Commission Roadmap: No Directive on SEPs (for now)
It has been a busy couple of weeks for standard essential patents (SEPs). Last week, we had the Unwired Planet v Huawei decision on FRAND (see post by the Amerikat here), and now we have the European Commission's roadmap on SEPs. With thanks to Katfriend Colm Ahern (Elzaburu, Madrid) who brings us up to date on the Commission's publication:
"The European Commission has just published its roadmap "Standard Essential Patents for a European digitalised economy", which is an initiative aimed at paving the way for 5G and the Internet of Things. One of the main problems that it sets out to address is the risk of uncertainty in SEP enforcement.
IPKat readers will remember that the Commission scored a significant victory in Huawei v ZTE C‑170/13, which significantly curtailed the rights held by owners of SEP patents under the “Orange Book Standard”. The CJEU decision obliged owners to offer any alleged infringers specifics of a fair, reasonable, and non-discriminatory (FRAND) license which could then become the subject of a counter-offer. The alleged infringer was only prevented from relying on a charge of abuse against the rights owner if its counter-offer were held not to be in accordance with recognised commercial practices and to constitute a mere delaying tactic. The alleged infringer could also reserve the right to later challenge both patent validity and the existence of infringement.
The Commission's roadmap points out that the judgment does not give guidance on the level of technical specifications which would be required to sustain the essentiality claim or the timing and basis for FRAND counter-offers . Nor does it deal with the issues of licenses covering an entire portfolio of patents or the impact of alternative dispute resolution mechanisms. Industry simply cannot wait until these and other issues wind their way through the slow and costly litigation system. The Commission instead proposes to fill the gap by “complementing existing jurisprudence” through best practice guidance, "without changing legal positions or rights and obligations”. So no directive for the moment. Further stakeholder consultations are planned to follow up on the SEP workshops and public consultations held in 2015 and 2016."
IPKat readers will remember that the Commission scored a significant victory in Huawei v ZTE C‑170/13, which significantly curtailed the rights held by owners of SEP patents under the “Orange Book Standard”. The CJEU decision obliged owners to offer any alleged infringers specifics of a fair, reasonable, and non-discriminatory (FRAND) license which could then become the subject of a counter-offer. The alleged infringer was only prevented from relying on a charge of abuse against the rights owner if its counter-offer were held not to be in accordance with recognised commercial practices and to constitute a mere delaying tactic. The alleged infringer could also reserve the right to later challenge both patent validity and the existence of infringement.
The Commission's roadmap points out that the judgment does not give guidance on the level of technical specifications which would be required to sustain the essentiality claim or the timing and basis for FRAND counter-offers . Nor does it deal with the issues of licenses covering an entire portfolio of patents or the impact of alternative dispute resolution mechanisms. Industry simply cannot wait until these and other issues wind their way through the slow and costly litigation system. The Commission instead proposes to fill the gap by “complementing existing jurisprudence” through best practice guidance, "without changing legal positions or rights and obligations”. So no directive for the moment. Further stakeholder consultations are planned to follow up on the SEP workshops and public consultations held in 2015 and 2016."
