At a 3G patent damages trial held in Mannheim on Friday afternoon, counsel for HTC told the most popular court in the world for wireless patent disputes that some of the Taiwanese device maker's shipments into Germany were held during the previous week (week of 2/4/13-2/10/13) by customs officers at Frankfurt-Hahn airport after patent monetization entity IPCom had applied for border seizure of HTC's 3G-compatible devices.
HTC's lawyer, Dr. Martin Chakraborty of Hogan Lovells, mentioned this fact as well as a failed attempt by IPCom to have HTC devices seized by the police at last year's CeBIT trade show (held in Hanover, Germany) as examples of IPCom's tireless and unrelenting efforts to force HTC to accept its terms. In 2007 IPCom had acquired a portfolio of wireless patents from Robert Bosch GmbH, a company that used to build wireless handsets but exited the market approximately 10 years ago. Most if not all of the Bosch patents IPCom purchased were declared essential to cellular telecommunications standards, particularly 3G (UMTS). The Munich-based patent firm's lead counsel, Dr. Wolfgang Kellenter of Hengeler Mueller, did not comment on the enforcement measures allegedly taken but claimed that HTC had been unwilling to come to the negotiating table.
It is unclear whether the goods seized had been released ahead of last week's damages trial. At this point there are no reports of a shortage of HTC devices in Germany. Nor did HTC's lawyer specify whether IPCom had requested customs action under
EU Council Regulation (EC) No 1383/2003 of 22 July 2003 concerning customs action against goods suspected of infringing certain intellectual property rights and the measures to be taken against goods found to have infringed such rights, under which LG Electronics achieved the temporary seizure of 300,000 Sony PlayStations in the Netherlands two years ago, or
An application for customs action under the aforementioned EU regulation could have Europe-wide effects and result in the seizure of HTC shipments in other EU member states (though possibly with some delay).
IPCom has been suing Nokia and HTC for about five years. IPCom still hasn't been able to successfully enforce an injunction. In the meantime, dozens of its patents have been declared invalid as granted (which usually means that they had to be narrowed through amendments). A recent ruling by Justice Floyd of the UK High Court mentions that shortly before a mid-January hearing, "Nokia and IPCom announced that they were close to a settlement of the disputes between them".
Last spring HTC had to postpone the launch of two products in the U.S. market after customs officers seized shipments for alleged violation of an import ban ordered by the ITC further to a complaint by Apple. The overall dispute between Apple and HTC was settled in November. HTC could have avoided the temporary seizure of products in the U.S. by requesting an advisory opinion from the ITC on its modified products. European and German customs actions are not comparable to ITC import bans. While the ITC holds evidentiary hearings (trials) before ordering an import ban, seizure can be requested in Europe merely on the grounds of suspected infringement. Improper requests for customs action can result in substantial liability for the disruptions caused to an alleged infringer's business.
IPCom's unilateral action against HTC's importation of gadgets into the German market appears daring against the background of the European Commission's efforts to give meaning to FRAND licensing pledges. Less than three weeks ago, European Commission Vice President Joaquín Almunia told reporters at a press briefing that more companies than Samsung, which received a Statement of Objections (preliminary ruling) over its past pursuit of SEP-based injunctions against Apple, may face formal investigations and, ultimately, fines. More than three years ago IPCom avoided formal EU antitrust investigations by declaring itself bound to the FRAND licensing pledges Robert Bosch GmbH had made prior to selling its wireless patents to the patent monetization entity.
Tensions between HTC and IPCom rose in late 2011 after HTC withdrew, on the eve of an appellate hearing, its appeal against a 2009 Mannheim injunction over a patent that had in the meantime been declared invalid as granted (but valid in an amended form) by the Bundespatentgericht (Federal Patent Court). This delayed resolution of IPCom's claims over two patents that it had added to its complaint only at the appellate stage. A few weeks later, IPCom sued dozens of German retailers for continuing the resale of HTC gadgets despite a cease-and-desist order sent by a law firm on IPCom's behalf.
Global market leader Samsung is licensed to IPCom's patent portfolio. It made a lump-sum payment of $12.5 million to Bosch approximately 10 years ago. IPCom is known to demand far higher royalties now. One industry player that is known to have taken a license from IPCom itself (rather than Bosch prior to the sale of the portfolio) is the BlackBerry maker formerly known as Research In Motion. The terms of that deal have not been disclosed.
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