the Directive on the Enforcement of Intellectual Property Rights, which I have begun reading.  For now, I will note a few things, mostly from the Executive Summary. and expect to have more to say about some of these issues in the weeks to come.  (As Florian Mueller notes on ip fray, the research that went into the study was concluded in 2024, so there isn’t much there about the UPC.  But what the report does address is, in my view, of substantial interest.) 

As stated in the Executive Summary, the study focuses on “five priority research topics”:  proportionality; PAEs; dynamic blocking injunctions; information sharing and data protection; and costs for the destruction of infringing goods.  Of these, the first two are of greatest relevance to patent law (though all are important to IP law, and my new remedies book provides some measure of discussion of blocking injunctions, the right to information, and the destruction remedy).  One thing that caught my attention is that, according to the study, in patent cases courts in EU member states grant permanent injunctions in 94% of cases, and that “proportionality was explicitly assessed in only 0.6% of these cases.” This is not exactly surprising, but it is interesting to see the statistics.  The study suggests that it might be useful to have some sort of harmonized criteria for determining when proportionality should limit matters such as injunctive relief and destruction orders, and in this regard “concludes that the Commission could issue guidelines defining factors which courts should assess when applying the proportionality principle, such as i) the nature of the plaintiff, ii) the economic harm suffered by the parties, and iii) the public interest.”  The full discussion of proportionality, found in section 3.1 of the report (pp. 27-50), includes some comparative analysis from different member states; discussion of some leading cases; and possible avenues for reform.  As for PAEs, the study states that “their presence in the EU remains relatively limited” compared to the U.S., but also notes that “the data could be showing only the tip of the iceberg as parties may settle disputes outside the courts.”  It also “found that PAEs are highly concentrated in Germany,” and calls for greater transparency “particularly in jurisdictions such as Germany where court decisions are not systematically published.”  The full discussion of PAEs, found in section 3.2 (pp. 50-69), includes, among other things, discussion of why (according to Darts-IP) 90%+ of all PAE activity takes place in the U.S. (among them, no loser-pays rule except in exceptional cases, much higher damages awards, and lack of specialized trial courts), and also suggests that the development of proportionality guidelines could help to forestall (future?) abusive litigation by PAEs within the EU.

German Federal Supreme Court Rejects HMD’s Appeal

In 2024, the European Commission filed an amicus brief in a SEP case, VoiceAge v. HMD, urging the Munich Higher Regional Court to require strict compliance with the sequence of steps laid out in Huawei v. ZTE.  That court rejected the EC’s interpretation, as did the Higher Regional Court a few months later.  (For previous discussion on this blog, see here, here, and here.)  Today, the competition law senate of the Bundesgerichtshof (German Federal Supreme Court) rejected HMD’s appeal.  The press release (in German) is here; I would guess there will be a written decision to follow, at some point.  According to the press release, the Court concludes that, in accordance with the CJEU’s decision in Huawei v. ZTE and the BGH’s two previous decisions in FRAND-Einwand  I  and II, SEP owners are not hindered from enforcing their patents against unwilling licensees; and that the evidence in this case, which includes negotiations dating back to 2019, shows the implementer (HMD) to be an unwilling licensee.  Moreover—and consistent with the FRAND-Einwand  I  and II decisions (which, inter alia, require that implementers demonstrate their willingness to license throughout the entire course of negotiations in order to avoid injunctive relief)—the Court has no doubt that TFEU article 102 does not require strict compliance with the sequence of steps set forth in Huawei v. ZTE, and therefore concludes that it is not obligated to refer matter to the CJEU.  The court further sees no reason to address the appellate court’s requirement that, as part of the Huawei v. ZTE framework, the implementer must post security in the amount of the SEP owner’s offer, because in this case, it states, the security the defendant posted wasn’t even as high as its own counteroffer. 

Judge Albright Enjoins Onesta from Proceeding in Munich with Claims for the Infringement of U.S. Patents

In December, I noted that, at BMW’s request, Judge Albright (W.D. Tex.) had entered a TRO prohibiting Onesta from litigating claims for the infringement of two U.S. patents in the Munich I Regional Court.  ip fray is now reporting that the judge yesterday converted the TRO into a preliminary injunction, that is, an antisuit injunction forbidding Onesta from proceeding with litigation over the U.S. patents in Munich.  I’ve checked both Pacer and Lex Machina, which show that Onesta has already filed a notice of appeal to the Federal Circuit; but there is no written opinion (yet) from the judge, though I would expect some sort of written opinion might follow.

