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VoiceAge v HMD

2021年08月19日 - 事件番号: 7 O 15350/19

http://caselaw.4ipcouncil.com/jp/german-court-decisions/lg-munich-district-court/voiceage-v-hmd

A. Facts

The claimant, VoiceAge, holds a portfolio of patents declared as (potentially) essential to the EVS standard (standard essential patents, or SEPs) developed within the framework of the European Telecommuni cations Stand ards Institute (ETSI). ETSI requires from patent holders to commit to make SEPs accessible to standard users on fair, reasonable and non-discriminatory (FRAND) terms and conditions.

The defendant, HMD, is a manufacturer of mobile phones complying with the EVS standard. HMD's products are sold globally, including Germany.

On 21 August 2019, VoiceAge sent a letter to the parent company of the HMD group, inviting HMD to find out more about the licensing opportunities concerning its SEP portfolio. VoiceAge informed that 14 patent families had been confirmed as essential to the EVS standard by independent experts and offered detailed information on the licensing conditions upon signing of a Non-Disclosure Agreement (NDA). HMD was also referred to VoiceAge's website, which contained a list of all EVS-related patents including links to the evaluation results concerning the essentiality of each listed patent. Furthermore, VoiceAge indicated on the website that it is prepared to grant licences on FRAND terms and provided access to sample licensing agreements. HMD did not react to VoiceAge's letter.

On 16 September 2019, VoiceAge sent a second identical letter to HMD, which again remained silent.

On 10 October 2019, VoiceAge filed an action against HMD before the District Court of Munich I (Court). VoiceAge requested the Court to declare that HMD was liable for patent damages on the merits and order HMD to render accounts and provide information for past infringement.

On 25 October 2019, VoiceAge sent HMD an offer for a licence providing for a running royalty regime. In addition, VoiceAge shared a draft non-disclosure agreement (NDA) with HMD, which would have allowed the latter to access particularly comparable licensing agreements signed by VoiceAge with third parties.

On 26 November 2019, HMD responded by letter to VoiceAge, expressing willingness to protect the intellectual property of others and take licences on FRAND terms to any of VoiceAge's patents that are 'valid and enforceable'. HMD added that willingness to take a licence was limited to patents essential to the standards implemented by its products. It further stressed that it was willing to sign an NDA with VoiceAge without, however, referring specifically to the draft agreement already shared by VoiceAge.

On 17 March 2020, HMD made a counteroffer to VoiceAge. In the accompanying letter, HMD reiterated its willingness to take a licence to any patents that are 'valid, actually essential and enforceable'.

On 6 May 2020, VoiceAge rejected HMD's counteroffer and made two new offers to HMD, one based on a running royalty regime and another one providing for a lump sum payment.

On 8 May 2020, HMD provided information to VoiceAge about sales volumes and revenues in Germany in the period July 2018 until February 2020 and made a respective security payment. On 26 June 2020, HMD proposed certain amendments to the draft NDA send by VoiceAge in October 2019. The parties reached agreement on the terms of the NDA four days later. After the NDA was signed, it took HMD almost two weeks to designate the persons, which would review VoiceAge's comparable licensing agreements. Actual access to these agreements was granted to HMD on 15 July 2020.

On 17 August 2020, HMD sent a letter to VoiceAge, in which it elaborated in detail the reasons why the third-party agreements shared by VoiceAge were not relevant with respect to HMD and referred again to its counteroffer dated 17 March 2020. In further correspondence in September and November 2020, HMD reiterated its willingness to take a licence from VoiceAge within the limits laid down in its letter dated 17 March 2020.

On 3 November 2020, following a respective request from HMD, VoiceAge made a new licensing offer providing for a lump sum payment. HMD rejected this offer by e-mail dated 11 November 2020. In said e-mail, HMD noted that it was no longer interested in a lump sum payment but preferred a running royalty regime instead.

In February 2021, VoiceAge extended its lawsuit by adding claims for injunctive relief as well as the recall and destruction of infringing products.

