In-depth reporting and analytical commentary on intellectual property disputes and debates. No legal advice.

BREAKING: Chinese court determines $731M for 6-year, $600M+ for 5-year ZTE-Samsung FRAND cross-license — UK court is global outlier

Florian Mueller

Context:

  • Yesterday, Mr Justice Meade of the High Court of Justice for England and Wales (EWHC) handed down (May 1, 2026 ip fray article) a $392M royalty determination in a case brought by Samsung, which wanted help from the UK in the form of a decision proposing a lower rate than the $731M figure proposed by ZTE.
  • The decision came one day after the Munich I Regional Court’s rulings according to which ZTE’s positions and conduct were fair, reasonable, and non-discriminatory (FRAND) (April 30, 2026 ip fray article), granting ZTE a standard-essential patent (SEP) injunction while rejecting Samsung’s request.
  • Last year, a Chinese court — the Chongqing Intermedia People’s Court (IPC) — held a FRAND trial, which is also mentioned in the UK decision as unknown at the time. That case had been brought by ZTE, and Samsung itself had argued in its 2021 dispute with Ericsson that China was the right jurisdiction to set a FRAND rate and provided expert testimony to the United States District for the Eastern District of Texas to that effect. The Court of Appeal of England and Wales (EWCA) agreed with ZTE that China was the appropriate forum (October 31, 2025 ip fray article).

What’s new: Thanks to recent efforts to engage in more primary research in China1, ip fray has learned from a reliable source that the Chongqing IPC also provided a FRAND rate for a ZTE-Samsung cross-license on Friday (May 1, 2026), holding that ZTE’s $731M offer for a six-year term (January 1, 2024 to December 31, 2029) was FRAND. That outcome is consistent with the rulings by the Frankfurt Regional Court (which held Samsung not to be entitled to a lower rate), the Munich I Regional Court (as discussed above), and the majority of a Brazilian appellate panel (February 4, 2026 ip fray article). Furthermore, even if one agreed with the shorter (five-year) term the EWHC applied2, the Chinese outcome would exceed $600M, making it (slightly more than) 1.5 times the UK figure.

Direct impact:

  • The consistent Chinese, German, and Brazilian outcomes are an impressive series of wins for ZTE and make the London decision an absolute outlier on the global stage.
  • The UK ruling is styled as a mere declaration3, which is emphasized in connection with its inclusion of non-SEPs over ZTE’s objection. But its persuasive impact is greatly diminished by the fact that the next higher UK court recognized Chongqing as the appropriate forum, and Chongqing has now spoken.

Wider ramifications:

  • As our coverage of the Chinese patent litigation landscape (see footnote 1) strives to explain, China is a jurisdiction that patent holders should increasingly consider for enforcement purposes.
  • It becomes clear that UK FRAND determinations in the first instance cannot be taken seriously. The two most recent ones underwent major upward adjustments on appeal (in the Optis case even by a mind-boggling factor). Each of the four UK FRAND rate decisions so far has been made by a first-timer4 (May 1, 2026 LinkedIn post by ip fray); they are made only by a single judge, as opposed to panel decisions in other places; and two of the three most recent decisions, including yesterday’s, ultimately relied on only a single “comparable” license agreement.
  • The U.S. government will not come to ZTE’s aid, much less against Samsung (given the U.S.-South Korean alliance), but U.S. SEP holders, notably InterDigital, and companies relevant to U.S. network infrastructure, such as Nokia, also find themselves on the receiving end of UK judicial imperialism. It will not go unnoticed in Washington, D.C. that the UK is now the “lowball” jurisdiction for FRAND, way below not only Germany (a traditionally “pro-IP” country) but also two BRICS countries: Brazil and China. This week’s Special 301 Report by the United States Trade Representative (USTR) raises various concerns over SEP devaluation and usurpation (May 1, 2026 ip fray article), the most pressing ones of which are primarily UK issues.

When one court (in fact, one judge) arrives at a number that is grossly inconsistent with the outcomes in several other jurisdictions, it is not impossible but rather unlikely that he is right and the others are “ghost drivers”. One then has to look at the reasoning, which is what we did yesterday:

The judge took a single “comparable” license agreement where the evidence showed that the net licensor (ZTE) was in a difficult situation and prepared to offer way sub-FRAND terms, and categorically treated license agreements as supra-FRAND just because the net licensors in question were known to be ready, willing, and able to litigate if necessary.

