Connectivity plays a key role in today’s economy and increasingly so as the Internet of Things develops. Standards, as enablers of connectivity, are central to this development. The fifth generation technology standard for cellular networks (5G) is pushing new industries to consider access to standards, including the licensing of standard-essential patents (SEPs), which are patents that need to be accessed for a product to comply with a standard. A predictable and efficient licensing environment is therefore key for companies’ strategies worldwide. To ensure accessibility to standards, some standard setting organisations require SEP holders to commit to license on fair, reasonable and non-discriminatory (FRAND) terms. These terms are subject to different interpretation, which gives rise to legal uncertainty and increased litigation. Despite this, judicial FRAND determination has been rare in Europe. This paper analyses the principles and methods applied by the courts to determine FRAND royalties, with a focus on the valuation methods adopted by Birss J in the landmark English Unwired Planet v. Huawei decision. It argues that the comparables method applied by Birss J is generally in line with mainstream economic valuation approaches and that judicial FRAND royalty determinations benefit the licensing system, albeit methods and access to data, including regarding SEP essentiality, need improvement.
{"title":"Judicial Determination of FRAND Royalties: the English High Court’s Valuation in Unwired Planet v. Huawei. Moving Away from Mainstream Economic Valuation Approaches? Who Should Determine FRAND Royalties and How? Iudex non Calculat?","authors":"Rita Garcia-Bennett","doi":"10.2139/ssrn.3903998","DOIUrl":"https://doi.org/10.2139/ssrn.3903998","url":null,"abstract":"Connectivity plays a key role in today’s economy and increasingly so as the Internet of Things develops. Standards, as enablers of connectivity, are central to this development. The fifth generation technology standard for cellular networks (5G) is pushing new industries to consider access to standards, including the licensing of standard-essential patents (SEPs), which are patents that need to be accessed for a product to comply with a standard. A predictable and efficient licensing environment is therefore key for companies’ strategies worldwide. To ensure accessibility to standards, some standard setting organisations require SEP holders to commit to license on fair, reasonable and non-discriminatory (FRAND) terms. These terms are subject to different interpretation, which gives rise to legal uncertainty and increased litigation. Despite this, judicial FRAND determination has been rare in Europe. This paper analyses the principles and methods applied by the courts to determine FRAND royalties, with a focus on the valuation methods adopted by Birss J in the landmark English Unwired Planet v. Huawei decision. It argues that the comparables method applied by Birss J is generally in line with mainstream economic valuation approaches and that judicial FRAND royalty determinations benefit the licensing system, albeit methods and access to data, including regarding SEP essentiality, need improvement.","PeriodicalId":255541,"journal":{"name":"Intellectual Property: Patent Law - Student Authors eJournal","volume":"2 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-09-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"124521513","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2018-09-28DOI: 10.36645/mtlr.25.2.unified
Jonathan I. Tietz
Healthy organisms inevitably produce cancer cells, and vibrant patent systems inevitably let bad patents slip through. These patents are harnessed by entities that leverage the uncertainty and expense of litigation to extract licenses from technological practitioners. Postissuance patent review (PIPR) has emerged as an invaluable errorcorrecting mechanism to prevent the socially harmful assertion of improperly issued patents. The United States, with the America Invents Act, established a new system for PIPR, expanding administrative routes to curtail bad patents. Europe is going a step further with the Unified Patent Court Agreement (UPCA). The UPCA enables a lowcost patent revocation action on a broad range of grounds and with a relaxed standing requirement. But this is an opt-in system with a loser-pays fee-shifting arrangement. Thus, although the structure of the Unified Patent Court (UPC) appears to be set up to facilitate efficient PIPR, the disincentives for opting in suggest that the UPC will be a less effective troll-fighting vehicle than expected. Indeed, patent trolls may simply opt for national patent systems.
{"title":"The Unified Patent Court and Patent Trolls in Europe","authors":"Jonathan I. Tietz","doi":"10.36645/mtlr.25.2.unified","DOIUrl":"https://doi.org/10.36645/mtlr.25.2.unified","url":null,"abstract":"Healthy organisms inevitably produce cancer cells, and vibrant patent systems inevitably let bad patents slip through. These patents are harnessed by entities that leverage the uncertainty and expense of litigation to extract licenses from technological practitioners. Postissuance patent review (PIPR) has emerged as an invaluable errorcorrecting mechanism to prevent the socially harmful assertion of improperly issued patents. The United States, with the America Invents Act, established a new system for PIPR, expanding administrative routes to curtail bad patents. Europe is going a step further with the Unified Patent Court Agreement (UPCA). The UPCA enables a lowcost patent revocation action on a broad range of grounds and with a relaxed standing requirement. But this is an opt-in system with a loser-pays fee-shifting arrangement. Thus, although the structure of the Unified Patent Court (UPC) appears to be set up to facilitate efficient PIPR, the disincentives for opting in suggest that the UPC will be a less effective troll-fighting vehicle than expected. Indeed, patent trolls may simply opt for national patent systems.","PeriodicalId":255541,"journal":{"name":"Intellectual Property: Patent Law - Student Authors eJournal","volume":"36 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-09-28","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"121031429","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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