Context: In January, it became known that Samsung had sued ZTE in the High Court of Justice for England & Wales (EWHC) after the two had failed to extend their existing licence agreement beyond 2024. Samsung asked the UK court to set a FRAND rate for ZTE’s global cellular portfolio. A month later, it became discoverable that Samsung had also sued ZTE in the Frankfurt Regional Court over antitrust concerns, and that ZTE had won a preliminary injunction (PI) in Brazil (February 13, ip fray article). And, to round it off, Samsung also sued ZTE in the Northern District of California (March 3, 2025 ip fray article), which the defendant responded to last week (May 28, 2025 ip fray article), and the Unified Patent Court’s (UPC) Mannheim Local Division (LD) (March 12, 2025 ip fray article). It was also revealed last week that Samsung is seeking an interim license in the UK prong of the case.
What’s new: Samsung’s jurisdictional challenge to ZTE’s Chinese FRAND/SEP action has been dismissed, Daniel Alexander KC, counsel for Samsung, revealed during opening arguments in a hearing before Mr Justice James Mellor in the EWHC today (June 4, 2025 ip fray LinkedIn post). Sarah Abram KC, counsel for ZTE, also gave her opening arguments, including why ZTE has offered an interim license, but subject to adjustment by a Chinese court rather than the EWHC. She also argued why the company would not be acting in bad faith if it does not agree to the UK setting a rate, including that a UK court being seised first over these issues does not give it “tie-breaker” powers.
Direct impact and wider ramifications: Counsel to Samsung is due to give its reply tomorrow morning, which could add a lot more substance to why the company believes ZTE is acting in bad faith by requesting that an interim license be set by the Chongqing court. If Justice Mellor sides with Samsung, Mrs. Abram argues that this would mean he believes a decision issued by a Chinese court would be “biased”. Meanwhile, if he sides with ZTE, this would entirely “undermine” the European Telecommunication Standards Institute’s (ETSI) FRAND scheme, according to Mr. Alexander.
During today’s hearing, both sides gave arguments on whether ZTE is in breach of its obligations of good faith. The issue at the heart of today was whether ZTE would be acting in bad faith by refusing to grant an interim licence to be adjusted by the EWHC, when it has brought a FRAND determination in the Chongqing Court and offered an interim licence to be adjusted by the Chongqing Court.
Mr. Alexander, counsel for Samsung, said ZTE’s position is “plainly unreasonable” because the UK “no doubt” has jurisdiction over the case at issue, and going against this would infringe on the “integrity” of the original proceedings. In fact, Mr. Alexander said, allowing the Chongqing Court to set a rate would “undermine” ETSI’s FRAND scheme: both parties had allegedly agreed to a forum and now, halfway through, ZTE is “unreasonably” asking for that forum to be changed.
While noting that he was “not casting any criticism” on the Chinese judiciary, as they are “fast learners”, he added that being fast learners and having the power to do something are two very different things.
However, during her counterarguments, Mrs. Abram, counsel to ZTE, said that Samsung’s arguments suggest Chinese courts are motivated to award high rates to reward SEP holders that litigate there. Noting points made by Samsung on an earlier Huawei case, she said it was suggested that Chinese courts will take note that ZTE is partly state owned, will make sure to reward more money to ZTE, and then produce a biased judgment.
But that is an “extraordinary insinuation” and there is no evidence of such, Mrs. Abram said.
For ZTE, there is a multitude of reasons to litigate in a home court, she added, including the familiarity with the legal proceedings, the language, the location of the documents, the desire not to lose management time through travel, and the general low cost of proceedings in China.
If the roles were reversed and the same point was being made of the UK, counsel to ZTE said, the English courts would find that an “extraordinary” allegation. “The allegation is no less serious just because it is of a Chinese court,” she said.
Justice Mellor pushed back on her arguments, noting that Samsung never explicitly said a Chinese court would be biased. But Mrs. Abram asked:
“It has to be an allegation of bias – why else would they question why we want to litigate at home?”
No one is acting in “bad faith” for seeking to push for their jurisdiction of preference, counsel to ZTE added, and, assuming there are no issues with the Chinese courts, it can’t be “bad faith” for one party and not the other. Mrs. Abram also noted that Samsung’s arguments contained no Chinese law evidence, and were all based on “hearsay” and its Chinese counsel Mr. Xi:
“There is no way to know if this material is right [and] no evidence at all from a Chinese law expert about what a Chinese court would do in these circumstances, meaning there is no sufficient basis for a judge to make a finding.”
Separately, on the argument of why the rate should be set in the UK rather than China, Justice Mellor noted that the UK was the first venue seised of the interim license issues.
But first seises is “not a tie break”, Mrs. Abram argued, “otherwise, companies would rush off to court – as filing first in their venue of choice would give them a huge upper hand in those negotiations.”
Mrs. Abram added that while Samsung argues that Chinese courts haven’t determined a cross-license FRAND rate yet (which is true), the UK court also has yet to do so.
Counsel
European cases
In the UK, Kirkland & Ellis (lead counsel: Nicola Dagg) represents Samsung, and Powell Gilbert is ZTE’s counsel.
In the UPC, Samsung is represented by A&O Sherman (lead counsel: Dr. Jan Ebersohl) and ZTE, depending on the case, by Vossius & Partner’s Dr. Georg Andreas Rauh and Dr. Andreas Kramer (the former leads the technical part, and the two co-lead on FRAND) as well as Taliens’s Dr. Thomas Lynker.
We have not yet identified counsel in the SEP antitrust case in Frankfurt.
Northern District of California
Samsung is being represented by a team at Kirkland & Ellis: Brandon H. Brown, Gregory S. Arovas, Todd M. Friedman, Edward C. Donovan, Stephen C. DeSalvo, and David Rokach.ZTE’s motion to dismiss has been filed by Perkins Coie’s John D. Esterhay, Eric R. Maas, Elliott J. Joh, Kevin A. Zeck, and Samantha Carl, as well as Foley & Lardner Boston’s Kevin M. Littman, Lucas I. Silva, and Kate E. Gehl.