Just as I predicted on Tuesday, the Oberlandesgericht München (Munich Higher Regional Court) once again proved that the lower court's patent judges can't be trusted to hand down reasonable and responsible decisions. They're out of control and stop at pretty much nothing to please patentees, but at least there is an appellate process.
On October 30, the Landgericht München I (Munich I Regional Court) had granted Nokia a standard-essential patent (SEP) injunction against Daimler, and allowed it to be enforced during the appellate proceedings if Nokia had posted collateral to the amount of €18 million (a little over $20 million), which is a laughable amount when the nationwide sales (which effectively even includes exports going out of the country) of Mercedes vehicles are at stake. While Nokia, for purely tactical reasons, carved out Mercedes cars that come with a telematics control unit (TCU) made by Samsung subsidiary Harman Becker, the percentage of Daimler's sales that would be affected by the enforcement of this injunction is still very high. (And Nokia expressly reserved the right to bring a follow-on case to go after the remaining portion of Daimler's sales as well.)
The appeals court has raised the security amount by a factor of almost 100 to €1.673 billion for the enforcement of the injunction itself, and to €11 million for the costs incurred by Daimler to provide the accounting that would enable Nokia to quantify its damages claim.
It appears very unlikely that Nokia can afford making a $2B+ deposit. Nokia could also post a bond, but presumably a bank would require Nokia to put the amount at stake into an escrow-style account.
But even if Nokia provided the collateral, they wouldn't necessarily get to enforce the injunction. Not only did Daimler move for an adjustment for the security amount (which motion clearly succeeded) but there is also a motion to stay enforcement pending the appellate proceedings, with Daimler arguing it's going to win the appeal. If Nokia started to enforce, the appeals court might still stay enforcement on other grounds (technical merits or FRAND/antitrust considerations).
Nokia is desperately trying to gain leverage over Daimler and to prevent the Court of Justice of the EU from clarifying the entitlement of component makers to an exhaustive SEP license on FRAND terms.
What the Munich appeals court has delivered is quite the opposite of a Christmas present for the lower court. It should give the patent judges on the court below some pause. If they continue to interpret the law in absurd ways, they'll be overruled again and again and again. Their "forum selling" efforts deprive defendants of even their most basic rights, and that court's patent rulings have lately become a very serious threat to industry (not only--but also--the automotive sector). What Germany needs badly is patent injunction reform--a real reform that would also affect SEP cases like this one.
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