In March 2021, HMD made a further counteroffer to VoiceAge in parallel infringement proceedings pending before the District Court of Mannheim. This counteroffer provided for a lump sum payment significantly lower than the terms offered by VoiceAge. No agreement was reached between the parties.

Shortly before the end of the oral hearings in the present case, HMD declared, for the first time, that it was willing to enter into a licensing agreement on FRAND terms without any conditions.

With the present judgment, the Court found - with certain exceptions - in favour of VoiceAge and issued an injunction against HMD. [727] (cited by gesetze-bayern.de)
 

B. Court's reasoning

The Court found that the patent in suit is valid and infringed. [728] It further held that HMD cannot successfully raise a so-called 'FRAND-defence' against the claims for injunctive relief (as well as the recall and destruction of infringing products) asserted by VoiceAge. [729] The assertion of such claims did not constitute an abuse of a dominant market position (which the Court, for argument's sake, assumed that VoiceAge held with respect to the patent in suit). [730]

Filing a court action can amount to an abuse of market dominance only towards an implementer willing to sign a licence, since such implementer has a claim to be contractually allowed to use the teachings of the patent on FRAND conditions by the SEP holder [731] . In the eyes of the Court, HMD had not acted as a 'willing' implementer. [732] On the other hand, VoiceAge had fulfilled its obligations towards HMD.
 

Notification of infringement

The Court explained that the 'particular responsibility' of a market dominant patent holder materializes in an obligation to notify the implementer about the infringement of the patent in suit prior to filing an action, in case that the implementer is (potentially) not aware that the implementation of the standard involves the use of said patent [733] .

In the present case, the Court found that by the letters dated 21 August 2019 and 16 September 2019 VoiceAge had given proper notice of infringement. [734] The fact that in both letters VoiceAge did not directly state that HMD infringes its patents was not considered as harmful: Additional or clearer reference to the infringement was not necessary, since VoiceAge had referred HMD to information contained in its website which -from an objective point of view- clearly relates to an allegation of infringement. [735] Furthermore, the Court explained that VoiceAge had sufficiently indicated the acts of infringement by highlighting the essentiality of its SEP portfolio for the EVS standard. [736] By that, it made clear that it considers the implementation of the EVS standard in HMD's products as an act of infringement. [736]

The Court also suggested that, in any case, the statement of claim filed by VoiceAge in October 2019 (which, initially, did not include claims for injunctive relief or the recall and destruction of infringing products) constituted an adequate notification of infringement. [737]

Having said that, the Court explained that - besides the notification duty - VoiceAge had no other conduct obligations in the present case, particularly an obligation to make a FRAND licensing offer to HMD. [738] Further conduct duties of the patent holder emerge only when the implementer has expressed willingness to obtain a FRAND licence. [739] In the eyes of the Court, HMD failed to do so. [740]
 

Willingness

According to the Court, the implementer must 'clearly' and 'unambiguously' declare willingness to sign a licensing agreement on FRAND terms with the SEP holder. [741] A declaration of willingness made subject to conditions is, therefore, not acceptable. [742] The same is true with a 'one-off' declaration of willingness: 'Continuous' willingness throughout the negotiation process is required, not least because it is an 'indispensable condition' for successful licensing negotiations [743] .

In addition, the implementer is also required to engage in negotiations in a 'target-oriented' manner. [744] The Court reasoned that the willingness of the implementer to legitimise the unauthorized use of the patent for the future by creating a respective contractual base is a prerequisite for placing the burden on the SEP holder to negotiate a FRAND licence with the implementer. [744] Accordingly, 'willingness' shall still be given when the SEP holder presents a licensing offer to the implementer. [745] The latter shall react to the licensing offer in good faith according to recognised industry practice, without applying delaying tactics [746] . An implementer, who has not shown interest in a FRAND-licence over a longer period after receipt of an infringement notification will have to undertake 'additional efforts' to make sure, that despite the delay caused a licence can be signed as soon as possible. [747]

Against this background, the Court found that HMD had not actually been willing to sign a FRAND licence with VoiceAge either before or after claims for injunctive relief (as well as the recall and destruction of infringing products) were asserted in the present proceedings. [748]

