Friday, September 20, 2013

Hoppe-Jänisch on the Düsseldorf Court's Decision to Refer "LTE Standard" to the CJEU

Daniel Hoppe-Jänisch has just published Der Vorlagebeschluss des LG Düsseldorf „LTE-Standard‟in the September issue of Mitteilungen der deutschen Patentanwälte (pages 384-90).  Mr. Hoppe-Jänisch's English-language translation of his article, titled The Landgericht Düsseldorf's (Düsseldorf District Court) decision to refer "LTE-standard," is available on White & Case's website, here.  (Mr. Hoppe-Jänisch had previously published a short commentary about the case in GRUR-RR, and I have cited his earlier commentary here and here.)  For those of you who aren't familiar with the matter, in  March 2013 the Düsseldorf District Court referred to the Court of Justice for the European Union (CJEU) the question of whether it is an abuse of dominant position for the owner of a FRAND-encumbered standard-essential patent (SEP) to seek an injunction, where the infringer has expressed its willingness to negotiate a FRAND license.

Mr. Hoppe-Jänisch's English-language version provides a nice translation of the five questions the court has referred to the CJEU:

1.  Does the owner of a standard-essential patent who declares themselves willing, vis-à-vis a standard-setting organisation, to grant a licence to any third party on fair, reasonable and nondiscriminatory terms, abuse their dominant market position if they seek injunctive relief before a court against a patent infringer despite the infringer having declared themselves willing to negotiate such a licence,


Can an abuse of the dominant market position only be presumed if the patent infringer has made an unconditional and binding offer to the owner of the standard-essential patent to conclude a licence agreement that the patent owner cannot refuse without unduly restraining the patent infringer or violating the non-discrimination rule, and the patent infringer, in anticipation of the licence to be issued, already complies with their contractual obligations with respect to already committed acts of use?

2.  If the abuse of a dominant market position can already be presumed from the patent infringer’s willingness to negotiate:

Does Article 102 TFEU pose specific qualitative and/or  chronological requirements to the willingness to negotiate? Can such a willingness to negotiate already be presumed when the patent infringer merely generally declares (orally) their willingness to enter into negotiations or does the patent infringer already have to have entered into negotiations by, for example, communicating terms and conditions under which they are prepared to conclude a licence agreement?

3.  If the submission of an unconditional binding offer to conclude a licence agreement is a requirement for an abuse of a dominant market position:
Does Article 102 TFEU pose specific qualitative and/or chronological requirements to the offer? Does the offer have to include all terms and conditions, which are usually set forth in licence agreements in the technology field in question? Can the offer be made particularly under the condition that the standard-essential patent is actually used and proves to be legally valid?

4.  If the patent infringer’s fulfilment of obligations arising from the requested licence is a requirement for an abuse of a dominant market position:
Does Article 102 TFEU pose particular requirements with respect to such acts of fulfilment? Is the patent infringer required, in particular, to make disclosures relating to past acts of infringement and/or to pay licence fees? Can an obligation to pay licence fees also be fulfilled by giving security?

5.  Do the requirements for the presumption of abuse of a dominant market position by the owner of a standard-essential patent also apply to other claims through legal action arising from patent infringement (disclosures, recall, damages)?

The article provides a good, concise overview both of the LTE-Standard case and of other relevant SEP/FRAND matters, including the EU's proceedings against Samsung and Motorola; the Dutch court's decision in Samsung v. Apple; and the UK decision involving IPCom and Nokia.  In Mr. Hoppe-Jänisch's view, the Düsseldorf court's accompanying opinion suggests an interest in balancing the conflicting interests of the SEP owner and the would-be licensee, and (despite its distancing itself somewhat from the BGH's Orange-Book-Standard framework) evidences concern over the risk of abuse both on the part of both the SEP owner and the alleged infringer.  He writes that a mere willingness to negotiate on the part of the alleged infringer isn't, or shouldn't, necessarily be enough to invoke the competition-law exception to the SEP owner's right to obtain an injunction, though it may suffice when "a purely tactical, delaying and dishonest behaviour can be ruled out."  He also notes the Düsseldorf court's willingness to bow to criticism and do away with the requirement that the infringer concede validity and infringement.  Finally, he notes that the CJEU is unlikely to to "take a position on all details of the objection's application," and discusses some possible future controversies over the meaning of "standard-essentiality" and the conditions relevant to demonstrating a willingness to negotiate.
Overall, a good read for those of you who are interested in the SEP/FRAND landscape in Europe. 

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