On 6 May 2013, the European Commission (EC) indicated that its preliminary view is that Motorola Mobility has abused a dominant position by seeking and enforcing an injunction against Apple in Germany on the basis of its GPRS mobile phone standard-essential patents (SEPs). While recourse to injunctions is a perfectly legal remedy for patent infringements, such conduct may, in the EC’s view, be considered abusive where SEPs are concerned and the potential licensee is willing to negotiate a licence on fair, reasonable and non-discriminatory (so-called FRAND) terms.
This case follows a very similar case started by the EC against Samsung in December 2012, which concerns that company seeking injunctions against Apple in various EU countries.
As in the Samsung/Apple case, the EC’s concern in the Motorola Mobility case is that, since injunctions generally involve a prohibition on the sale of the product infringing the patent, recourse to an injunction in this situation (where there is a willing licensee) risks excluding products from the market without justification and may distort licensing negotiations unduly in the SEP-holder’s favour. The EC is careful to point out, however, that its concerns in the present case relate to the specific circumstances of the action by Motorola Mobility against Apple (where there was a previous commitment to license SEPs on FRAND terms (by Motorola Mobility to the standard setting body) and Apple had agreed to accept a binding determination by a third party of the terms of a FRAND licence for SEPs). The EC does not question the availability of injunctive relief for SEP holders where, for example, a third party is unwilling to take a licence, an “unwilling licensee”.
This case and the Samsung/Apple case are highly important in the context of the application of abuse of dominance rules in the EU to licensing conduct and litigation strategy concerning SEPs generally (not just where smartphones are concerned). There is to date no precedent (and limited guidance) and, if a decision is ultimately taken in either case, it will therefore be the first to establish when injunctions in SEP-related patent litigation are allowed under EU and national competition law. Any company involved in licensing SEPs in any sector in the EU should watch developments carefully.