Apple Loses Bid For ECJ Guidance Over 4G LTE Patents
By Bonnie Eslinger
Law360, London (September 9, 2020, 7:26 PM BST) -- A London judge on Wednesday rejected Apple's request for the European Union's highest court to weigh in on a patent infringement dispute over 4G technology brought by three PanOptis subsidiaries, saying a national court could handle the competition issues in the case.
High Court Judge Colin Birss said timing is his main reason for denying Apple Inc.'s request for a reference to be made to the European Court of Justice on the company's competition questions in the patent royalty dispute, since the U.K. is due to leave the EU at the end of 2020.
"For this reason of timing alone, I have decided I should not refer these questions," the judge said in an oral judgment. "I appreciate that if I do not refer questions now, the opportunity to do so will be lost."
The judge noted, however, that similar questions of competition law were put to the U.K.'s Supreme Court in the recently decided case of Unwired Planet — another PanOptis subsidiary — against Huawei.
"Unwired Planet shows that issues of this kind can be dealt with fully and properly without the reference," Judge Birss said. "And in my judgment the national courts will be able to deal with this case without a reference."
The litigation, brought by Optis Cellular Technology LLC, Unwired Planet International Ltd. and another subsidiary of PanOptis — which own a portfolio of standard essential patents — alleges Apple is infringing the patents by offering 4G LTE capability on the iPhone, iPad and Apple Watch.
Among the questions Apple sought to put before the European Court of Justice is whether an owner of an industry-essential patent that asks the court to determine licensing terms and impose an injunction against an infringer is abusing its dominant position and violating European Union competition law.
Optis has claimed it tried to get Apple to take a license, but that Apple rebuffed its offers — and won't even commit to taking any "fair, reasonable and non-discriminatory" license fee determined by the British court. The PanOptis subsidiaries have asked the High Court to decide the FRAND terms for the company's worldwide portfolios.
Apple does not accept that the patents are essential or even valid and denies a license is needed, the judge noted during his Wednesday ruling.
Apple also requested the ECJ's guidance on whether a SEP owner that never presented a "specific written offer" on FRAND terms has skipped over its obligations to a company that wishes to utilize its patents and if that would be considered a violation of Article 102 of the Treaty on the Functioning of the European Union.
A series of trials is set to start in the case, with the first technical trial slated to begin in October. Another trial, on whether Apple is an "unwilling licensee," will start in July 2021. The final trial, which would possibly determine a license on required FRAND terms and rule on various allegations made by Apple of anti-competitive behavior by Optis, is due to be heard in June 2022.
Among those claims, Apple said the license terms offered by Optis during prelitigation negotiations were "far above" what could be considered FRAND, worse than what was offered to other implementers, and the filed lawsuit seeks to put pressure on Apple so it will accept "excessive royalties."
Apple argued that the court would be assisted by the ECJ's answers to its questions, along with the industry in general, given the international nature of FRAND licensing.
In his Wednesday ruling, Judge Birss said that if he were to refer questions, it would be after the facts of the case were hashed out.
"In other words, were it not for the point about leaving the EU, then I would be quite sure that whether questions should be referred in this case would be best decided after the trial when the rest of the circumstances had been gone into properly," he said before dismissing the application.
Similar litigation has been brought by PanOptis against Apple in the U.S., and in August, a Texas federal jury said Apple should pay PanOptis and related companies more than $506 million for willfully infringing patents covering 4G LTE technology.
The Optis claimants are represented by Adrian Speck QC, Jennifer Dixon and Isabel Jamal of 8 New Square, and Sarah Ford QC of Brick Court Chambers, instructed by EIP Legal.
Apple is represented by Michael Bloch QC of Blackstone Chambers, Marie Demetriou QC of Brick Court Chambers, and Meredith Pickford QC and Ligia Osepciu of Monckton Chambers, instructed by WilmerHale.
The case is Optis Cellular Technology LLC and others v. Apple Retail UK Ltd. and others, case number HP-2019-00006, in the High Court of Justice of England and Wales.
--Additional reporting by Dani Kass and Tiffany Hu. Editing by Abbie Sarfo.
For a reprint of this article, please contact reprints@law360.com.
