Tuesday, January 18, 2022

Ericsson seeks U.S. import ban against iPhone, iPad, Apple Watch; accuses Apple of 'reverse hold-up' in 4G/5G patent licensing negotiations

I've just been able to obtain the complaint Ericsson filed against Apple yesterday with the United States International Trade Commission, seeking a U.S. import ban of 4G and 5G Apple products (iPhones, iPads, and Apple Watches; I'll provide the full list further below). As I speculated in my previous post on Ericsson v. Apple, one of the two patent infringement lawsuits Ericsson filed yesterday with the United States District Court for the Western District of Texas is a companion complaint to an ITC complaint--and as I figured, it's the one in which Ericsson is asserting four patents:

  1. U.S. Patent No. 8,102,805 on "HARQ [Hybrid Automatic Repeat reQuest] in spatial mutiplexing MIMO [multiple-input multiple-output] system"

  2. U.S. Patent No. 9,532,355 on "transmission of system information on a downlink shared channel"

  3. U.S. Patent No. 10,425,817 on a "subscription concealed identifier"

  4. U.S. Patent No. 11,139,872 on "codebook subset restriction signaling"

Those four patents have all been declared essential to the 4G or 5G cellular connectivity standards. The Texas case will be stayed pending the resolution of the ITC complaint, but Ericsson could go back later (should the parties still not have agreed on a deal by then) and seek damages in Texas. The ITC can order import bans, but does not have the statutory authority to award damages.

Formally, the ITC now has to decide whether to institute an investigation. That preliminary phase takes about a month, and it's a given that an investigation will be launched.

The complaint reveals that the previous license agreement ran through Friday (January 14, 2022). The most interesting passage is how Ericsson experienced its talks with Apple to agree on a new license agreement:

"[...] Starting in late 2020, Ericsson extended offers to Apple to sign a new license on FRAND terms. In sum, consistent with its obligations under the ETSI IPR Policy and to the technology community, Ericsson has sought in good faith to conclude a license agreement with Apple on FRAND terms.

"Ericsson’s efforts have failed because Apple refuses to pay a FRAND royalty for a portfolio license commensurate with licenses taken by existing licensees. Apple’s gambit is indistinguishable from a “reverse hold-up,” in which Apple abuses the protections afforded by FRAND while freely using Ericsson’s patented technology. Such tactics give Apple a ubstantial, unfair edge over its telecommunications competitors who have agreed to—and who maintain—licenses under Ericsson’s global portfolio of patents on FRAND terms. Apple has therefore not fulfilled its obligations to remain a third party beneficiary of the contract between Ericsson and ETSI." (emphases added)

Ericsson also says it has "provided Apple with a set of 300 claim charts demonstrating essentiality of certain of Ericsson’s Essential Patents," but "[t]he negotiations made clear there is a dispute between Apple and Ericsson as to the essentiality, and value, of Ericsson’s Essential Patent portfolio." And then Ericsson says this:

"After more than a year of negotiations, Apple continues to insist on an unreasonably low, non-FRAND rate for a cross-license." (emphasis added)

Various media reports today quoted an Ericsson statement according to which the Swedish company is now suing Apple "in multiple jurisdictions." I would expect at least Germany, the United Kingdom, and the Netherlands to be among them, and possibly some Asian jurisdictions. I'll try to find out more.

The official title is "In the Matter of Certain Mobile Telephones, Tablet Computers with Cellular Connectivity, and Smart Watches with Cellular Connectivity, Components Thereof, and Products Containing Same." Here's the complete list of accused Apple products:

  • 5G iPhones: iPhone 13 Pro, iPhone 13 Pro Max, iPhone 13 (5G), iPhone 13 mini, iPhone 12, iPhone 12 Pro, iPhone 12 Pro Max, iPhone 12 mini

  • 4G iPhones: iPhone 11 Pro, iPhone 11 Pro Max, iPhone 11, iPhone SE, iPhone XS, iPhone XS Max, iPhone XR, iPhone X, iPhone 8 Plus, iPhone 8

  • 5G iPads: iPad Pro 11-inch (3rd gen), iPad Pro 12.9-inch (5th gen), iiPad mini (6th gen)

  • 4G iPads: iPad Air (4th gen), iPad (9th gen), iPad Pro 12.9-inch (4th gen), iPad Pro 12.9-inch (3rd gen), iPad Pro 12.9-inch (2nd gen), iPad Pro 12.9-inch (1st gen), iPad Pro 11-inch (2nd gen), iPad Pro 11-inch (1st gen), iPad Pro 10.5-inch, iPad Pro 97-inch, iPad Air (3rd gen), iPad Air 2, iPad Air (1st gen), iPad (8th gen), iPad (7th gen), iPad (6th gen), iPad (5th gen), iPad mini (5th gen), iPad mini 4, iPad mini 3, iPad mini 2

  • 4G Apple Watches: Apple Watch Series 7, Apple Watch Series 6 Apple Watch SE, Apple Watch Series 5, Apple Watch Series 4

In principle, Ericsson can try to add to that list any Apple products released in the coming months.

Here's Ericsson's ITC complaint (without the exhibits):

22-01-17 Ericsson v. Apple ... by Florian Mueller

Share with other professionals via LinkedIn: