For a second year, Mathys & Squire has been ranked as a leading European patent firm as part of the Financial Times’ report: Europe’s Leading Patent Law Firms 2020.
Based on recommendations made by clients and peers, alongside our leading firm ranking for patent prosecution and strategy consultation services, Mathys & Squire has also been recommended for its industrial expertise in the following sectors: Chemistry & Pharmaceuticals and Electrical Engineering.
As part of the research, recommendations from over 2,900 clients and peers were considered, which generated a list of 160 recommended patent law firms from across Europe.
We would like to thank all our clients and contacts who have taken the time to recommended the firm as part of the FT’s research.
To access the full report and rankings tables, please visit the FT website here.
The CJEU has ruled that the shape of technical designs may be eligible for copyright protection, even if the shape is partially dictated by technical function.
This ruling, issued on 11 June 2020, came as a result of a referral from Belgium in a dispute between Brompton, makers of the well-known Brompton foldable bike, and Korean company Get2Get, which manufactures a similar foldable bike. The Brompton bike had previously enjoyed patent protection but, since this has now expired, Brompton brought a case against Get2Get for infringement of their copyright in the shape of their folding bicycle. Get2Get argued that they were simply copying the technical aspect of the foldability of the bike and this inevitably led to a similarity in shape. Therefore, they reasoned, this was not protected by copyright as it was dictated by technical function. While the CJEU agreed that copyright protection does not apply when the shape of a design is dictated solely by technical considerations, it has ruled that copyright may still subsist in a design where the shape is only partially dictated by function. The only criterion is that the design fulfills the originality standard for copyright protection – namely that it is the author’s own intellectual creation resulting from free and creative choices.
Copyright protection in the UK and Europe arises automatically and provides a much longer term of protection than that conferred by patents and designs. Even though an article has previously enjoyed another form of IP protection such as a patent, this decision highlights that it is not precluded from continuing to enjoy copyright protection beyond expiry of this alternative right. Therefore, this ruling emphasises how copyright may form an additional tool in enforcing rights against potential copycat-infringers.
For more information on the protection and registration of designs, visit our webpage here, or to view our registered design FAQs page, please click here.
The 2020 edition of IAM Patent 1000: The World’s Leading Patent Professionals has been launched and Mathys & Squire is delighted to feature as a recommended firm once again. In addition to our firm ranking for prosecution, four of our patent partners have been singled out this year as recommended individuals: Jane Clark, Chris Hamer, Martin MacLean and Craig Titmus.
The firm’s ‘hands on’ ‘A-Z approach to patent prosecution’ and ‘invaluable assistance in contentious scenarios’ is highlighted, with one source commenting: “They showed an excellent balance of lateral thinking, pragmatism and ambition for our invention. Some of their suggestions even went beyond drafting the patent and into ideas that might improve the invention itself.”
Jane Clark, who “develops new skills for new areas that we get involved in, is creative in finding solutions to difficult obstacles and is very prompt, with strong attention to detail and execution.”
‘Chemistry maven Chris Hamer knows all there is to know about ionic liquid technologies and routinely shares his wisdom by lecturing to chemistry and chemical engineering students at Queen’s University Belfast.
‘The firm’s resident biotechnologists include Martin MacLean and Craig Titmus: MacLean showcases his knowledge on the targeting of bacterial toxins through his work for Ipsen Bioinnovation; while sustainable technology start-up Colorifix calls Titmus a “lifesaver” for his slick management of its fabric dye patent portfolio”.’
IAM Patent 1000 has become the definitive directory exclusively dedicated to identifying the world’s leading patent services providers. The extensive research process for this guide was conducted over several months by a team of analysts, consisting of more than 1,700 interviews with patent specialists across the globe.
Featuring 48 country-specific chapters, analysing local patent professional services markets and detailing the firms and individuals identified as leaders in their respective fields, the tables and accompanying detailed editorial reflect the depth of expertise, market presence and levels of work on which firms are typically instructed. The publication therefore serves as a one-stop reference source for anyone seeking patent services.
To read the full Mathys & Squire profile, and to view the rankings in full, visit the IAM website here.
The EPO’s new Rules of Procedure of the Boards of Appeal (RPBA) came into force on 1 January 2020. Following on from our previous review examining recent case law decisions relating to changes regarding remittance, this briefing highlights two recent cases, T1625/17 and T890/17, which were decided under the new rules.
Amongst other things, the new RPBA codified a stricter approach to the ability of an appealing party to amend their case, which even prior to the new rules had already been developing in the jurisprudence of the Boards of Appeal.
As a very general summary of the new rules, in any appeal the parties must put forward their complete case at the earliest possible opportunity. New evidence and even new arguments may be ruled inadmissible by a Board of Appeal if they could have been filed earlier. Whilst a Board of Appeal does have discretion in this regard, the rules are themselves very strict, and the Boards are using their discretion to apply them strictly, as the two cases summarised below illustrate.
In the decision of the Board of Appeal in T1625/17, a patent proprietor had filed a series of requests for amendment of the claims (so called Auxiliary Requests), but submitted only a cursory argument as to why the amended claims were inventive. The Board of Appeal refused to consider any of these requests for amendment because the notice of appeal did not provide properly reasoned problem and solution arguments for each request.
In T890/17, an opponent had raised an objection of lack of novelty based on a prior art document, but had mentioned inventive step only to say that if the claim was found to be novel it would be obvious. The Board found the claim novel, but refused to consider the question of inventive step because the inventive step arguments were deemed not to be properly reasoned and new arguments would not be admitted.
These decisions are not surprising, because they are in line with the new rules and with the jurisprudence which had been developing before the rules came into effect. In practice, parties must make their complete case, including properly substantiated reasoning on all foreseeable issues at the earliest possible opportunity.
In this article for Entrepreneur & Investor, we provide our insights into IP valuation and how this can be used as alternative financing for your business.
Companies, ranging from start-ups to SMEs, are frequently seeking a capital injection to sustain their business, and now even more so because of the significant economic impact currently seen worldwide due to the COVID-19 pandemic. With large numbers of businesses throughout the UK facing loss of income or even insolvency, there is a case to be made for the increased use or monetisation of the intangible / intellectual property (IP) assets held by such companies.
Traditionally, the value of companies has been largely based on their tangible assets – for example: buildings; plant machinery; production equipment; and vehicles, and as such, debt financing has been based on the value of these tangible assets. However, things are changing and the World Intellectual Property Organisation (WIPO) [1], UK Intellectual Property Office and the British Business Bank all recognise this [2].
Nowadays, the value of intangible assets / IP assets represents up to 84% of the company’s value [3] [4]. This shift is further seen at a larger scale as many developed countries, including the UK, have moved from largely production based to being service-based economies. This shift to a ‘knowledge-based economy’ has seen a commensurate rise in the use and importance of intangible assets, including IP, and with this a rapid increase in the UK wide investment in intangible assets – almost doubling between 1995-2015 [2]. This has the secondary effect that many newer companies, especially operating in the software developments space, have few tangible assets on which to base traditional debt financing.
While it is recognised that IP can be monetised by selling or licensing the assets, not all companies recognise the intangible assets they possess and even fewer recognise the potential of these assets as sources of untapped capital. These intangibles including trademarks, designs, trade secrets, know-how, databases, client lists, domain names and associated goods. The process of lending fully or partially against intangible or IP assets is also known as IP securitisation or alternative asset-based financing. This concept is a new arrival in a number of countries, including the UK, and has the basic premise of collateralising debt financing to SMEs and small companies by providing a security interest in the company’s IP assets [5]. With this in mind, and given the current dire situation in which many companies across the UK find themselves due to the COVID-19 crisis, there is a significant opportunity in raising awareness of the value of intangibles in a business and how to unlock this value.
In some cases, this can take the format of the financial institution gaining control of future license royalties for the IP asset in question, while others may effectively involve the purchase and lease-back or licensing of the asset from the financial institution. The IP securitisation or IP backed financing concept has already been trialled in a number of countries, with mixed results, but is still in its infancy in the UK with a relatively low number of financial institutes providing an IP backed financing service.
Those that have recognised this opportunity in the UK include:
Lombard, which is part of RBS, offers an IP backed funding solution based on a business’ internally developed and owned software assets [6]. Under this solution, the software assets are sold to Lombard and the business then licenses the software back from the bank for a fixed term of three – five years, after which time the agreement can be extended and further financing provided or the IP can be transferred back to the SME.
This UK based pension administrator offers two products, the Self-invested Personal Pensions (SIPP) and Small Self-administered schemes (SASS), both of which will consider IP assets for investment [7]. In addition, a subsection of IP backed financing called pension-led funding may also be provided [8]. In this case, the pensions held by the SME are used to provide a capital injection, where the IP is used as collateral in a loan or is purchased by the pension fund and licensed back to the SME.
In all of the above, IP backed financing requires IP assets to be developed, owned by the company and free of any existing encumbrances or liens and not currently subject to any litigation action. In each case, in order for a loan or purchase and lease-back facility to be provided, the IP assets in question need to be valued by a third party, which has expertise in the area of IP valuation. For the most part, many current offerings in IP backed financing focus on software assets and the ability of management and founders to deliver returns based on their own know-how and the software assets.
As the valuation of IP assets requires knowledge of both IP and financial modelling, there are only an estimated 600 practitioners offering IP valuation in the UK [2]. This processes not only identifies the range of values under which the transaction should occur, but also helps businesses open their eyes as to how these contribute to the business and how their contribution can be further enhanced moving forward. In many cases, this takes the form of a review or audit of the IP assets to be valued.
While IP securitisation or IP backed financing is a very attractive offering and is likely to grow further under the current economic difficulties, problems still remain in wider roll out due to the risk involved. Some IP assets may not have easily realisable value outside of the business in which they were created, while there may be differences in the perceived value of the assets based on the methodology being used and the market conditions.
Ultimately, the valuation process is useful for businesses as it highlights where the IP assets add value to the business, and in doing so, ensures they are better prepared for negotiations and more likely to leave with a good deal.
This article was first published by Entrepreneur & Investor in June 2020.
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[1] WIPO, ‘The Securitization of Intellectual Property Assets – A New Trend’, 2020
[2]British Business Bank, ‘Using Intellectual Property to access growth funding’, British Business Bank Plc, Sheffield, 2018
[3]Raconteur, ‘Intellectual Property 2020’, February 2020
[4]J. P. Ogier, ‘Intellectual property, finance and economic development’, WIPO Magazine , February 2016
[5]OECD, ‘Enquiries into Intellectual Property’s Economic Impact – IP-Based Financing of Innovative Firms’, OECD, Paris, 2015
[6]Lombard, ‘Intellectual Property Funding,’ 2020
[7]Morgan Lloyd, ‘Products – SIPPs’
[8]Clifton Asset Management, ‘Clifton Asset Management’, 2020
In this article for Open Access Government, Mathys & Squire Partner Andrew White argues that widespread adoption of electric vehicles is key to achieving net-zero carbon emissions.
If the UK Government is to meet its target of net-zero carbon emissions by 2050, then the widespread adoption of electric vehicles is key. When combined with a wider shift in how electricity is generated in the UK, electric vehicles truly do offer a more efficient alternative, with a lower carbon footprint than conventional internal combustion engines. To date, drivers who have adopted electric vehicles are those with the ability to charge their vehicles either off-street, at home, and/or at work.
However, if the UK is to see more widespread adoption of electric vehicles, then the issue of providing sufficient access to electric charging points for those who do not have the luxury of off-street parking needs to be addressed. Indeed, with a growing recognition of the problems associated with poor urban air quality, the need for electric vehicle adoption to foster net-zero carbon emissions would appear to be greatest in locations that pose challenges in providing sufficient charge points.
Ameliorating any real (or perceived) barriers that drivers may have about getting access to an electric vehicle charge point and/or ‘range anxiety’ is crucial. One solution may be to provide charge points in public car parks, transport nodes, shopping centres, etc., allowing drivers to use their leisure time to fully recharge their vehicles. Providing enough residential on-street charge points will also be important. If sufficient charge points are provided, drivers would not be concerned about the ability to guarantee a space to re-charge when they return home after a journey, which may be the case at present due to relatively sparse charge points in towns and cities.
If there is to be a wider uptake in electric vehicles in the UK, then drivers need to perceive charge points as (i) accessible; (ii) in a good state of repair; and (iii) that a database of their locations (e.g. for use via a smartphone app or similar) is accurate and up to date so that a charge point can always be found when needed.
The government’s recent announcement to double residential street charge point funding and increase access to real-time information can, therefore, only be welcomed, but it may not be a silver bullet. Typically, residential charge points work based on delivering a slow charge over the course of the night (e.g. over nine hours) so that the vehicle is charged and ready to go in the morning. While this may be suitable for the ‘normal’ commute for many drivers, those taking ‘out of the ordinary’ journeys – or deviating from their normal routine – may still have concerns.
One way in which Britain can bounce-back from COVID-19 is evidenced by the UK Government’s ambition to build “a network of rapid charging stations for electric cars,” said Transport Secretary, The Rt Hon Grant Shapps MP during May 2020. The UK Government had a vision that each motorway service area will have no less than six ultra-rapid charge points by 2023. In the future, it is anticipated that drivers can charge their cars in around 15 minutes, which is three times quicker than they can today.
The Transport Secretary recently remarked that while the car industry has of been very badly hit during the COVID-19 crisis, sales figures for April 2020 tell us that for the first time, “the two biggest selling models were both electric vehicles.” Shapps added that to keep the momentum of the “quiet, clean car revolution going”, £10 million of funding will be allocated to support extra car-charging points. The Transport Secretary provided some additional thoughts that follow on from this ambition. “The car will remain the mainstay for many families and, as well as backing electric infrastructure, we’re going to accelerate the filling of pot-holes that plague so many road users,” he commented.
It is interesting to note as part of tough new standards for cycling infrastructure, the UK Government is aiming for “at least one ‘zero-emission city,’ with its centre restricted to bikes and electric vehicles,” the Transport Secretary added. Finally, a comment by the Transport Secretary sums up well the UK Government’s ambition for making electric vehicles the “new normal” of the future. “We want to make electric cars the new normal, and ensuring drivers have convenient places to charge is key to that,” Shapps said.
As an expert in the field of battery technology, Mathys & Squire client Stephen Irish, Commercial Director at Hyperdrive Innovation, comments that a solution to this issue may be the provision of ‘fast charge’ points. If a number of these are distributed in the community at accessible locations amongst slower ‘normal’ charge points, then drivers can opt to charge their vehicle with a fast charge point when they are going to make such a journey.
Stephen notes that there are downsides, however. Fast charge points work by delivering much higher power to electric vehicle batteries, which can create excess heat and result in the batteries and charging circuitry becoming extremely hot. Not only is this much more inefficient, but in some cases, it may also require some degree of active cooling. Moreover, if repeated frequently, the use of fast charging can rapidly degrade the car’s battery.
He adds that the battery’s on-board management system (known as the battery management system or BMS) is key to managing and mitigating this degradation and is critical to how the batteries interface with the charge point.
By spotting pinch points between current technology and future commercial need, innovative technology can be turned into commercially valuable intellectual property.
A version of this article was published by Open Access Government in June 2020.
In the ruling of the Düsseldorf Higher Regional Court (2 U 31/16), the limitations of the scope of protection of an SEP arising from a FRAND declaration, as well as existing licence agreements in the case of transfers of rights of the SEP, are examined in more detail.
As an SEP owner, Unwired Planet claimed for information and damages from a granted European SEP with effect in Germany from Huawei (SEP user). The SEP was transferred earlier from Ericsson to Unwired Planet for reasons of better licence generation.
