InterDigital accused of breaking FRAND commitments
Swiss wireless semiconductor company u-blox is suing American telecommunications firm InterDigital for demanding unreasonable licensing fees on its standard-essential patents (SEPs).
The complaint was filed in the US District Court for the Southern District of California on Tuesday, January 1.
The Swiss company manufactures cellular modules including GPS systems, which rely on 2G, 3G and 4G technology licensed by InterDigital. The company alleged that InterDigital reneged on its commitments to the European Telecommunications Standards Institute (ETSI) to provide licences for its SEPs on fair, reasonable and non-discriminatory (FRAND) terms.
InterDigital has declared a number of its 2G, 3G and 4G patents “essential” to ETSI’s standards.
ETSI’s IP rights policy requires that companies that hold patents essential to ETSI standards undertake to grant irrevocable licences on FRAND terms and conditions.
In the suit, u-blox claimed that InterDigital has demanded royalties that are “far higher than FRAND rates”. The company further accused InterDigital of “intentionally locking in the industry” before breaching its promises to ETSI and its licensees.
The Swiss company is seeking a declaration from the court that it is entitled to license InterDigital’s SEPs on FRAND conditions, and an order enjoining InterDigital from demanding royalties higher than these rates.
The suit further alleged that InterDigital had engaged in “unnecessarily destructive and outrageous” behaviour by contacting u-blox’s customers and manufacturers with the intention of damaging u-blox’s “critical customer relationships”.
In the suit, u-blox requested that the court grant an injunction to prevent InterDigital from “intentionally disrupting or otherwise interfering with u-blox’s relationships with its customers or downstream manufacturers”.
Thomas Seiler, CEO of u-blox, said that the company “has always been and continues to be a willing licensee to SEPs”.
“To the extent that InterDigital is willing to reconsider their position, u‑blox is open to further negotiations—but not to the detriment of the company, our customers or shareholders,” Seiler added.
The Swiss company is also seeking damages, costs and attorneys’ fees.
InterDigital has been cleared of FRAND breaches in the past. In 2017, WIPR reported that the Taiwan Fair Trade Commission had, following an investigation, found no evidence of InterDigital having failed to provide patent licences on FRAND conditions.
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