FRAND and STEP: Latest Judgment from the Court of Appeal

The Court of Appeal has upheld the ruling of Birss J in Unwired Planet v Huawei.

The Court of Appeal has given judgment on the appeal brought by Huawei against judgments which resolved a number of issues surrounding FRAND licences – see Unwired Planet International Ltd & Anor v Huawei Technologies Co Ltd & Anor [2018] EWCA Civ 2344.

The Court of Appeal judgment is lengthy (291 paragraphs) and, although the overall conclusion is to dismiss the appeals and support the judgment of Birss J, it is probably required reading for all concerned with standard essential patents (SEPs). (Essentially SEPs impose an obligation upon the owner of a patent which protects a technology which its owner has declared to be essential to the implementation of one or more of the telecommunications standards such as 2G-GSM, 3G-UMTS and 4G-LTE to provide a licence on certain terms.)

Unwired Planet International contended that five SEPs had been infringed and were essential, and that Huawei, having refused to take a FRAND licence, should be restrained by injunction from further infringement. Huawei responded that the SEPs were neither essential nor valid. It also raised defences and counterclaims based on breaches of competition law, aspects of which were founded upon the contention that Unwired Planet International and its associated companies had not made an offer to license these patents on FRAND terms.

The Court of Appeal was concerned with the findings of Birss J that:

  • willing and reasonable parties would agree on a global licence, and such a licence was the FRAND licence for a portfolio such as that held by UP and for an implementer like Huawei - Unwired Planet was therefore entitled to insist on it. It followed that the UK licence offered by Huawei was not FRAND
  • the rates sought by Unwired Planet were too high and it was appropriate for the court to set the appropriate global FRAND rates between the parties
  • Unwired Planet was in a dominant position in the relevant market but had not abused that dominant position by pursuing the proceedings in the way that it did.

Although this is a lengthy judgment, yet to be pored over in every detail, it is hard to detect any points where the Court of Appeal has done more than endorse Birss J’s findings.

Published: 2018-10-23T15:50:00


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