The Chinese company ZTE failed in an attempt to obtain preliminary relief from enforcement of a Nokia patent on the UMTS telephony standard. The Netherlands court rejected ZTE's defences of non-infringement, invalidity and abuse of the patent right in view a commitment to license the patent under fair, reasonable and non-discriminatory (FRAND) conditions.
Vringo, which runs a licensing programme for the patent, has started infringement proceedings against ZTE in a number of countries. It has also obtained seizures of shipments of products destined for the Dutch and German markets, to ensure delivery to Vringo in the case of a future infringement decision. ZTE started the present action in the Netherlands formally to lift this seizure. This enabled ZTE to try and get a quick preliminary decision, but also imposed on it an increased burden of conviction compared to normal infringement proceedings.
The court rejected the defence of abuse of the patent right. The court recognised that enforcement of a patent subject to a FRAND commitment could be abuse, if applied against a party that was willing to take a licence, and that ZTE had made an offer to take a licence. But the court found ZTE's offer insufficient to establish willingness. The court distinguished from case law wherein willingness had been established by an agreement to the terms of the licensor subject to review of the terms by the court. ZTE also failed to present its objections to the reasonableness of Vringo's offer in response to that offer.
ZTE presented a defence of non-infringement by pointing out that the patented feature was merely optional under the UMTS standard and presenting expert testimony that its products did not implement this option. In the present action to lift the seizure, the court presumed that the seized products implemented the standard, and rejected the expert testimony because it was not based on those actual products. Furthermore, the court did not exclude contributory infringement or the possibility that acts in the Netherlands infringe the German patent.
ZTE presented defences of invalidity based on implicit disclosure in the prior art and selection from two obvious alternatives. However, the court ruled that these defences failed to make invalidity sufficiently uncertain, pointing at doubt whether the prior art concerned the circumstances wherein the implicit disclosure could arise, and the existence of more alternatives. In any case, the Dutch court had to defer to the German court on this, because products destined for Germany were involved.
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Lars de Haas |
V.O.
Johan de Wittlaan 7
2517 JR The Hague
The Netherlands
Tel: +31 70 416 67 11
Fax: +31 70 416 67 99