As I noted in December, the order comes after Onesta asserted claims against BMW for the infringement of both German and U.S. patents in Munich—something that the CJEU’s February 2025 decision in BSH v. Electrolux appears, on my reading, to permit it to do in a case like this, in which the defendant is domiciled in an EU member state, subject to the caveat that any decision concerning patent validity would apply only inter partes (in other words, the validity ruling would not be binding in other litigation between Onesta and another party).  BMW contested this reading in its initial motion papers, which were available from Law 360 (and on Pacer and Lex Machina).  Dennis Crouch has an excellent writeup on the issue of whether courts may adjudicate claims for the infringement of foreign patents, which notes among other things the Federal Circuit’s 2007 opinion in Voda v. Cordis (denying supplemental jurisdiction to adjudicate such claims, over a dissent from Judge Newman).  The ip fray post mentions expert declarations in the BMW case have been filed by three people I know, admire, and have worked with, namely Professors Peter Picht (in support of Onesta), Margo Bagley (in support of BMW), and Matthias Leistner (also in support of BMW).  Their declarations, attached to the motion papers, are available here, here, and here.  (I have not yet read through all of them carefully myself.)

For my February 2025 writeup on BSH, see here.  Also note that, in my December post, I flagged as a possible issue (to which I do not claim to know the answer) whether the German court, if it were to adjudicate claims for the infringement of U.S. patents, would apply German or U.S. law to the question of remedies, especially permanent injunctive relief.  That would be a huge issue here, where under U.S. law an injunction in a  case like this would be difficult to obtain.

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. 

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.       

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.

Bonadio, Kansara & Tayal on the Eu-China WTO Arbitration Panel Decision

Although I (and others) have blogged about the July 2025 WTO arbitration award finding China’s antisuit injunction policy to be in violation of TRIPS (see, e.g., here, here, and here), this is the first (though I know it will not be the last) full-length article on the arbitration award that has come to my attention:  Enrico Bonadio, Mahak Kansara & Vansh Tayal, Litigating Patent Standards:  the EU-China WTO Dispute on Anti-Suit Injunctions, 47 EIPR __ (forthcoming 2025).  Here is a link to the ssrn version, and here is the abstract:

 

This article examines the WTO dispute between the EU and China concerning Chinese courts' use of anti-suit injunctions (ASIs) in standard-essential patents (SEPs) litigation. The Arbitrators' ruling of 21 July 2025 overturned key Panel findings, holding that China's ASIs policy violates Articles 1.1, 28.1, and 28.2 of the TRIPS Agreement by frustrating foreign patent holders' rights to enforce and license SEPs internationally. Significantly, the Arbitrators articulated a new and problematic "anti-frustration" rule, clarifying that measures which systematically undermine substantive IP rights and their cross-border enforcement contravene WTO/TRIPS obligations. The article critically assesses the legal and policy implications of the Arbitrators' interpretations, exploring their impact on global SEPs enforcement and the evolving interface of international IP and the WTO dispute resolution system.

The article does a good job explaining the dispute, and devotes considerable attention to the arbitrators’ conclusion that TRIPS article 1.1 embodies some sort of “anti-frustration” principle, which China’s anti-suit injunction policy breached.  (See Arbitration Award para. 4.74, in which the panel states that the corollary of the obligation set forth in article 1.1 to "give effect to the provisions of th[e] Agreement" in members’ territory “is to do so without frustrating the functioning of the systems of protection and enforcement of IP rights implemented by other Members in their respective territories.”)  Although (for now, at least, and unlike Bonadio et al.) I remain agnostic on whether the arbitrators were correct in inferring some sort of “anti-frustration” principle into article 1.1, I fully agree that the arbitrators articulation of that principle leaves much to be desired.  Taken to its logical conclusion, the anti-frustration principle would not only do away with ASIs altogether (even the more traditional, limited ones that the U.S. and U.K. might occasionally grant), but also would seem to cast many other national practices into doubt—including not only awards of global FRAND royalties as in the U.K. and China, but also the practice of the German courts to routinely grant injunctions in SEP cases (which, as a practical matter, often compel global settlements).  Of course, it would be crazy to say that Germany’s obligation to give effect to the provisions of TRIPS forbids Germany from entering territorially-limited injunctions because doing so frustrates the ability of other member states to adjudicate FRAND disputes pending before their courts, but the fact that the anti-frustration principle would lead to that paradoxical (and clearly wrong) result indicates that there must be something amiss with an unconstrained anti-frustration principle.  Unfortunately, the arbitration panel didn’t spell out the constraints, though as Bonadio et al. suggest, perhaps the other EU-China dispute pending before the WTO (involving China’s willingness to render global FRAND awards) will clarify matters.  

From Around the Blogs

1. On SpicyIP, Ambika Aggarwal has published two posts (here and here) concerning the Supreme Court of India’s recent decision dismissing an appeal from a 2023 Delhi High Court judgment in Ericsson v. Competition Commission of India (CCI), previously reported on this blog here, holding that the “CCI cannot exercise jurisdiction over actions of an enterprise that are in exercise of their rights as a patentee.”  Although the Supreme Court's decision is apparently not publicly available yet, it is reported that the Court dismissed the action on the ground that the parties had, in the meantime, settled their dispute.  Dr. Aggarwal argues, persuasively in my view, that the current state of affairs in India leaves a gap in antitrust oversight of SEP-related issues, and is at odds with the positions taken in other major markets including the E.U., the U.K., China, Japan, and Korea.  For discussion on ip fray as well, see here and here.

