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France – Uneven Standards: SEP infringement requires claimed process identical to the standard

SignalBEThe First Instance Court of Paris has held* that when asserting alleged Standard Essential Patents (“SEPs”), a patent holder first has to show that the process claimed in the asserted patent is identical to the process disclosed in the underlying standard.

Vringo Infrastructure Inc. (“Vringo”) purchased roughly 500 patents declared by their initial owner as essential with the ETSI for implementing the UMTS (3g) standards. Vringo and ZTE exchanged letters on some of the alleged SEPs, their implementation by ZTE and the need for the latter to enter into a Fair Reasonable And Non Discriminatory (“FRAND”) license.

Knowing that ZTE provided infrastructure equipment to a French client and that it took part in a tender from another French client, Vringo considered that these acts involved the implementation of an infrastructure system that included the invention protected by two of its SEPs, i.e. European patents No. 1 221 212 (for “methods and apparatus for synchronization“) and No. 1 186 119 (for “methods for transmitting a sequence of symbols“). Consequently, Vringo had an infringement-seizure performed at the headquarters of ZTE in France.

Vringo then sued ZTE on the merits, requesting a permanent injunction and damages for infringement of EP’212 and EP’119.

The Court found that EP’212 is invalid for lack of inventive step.

Turning to EP’119, the Court did not assess its validity but looked at an actual infringement.

According to the Court, some of the steps of one of the features of claim 1 of EP’119 “are not identical to the method exposed by the standard, even if they achieve an identical result.

Having reviewed the remaining dependant claims asserted, the Court decided that “the claims of EP’119 not being implemented by the UMTS standard, Vringo fails to establish patent infringement by ZTE equipment, as it offered to demonstrate infringement by arguing that said equipment necessarily implemented the patent’s claim as a result of their compliance with the UMTS standard“.

Because the process claimed in EP’119 was not identical to the process disclosed by the standard, there is no finding of infringement.

ZTE counterclaimed that, under the ETSI IPR policy, Vringo bound itself by contractual stipulation to concede a licence to any person wishing to implement the standard, on FRAND terms. ZTE asked the Court to acknowledge that ZTE accepted this licence and that consequently, an expert should be appointed to assess the FRAND royalty to be paid for EP’212 and EP’119.

ZTE also alleged that Vringo would be abusing a dominant position by breaching its ETSI commitment.

Because the patents were held to be null and/or not infringed, the Court did not address these counterclaims. This judgment may still be appealed.

* First Instance Court of Paris, 30 October 2015, Vringo Infrastructure Inc. v. ZTE Corporation and ZTE France (together “ZTE”)