Huawei’s response to IDCC’s petition.
The response followed normal practices in that it gave very brief responses to all the paragraphs in the petition with specific detailed supporting documents filed separately and sealed. The following are some interesting comments from the response and their summary statement of affirmative defenses:
8. Huawei admits that InterDigital and Huawei have engaged in negotiations concerning a potential license to certain InterDigital patents. Huawei also admits that InterDigital and Huawei have engaged in litigation regarding patent infringement and FRAND issues in various fora. Huawei also admits that the parties have not agreed on certain license terms including royalty terms for the period beginning January 1, 2014.
13. ……..To the extent a response is required, Huawei admits that a Partial Award was issued on May 22, 2015, to which one of the arbitrators dissented.
14. ………To the extent a response is required, Huawei admits that the parties conferred on the initial payment that would be due under the terms of the Partial Award.
Affirmative Defenses
Under Article V(1) of the New York Convention, the Award (as defined in InterDigital’s petition) deals with differences not contemplated by or not falling within the terms of the submission to arbitration.
2. Under Article V(1) of the New York Convention, the Award (as defined in InterDigital’s petition) contains matters beyond the scope of the arbitration.
3. Under Article V(1) of the New York Convention, the Award (as defined in InterDigital’s petition) violates due process.
4. Under Article V(2) of the New York Convention, recognition or enforcement of the Award (as defined in InterDigital’s petition) is contrary to public policy.
5. Huawei reserves the right to amend its answer herein, including by the addition of affirmative defenses.
Conclusion
WHEREFORE, Huawei respectfully requests that this Court:
1. Stay InterDigital’s petition pending the annulment decision of the Paris Court of
Appeals;
2. Dismiss InterDigital’s petition with prejudice;
3. Award Huawei costs of suit herein; and
4. Award Huawei such other relief as the Court deems just and proper.
———-
It is interesting to note that Huawei, rather than asking the Court to vacate the order using the criteria of the Federal Arbitration Act, asked the Court to dismiss IDCC’s petition and cited as defenses the New York Convention. I assume this was done as the location (seat) of the arbitration was not in the Southern District of New York’s jurisdiction.
The time table calls for IDCC to respond NLT Aug 24 to Huawei’s request for a stay and Huawei’s response to IDCC’s petition. Huawei is then to respond by the later of (a) 21 days after InterDigital serves its reply and opposition, or (b) September 4, 2015.
Since the case is no longer a simple arbitration award confirmation case there is the possibility of more filings and the probability of a hearing, under these circumstances there is no guessing as to how long it might take to be finalized; but, unless there is a settlement I wouldn’t expect a quick resolution.
In US courts (especially in the 2nd Circuit), and apparently also in France, it is difficult to overturn an arbitration award. This would seem especially true for ICC awards which have a reputation of being solidly based on legal considerations and have their own court review before issuance. Although nothing is certain in litigation, I believe Huawei is following a delay strategy with the hopes that they will be able to negotiate a better settlement agreement than whatever the arbitration award was.
It should be also noted that the current action only applies to the ICC partial award. As Huawei stated in a previous filing: “In addition, it is anticipated that the InterDigital entities may file an amended or supplemental petition/motion to confirm and enforce a further award. The Huawei entities have confirmed that their response to any amended or supplemental petition will address only issues raised by the amended or supplemental petition.”
It also looks like Huawei is getting ready for a protracted court fight. Where formerly they only had a single lawyer representing them, in the past week they have added four more, including three Pro Hac Vice (out of state) attorneys.
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