IN THE HIGH COURT OF JUSTICE HC-2012-000076
CHANCERY DIVISION
PATENTS COURT
BETWEEN
VRINGO INFRASTRUCTURE, INC.
(a company incorporated under the laws of the state of Delaware)
Claimant
-and-
ZTE (UK) LIMITED
Defendant
DEFENDANT'S STATEMENT OF CASE
IN RELATION TO THE RELIEF TRIAL.
Introduction
1. Paragraph references in this statement of case are to paragraphs of
the Claimant's Statement of Case in relation to the Relief Trial
2, The Defendant responds to the Claimant's summary in paragraph 2 as
follows:
a. It is admitted that EP (UK) No. 1 212 919 (“the 919 Patent”) has
been found valid and infringed by the Defendant but it is not
admitted that it is, in fact, valid and infringed. ‘The further prior
art identified following the judgment and sought to be relied on
following judgment means that, even in the United Kingdom, the
patent should be treated as arguably invalid. Moreover,
equivalents of the 919 Patent have been held invalid in other
jurisdictions, in particular in China, and the German Federal PatentCourt's preliminary opinion is that the German equivalent of the
919 Patent is invalid?
b. The Claimant is not and has not at any time been willing to license
its standards essential patents ("SEPs") or any of them on fair
reasonable and non-discriminatory (“FRAND") terms. To the
contrary, the Claimant has pursued an international litigation
strategy which, it is to be inferred, has been conducted in co-
operation with its predecessor in title and potential beneficiary -
Nokia Corporation - which is intended to require the Defendant
(and possibly others) to pay much more than the SEPs and each of
them are genuinely worth. Further, the Claimant has sought to take
advantage of the availability in certain jurisdictions of injunctive
relief (in particular ex parte preliminary injunctive relief before
the validity and infringement of the relevant patents has been
tested) to try to oppress the Defendant into paying royalties for its
SEPs at a level which is not FRAND.
c. The Claimant has not offered the Defendant a licence in respect of
the Claimant's global patent portfolio (a “Global Portfolio Licence”).
The global portfolio licence to which the Claimant refers was
offered to the Defendant's parent company, ZTE Corporation. ZTE
Corporation is not a Defendant in these proceedings and is not
alleged to carry out any infringing acts in the UK. The Defendant
does not need, and has not requested, a Global Portfolio Licence.
The Claimant is not entitled only to offer the Defendant a licence to
the 919 Patent through a Global Portfolio Licence to the
Defendant's parent company. In any event, the Global Portfolio
Licence is not FRAND, inter alia, for the following reasons:
+ A final decision on the German equivalent of the 919 Patent is expected in early May 2015,
Based on the oral hearing, in which the Court mentioned that the independent claims (as,
originally granted) seemed not to be valid, itis expected that the German equivalent of 919
Patent will only survive (iFat all} with a very limited scope in Germany.i. it is inappropriate for the Claimant to force the Defendant
to take a licence to patents that the Defendant does not use
and/or that are invalid,
ii, it is also inappropriate for the Claimant to force the
Defendant to pay the same royalty rate in all countries
irrespective of the number of patents that are registered in
that country or the extent to which those patents are used
by the Defendant in that country,
iii, although the Claimant may now be “willing voluntarily” to
enter into a licence agreement with the Defendant under
which the Defendant would be granted a licence to the 919
Patent for the United Kingdom (“a 919 Patent UK Licence”)
on FRAND terms, at all material times the Claimant has
either licensed or is under an obligation to license the
Defendant under the 919 Patent in the UK, regardless of
whether the Defendant takes a licence under any other of
the Claimant's alleged rights. The aforesaid obligation
applies to all of the Claimant's patents which have been
declared to be standard essential, since the legal effect of an
ETSI declaration, as well as the relevant competition law of
the EU and the UK, are such as to ensure that such licences
are available not as a matter of the proprietor’s choice but
as a right available for all in the telecommunications
industry to exercise
d. The Defendant has not “failed to specify the terms of a Patent 919
UK Licence which it considers to be FRAND" if such is intended to
imply that the Defendant was under an obligation to do so, Atal
material times, the Claimant has been under a duty to offer FRAND.
terms for a Patent 919 UK Licence and has repeatedly refused to
do so. Despite repeated requests from the Defendant, the