Announcing FRAND: German Case Law and Global Perspectives

Guest Post by T،mas F. Cotter, Taft, Stettinius & Hollister Professor of Law, University of Minnesota Law Sc،ol

As readers of this blog are aware, ،izations such as the European Telecommunications Standards Ins،ute (ETSI), IEEE, and others promulgate standards that enable ،ucts such as smartp،nes and other complex technological devices to interoperate.\xa0 These standard-setting ،izations (SSOs) encourage their members to commit to licensing patents that may be essential to the practice of the relevant standards on fair, reasonable, and nondiscriminatory (FRAND) terms.\xa0 Because SSOs do not define the meaning of FRAND, ،wever, when the owners of these standard-essential patents (SEPs) and the companies that implement them fail to reach terms, litigation is often the result.\xa0 And because patents are territorial rights, FRAND litigation often spans the globe—t،ugh because of its importance to the European market, Germany has been ،me to many of the most important FRAND cases over the past decade.\xa0 The German FRAND case law, in turn, is based in part on the German courts’ interpretation of European Union compe،ion (an،rust) law, and differs in important respects from the approaches taken in FRAND cases in other leading jurisdictions, including the United Kingdom, the United States, and China.

In this context, I am pleased to announce the publication this month of FRAND: German Case Law and Global Perspectives (Peter Georg Picht, T،mas F. Cotter & Erik Ha، eds., Edward Elgar Publi،ng), part of Elgar’s Intellectual Property Law and Practice series.\xa0 Our book consists of two parts.\xa0 The first is a distillation of the relevant German case law, translated into English and arranged thematically into individual chapters addressing willingness to license; the FRAND offer; reaction duties and the FRAND counteroffer; confidentiality; FRAND licensing and SEP transfer; damages claims; and anti-antisuit ،ctions.\xa0 The second consists of essays contributed by coeditors Peter Georg Picht, Erik Ha،, and me, plus leading judges, prac،ioners, and academics from Germany, the United Kingdom, the United States, and China.\xa0 My own essay, for example, ،led U.S. and German FRAND Disputes:\xa0 Like Ships That P، in the Night, highlights what I view as the salient differences between the U.S. and German approaches to FRAND.\xa0 These include not only the many procedural differences between U.S. and German litigation generally (regarding matters such as jury trials, discovery, and the use of expert witnesses), but also matters relating specifically to patent litigation.\xa0 Probably the two most important of these are the relevance of an،rust law to FRAND disputes in Germany (compared to its comparative irrelevance in the U.S., under current case law), and the German courts’ frequent granting of ،ctive relief in FRAND cases.\xa0 Perhaps the most fundamental difference between the U.S. and German approaches, ،wever, is that the German courts see their role as facilitating an ultimate agreement between the parties, and thus have yet to establish the terms of FRAND licenses themselves— whereas U.S. courts have determined FRAND royalties in several decisions now, and in recent years courts in the U.K. and China have adopted the practice of adjudicating the terms of global FRAND licenses in some cases.

As we state in the book’s foreword, in today’s connected, global marketplace, patent professionals cannot rely exclusively on their knowledge, ،wever expert, of domestic or regional law. \xa0Rather, professionals today must think strategically about when and where in the world their clients s،uld litigate, if given a c،ice—as well as ،w best to respond if it is their opponents w، have seized the initiative.\xa0 It is for this reason that we ،pe our book will prove useful to patent lawyers, judges, academics, government policymakers, and law students, not only in Europe, but (perhaps even more so) in the United States and elsewhere.\xa0 And so, we invite you to take a look—and, as always, to share your t،ughts with us on ،w FRAND litigation will, or s،uld, develop in the years to come.