In the eyes of the Court, HMD's declaration dated 26 November 2019 was not 'clear' and 'unambiguous', since it was subject to conditions. [749] By declaring willingness to sign a licence only to patents that are 'valid and enforceable', HMD made clear that it was not prepared to obtain a licence with the scope offered by VoiceAge. [750] What is more, HMD suggested that it was not willing to sign a licence before the validity and infringement of VoiceAge's patents was finally established. [750]

Furthermore, the Court could not extract a sufficient declaration of willingness from both HMD's letter and counteroffer dated 17 March 2020 either. [751] HMD had again made its willingness subject to conditions, since it was prepared to take a licence only to 'valid, actually essential and enforceable' patents. [752] By insisting on this limitation, HMD made clear that it was not willing to conclude a licensing agreement on terms different than those underlying its counteroffer. Given that there is a range of FRAND-compliant terms and conditions, HMD's behaviour indicated that it was not prepared to enter into negotiations with VoiceAge, which is, however, something that is to be expected by 'willing' parties. [753]

In line with the above, the Court held that HMD's correspondence with VoiceAge in August, September and November 2020 did not contain a sufficient declaration of willingness: by reiterating the position laid down in the letter dated 17 March 2020, HMD had failed to make an unconditional declaration as required. [754]

Apart from the fact that a proper declaration of willingness was missing, the Court highlighted that HMD had also failed to engage in negotiations with VoiceAge in a 'target-oriented' manner. [755]

HMD's behaviour prior to the assertion of claims for injunctive relief in the pending proceedings was considered by the Court as an attempt to delay the negotiation process. [756] HMD reacted to the notification letters of VoiceAge dated 21 August 2019 and 16 September 2019 for the first time on 26 November 2019, that is more than two months after receipt of the first letter. [757] The Court also criticized the fact that in its response HMD only declared to be, generally, willing to sign an NDA: given that VoiceAge had already presented a draft NDA, it could have been expected from HMD either to sign this draft or to propose specific amendments. [758] The sole declaration of willingness to sign an NDA is not sufficient, when a draft agreement has been already presented. [758]

The Court took the view that HMD did not adequately react to VoiceAge's licensing offer dated 25 October 2019 either. [759] Providing feedback on specific clauses contained in said offer after more than eight months (that is only by the letter dated 17 August 2020) did not correspond to the 'customary practice' of parties engaged in licensing negotiations. [760]

HMD's counteroffer dated 17 March 2020 was also considered to be belated [761] . Although a fixed deadline for the production of a counteroffer is not given, a period of almost five months after receipt of VoiceAge's offer was seen as too long. [761] This was particularly the case, since the calculation of the royalty rates included in HMD's counteroffer depended only on a few factors (e.g. the estimated total royalty burden, or the share of VoiceAge's portfolio compared to the total number of patents declared as essential to the EVS standard). [761]

The Court further found that the security payment made by HMD in May 2020 could not compensate the missing willingness, especially since HMD had reacted belatedly to both VoiceAge's amended licensing offers dated 6 May 2020 and VoiceAge's offer to grant HMD access to comparable licensing agreements upon signing of an NDA. [762] On the one hand, the Court pointed out that HMD should not have taken three months to respond (by letter dated 17 August 2020) to the amended licensing offers, particularly given the 'unwilling' behaviour previously demonstrated. [763] On the other hand, the Court was not satisfied by the fact that HMD proposed amendments to the draft NDA provided by HMD in October 2019 only almost eight months later (on 26 June 2020). [764] In the eyes of the Court, this was a further indication of delaying tactics on the side of HMD. This view was reinforced by the fact that it took HMD almost two weeks after the signing of the NDA to designate the persons that would review VoiceAge's third-party licensing agreements on its behalf. [764]

The Court also viewed HMD's reaction to VoiceAge's licensing offer dated 3 November 2020 as another sign of missing willingness. [765] Although HMD had expressly asked for a lump sum payment, it rejected the aforementioned offer, which VoiceAge had formed accordingly, by indicating that it was no longer interested in a lump sum payment but preferred a running royalty regime instead. [765]

