Huawei Technologies Co.. Ltd. v. Zte Corp. Case No. C-

170/13 (2015)

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Nature of the Case

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Facts

Paragraph 139(1) of the Law on Patents states: ‘The injured party may, where there is a risk of recurrence, bring an action for an injunction against any person who uses a patented invention in breach of Paragraphs 9 to 13. The injured party shall also have that right if an infringement is liable to be committed for the first time.’ The European Telecommunications Standards Institute (ETSI) is a body the objective of which is to create standards which meet the technical objectives of the European telecommunications sector and to reduce the risk to ETSI, its members and others applying ETSI standards, that investment in the preparation, adoption and application of standards could be wasted as a result of an essential intellectual-property right for those standards being unavailable. Annex 6 seeks a balance between the needs of standardization for public use in the field of telecommunications and the rights of the owners of intellectual property rights. Owners of intellectual property rights should be adequately and fairly rewarded for the use of their intellectual property rights. Each of the members of ETSI is required to use reasonable endeavors, in particular during the development of a standard in the establishment of which it participates, to inform ETSI of that member’s intellectual-property rights which are essential to that standard, in a timely fashion. When an intellectual-property right essential to a standard is brought to the attention of ETSI, the Director-General of ETSI must immediately request the owner of that right to give, within three months, an irrevocable undertaking that it is prepared to grant licenses on fair, reasonable and non-discriminatory terms (FRAND terms) in relation to that right. P owns a European patent where it agreed to undertook to grant licenses to third parties on FRAND terms. Between November 2010 and the end of March 2011, P and D entered into discussions concerning the possibility of concluding a license on FRAND terms in relation to P's patent. P indicated the amount which it considered to be a reasonable royalty. D sought a cross-licensing agreement. No offer relating to a licensing agreement was finalized. D markets products that use P's patent. P brought an action for infringement seeking an injunction prohibiting the infringement, the rendering of accounts, the recall of products and an award of damages. Before the Court is the question of whether the action brought by P constitutes an abuse of that company’s dominant position.