A Division Bench of the Delhi High Court has held that Standard Essential Patent owners, who file lawsuits, can pray for interim and final injunctive relief if an infringer is deemed by a Court to be an ‘unwilling licensee,’ often as indicated by the use of ‘stalling’ and other opportunistic bargaining and litigation tactics.
The Court also observed that there is no prohibition in Indian law against a Standard Essential Patentee from seeking an injunction. Observing that there was near uniformity of judicial opinion in multiple jurisdictions, on the issue, the Court noted that if Standard Essential Patent owners are flatly precluded from seeking injunctions, then infringers would have little reason ever to agree to, or negotiate in good faith, a licence with a Standard Essential Patent owner.
The High Court hence rejected the argument that it should not grant an injunction or pass a direction to pay, since the Standard Essential Patent owner’s only interest is in obtaining reasonable royalties, an interest which can be fully recognised by an award of damages at the end of the trial.
The High Court in its Judgement dated 29 March 2023 also held that the four-fold test as laid down the Single Judge Bench of the Court in the decision Nokia Technologies OY v. Guangdong Oppo Mobile Telecommunications Corp. Ltd. & Ors. was contrary to law.
According to the Division Bench, the Single Judge in Nokia v. Oppo set an impossibly high bar for admission in a case of Standard Essential Patent infringement, i.e., there has to be an unequivocal admission on (i) essentiality and validity of the suit patents (ii) fact of utilization (iii) fact that such utilization, absent payment of liability, would amount to infringement (iv) that the royalty rate proposed by the Plaintiff was FRAND.
The Court here in Intex Technologies (India) Ltd. v. Telefonaktiebolaget L M Ericsson observed that if there was an unequivocal admission on all four counts, there would be no necessity to file a suit for infringement at all and otherwise also, same would mean seeking/passing of a final decree at the interim stage. In the opinion of the Court, the four-fold test casts an onerous burden upon the Standard Essential Patentee and that too at the interim stage itself.