Context: Brazil is an increasingly relevant jurisdiction for technology law in general and patent enforcement in particular. Late last year it became known that small technology company DivX won the first-ever Brazilian permanent injunction over a (standards-related) patent. The defendant was Netflix (December 24, 2023 ip fray article).
What’s new: DivX and its lawyers from Licks Attorneys (firm website) have won another decision over the same patent (BRPI0506163A on a “video unlock filter”). After Netflix and Amazon, Hisense, Toshiba (which has been acquired by Hisense and is the brand under which Hisense markets its TV sets in Brazil thus far) and local manufacturer and distributor Multi have been slapped with a preliminary injunction over this patent, which is related to the HEVC (H.265) video codec standard. The 6th Business Court of Rio de Janeiro entered the PI on March 27, within two days of the filing of the complaint.
Direct impact: The PI bars Hisense from launching Hisense-branded TVs in Brazil (for which the company had announced plans and apparently started preparations) that implement the HEVC standard and from the continued distribution of Toshiba-branded TVs in Brazil that implement the same standard.
Wider ramifications: Apparently some net licensees have identified Brazil as another jurisdiction in which to engage in lobbying so as to weaken enforcement. However, Brazilian preliminary injunctions do not allow patentees to overleverage their intellectual property rights: implementers can avoid sales bans through constructive licensing conduct.
Brazil is not the only jurisdiction in which DivX is enforcing patents against unlicensed implementers. For instance, there is also litigation pending against Netflix in Germany.
DivX, which says on its website that its video player software has been downloaded a billion times, has an active licensing business. The company is funded by Fortress Investment and has concluded various license agreements. Licensees include such companies as Roku, TCL, Disney and Vizio.
Hisense is the primary target of this Brazilian lawsuit, but if DivX had sued only Hisense, there is a possibility that its Toshiba subsidiary and/or Multi (the local manufacturer and distributor) could have circumvented it.
The CEO and Chief Legal Officer of DivX, Noel Egnatios, is one of the speakers at this week’s first-ever European edition of the IP Dealmakers Forum (as is ip fray‘s founder).