Context: Since last fall, Ericsson and Lenovo are embroiled in a multijurisdictional patent dispute that is primarily about 5G standard-essential patents (SEPs). In late December, Lenovo asked the United States District Court for the Eastern District of North Carolina for a temporary restraining order (TRO) to bar Ericsson from the enforcement of 5G SEP preliminary injunctions (PIs) in Brazil and Colombia, a motion that the court still hasn’t ruled on (February 1, 2024 ip fray article).
What’s new: Yesterday (February 12, 2024), Lenovo made another filing with Judge Terrence Boyle with a view to the pending TRO motion: a notice of newly filed UPC and UK cases. The UPC actions are two 5G SEP infringement complaints. The UK case is also a 5G SEP infringement action, but involves a PI request designed to force Ericsson to choose between being enjoined in the UK or ceasing its ongoing enforcement of various Brazilian and Colombian PIs in favor of letting the High Court of Justice in London determine the terms of a global cross-license.
Direct impact: Lenovo appears increasingly desperate because of the commercial impact that Ericsson’s ongoing enforcement in Brazil and Colombia is making. The idea that a UK court should force Ericsson by way of a patent PI to agree to a global rate determination in London is novel. So far, UK courts followed a procedure that first required full SEP trials before a conditional injunction would issue. If the UK court granted Lenovo’s PI motion, it would set a problematic precedent.
Wider ramifications: It is questionable whether Lenovo’s latest filing will persuade Judge Boyle, who has been sitting on the TRO motion for an unusually long time, to act. At some point he will say something, but if Lenovo’s TRO motion had struck him as being extremely strong, it’s hard to imagine he wouldn’t have granted it already. In the global jurisdictional context, what Lenovo is doing is pure gamesmanship, hoping that the UK would go out of its way to be an exceedingly licensee-friendly patent jurisdiction. The fact that enforcement is actually still ongoing in Brazil and Colombia against Lenovo and some of its resellers will presumably lead other SEP holders to place ever more emphasis on those jurisdictions (and other new jurisdictions).
Here’s Lenovo’s latest filing:
Lenovo asserts that all three new patents-in-suit are essential to the 5G standard.
Whether Lenovo will try anything novel and aggressive in the UPC remains to be seen. Based on what the filing indicates, Lenovo’s UPC cases are (at least for now) run-of-the-mill SEP infringement actions. The complaints were filed (in whatever Local Division(s)) on January 30, 2024, and the patents-in-suit are EP3780758 (title: “In a wireless communication system, network slice selection based on application category”) and EP3342086 (title: “method and apparatus for low latency transmissions”).
Lenovo’s description of its February 2, 2024 UK complaint over EP3646649 (title: “Demodulation reference signal configuration”) is the second attempt in a short while to get help from Justice Richard Meade against Ericsson’s ongoing PI enforcement in Brazil and Colombia. The first attempt was that Lenovo asked for a kind of letter (a judicial declaration to be used in a Latin American proceeding), and that effort went nowhere. Now Lenovo comes back and essentially tells the UK court this:
- Please find in a fast-track proceeding that Ericsson likely infringes the UK part of EP’649 and that it is likely valid.
- Enter a conditional FRAND injunction, but with two twists:
- For the first time ever, a UK FRAND injunction would issue as a PI. By contrast, any prior UK FRAND injunctions came down only after at least one SEP was deemed infringed further to a full trial or (a more recent variant) after a defendant agreed to proceed straight to the FRAND part. Here, Ericsson is presumably not going to consent to anything like that.
- The second novel, aggressive and ambitious element is that Lenovo would not even content itself with Ericsson committing to take a license on whatever terms will be deemed FRAND as a result of a future UK determination. Lenovo additionally wants Ericsson to withdraw its Latin American PIs. If any one of the conditions wasn’t met, Lenovo would want the requested UK SEP PI to be enforced against Ericsson.
In order for Justice Meade to agree with Lenovo, he’d have to decide on what is not just a logical extension of existing UK law but would have to enter new territory.
