For many reasons it is not surprising that the reaction of the primarily responsible regional courts in Düsseldorf, Mannheim, and Munich regarding the FRAND objection is cautious. The intention to conclude infringement proceedings quickly with decisions on the merits is a weighty argument against granting FRAND objections in an extensive manner.
In recent times, numerous decisions have resulted from this:
The focus was partly on whether the proprietary right in suit is in fact a patent that gives the patent holder a monopoly. In the so-called NFC decision, the Düsseldorf Regional Court (decision dated 26 March 2015, File no. O 140/13) assessed a situation, in which the particular standard allowed different implementations and the patent in suit only covered one of at least two possible technical variants. Regardless of whether the particular standard (NFC) could even establish market control in the smartphone market, the Regional Court denied the market control (and with that also the applicability of FRAND defence) for the very reason that there is an implementation alternative that is patent-free and conforms to standards. Therefore, it was a special situation that was eventually correctly adjudicated. From the start, implementation patents are not SEPs.
Further first-instance decisions dealt with cases in which SEP patent holders did not comply with its FRAND conditions before filing a claim. Several decisions generously granted the patent holders remedy of their own omissions, but failed to do so for patent users. Thus, a patent holder who, once the patent was pending, but before lis pendens, offered a licence that was not specified in detail, could avoid FRAND objection, because the defendant did not respond with a counter-offer fast enough according to the understanding of the judgement. In contrast, the circumstance that this is neither in accordance with the wording nor the grounds of the EJC’s decisions had to take a back seat because the decision determined, with a hypothetical consideration of causality, that the defendant should in any case have presented a FRAND contract offer on his part before or together with the statement of defence, in order to be able to be considered as a patent user willing to purchase a licence. Therefore, this omission caused him to forfeit his defence argument.
The similar strategy of another decision appeared in one case in which the patent holder did, in fact, offer a licence but not in accordance with FRAND conditions. Here too, the patent user lost the FRAND objection based on the consideration that after a first licence offer it would have been the patent user’s obligation, in any case, to immediately submit a counter offer at FRAND conditions, even if the original licence offer supposedly did not meet these conditions.
Both of these decisions show the tendency of the regional courts to allow the patent holder to make up for, and therefore remedy, during the infringement proceedings, any omissions, but to fail to do so for the patent user. Given especially the many unclear legal and factual situations, this tendency causes a structural imbalance in the parties’ legal defence options and also a troubling inequality in the basic fair trial principles.
The Higher Regional Court of Düsseldorf was right in correcting the previously mentioned reasoning in two decisions dated 13 January 2016, I-15 U 66/15 and I-15 U 65/15 in which it clarified that an initial licence offer of the patent holder does not trigger an obligation for the patent user to react if it does not comply with FRAND conditions. Thus, the Higher Regional Court reverts to the EJC’s line of argument and once again asserts the validity of this decision which was at least questioned by the decision of the regional courts.
Furthermore, it is hoped that in the same sense, the courts of appeal also handle the make-up/remedy of omissions by the graduated duty in terms of action and reaction under the FRAND procedures, by offering all parties the same opportunity to make-up/remedy omissions, and thus restore the basic principles of fair trial.
