Published: 11/3/15
Case Nos. 4a O 93/14 and 4a O 144/14, Regional Court of Düsseldorf (2015)
Case Nos. I-15 U 65/16 and I-15 U 66/15, Higher Regional Court of Dusseldorf (pending)
In late 2015, Germany’s Regional Court of Dusseldorf issued the first decision in Sisvel v. Haier that interpreted and applied the European Court of Justice’s decision in Huawei v. ZTE, which specified the circumstances under which a patentee may obtain injunctive relief with respect to FRAND-encumbered SEPs. Huawei had held that a holder of a FRAND-encumbered SEP may not seek injunctive relief unless it first informs the alleged infringer in writing of the specific infringement, offers to license the SEP on FRAND terms, and negotiates with the potential licensee if the latter rejects the initial terms in good faith. (See case summary for Huawei v. ZTE posted at http://www.allthingsfrand.com/).
Sisvel owned FRAND-encumbered SEPs that it claimed to be essential to wireless telecommunications standards. In 2014, Sisvel and Haier negotiated over the terms of a potential license to Sisvel’s patents, but did not reach an agreement. Sisvel sought to enjoin Haier smartphones and tablets that allegedly infringed Sisvel SEPs, and the regional court granted Sisvel’s request for an injunction. Although the court found that Sisvel had failed to provide Haier written notice of the specific infringement as required by Huawei v. ZTE, it held that this aspect of the ECJ’s decision should not be applied retroactively. (Sisvel’s complaint was filed before issuance of the Huawei decision.)
During the pendency of an appeal to the Higher Regional Court of Düsseldorf, the appeals court stayed enforcement of the injunction on the ground that the Regional Court’s application of Huawei v. ZTE was “obviously wrong.” In particular, the Higher Regional Court held that the SEP-holder must take each of the steps prescribed by Huawei v. ZTE, including giving written notice of the specific infringement, before filing suit. In addition, the appeals court held that injunctive relief is unavailable where the SEP holder fails to offer a license on FRAND terms, and that the lower court therefore should not have enjoined Haier without first determining whether Sisvel’s licensing offers complied with FRAND requirements. In this case, the court would have needed to first determine the reasonableness of the royalty rate and other license terms as part of evaluating whether Sisvel’s offer was consistent with FRAND terms.