Munich Regional Court adopts new approach to FRAND
On March 23, 2022, the 21st Civil Chamber heard the first FRAND proceeding in the global dispute between Nokia and Oppo. During the hearing, Presiding Judge Georg Werner took the opportunity to redefine the court’s FRAND guidelines.
In 2020, the Regional Court of Munich provided holders and performers of SEP guidelines on conduct in FRAND proceedings, in which both patent chambers set out their views on the CJEU’s stipulations determined in Huawei v. ZTE.
But things have changed. Firstly, the regional court in Munich now has three patent chambers. In addition, the German Federal Court of Justice has also announced two major decisions on FRAND in the case Sisvel v. Haier I and II, to which the Munich Regional Court has now reacted. Old guidelines announced by the court before Sisvel vs Haier I and II are no longer available on the Court’s website.
Munich Regional Court on FRAND
Last week, Presiding Judge Georg Werner used the 30-minute introduction to several FRAND cases in Nokia v. Oppo to announce the court’s current position on SEP proceedings. Above all, Werner stressed that both parties must demonstrate their willingness to conclude a license over a long period, drawing inspiration from the decision of the Federal Court of Justice in Sisvel v. Haier I and II. Previously, the Munich Regional Court had mainly held the performers liable.
In 2020 and 2021, the Federal Court implemented the CJEU guidelines in SEP proceedings. Germany’s highest patent court has strengthened the position of SEP holders by ordering implementers to deliberately work towards concluding a license in order to avoid a so-called withholding. But SEP holders must also contribute constructively to a license agreement.
As the judge explained, in future the three patent chambers in Munich will implement the requirements of the Federal Court of Justice. Werner pointed out that Munich’s patent chambers, like the Federal Court of Justice, assume that a court cannot prescribe a good license agreement. Rather, Werner said, it must be the result of negotiations between the parties.
This means that the 21st Civil Chambers expects both parties to openly and deliberately work towards a FRAND license until the end of the hearing.
Willingness to License
In the so-called Munich procedure, there is a first early hearing followed by a subsequent main hearing. It is only at the end of the main hearing that the court can determine whether both parties have worked to obtain a license.
Even under the previous guidelines, parties could make their offers so far and improve them if necessary. However, the guidelines did not previously explicitly state that the court would consider the parties’ willingness to take out a license over an extended period. The court wants the parties to enter into a license during the proceedings, instead of relying on the decision of a judge.
According to Werner, the CJEU’s requirements state that the SEP holder’s first offer remains the starting point for license negotiations.
However, the SEP holder and performer cannot simply bid. They must also demonstrate to the court that they are actively seeking a license until the end of the hearing.
Werner also said that there is no general rule for setting a FRAND rate. Rather, he indicated that a FRAND license is always subject to a certain range because it depends on many underlying conditions, such as industry specifics, parties’ markets, and the specific dispute.
At this time, the court has not confirmed whether the other two chambers share the new view of the 21st civil chamber on the FRAND. In the past, however, they have always coordinated closely on fundamental issues.
Currently, the Munich Regional Court is the busiest patent court in Germany. She mainly hears patent litigation relating to mobile communications.
Behind closed doors
The 21st Civil Division of the Munich Regional Court excluded the public, after the introduction, due to confidential contract details. Therefore, it is unclear how Nokia and Oppo met the requirements.
In total, the court heard FRAND questions on nine actions brought by Nokia against various Oppo companies (case numbers: 21 O 8879 to 81/21, 21 O 8890 and 91/21, 21 O 11522/21, 21 O 12125/21, 21 O 110039/21, 21 O 12142/21).
The claims were based on four standard-essential Nokia patents (PE 20 80 193, PE 17 28 352, EP 35 57 917 and EP 33 96 868). The Munich Regional Court has set the main hearings for these proceedings on June 15 and 29, 2022.
The court had already held initial hearings on the technology in individual lawsuits against Nokia in mid-March. Further hearings in other lawsuits against Nokia will follow by May.
Alongside the ongoing proceedings in the Munich Regional Court, the two companies have been facing each other in the global patent courts since 2021. The main disputes concern SEPs, including various 5G patents. But implementation patents are also in dispute. According to information from JUVE Patent, Nokia has filed lawsuits mainly in Europe, but also in India, Indonesia and Russia.
Nokia has pursued more than nine SEPs and five implementation patents in Munich, Mannheim and Dusseldorf. A total of 26 lawsuits filed by Nokia against multiple Oppo companies are currently pending in Germany.
Oppo, for its part, claimed seven SEPs against Nokia. In addition, both companies attacked the validity of the other’s patents in dispute. They also clash in oppositions to the European Patent Office.
In the UK, Nokia filed four claims, three of which related to SEPs, according to patent information JUVE. In France and Spain, Nokia claimed two implementation patents each.
Oppo has not filed claims for its own patents in these countries. However, JUVE Patent has learned that Oppo has filed nullity suits against Nokia’s patents in the Netherlands, which Nokia countered with infringement suits. Nullification proceedings are also underway in China. The dispute concerns the renewal of a cross-licensing agreement, which ended last year.
