Replies to post #108167 on InterDigital Inc (IDCC)

[Desert dweller]

When Samsung first announced arbitration, I wondered whether the whole MFL clause would also apply to the 3g portion of the Nokia contract. I even asked Janet at one point and was told that it did not.

I was somewhat surprised recently to read that Samsung is now claiming that it does. I am not surprised that they are trying to get the same 3g contract though. Isn't it somewhat a requirement that when you invoke an MFL that you must get the whole agreement and not piecemeal? Otherwise, what would stop licensees from constantly invoking an MFL clause for portions of contracts without taking the entire contract into consideration?

[3GDollars]

Sammy might be arguing that their contribution to the work in BCDMA might qualify them for royalty free use of 3G IPR; just like Nokia is entitled to free use of TDD related IPRs.

IMO, of course

[olddog967]

Loophole: Here are the introductions to the MFL clauses In the Sharp and NEC agreements. They read basically the same in that the MFL is in regard to “Covered” units and/or standards. (Note: both clauses have additional terms which exclude specified units and/or standards). Both clauses state that that they have to substitute the the MFL in its entirety, with the Sharp clause stating that it constitutes a novation of the “entire agreement”, while the NEC clause states that it a novation of only “portions” of the agreement.

In regard to Samsung, as with all legal matters you have to see the actual document to try to understand what it covers. As you state, it appears that the clauses would only apply to covered units/standards, which for Samsung would be 2G. However if the novation applies to the entire agreement (Sharp), rather than portions of the agreement (NEC), could that be considerd confusing and form the basis for Samsung’s argument?



Sharp (2G)

Most Favored Licensee Rights. Provided Licensee is not in default of its obligations hereunder, the Licensee shall be treated as a most favored licensee ("MFL") under the Licensed Patents with regard to Covered Subscriber Units. If, subsequent to the Effective Date, ITC enters into an agreement with a third party comparable to the license granted in this Agreement but containing commercial terms which, in the aggregate (i.e., not on a clause by clause basis), are more favorable to the third party than the commercial terms in this Agreement, ITC will notify Licensee of such agreement. Licensee shall have the right to substitute for this Agreement the more favorable license agreement in its entirety (the "Substitute Agreement") and such substitution shall constitute a novation of this entire Agreement.

NEC (3G)

Most Favored Licensee Rights. Provided Licensee is not in material default of its obligations hereunder, Licensee shall be treated as a most favored licensee ("MFL") under the Licensed Patents with regard to Covered Subscriber Units and Covered Infrastructure Units. If subsequent to the Effective Date, ITC enters into an agreement, including a settlement agreement, with a third party pursuant to which ITC licenses said third party to sell products that operate under Covered Standards, ITC will notify Licensee of such agreement and will provide a copy of such agreement, in confidence, to Licensee. Licensee shall have the right to substitute for this 3G Agreement, on a forward going basis, the more favorable license agreement in its entirety and such substitution shall constitute a novation of those portions of this 3G Agreement addressed in such substitute agreement;




Samsung has no chance of extending its MFL clause to 3g coverage. They would have had to update their 2g license prior to the Nok PLA for 3g in order to be successful in that argument. They did not and the age old rule of law called TS applies to the Samsung claim.