CJEU mulls over standard-essential patents enforcement
The Court of Justice of the European Union (CJEU) has heard arguments in a patent dispute involving Huawei and ZTE over when a request for an injunction related to standard-essential patents (SEPs) can be prohibited.
The case, Huawei v ZTE, referred to the CJEU from a lower court in Germany, is expected to provide guidance for future patent litigation and affect licence negotiation tactics surrounding SEPs.
SEPs are patents that are essential to implement an industry standard.
Huawei, China’s largest phonemaker, sued ZTE at the Regional Court of Düsseldorf, seeking an injunction for the alleged infringement of an SEP relating to the implementation of the LTE standard.
But ZTE, also based in China, claimed the demands were an abuse of Huawei’s dominant market position.
The telecommunications company cited a European directive (Article 102, TFEU), which claimed that an application for an injunction based on a SEP would be an abuse of dominance.
ZTE claimed that, because it was willing to negotiate a licence agreement to use the patent, no injunction could be issued against it.
According to Axel Walz, partner at King & Wood Mallesons SJ Berwin, who attended the hearing yesterday (September 11), questions from the judges indicated that Europe’s highest court is considering the interests of both patent owners and standard users.
The CJEU asked questions of Huawei, China’s largest maker of mobile phones, including why, from an SEP owner perspective, it should not be sufficient to rely upon good faith negotiations before seeking an injunction, Walz said.
He told WIPR: "Restrictions to this basic right to an injunction are possible but require exceptional circumstances.
"The final decision in this case will have a significant impact on the enforcement of SEPs and the negotiation of corresponding licence agreements in the future. The CJEU must now draw a fine and balanced line between the interests of patent owners and technology users.”
The CJEU is expected to give its final opinion later this year before the case will return to the German regional court.
