Federal judge’s preliminary assessment: Samsung’s U.S. case against ZTE over FRAND may very well be thrown out

Context: In an unprecedented brute-force play, Samsung is presently pursuing FRAND (fair, reasonable and non-discriminatory licensing) claims over ZTE’s standard-essential patents (SEPs) in (at minimum) four jurisdictions (June 20, 2025 ip fray article). The third venue where such a filing showed up is the United States District Court for the Northern District of California (March 3, 2025 ip fray article). ZTE brought a motion to dismiss the U.S. case (May 28, 2025 ip fray article), in response to which Samsung disparaged the Chinese judiciary (June 11, 2025 ip fray article). That apparently did not impress Judge Araceli Martínez-Olguín. She clearly deprioritized the case, pushing back the motion-to-dismiss hearing by four months (June 18, 2025 ip fray article). A case management conference was, however, still on the calendar for July 16 (next week’s Wednesday), and the question of whether discovery should begin could not wait until the motion hearing in November.

What’s new: Judge Martínez-Olguín has now granted ZTE’s motion to stay discovery pending the resolution of the motion to dismiss. The procedural decision is based on a prima facie assessment of the merits based on the full briefing (motion, opposition, reply), finding that ZTE may very well succeed in getting the U.S. case thrown out. Therefore, the question of how much or little of a burden discovery would have been on ZTE was not even relevant.

Direct impact: This is negative for Samsung in more than one way. While the case has obviously not been prejudged, Samsung’s arguments that ZTE’s motion to dismiss is meritless have no traction at this stage. It is Samsung who has a merits problem now. Second, the discovery stay prevents Samsung from conducting a FRAND-related fishing expedition with the purpose of obtaining information that it might use in negotiations as well as proceedings in various jurisdictions around the globe. It is quite possible that the prospect of discovery was a large part of Samsung’s motivation to bring a rather duplicative action in the U.S. while actually betting on the UK. In other jurisdictions, discovery is either unavailable or much more narrowly tailored. Even if Samsung fended off the motion to dismiss, discovery wouldn’t begin this year just based on today’s decision and typical timelines.

Wider ramifications: This is another example of U.S. judges making far more reasonable decisions than their UK counterparts when faced with cross-jurisdictional gamesmanship and tempted to usurp on other jurisdictions. U.S. judges tend to do what good judges simply do: they ask themselves whether a case is properly before them, and if there is significant doubt, they strive to conserve court and party resources. By contrast, UK judges have recently shown a worrying tendency to treat FRAND actions as their favorite toy, as if it gave them power euphoria to set global license fees between major players despite their country not being objectively important in the world of telecommunications (or other digital) standards. At the moment, UK decisions are particularly hard to understand when disputes clearly have their center of gravity in China (July 8, 2025 ip fray article). The UK aberrations will be brought to an end sooner or later through defensive measures by other jurisdictions.