However, Ericsson had already started to conclude its own (old) licence agreements before the transfer. The key procedure points to be considered were therefore:
For the SEP, Ericson had filed a FRAND declaration, and since such a declaration limits the effect of the SEP, it automatically follows the SEP in the event of a transfer and is transferred to the new SEP owner. In this case, Unwired Planet itself had also issued a corresponding FRAND declaration.
Due to the transfer of the effect of an existing FRAND declaration from the first SEP owner to the new SEP owner, the Higher Regional Court of Düsseldorf decided that the existing old licence agreements remain important for the assessment of whether a licence offer meets the FRAND criteria. For the court, the very first licence agreement is decisive here, since no examination for discrimination can be made at that point in time. Rather, only the criteria ‘fair’ and ‘reasonable’ must be met.
From the point of view of the Düsseldorf judges, this must be interpreted as a commitment to a licensing concept which may only be deviated from at a later point in time in limited and justified cases. This concept also continues to exist not only ‘on the merits’ but also concerning ‘amount and content’ for the transfer of the SEP, so that the new SEP owner is also bound by this concept.
In the event of transferring an SEP to a new owner, the existence of a licensing concept established by old licence agreements, in addition to a FRAND declaration, also constitutes a restriction on the new owner’s use of the SEP.
From the Higher Regional Court of Düsseldorf’s perspective, the content and conditions of existing old licence agreements are therefore decisive for the assessment of the amount of a FRAND licence. Thus, the new SEP owner must ensure that he has access to such old licence agreements if he is interested in exploiting the SEP, including judicial enforcement. Confidentiality obligations in such old licence agreements cannot release the new SEP owner from this obligation under the Düsseldorf Higher Regional Court per se.
As the owner of an SEP, special attention should be paid to the very first licence agreement. Its conditions must meet the criteria of ‘fair’ and ‘reasonable’ and sets the standard values for the licence rate and reference value for all future licence agreements.
As the purchaser of an SEP, the restriction of the SEP’s effect by the automatic transfer of the FRAND declaration and by the licensing concept already established from old licence agreements must be considered. When drafting the transfer agreement, it should also be ensured that the new SEP owner has a right to access and a right of presentation for old licence agreements in legal disputes in order to enable the SEP to be exploited.
As employers contemplate the grim possibility that redundancies might be unavoidable during this time of uncertainty, the rigorous governance of commercially sensitive secret information and intellectual property (IP) becomes more vital than ever.
For most technology and engineering businesses, the most valuable IP is its people – and the knowledge each of them carries around in their heads, that which they will carry into any future employment if they move on.
Employers often assume that everything confidential that an employee cannot disclose during their employment is a trade secret, which, if the employee left the company they could not use in employment by a competitor or in their own competing startup. This is not the case.
There is a distinction between trade secrets and the employee’s own know-how. An ex-employer can take legal action against an ex-employee or his/her new employer to restrain use of trade secrets, but unless they have taken the proper steps, the ex-employer cannot do anything about the ex-employee making use of their own know-how.
The boundary between these two types of confidential information can be unclear. It is possible for something which starts out as a trade secret to cease to be treated as such, because of the way it is handled in a business. Thus, in some circumstances, information handling practices can cause control of a valuable once proprietary secret to be lost when employment ends.
The law recognises that employees may use different types of information in their employment. Firstly, there is information which is not confidential. Secondly, there is information in the form of the employee’s knowledge which the employee must treat as confidential during the period of his employment, but which they are not restrained from using or disclosing after the employment has ended. Thirdly, there are trade secrets.
Even prior to the adoption of the Trade Secrets Directive in 2018, this third class of information had its own definition and required different treatment. The second class of information necessarily remains in the employee’s head and becomes part of his or her own skill and knowledge. Significantly – there is generally no restriction on the employee using or disclosing this second class of information, their own knowledge, after termination of the employment.
