AIPPI 2018: Levelling the FRAND playing field, and plain packaging
The TCL v Ericsson decision has moved licensees a few steps closer to levelling the playing field when negotiating standard-essential patent (SEP) licences, a US lawyer involved in the case told an industry conference.
Stephen Korniczky, partner at Sheppard Mullin in San Diego and the representative of China-based smartphone maker TCL in its dispute with Ericsson, was speaking in the “Briefing: hot topics in IP” panel session during the 2018 AIPPI World Congress in Cancún, Mexico, which closed yesterday, September 26.
All panellists were speaking in a personal capacity.
In late December last year, US District Judge James Selna issued a 115-page opinion, handing down a fair, reasonable and non-discriminatory (FRAND) licence for SEPs in the high-profile quarrel.
Approximately 100 to 150 Ericsson patents were at issue, each of them covering technology essential to the implementation of the 2G, 3G and 4G wireless telecoms standards published by the European Telecommunications Standards Institute.
According to Korniczky, the case is important as it provides a methodology on how to create a FRAND royalty rate and is the first case that looked at calculating such a rate for an entire portfolio (whereas other cases looked at a handful of patents).
He added that the case has changed the way that FRAND licences are agreed.
“Potential licensees have a methodology to follow when negotiating these licences and they’re asking for confirmation that the rates they’re paying are the same [as others that have taken a licence],” said Korniczky.
On Tuesday, September 25, WIPR reported on another panel session, “SEPs—maximising value before enforcement”, which highlighted the advent of 5G technology and the internet of things.
Korniczky added: “Once the 5G standard is in place, it’s going to permeate every aspect of our society. So if you haven’t had to negotiate a SEP licence today, there’s a good chance you’ll be negotiating these licences in the future.”
Also on the panel, Wolf Meier-Ewert, counsellor in the IP division of the World Trade Organization (WTO), outlined the process behind the organisation’s decision to endorse Australia’s plain packaging restrictions on tobacco products in June this year.
Indonesia, Cuba, the Dominican Republic and Honduras filed challenges to Australia’s rules at the WTO (Ukraine had challenged them too but dropped its claim).
In June, the WTO backed Australia’s contention that its rules don’t violate international trade law because they qualify as legitimate public health measures.
Meier-Ewert explained that while prohibiting the use of a trademark is the ultimate encumbrance of trade, the plain packaging restriction was justified by the primacy of health concerns and the fact that plain packaging was not an isolated measure, but rather part of an extensive policy which included the increase in taxes and reduction in places to smoke.
Another panellist, Tony Rollins, immediate past president of the Chartered Institute of Patent Attorneys in the UK, spoke about efforts towards the substantive harmonisation of patent law.
“It’s something that’s been going on for many years and there have been a number of unsuccessful attempts,” said Rollins, before adding that the European Patent Office, US Patent and Trademark Office and Japan Patent Office have been working on this issue (as the Trilateral Co-operation).
The Trilateral Co-operation had aimed to reach a consensus and issue a final package yesterday, September 26, but they were unable to meet the deadline because of the difficulty of some of the issues such as grace periods.
Finally, Eryck Castillo Orive, senior partner at Uhthoff, Gomez, Vega & Uhthoff in Mexico City, and moderator of the panel, highlighted developments in Mexico.
In June, the Mexican Institute of Industrial Property ( IMPI) updated the IP law to allow for the protection of some non-traditional marks, with the amendments coming into force on August 10.
“In the past month, there has been a boom in the filing of these trademarks, with more than 100 applications filed in the first few days,” Orive noted, adding that he doesn’t expect many sound marks to obtain protection as they are not distinctive.
Additionally, geographical indications are now protected in Mexico.
He concluded: “It’s important because now we have protection for these designations, but the problem is we are still at the beginning of the process. There are lots of questions on how we’re going to cope.”
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