Tokyo High Court publishes Apple v Samsung ruling

The Tokyo High Court has published a ruling on a patent dispute between Apple and Samsung that could have an important bearing on other Japanese litigation between the companies.

In February this year, the court rejected Samsung’s claims that Apple infringed a patent directed to a wireless data packet system. The court said Samsung had failed to comply with an agreement forcing it to license the patent – deemed essential to industry standards – on fair, reasonable and non-discriminatory (FRAND) grounds.

Until now, little has been known about the case. The ruling shows that Apple contacted its South Korean rival in an attempt to negotiate a licensing deal for the patent. Samsung argued that Apple’s letter had challenged the validity of the patent – and so the licensing offer was not definitive.

The court said when Samsung received the letter, it had a duty to negotiate in good faith under the policies of the European Telecommunications Standards Institute (ETSI), which sets standards governing the disputed patent’s technology.

When the parties began negotiating, some time before Samsung sued Apple in April 2011, the court said Samsung failed to show how it calculated its proposed royalty rate of 5 percent, which Apple argued was excessive.

The court sided with Apple, finding that Samsung had neglected its duty to negotiate the deal in good faith, especially as it had offered lower FRAND licensing rates in separate lawsuits. The court said Samsung’s enforcement of the patent infringement claims would have been abusive.

“This ruling addresses, probably for the first time in Japan, the implications of a so-called FRAND commitment made under the ETSI IPR policy,” said Yoshiyuki Miyashita, attorney at law at Nishimura & Asahi in Tokyo.

He added: “I am inclined to support the court's ruling that any patent holder who makes the FRAND commitment should be obliged to engage in good-faith negotiations and that a failure to do should result in a finding of an abuse of rights. This is because the FRAND commitments are material foundations for standardisation activities, and should entail legal obligations to pursue good-faith negotiations.”

Miyashita said although there are a number of other cases between Apple and Samsung pending at the Tokyo District Court, this ruling should be “significantly advantageous” for Apple in the other disputes between the companies.

“As I understand that most of Samsung's patents in other cases are also essential patents for which Samsung had made FRAND commitments, this ruling made in Apple’s favour may be similarly applied to other cases,” he said.

According to some reports, the patent in this case was the 25th standards-essential patent Samsung has asserted against Apple in their continuing global litigation. Only three of these have succeeded: two in South Korea and one in the Netherlands.