Alex Brodie is co-chair of Gowling WLG’s tech sector. This article, co-authored by Tom Foster, associate at Gowling WLG, reviews some of Europe and the UK’s top tech patent cases of the past year.
As the environment for tech-focussed patent litigation in the US continues to present increasing challenges to patentees, Europe is proving to be an attractive alternative for litigation with a number of high profile cases passing through the European courts in 2015.
Perhaps the most significant decision of 2015 saw the Court of Justice of the European Union hand down its judgement in Huawei v ZTE, a decision which describes the circumstances in which it may or may not be an abuse of a dominant position for an owner of a standard essential patent or SEP (a patent covering technology adopted by a standards body) to sue for injunctive relief.
Huawei v ZTE provides a framework for both patentees and users of patented technology to follow when negotiating licences, and many European commentators have seen it as a positive decision, which should prevent infringers (for example mobile phone manufacturers) from unduly delaying in order to postpone meaningful licence negotiations.
Although the decision is not one-sided, many SEP owners will be encouraged by the imposition of reciprocal obligations on infringers who, in the UK at least, have tended to use competition law as a smokescreen when asked to pay for the right to use patented technology by taking a licence.
UK rulings
The Huawei v ZTE decision was made in response to a referral from a German court, but the UK also continues to be a popular jurisdiction for patent litigation in the technology sector.
In November 2014, the UK Court of Appeal ruled that two dynamic spectrum management patents belonging to ASSIA, a California-based broadband software developer, were valid and infringed by BT. The infringement claim was brought by ASSIA in respect of BT’s “Infinity” broadband system, and the parties went on to settle their dispute in July 2015.
ASSIA has proved to be somewhat of a forerunner for technology companies succeeding in the UK Patents Court. In particular, two non-practising entities (NPEs), Vringo and Unwired Planet, have both secured recent and notable victories.
Vringo achieved success in late 2014 when one of its patents relating to 3G and 4G infrastructure was held to be valid and infringed by ZTE. The case was set to go to a royalty determination in January this year, but shortly before then the parties settled their global dispute for a reported sum of approximately $21.5m.
Unwired Planet has also experienced success in its patent dispute with Samsung and Huawei. The US-based NPE is embroiled in a considerable battle with the two East Asian mobile phone manufacturers, having sued them both for infringement of six of its patents in the UK.
Unwired Planet succeeded in the first of five UK patent trials, with a patent concerning an efficient ‘polling’ system for a wireless communication network found to be valid and infringed.
After succeeding in a parallel German trial, Unwired Planet then had two of its patents relating to base station communications revoked in the second trial of the UK action (one patent being a divisional of the other).
The fifth and final patent trial is set to be heard in July 2016, following which the court is scheduled to hear a 13-week “non-technical trial” to consider competition law defences raised by the defendants.
Guidance
UK commentators eagerly await further guidance on the relationship between competition law, the licensing of SEPs, and the availability of injunctive relief, and it is expected that Unwired Planet’s non-technical trial will revisit, from a UK perspective, the issues considered by the CJEU in Huawei v ZTE.
Another issue that will be of interest to many tech companies contemplating (or threatened with) patent litigation, is the issue of pre-action disclosure. This came to the fore in The Big Bus Company v Ticketogo last year when, having been approached to take a licence and assured that others had done so, The Big Bus Company applied to the court for pre-action disclosure of Ticketogo’s existing licences on the basis that it needed to know the extent of its potential liability.
The Big Bus Company was partially successful – the court using its discretion to order disclosure of a small number of particularly relevant licences.
This may seem likely to prove significant for many prospective litigants’ negotiation and case management strategies, but it is worth noting that The Big Bus Company had to satisfy a number of strict criteria in order to succeed, so the result should not be seen as opening the door to a huge influx of applications for pre-action disclosure.