The idea that there is no meaningful FRAND defense in Germany reflects an outdated state of affairs. There were various decisions after Sisvel v. Haier (Federal Court of Justice ruling) that indeed refused to engage with any economic argument. But under the thought leadership of the 7th Civil Chamber’s Presiding Judge Dr. Oliver Schoen (“Schön”; March 30, 2026 ip fray interview), the Munich I Regional Court has developed a sophisticated economic approach. It made great strides, even in connection with non- SEPs.5 It listened to economic experts for both sides at the trial. And the Munich court’s Ethernet SEP injunction in Broadcom v. Renault remains enforceable after an initial assessment by the appeals court (April 23, 2026 ip fray article).

It is also worth noting that the Munich court tried everything to broker a settlement as the general public could see in open court on Thursday morning. For example, a source informed us of a break that ZTE requested in order to decide on the judge’s proposal to extend an offer by one week.

Samsung is now facing the risk of enforcement in Germany. ZTE just has to post a bond or, more likely, make a deposit. The outlier UK ruling does not give it any significant counterleverage. In the end, the UK proceedings (where even just closing argument took three days) will have been a waste of time and money.

The fact that the UK rate determination is substantially below a rate considered FRAND by courts in three other countries will give other SEP holders (who will not be able to show as clearly as ZTE that the UK court is an outlier) pause. In a very special situation, Huawei agreed on UK dispute resolution with TP-Link (February 5, 2026 ip fray article). Nokia did so in its disputes with Warner Bros. Discovery (WBD) and Paramount (which is in the process of acquiring WBD) (February 26, 2026 ip fray article), but rightly declined to do so against Acer and ASUS (April 23, 2026 ip fray article).

This week, the top UK court appeared arrogant and ignorant when considering it a given that the English courts should set global FRAND rates. Lord Kitchin, who was one of the two judges with the great responsibility for the Unwired SNAFU, was blissfully unaware of all the interjurisdictional friction that has arisen since.6 He may wake up one day to the news that the UK has finally made it onto the U.S. government’s IP watch list or that the EU brought a World Trade Organization (WTO) complaint against the UK. In light of what is going on in the UK, it makes no sense for the European Commission to be obsessed with China. If there is a problem to be solved concerning SEP devaluation, it’s just across the English Channel.

  1. We specifically mentioned China as a place in which we could use some local help (March 11, 2026 ip fray job ad). Since then, we have added several team members (April 8, 2026 ip fray article). Jared Cho provided an overview of China’s patent proceedings (April 1, 2026 ip fray article), was first to report (at least in a non-Chinese publication) new regulations against foreign extraterritorial overreach (April 13, 2026 ip fray article), and wrote specifically about Chinese SEP enforcement earlier this week (April 28, 2026 ip fray article). ↩︎
  2. As discussed yesterday, the UK court’s finding that Samsung should be treated as if it had been licensed during the year 2024 was irreconcilable with the fact that there would have been no reason to distinguish the year 2024, through a covenant not to sue, from the other years of the contract term other than preserving ZTE’s entitlement to payments for that period while ensuring that litigation would not immediately follow the term of the previous license if that one is based on a calendar year. Such covenants not to sue are very commonly found in patent license agreements. Some agreements do not contain them, in which case litigation can brought immediately upon expiration, but the most recent Ericsson-Samsung dispute started on the infringement side only in mid-January even though the license term was based on calendar years. In that case, the period was obviously designed avoid the need to bring and react to litigation during the main holiday season in Western countries, but such cool-down periods can also be substantially longer if the idea is that there should be a lot of time for negotiations, which is precisely what Samsung will have wanted at the time it signed its first deal with ZTE. It is inconsistent that a court ruling which bases its global scale on “industry practice” reached a conclusion on the meaning of a covenant not to sue and a clause preserving an entitlement to payments that is at odds with industry practice. ↩︎
  3. In this situation, given the position of the appeals court above the EWHC that the appropriate forum for this licensing dispute is China, it appears highly unlikely that Samsung could leverage the UK declaration for coercive purposes, such as by seeking breach-of-contract damages or a specific-performance injunction. Doing so would also put Samsung out of compliance with new Chinese anti-overreach regulations, and Samsung has substantial business interests in China. ↩︎
  4. For the avoidance of doubt, those judges are very experienced when it comes to the technical aspects of patent law. They also deal with SEP-specific questions at various stages of proceeding all the time. But it is a fact that each of those four FRAND determinations was the first one for the respective judge to make. ↩︎
  5. A recent non-SEP damages judgment came with 16 headnotes discussing different damages theories and the interdependencies between them as well as springboard damages (April 26, 2026 ip fray article) ↩︎
  6. Chinese courts started to set global rates only in response to Unwired. The ongoing InterDigital-Amazon dispute has led the European Commission to keep an eye on UK developments. Later this month, the Unified Patent Court’s Court of Appeal will hear Amazon’s appeal. We will attend and report. ↩︎