The Court further stressed that HMD had not sufficiently declared willingness to obtain a licence after VoiceAge had raised claims for injunctive relief in the pending infringement proceedings either. [766]

The fact that in March 2021 HMD made a counteroffer to VoiceAge for a lump sum payment in parallel infringement proceedings pending before the District Court of Mannheim did not render HMD a 'willing' licensee: Since the amount offered was significantly lower than VoiceAge's offers, it could not be assumed that by this counteroffer HMD expressed, in general, willingness to sign a licence on 'whatever terms are in fact FRAND'. [767] Moreover, the very low lump sum payment proposed indicated that the counteroffer was made just for tactical reasons and was not meant seriously, particularly since HMD had already reviewed comparable licensing agreements and should, therefore, have been aware that its offer was considerably lower than the terms agreed by VoiceAge with other licensees [768] .

Finally, the Court did not see a proper declaration of willingness in HMD's statement that it is prepared to enter into a licensing agreement on FRAND terms without any conditions, which was made for the first time shortly before the end of the oral hearings. [769] Such unconditional statement, which is a prerequisite for the initiation of licensing negotiations, was made at a point in time, in which target-oriented negotiations could - at least with view to the first instance proceedings - no longer take place. [769]
 

SEP holder's offer

Having found that HMD had failed to adequately express willingness to obtain a FRAND licence, the Court explained that VoiceAge was under no obligation to make a FRAND offer. [738] For this reason, the Court refrained from a detailed examination of the FRAND-conformity of VoiceAge's offers. [738]

In this context, the Court noted, however, that an offer of the patent holder made at the beginning of negotiations cannot per se establish an abuse of market dominance, even when the terms offered would unreasonably impede or discriminate the implementer, if contractually agreed. [731] An abuse will only be given, if the SEP holder insisted on such conditions also at the end of licensing negotiations with the imple menter or refused to grant access to the technology at all. [731]

The Court held that this had not been the case here. On the contrary, based on a summary assessment under consideration of comparable licensing agreements signed by VoiceAge with third parties, the Court took the view that particularly VoiceAge's last offer was not evidently inadequate and, thus, constituted a proper starting point for licensing negotiations between the parties. [738]
 

  • [727] VoiceAge v HMD, District Court of Munich I, judgment dated 19 August 2021.
  • [728] Ibid, paras. 30-77.
  • [729] Ibid, paras. 93 et seqq.
  • [730] Ibid, paras. 109 et seqq.
  • [731] Ibid, para. 95.
  • [732] Ibid, paras. 93, 110 and 122 et seqq.
  • [733] Ibid, para. 96.
  • [734] Ibid, paras. 114 and 120.
  • [735] Ibid, para. 118.
  • [736] Ibid, para. 119.
  • [737] Ibid, para. 121.
  • [738] Ibid, para. 123.
  • [739] Ibid, para. 97.
  • [740] Ibid, paras. 93 and 122 et seqq.
  • [741] Ibid, para. 98.
  • [742] Ibid, para. 99.
  • [743] Ibid, para. 100.
  • [744] Ibid, para. 103.
  • [745] Ibid, para. 102.
  • [746] Idid, para. 107.
  • [747] Ibid, para. 106.
  • [748] Ibid, para. 122.
  • [749] Ibid, paras. 126 and 128.
  • [750] Ibid, para. 127.
  • [751] Ibid, paras. 129 et seqq.
  • [752] Ibid, para. 129.
  • [753] Ibid, para. 130.
  • [754] Ibid, paras. 131-133.
  • [755] Ibid, paras. 134 et seqq.
  • [756] Ibid, para. 135.
  • [757] Ibid, para. 136.
  • [758] Ibid, para. 137.
  • [759] Ibid, para. 138.
  • [760] Ibid, para. 145.
  • [761]  Ibid, para. 139.
  • [762] Ibid, para. 141.
  • [763] Ibid, para. 143.
  • [764] Ibid, para. 142.
  • [765] Ibid, para. 148.
  • [766] Ibid, paras. 150 et seq.
  • [767] Ibid, para. 152.
  • [768] Ibid, para. 156.
  • [769] Ibid, para. 154.