Optis Puts Apple's Feet To The UK Fire: Commit To FRAND Or Be Snuffed Out

• Published date: 06 October 2021
• Subject Matter: Intellectual Property, Patent
• Law Firm: Mintz
• Author: Mr Michael Renaud, Daniel B. Weinger and James J. Thomson

Recent developments indicate that the UK is a favorable jurisdiction that owners of standard essential patents ("SEP") can leverage to obtain appropriate SEP rates from what would otherwise be unwilling licensees. Demonstrating the point, a recent order from Justice Meade of the High Court in the sprawling Pan Optis/Unwired Planet SEP dispute with Apple provides an outline to the UK's approach to handling SEP implementers who are unwilling to commit to court-determined FRAND licenses. In a lengthy decision, issued September 27, 2021, Justice Meade essentially gave Apple two choices: (1) commit, now, to taking a FRAND license with terms to be decided at a subsequent trial taking place in 2022; or (2) be enjoined from the UK market until resolution of the FRAND trial and acceptance of the terms that issue. Importantly, Justice Meade issued this ultimatum even though Apple has threatened to abandon the UK market rather than agree to any global FRAND rate set by the UK courts.

Background

Optis and Apple have long been engaged in a global dispute over Optis' SEP patent portfolio related to the Long-term Evolution (LTE) standard for wireless telecommunications. This past August, a jury from the Eastern District of Texas awarded Optis $300 million in damages after Apple was found to infringe Optis' SEP patents. This award was the result of a retrial ordered by U.S. District Judge Rodney Gilstrap, after finding the jury's previous award of $506 million may not have been in line with Optis' responsibility to license the patents on FRAND terms. Apple will certainly appeal this second seven figure jury award.

Meanwhile, across the pond in the UK, the parties have been embroiled in four technical trials to determine the validity of Optis' asserted patents and Apple's infringement. (The UK system typically deals with issues of validity and infringement on a patent-by-patent basis in technical trials, while issues such as FRAND terms and competition law are dealt with separately).

In June of 2021, at the conclusion of one of technical trials, one of Optis' patents was found to be valid, essential, and infringed by Apple. A FRAND trial is slated to commence in June 2022 to determine the terms of global FRAND license, but Optis sought an injunction in the interim because of Apple's unwillingness to commit to the resulting license to be determined by the court. As such, the UK judge, Justice Meade, held a hearing on whether Apple was a willing or unwilling licensee.

The...