Hogan Lovells for Oppo
Hogan Lovells partners are no strangers to cell phone lawsuits. The firm regularly represents industry giants such as Apple, Google and Vodafone. But while Asian companies such as ZTE and Xiaomi are also among their customers, it is relatively new alongside Oppo. The relationship began with a dispute between Oppo and Sharp last year.
In the litigation against Nokia, the law firm primarily defends Oppo against Nokia’s claims. Here, its lawyers are assisted by in-house patent attorneys. In addition, Maikoswki & Ninnemann’s patent attorneys are involved in a number of proceedings. Hogan Lovells is also active for Oppo in the UK, Spain, France and Russia.
Bardehle Pagenberg is also active for the Chinese mobile phone manufacturer in Germany. The Munich-based IP boutique is leading the active lawsuits against Nokia in the Munich Regional Court, as well as parallel nullity proceedings. The firm also advises Oppo in oppositions against Nokia’s patent at the EPO.
Three patent attorney firms plus Bird & Bird
Nokia relies on its usual advisers. The Finnish company has a long-standing relationship with Bird & Bird. The firm manages proceedings primarily from its offices in London and Düsseldorf, through its two respective senior partners, Richard Vary and Christian Harmsen.
On the other hand, the Munich partner Boris Kreye takes care of the defense against the claims of Oppo.
Arnold Ruess advises Nokia in its patent lawsuits that it has already brought against Daimler. The Dusseldorf IP shop essentially conducted the connected car case against the German automaker. Here, Bird & Bird did not appear in court.
On the patent attorney side, Nokia is relying on Bird & Bird’s partner, Felix Landry, in the German proceedings. This is alongside patent attorney Wolfgang Lippich of Samson & Partner, and Christoph Walke, partner of Cohausz & Florak.
David Molnia of df-mp completes the Nokia team. The three patent attorney firms had already participated in the proceedings against Daimler and are therefore very familiar with the patents in question. Arnold Ruess was also involved in these proceedings.
A mix of advisors
bird and bird (Düsseldorf, Munich): Christian Harmsen (head), Boris Kreye, Marc Grunwald, Felix Landry (patent attorney), Stephan Waldheim (competition law); counsel: Nick Pearson, Tobias Wilcke, Malte Frese (patent attorney); collaborators: Bastian Selck, Elaine Jatta, Tamy Tietze (competition law), Katharina Pehle, Simon Reuter, Maximilian Groß
Arnold Russ (Düsseldorf): Arno Riße (leader), Cordula Schumacher; Partners: Jan Wergin, Tim Smentkowski, Theresa Schulz
Cohausz & Florack (Düsseldorf): Christoph Walke (lead), Philipe Walter, Fabian Vogelbruch, Matthias Waters, Michel Kaminsky, Björn Brouwers, Peter Reckenthäler (all patent attorneys)
Samson & Partner (Munich): Wolfgang Lippich Georg Jacoby, Alexander Münster, Marcus Otten (all patent attorneys)
df-mp Dörries Frank-Molnia & Pohlman (Munich): David Molnia (patent attorney)
internally: Taliah Walklett (Lead, Wimbeldon), Clemens-August Heusch (IPR litigation), Armin Schwitulla (both in Munich)
Hogan Lovells (Düsseldorf): Henrik Lehment, Martin Fähndrich (both leading), Clemens Plassmann, Steffen Steininger (Munich), Christian Stoll (Hamburg), Miriam Gundt, Alexander Klicznik, Andreas Schmid (both patent attorneys, Munich), Anna -Katharina Friese (Hamburg), Martin Sura (regulatory); counsel: Markus Kuczera, Felix Banholzer, Kerstin Jonen, Elena Wiese (regulation); partners: Dania Esser, Bastian Englisch, Teresa Christof, Verena Dormann, Martin Koch, Lars-Fabian Blume, Daniel Kaneko, Cedric Rohr, Michael Jordan, Stephan Stürwald, Niels Gierse, Miriam Werner, Cao Yang, Julian Urban (regulation)
Bardehle Pagenberg (Munich): Tilman Müller-Stoy (leader), Jan Bösing, Stefan Lieck, Alexander Haertel, Ronja Schregle, Rebekka Jeschke, Sebastian Horlemann; patent attorneys: Tobias Kaufmann (responsible), Patrick Heckeler, Christian Haupt, Benjamin Ruckert, Michael Wolfgang Waschak, Nikolaus Buchheim, Marius Fischer, Johannes Scholz, Max Link, Zhicheng Yu
Maikowski and Ninnemann (Berlin): Gunnar Baumgärtel, Felix Gross, Ralf Emig, Andreas Tanner, Frederick Kramer, Sandro Staroske, Matthias Euler, Piet Schönherr (all patent attorneys)
Munich Regional Court21st Civil Chamber
Georg Werner (chairman), Anna-Lena Klein, Sebastian Benz