2. Enrico Bonadio has published two posts on SEP matters on the Kluwer Patent Blog.  The first, titled Judgment Without Trial:  The Erosion of Appellate Restraint in UK Patent Law, takes issue with the Court of Appeal’s decision in Optis Cellular Tech. LLC v. Apple Retail UK Ltd., [2025] EWCA Civ 552 (previously discussed on this blog here), increasing the award of global FRAND royalties from $56 million to $502 million.  Professor Bonadio contrasts this result, which he views as the appellate court improperly serving as finder of fact, with the Federal Circuit’s en banc decision in EcoFactor v. Google (previously discussed on this blog here), which after reversing the trial court for admitting expert testimony in violation of the rules of evidence remanded for a new trial on damages.   He also recently published a post titled Restoring Balance in SEPs Governance—Next Steps for the EU After the Regulation’s Withdrawal.  He argues, inter alia, that a step forward “would be a strategic referral to the CJEU that addresses the gaps and inconsistencies left by Huawei v. ZTE.”

3.  Also on Kluwer, Jiří Slavík published Substantiating Infringement (or Risk Thereof) at the UPC:  Divide & Conquer or One to Rule Them All?, discussing, inter alia, UPC decisions on whether courts may grant preliminary or permanent injunctions throughout all of the contracting member states (CMSs) and, after BHS Hausgeräte (discussed on this blog here) non-CMSs as well.

A Couple of New Articles on FRAND/SEPs

1. Michael Nieder has published an article titled EPG-Widerklage auf gerichtliche Bestimmung einer angemessenen FRAND-Lizenz?—Zur Entscheidung der LK Mannheim vom 22.11.2024—UPC CFI 210/2023 (“UPC Counterclaim for a Judicial Determination of a Reasonable FRAND License?—On the Nov. 11, 2024 Decision of the Mannheim Local Division— UPC CFI 210/2023”), 2025 GRUR Patent 401.  Here is the abstract:

The EPG [UPC] has so far issued two injunctions for infringement of a standard-essential patent (SEP) in cases where the FRAND issue played a role.  These are the decisions of the EPG Local Division Mannheim of November 22, 2024—UPC CFI 210/2023—Panasonic/OPPO an OROPE and the EPG Local Division Munich of December 18, 2024—UPC CFI 9/2023—Huawei/Netgear.  Due to corresponding counterclaims by the defendants, the question of the possibility of a court determining the appropriate rate for a FRAND license arose only in the Panasonic/OPPO and OROPE case.  The following remarks deal with this issue.

In the course of the article, Dr. Nieder argues against the position taken by Matthias Leistner (who believes the UPC has jurisdiction to determine FRAND rates), and in favor of the position taken by Peter Meier-Beck and by Tim Dornis (that it doesn’t).  For my previous commentary on the Mannheim decision, see here; for previous posts on Dr. Leistner’s and Judge Meier-Beck’s takes on the issue discussed by Dr. Nieder, see here and here.   

2.  Runhua Want has posted an article on ssrn titled Irrational Unwillingness in SEP Licensing, 34 Tex. Intell. Prop. L.J. __ (forthcoming 2025).   Here is a link to the paper, and here is the abstract:

The role of injunctions in guiding standard-essential patent (SEP) licensing negotiations is important but remains unclear. Many SEP holders argue that a high threshold for injunctions fails to protect them against holdout and efficient infringement. By contrast, SEP implementers are concerned about patent holdup resulting from threats of injunctions by SEP holders. This conflict raises a broader policy issue: how should legal institutions guide parties toward efficient licensing negotiations? However, since the United States withdrew its most recent guidance in 2021, it has lacked a clear position on this issue. Other jurisdictions likewise face challenges in designing effective injunction rules. Among these challenges, the definition of unwilling licensees, a key factor in granting injunctions, remains inconsistent and under development. This Article addresses the unsettled role of injunctions in SEP licensing negotiations and contributes to the policy debate by analyzing cognitive and structural barriers to implementer cooperation. Specifically, it examines whether injunction rules can be designed to effectively enhance the willingness of implementers to license. To that end, it reviews public feedback submitted in a semi-structured survey, which was conducted by the United States Department of Justice in 2022. The survey examined both the thresholds for injunctions and the standards for identifying unwilling licensees. This Article documents various approaches to identifying unwilling licensees, as suggested in the feedback. Based on the documented feedback and textual analysis, the Article identifies four motivations that underline SEP implementers' lack of cooperation in licensing negotiations: 1) resistance to holdup, 2) information asymmetries, 3) habitual holdout and efficient infringement, and 4) financial constraints. These motivations reflect not only strategic behavior but also deeper cognitive biases held by both SEP holders and implementers. This Article argues that due to the cognitive biases, injunction rules, regardless of their design, face inherent limitations in promoting efficient licensing.