Firstly, there is no ‘bright-line test’ to separate one type of information from the other[1], and there is no magic way to make legitimate employee knowledge be deemed a trade secret. Proper management of sensitive information is needed however to ensure that valuable trade secrets do not inadvertently become, through mishandling, information which an ex-employer can no longer control when employment ends.
Secondly, the ex-employer must be able to identify the particular secret information at issue, and preferably to define it in a way which is broad enough to protect the ex-employer’s legitimate interests but without being so broad as to go beyond the enforceable scope of the ex-employee’s obligations.
For further information about managing your business’ sensitive and confidential information, distinguishing between trade secrets and employee know-how, get in touch with one of our IP experts.
[1] The Trade Secrets Directive (also known as the Trade Secrets (Enforcement, etc.) Regulations 2018) provides its own definition of a trade secret.
In this article for Compare the Cloud, we discuss the improved energy efficiency of Tiny AI, as well as the commercial benefit for companies in capitalising on the advancements they bring in giving AI more widespread and sustainable applications, through a developed IP strategy.
Advances in AI have changed the world in the last decade, whether indirect consumer-facing services like Amazon’s ‘Alexa’ or Apple’s ‘Siri’ which have become widespread, or behind the scenes with image processing; less glamorous inference; data processing; or control applications.
Whilst large scale necessarily cloud anchored applications will be here for the foreseeable future, cloud processing of AI requests places heavy demands on communications networks. Regardless of how communication technology advances, there will always be some issues of latency and reliability of connection. In a mobile world and for real-time safety-critical applications – with autonomous vehicles being one notable application – this can still be an important practical barrier to greater adoption.
The world is, unfortunately, experiencing the effects of the Covid-19 crisis at the time of writing, which has, among other things, greatly reduced human travel and transport energy demands. Data still travels, increasingly so, and a rising concern is the proportion of energy consumed by computing and communications. Although data obviously costs a lot less energy to transport than a person, it still has a finite energy and infrastructure cost. Rapidly growing individual streams of individual raw data from myriad mobile consumer applications of AI to and from data centres will hit bottlenecks. ‘Locally sourced’ intelligence can mitigate this.
The historical shift between cloud versus local or edge and mixed processing in other areas of computing will be familiar to most readers. You wouldn’t sensibly post a letter from the UK to California just to ask a question that the person at the post office counter could easily have answered for you. Using a data centre a thousand miles away to identify a smile could be compared to using a sledgehammer to crack a nut – even if you still need to use a cloud solution for part of the application. For many AI applications, an acceptable result can be obtained without needing the resources of a data centre, if a suitably trained processor is used locally. This can avoid, or at least reduce, communication demands and data centre processing demands – thereby making more applications more widely available.
A lot has been said and written about patent protection for AI. Speaking from my personal perspective as a patent attorney working in this area, I have frankly seen disproportionate hype around not much more than application of known techniques to a new data set, whereas some of the more interesting development (to me personally at least) is not really protectable for various reasons outside the scope of this article. That is not to say there is no scope for valuable innovation in the area of ‘conventional’ AI, but do not expect every application to be protectable, and be prepared to engage creatively with someone to root out what is commercially worthwhile protecting.
That being said, I do see plenty of scope for interesting and protectable development in making tiny AI work well. There are of course numerous applications which do work locally, but AI feeds on data. Having plenty of data to train on is important, so gathering available new input to grow that dataset is an important part of bootstrapping knowledge and effectiveness. This does not readily lend itself to individual smaller processors working on their own datasets.
Taking the right aspects of what can be done in the cloud and choosing to do them locally and then managing the interactions between local and cloud components still has a lot of unsolved problems. Getting the most out of all the data available to the local device’s eyes or ears without simply shipping all of it back to base, and keeping distributed processors efficiently up to date with the latest intelligence, is likely to play an important part in next-generation consumer AI applications.
I see AI as just following the cycle of other industrial developments a step or two behind other industries: we are now looking at improving energy efficiency; miniaturisation; data supply chain logistics; and security (which will be an issue – e.g. rogue data corrupting training). There is plenty of scope for innovation here as in other industries.
