Context: The United States International Trade Commission (USITC, or just ITC) is presently in the final stages of investigations of standard-essential patent (SEP) complaints by Nokia against Amazon and by Ericsson against Lenovo. Last month, the Commission (the political appointees at the top of the U.S. trade agency with quasi-judicial powers) raised several questions relating to the public interest and remedy determination, most of which involve SEPs and FRAND (fair, reasonable and non-discriminatory licensing) including the potential bearing of a parallel proceeding in the High Court of Justice for England & Wales (EWHC) (February 28, 2025 ip fray article). At the moment the ITC keeps pushing back the related decisions, which appears to have more and more stakeholders in the SEP ecosystem concerned (March 22, 2025 LinkedIn post by ip fray).
What’s new: The first publicly-available response to the late-February questions comes from the Office of Unfair Import Investigations (OUII, commonly referred to as the ITC Staff). The OUII participates as a neutral party, in this case with an exclusive focus on public interest and remedy. The OUII reiterates its finding that Nokia has complied with FRAND while Amazon has not, and explains how the ITC should generally deal with FRAND defenses.
Direct impact: The OUII does not have decision-making authority, but its views tend to bear substantially more weight with the Commission than those of private parties.
Wider ramifications: FRAND is in flux at this point, not only with what is going on at the ITC but also in other proceedings in different jurisdictions, such as a recent ruling by a regional appeals court in Germany (March 20, 2025 ip fray article). An activist judge in the UK is trying to consolidate all of the world’s SEP disputes in his country, but Ericsson has already made it clear that Lenovo will not be granted the interim license that the England & Wales Court of Appeal (EWCA) said it was entitled to (March 11, 2025 ip fray article).
The following passage from the latest filing by the OUII explains that Nokia has discharged its FRAND licensing obligations while Amazon is regarded as an unwilling licensee:
The OUII appears to confuse the Netherlands for its larger neighbor country: The Hague is a Dutch city. But in any event, one can infer from the above that the OUII believes Amazon “repeatedly made obviously unreasonable counter[]offers that were not justified by the facts.
The heavily-redacted filing also indicates that the OUII attaches significant importance to the various license agreements Nokia has entered into with third parties, and to the fact that Judge James L. Robart of the United States District Court for the Western District of Washington found in his legendary Microsoft v. Motorola FRAND ruling that Nokia was a major contributor to the H.264 standard.
The OUII rejects any proportional application of pool rates covering different companies’ patents to the bilateral royalty demands made by a party like Nokia.
Amazon’s arguments concerning Nokia’s conduct are unpersuasive in the OUII’s opinion. It is the normal course of business that a SEP holder will start enforcement actions at some point, and that this involves threats. The OUII rejects any doctrine under which the mere fact that a SEP holder enforces its rights makes it an unwilling licensor. Amazon even wants to hold it against Nokia that it portrayed Amazon as an unwilling licensee, which the OUII says is what a litigant will obviously do in Nokia’s shoes.
More fundamentally, the OUII opposes the notion that, as Amazon advocates, limited exclusion orders (U.S. import bans) should be generally unavailable over SEPs. Even when the United States Trade Representative (USTR), to whom U.S. presidents typically delegate their veto power over ITC decisions, vetoed an import ban in a Samsung-Apple case in 2013, the decision did not rule out import bans over SEPs categorically.
As for the procedural context in which the ITC should adjudicate FRAND, the OUII says that FRAND is not a public-interest factor, but it goes into the public-interest analysis. If a respondent makes the prerequisite factual allegations, the OUII believes FRAND can also be part of certain affirmative defenses, such as a defense under contract law, for which the respondent then bears the burden of proof. There are different views, however, and some argue that FRAND should be relegated in its entirety to the public-interest analysis.
The OUII does not consider Amazon’s UK proceedings relevant. It does not take a strong position on whether the English courts engage in judicial imperialism: it proposes treating them with benign neglect.
The upcoming Ericsson-Lenovo and Nokia-Amazon decisions by the ITC will give a clearer idea of how the agency wants to address FRAND arguments in investigations involving SEPs.