While Brazil and Colombia are jurisdictions where PIs are granted over SEPs, other jurisdictions even in otherwise injunction-happy Europe have not done so yet. Interestingly, even the Phoenix v. Harting decision by the European Court of Justice, which clarified that the hurdle for the likelihood of a patent-in-suit being valid must not be too high, hasn’t yet opened the floodgates to the extent that SEP holders would flock to particularly German courts and seek SEP PIs. It could be that it will work, and that many will later realize they missed out on an opportunity. But for now, only Brazil and Colombia are places where SEP PIs are granted (not routinely, as the petitioning party must meet certain requirements, but they are not rejected because of concerns over SEP enforcement on a PI basis).
Lenovo’s lawyers appear to be speculating that Justice Meade will see this difference between the two types of jurisdictions, and might be so very interested in hearing many SEP cases that he’d try to “compete” with those two Latin American jurisdictions on the availability of SEP PIs. There’s no question that Justice Meade loves patent law, but because he does, he also tries to apply it reasonably. It’s doubtful that he would want to engage in a race to the bottom.
Psychologically, the request that Ericsson not only commit to a license on UK-determined terms but also withdraw its injunctions abroad shows the same pattern. Lenovo’s lawyers hope that Justice Meade is just going to look for some way to thwart Ericsson’s enforcement in Latin America. Lenovo is basically telling him that unless he puts pressure on Ericsson, through a conditional 5G SEP PI, to withdraw those Latin American injunctions, the UK proceedings are not going to go far as Lenovo may settle.
Lenovo’s problem here is that the UK PI request will give it the desired kind of leverage only if Justice Meade audaciously departs from existing UK law in both respects (PI instead of post-trial permanent injunction; additional requirement to withdraw foreign cases, which makes it a de facto antisuit injunction). And even if he did, Lenovo would have to defend the decision on appeal.
It’s also questionable whether the UK will prove to be quite as implementer-friendly a SEP jurisdiction as Lenovo hopes. The two key rate-setting decisions are on appeal. The picture could change.
Meanwhile, Lenovo’s story in the U.S. becomes weirder and weirder. It was already clear before the latest filing that Lenovo wants the court in North Carolina to enter an antisuit injunction not to protect U.S. jurisdiction over the FRAND terms (it’s actually Ericsson who wants FRAND decisions in the U.S.), but to protect the UK’s jurisdiction over Lenovo’s claims there.
With the latest request for a conditional injunction in the UK, Lenovo demonstrates its “UK first, U.S. only as useful defensive tool, LatAm never ever” set of jurisidictional preferences. Lenovo still wants to maintain its chances of obtaining a U.S. antisuit injunction, which is why it made this filing that attempts to justify the UK initiative (and to downplay its importance by pointing to those UPC actions first).
There previously was discussion over whether Lenovo’s own injunction requests against Ericsson undermined its argument for a U.S. antisuit injunction against Ericsson’s Latin American PIs. That’s why Lenovo stresses that Ericsson could solve the whole problem by agreeing to a UK FRAND determination.
Lenovo could have brought that UK motion before. But its lawyers first tried to find out whether Justice Meade would give them some kind of declaratory support with a view to the Latin American appeals, and whether Judge Boyle in North Carolina would grant them an antisuit injunction.
The longer it takes in the U.S., the less likely it is that Lenovo will get any antisuit leverage. That’s why Lenovo apparently decided to start the additional (and really ambitious) UK initiative. Between the lines, the message to Judge Boyle may be that since he isn’t helping them, they have to help themselves through those UPC infringement actions and the UK PI request. Judge Boyle may not, and certainly doesn’t have to, care at all. It’s Lenovo’s problem, and if Lenovo’s TRO motion had been right about irreparable harm, why are they still litigating instead of settling? All but one of the Latin American PIs already came down last year. In the briefing concerning the TRO motion, Lenovo made it sound like it would come under settlement pressure in a matter of days. Enforcement has now been ongoing for about two months.
So how important and impactful are those Latin American PIs? The truth is somewhere in the middle. It’s not like the sky is falling and Lenovo about to go out of business. But some of what Lenovo is trying her does appear borderline-desperate. It could be that a denial of the U.S. antisuit TRO and of the UK PI (or at least of a UK PI with an antisuit element) will mean that Lenovo’s lawyers are also at their wit’s end (their ideas so far have been creative, but fruitless and partly frivolous) and that Lenovo will settle.
Lenovo may overestimate how much those judges in the U.S. and the UK worry about the possibility of those cases being terminated further to a near-term settlement. Judge Boyle clearly has other priorities, and even if Justice Meade likes these kinds of cases, there’s a limit.