Antisuit and anti-antisuit injunctions: Ericsson and Samsung battle it out

I've taken a couple of weeks off of blogging--and reading blogs--so it was only last night that I learned about the recent developments in the Wuhan Intermediate People's Court and the U.S. District Court for the Eastern District of Texas involving Ericsson and Samsung.  If I understand correctly, based on posts I have now read by Mark Cohen on ChinaIPR, Florian Mueller on FOSS Patents (here, here, and here), and Gene Quinn on IP Watchdog, which are themselves based on the pleadings filed in the Texas action, Samsung initiated an action in Wuhan on December 7, asking the court to establish the terms of a global FRAND license; Ericsson filed suit in the U.S. on December 11, but (in accordance with Chinese law) was not informed of the Wuhan action until a few days later; the Wuhan court issued an ex parte antisuit injunction on December 25 (which, according to Samsung, Ericsson can ask the Chinese court to modify, albeit after-the-fact); and the Texas court issued a TRO against Samsung on December 28.  There will be a hearing later this week on whether to convert the TRO into a preliminary injunction. 

While we wait to see how all of this plays out, I am working on a short paper outlining what I view as some of the ongoing problems with global FRAND disputes, including the inevitable frictions resulting from parties seeking antisuit and anti-antisuit injunctions around the world.  Ideally, in my view, there would be some sort of global tribunal to adjudicate FRAND cases, along the lines Jorge Contreras has advocated and in accordance with some common, agreed-upon methodology.  But this is a long-term goal; for now the nations of the world don't have a common, agreed-upon methodology for determining FRAND rates, and I'm not aware of any efforts in progress to establish a global tribunal.  Thus, while I'm inclined to think that a system in which courts take upon themselves the burden of establishing global rates, absent consent of the parties--and issue anti- and anti-antisuit injunctions to preserve their jurisdiction to do so--is not, in the long run, sustainable, things may just have to get a lot worse before we see any progress in developing a solution.

Update:  Further coverage today on Bloomberg Law and Law360.

From Around the Blogs: Dutch FRAND Case, Fees 5 Years After Octane Fitness, and More

1.  On the IPKat Blog last week, Annsley Merelle Ward published a post by Léon Dijkman titled Dutch Court of Appeal injuncts unwilling licensee in first post-Huawei v ZTE FRAND decision.  The decision, Koninlijke Philips N.V. v. Asustech Computers Inc., was handed down on May 7, and Mr. Dijkman provides links to both the Dutch original and an English translation.  Mr. Dijkman notes, inter alia, that the defendant's "alleged willingness to enter into negotiations after the institution of the proceedings and a possible counteroffer in that regard cannot render the litigation abusive or trigger an obligation to stay the proceedings," and that the court "does not interpret Huawei/ZTE as obliging SEP holders to substantiate why their license offers are FRAND."    EPLaw also has a write-up, earlier noted on IPKat, here.

2.  Also on EPLaw (and earlier noted on IPKat) is a write-up, and link to an English language summary, in Graf v. Kaban & Daser, a decision of the Barcelona Commercial Court from last November, denying a request for an ex parte injunction against the exhibition of a device at a trade fair in Madrid.  The summary discusses the circumstances under which a patent owner should use a procedure known as a "preliminary verification of facts" to determine if a device infringes.

3.  Also on IPKat is a post by Peter Ling titled Does a “Launch At Risk” Automatically Exclude the Right to Appropriate Compensation for a Wrongfully-Issued Preliminary Injunction?  The post discusses a referral from the Metropolitan Court of Budapest to the CJEU, and AG Pitruzzella's opinion that the Enforcement Directive does not authorize member states to automatically deny compensation for a wrongly issued injunction if the defendant launched at risk (without having first sought to invalidate the patent in suit).

 

4.  As for the U.S., Ryan Davis published an article on Law360 last week titled 5 Things We've Learned in 5 Years Since Octane Fitness.  Citing data compiled by Nirav Desai, Mr. Davis presents descriptive statistics on the number of attorneys' fee motions filed and the grant rate post-Octane Fitness, and concludes that while fee awards have become more common, they are still unusual (as one would expect, given the statutory requirement that fees be awarded only if the case is exceptional).  Mr. Davis also discusses various factors that courts have considered in determining that a case is exceptional.

Trimble on TROs

Professor Marketa Trimble has posted a paper on ssrn titled Temporary Restraining Orders to Enforce Intellectual Property Rights at Trade Shows: An Empirical Study, 83 Brooklyn Law Review __ (forthcoming 2018).  Here is a link to the paper, and here is the abstract:

Infringements of intellectual property (“IP”) rights by exhibitors at trade shows (also called trade fairs or exhibitions), such as infringements committed through exhibitions of or offers to sell infringing products, can be extremely damaging to IP right owners because of the wide exposure that trade shows provide for infringing IP; the promotion of the infringing IP and the contacts made by infringers at trade shows can facilitate further infringements after a trade show that can be very difficult for IP right owners to prevent. IP right owners therefore seek to obtain emergency injunctive relief to stop trade show infringements immediately — if possible, during the trade show itself. In the United States, the relief that courts issue in these situations is typically a temporary restraining order (“TRO”). This article reviews the law and practice of TROs requested and issued for trade shows and reports original empirical findings about the practice at the U.S. District Court for the District of Nevada — the court that issues TROs for trade shows that take place in Las Vegas, Nevada, a major international trade show center. Based on an analysis of the law and practice, the article argues that in the context of trade shows, current law on injunctive relief in IP cases relegates a TRO to a position as a tool that is available only against foreign infringers who have infringed IP rights before the trade show in question. While there may be multiple reasons why TROs issued for trade shows often target foreign infringers, current TRO law might be a contributing factor to the high percentage of trade show-related TROs issued against foreign infringers. The limited availability of TROs for trade shows is problematic because it leaves IP right owners without access to emergency relief in situations other than those involving pre-existing infringements by foreign infringers. Absent a change in the current law, alternative dispute resolution mechanisms may offer a route to more accessible emergency relief at trade shows.

I read a version of this in draft, and I thought it was quite good.  For me the principal takeaway point was that the general problem with TROs is that they are available only for emergency situations, but in order to obtain a TRO the movant has to provide among other things a detailed evidentiary basis of irreparable harm, which presumably is very difficult to do in a genuine emergency.  Some deserving cases therefore don't result in TROs.  Moreover, I suspect the problem might get worse before it gets better, in view of recent Federal Circuit cases (Nichia v. Everlight, Amgen v. Sanofi; see discussion here and here) that read eBay as requiring the movant to prevail on all four factors to obtain an injunction (rather than, as under a  traditional equitable approach would have it, four factors to be balanced and considered, such that weak or nonexistent evidence on one factor could be compensated for by stronger evidence on another).  Thus, a traditional approach as I understand it might not require such a detailed showing of irreparable harm if the balance of hardships weighed very strongly in favor of the IP owner (and perhaps the balance would weigh in favor of the IP owner if it was required to post a meaningful security bond).  But under eBay and Winter as understood by the Federal Circuit, I think it will become even more difficult to get a TRO (or other form of injunctive relief).