Unwired Planet v Huawei - the FRAND injunction
By James Cross
Having granted Unwired Planet a final injunction to restrain infringement of two standard essential patents (SEPs) by Huawei in its main judgment ( EWHC 711 (Pat)) the High Court has now ruled on remedies. The decision to grant an injunction allowing the parties to come back to court after final relief has been granted is unusual.
In this judgment, Mr Justice Birss decided the terms of the final injunction which should be granted and stayed pending appeal. He found that this new type of IP injunction - a FRAND (fair, reasonable and non-discriminatory) injunction—should be in normal form to restrain infringement of the relevant patent(s), but ought to include a proviso that it would cease to have effect if the defendant entered into a FRAND licence. If, as in this case, the FRAND licence was for a shorter duration than the lifetime of the relevant patents, then the injunction should also be subject to an express liberty to enable either party to return to court in future to address the position at the end of the term of the FRAND licence. In addition, the court made a declaration that the form of the licence finalised a few weeks after the main judgment (the Settled Licence) represented the FRAND terms in the relevant circumstances that existed between the parties. It was also ruled that Huawei had to make a payment on account of costs of £2.9 million, in order to cover some of Unwired Planet’s costs of the non-technical trial (save for the Samsung issues and the costs of the FRAND rate issue), and permission to appeal was granted to Huawei on three issues, and to Unwired Planet on one issue.
It was common ground that some sort of declaration should be made about the Settled License but there was a dispute about the terms. Birss J decided that the correct declaration would be: "the license annexed to the judgment represents the FRAND terms applicable between the parties in the relevant circumstances".
As Huawei had maintained throughout the proceedings that they were not prepared to enter a global license with Unwired Planet on the basis that such a global licence would not be FRAND as a matter of competition law, the draft terms of the injunction remained undecided after the main judgment.
In this latest judgment, the terms of a new injunction - a FRAND injunction - were decided. Normally in English law, once final relief has been granted by the court, the parties are not entitled to come back to court in future even if circumstances change, which runs contrary to the unusual terms in the FRAND injunction. The flexible nature of the FRAND injuction in the form granted in this judgment allows parties to come back to court at the expiry of the FRAND license; as Birss J Said "the court should not pre-judge at this stage what should happen if or when the FRAND license ceases to have effect".
For questions about this matter or related issues, please contact our Partner James Cross (firstname.lastname@example.org).
Tuesday, September 12, 2017