The backbone technology of AI is potentially valuable, and I predict numerous new companies will emerge to capitalise on niche areas, intellectual property (IP) being a key aspect of their strategy in order to maximise value and avoid simply being swallowed up or bypassed (and they may well be acquired based on that value). Companies working in AI often have a lot of smart people working on getting the product working well as a priority (for understandable reasons), but some give a lower priority to looking ahead to actively maximising ultimate value realisation. Creatively approaching the IP strategy is one component. It is always satisfying to see a company that has developed a great product do well, and frustrating to see one who did ok but could have done better. The key here would be for more companies to capitalise fully on the advancements they bring in giving AI more widespread and sustainable applications.
This article was originally published by Compare the Cloud in June 2020.
For more information on our IP expertise relating to artificial intelligence and machine learning, visit our page here.
Since the Court of Justice of the European Union (CJEU)’s decision in the case of Huawei v ZTE (July 2015) regarding competition law implications for FRAND-based standard essential patents (SEPs), various national courts have sought to clarify the scope of what can be considered ‘appropriate behaviour’.
In a recent SEP ruling, the Higher Regional Court of Karlsruhe comments on the interpretation of the four steps defined by the CJEU in 2015, and in particular, addresses the following key points:
Based on an SEP, the SEP user was sentenced in the first instance at the Mannheim District Court to cease and desist; to provide information; to destroy; to recall; and to pay damages. The SEP user appealed against this decision and was directed to the Higher Regional Court of Karlsruhe.
In this judgment, the Higher Regional Court of Karlsruhe confirmed that transmission of the infringement notice to the defendant is not absolutely necessary in order to fulfil the obligation under Step I of the CJEU decision. Instead, it is sufficient to send the notice of infringement to a group company which is responsible for licence negotiations and licensing within the group.
At the courts in Düsseldorf, a very high standard has been applied so far to the content of the notice of infringement. From the point of view of the Higher Regional Court of Karlsruhe however, it is sufficient that the SEP user is able to get a basic picture of the infringement allegation. For this purpose, contrary to the opinion of the Düsseldorf courts, no specific claim charts are necessary in Karlsruhe. Instead, reference to the SEP and the corresponding sections in the standard are adequate.
The Higher Regional Court of Karlsruhe’s deadline to reply to the infringement notice is considered to be two months. This relatively short period is justified by the fact that only an overview of the infringement notification is necessary for the first reply. A detailed examination of the merits of the infringement allegation is regularly conducted in the subsequent licence negotiations. However, if this deadline is missed, it is possible to make up for the failure to reply, even if the infringement proceedings are already underway. The same applies to the commencement of licence negotiations, provided that a pressure-free negotiation situation exists between the parties. In this aspect, a harmonised opinion emerged between the relevant courts in Germany.
The Higher Regional Court of Karlsruhe sets a lower standard than the courts in Düsseldorf for an assessment of whether a licence offer of the SEP holder meets the FRAND criteria. According to the present judgment, it is enough to hand over and explain the content of existing licence agreements regarding the FRAND assessment. In the present case, these reduced criteria were not taken into account, so the court considered the claims for injunction and recall to be abusive. In Düsseldorf courts, it is usually expected that full copies of these agreements must be submitted.
The Higher Regional Court of Karlsruhe also has a different opinion to the courts in Düsseldorf when it comes to the scope of accounting. Thus, in the present case, the SEP user must provide information on profit and costs in addition to the accounting regarding the FRAND license.
While the German infringement courts further clarify the CJEU requirements for SEPs, the courts in Düsseldorf, Munich and Karlsruhe/Mannheim all appear to apply the judgment differently on some key points.
For an SEP holder, this means that the choice of jurisdiction should be made with caution at this stage. In particular, the court in Mannheim/Karlsruhe seems to offer itself as comparatively friendly for an SEP holder, as the claims for infringement notification are lower, the scope of disclosure of existing license agreements is more limited, and the scope of the information that can be obtained through accounting is broader.
