Of the two cases--technically, sets of cases with different case numbers for different groups of defendants--the Munich I Regional Court's 21st Civil Chamber (Presiding Judge: Dr. Georg Werner; Reporting Judge: Dr. Benz; second side judge: Judge Anna-Lena Klein) heard yesterday, the first one was of heightened interest to me because it involved App Store monopoly as well as patent infringement issues. That's the "Epicsson" (Ericsson and Epic Games) interdependency that also plays a role in the discovery dispute at the ITC over Apple's astroturfing. From a pure patent litigation point of view, however, the afternoon part of yesterday's court session was even more important.
The second patent-in-suit is EP3119141 on a "technique for performing a random access procedure over a radio interface." That patent appears to be essential to both the 4G and 5G cellular standards as the court's preliminary claim construction is consistent with Ericsson's, and Apple's non-infringement arguments fail under that interpretation. Things are going well so far for Ericsson, whose lead counsel on the technical merits of this case is Kather Augenstein's Miriam Kiefer, with
Just like in the other case heard yesterday, it is not likely that Apple can defend itself unless it can raise serious validity issues. Those weren't addressed yesterday, but will be next time.
Of course, this being a SEP case and Ericsson seeking an injunction, there's also a FRAND defense to be adjudged. The court discussed case management with the parties as there are presently five Ericsson v. Apple SEP cases pending in Munich (plus the non-SEP case heard yesterday morning that is over WhatsApp's internal protocols, which are not an industry standard). Earlier this year the Munich court explained that it is exploring ways to streamline the resolution of multi-patent SEP disputes, with a single FRAND hearing, which in Ericsson v. Apple has been scheduled for December 21. That is still the plan, but the date may have to be pushed back. Apple has until October 21--by coincidence, the date of the Ninth Circuit hearing at which I expect Epic Games to make substantial progress--for its next FRAND pleading, and Ericsson would have to respond within a month in order for the court to have enough time to prepare for the hearing. Normally, Ericsson's lawyers of the can keep that schedule, but in the event Apple makes any surprise move (such as a counteroffer that requires careful analysis), Dr. Christof Augenstein couldn't rule out that they might have to request--and would then be granted, as Judge Dr. Werner assured--an extension.
Apple's lead counsel in the SEP case, Dr. Andreas von Falck of Hogan Lovells, also pointed to the FRAND trial in the Eastern District of Texas in early December. He didn't elaborate on where he sees the overlap between the Texas and Munich SEP issues. It's possible that any Texas testimony will be pointed to in the Munich FRAND discussion. Whether a jury verdict will bear much weight with German judges is doubtful. They might appreciate it if the outcome of the Texas case was consistent with their own findings, but wouldn't be deterred from reaching a divergent conclusion. Apart from an outlier patent pool case in Dusseldorf, no SEP implementer has prevailed on a FRAND defense in Germany in about five years (a couple of Mannheim cases where Philips was the losing plaintiff). Post-Sisvel v. Haier, the odds are long against Apple.
With Ericsson having the upper hand on the technical merits and the FRAND situation in Germany being what it is, Apple has to be creative, and its lawyers have raised a procedural issue that those asserting or defending against patents in Germany will find interesting: Apple argues that some Ericsson cases (such as the ones over EP'141, case nos. 21 O 513/22 and 21 O 515/22) should be dismissed under Art. 145 of the German Patent Act (§ 145 PatG), which says that a plaintiff must not sue an alleged infringer over the same actions that it should have raised in an earlier case. EP'141 is from the same patent family as EP1952560, over which the Mannheim court will hold a trial on January 17, 2023 (case no. 2 O 27/22).
According to Dr. Benjamin Schroeer ("Schröer" in German), there are two other patent families from which Ericsson chose to assert different members in Mannheim and Munich.
Presiding Judge Dr. Werner--who besides his judicial career is also well-recognized in academic circles--laid out the court's preliminary inclination, which is that Ericsson's case should go forward because Apple isn't harmed in the way that Art. 145 of the Patent Act seeks to shield defendants from. That's because German patent infringement courts typically sever distinct patents-in-suit anyway (under another Art. 145--that of the German Code of Civil Procedure).
On Ericsson's behalf, Dr. Kiefer agreed with the court's approach and added that Apple itself had actually requested that the Mannheim court sever a part of a case (apparently involving different defendants from Apple's corporate group). Dr. Augenstein requested (and was granted) leave to file a separate short brief about that fact.
Apple's argument that it would be more efficient for one court (either Mannheim or Munich) to adjudicate cases over closely related patents--even if there formally might be multiple case numbers--didn't get traction. Overall judicial economy is a key factor in the U.S., but the Mannheim Regional Court is run by another state (Baden Wurttemberg) than the Munich court (Bavaria), unlike U.S. district courts, all of which belong to the federal judiciary. There are no forcible venue transfers in Germany. If an infringement occurs nationwide, any court that may hear patent cases is a court of competent jurisdiction.
I'm sure that Apple's actual concern is neither about litigation costs (they do manage their multi-billion-dollar legal budget well, but above all they seek to devalue SEPs) nor about saving court resources (as I believe Judge Gilstrap would confirm after having had to rule on a number of Apple motions that the world never needed). In reality, this here is about the equivalent of double jeopardy: if Ericsson asserts similar patents (not identical, though, as that would amount to double patenting and not be allowed) in Mannheim and Munich, it has two bites at the proverbial apple--and one injunction may just be enough to bring about a settlement.
In the U.S., Apple would have a strong argument here: the risk of divergent decisions. But Germany has a totally different legal culture. An example from a different field of law illustrates the difference between common law and German law: there was a problem with a condominium in (if I recall correctly) Nuremberg, just about 100 miles north of Munich. It affected all owners or tenants in the same way. Several of them went to court. The cases were assigned to two different judges of the same lower court, and on an indistinguishable set of facts, some complaints succeeded while others were rejected. Whether this became more consistent at the appellate stage (if there even were appeals), I don't know. But there's no stare decisis doctrine in Germany. It wouldn't be considered the end of the world if Ericsson prevailed in Munich and lost in Mannheim, or the other way round.
The Munich and Mannheim courts manage cases differently. In Munich, there are typically two hearings per case on the technical merits (plus potentially a consolidated FRAND hearing for an entire dispute as I mentioned above). In Mannheim, there's just one trial, after which a decision normally comes down. Mannheim cases now tend to be resolved earlier than Munich cases, but plaintiffs often benefit from the pressure mounting on defendants based on how first hearings go (here, Ericsson is on the winning track for now in both cases heard yesterday). There may be situations in which Ericsson or Apple already know from a Munich case what arguments will likely be made in Mannheim, or the other way round.
From the beginning, where Ericsson brought a FRAND action under contract law in the Eastern District of Texas months before the expiration of the previous license agreement, the Swedish wireless innovator has displayed an extremely high level of sophistication when it comes to litigation tactics. Apple left no stone unturned in its attempts to restructure the Eastern District of Texas part of the dispute, but failed--because Ericsson's strategy worked out. At least for now it seems that things are also going according to plan for Ericsson in Germany. As I mentioned in the previous post, it's also pretty clever to sue Apple over WhatsApp for iOS, as virtually every German citizen uses WhatsApp and Apple, by maintaining (illegally as various parties and regulators reasonably believe) its iOS app distribution monopoly, thus can be held responsible for the apps it exclusively distributes. Apple's Epicsson dilemma.
