Thursday, May 19, 2022

OPPO says Nokia base stations infringe patent that is foundational to 5G as key enabler of ultra-reliable low-latency communication (URLLC): Munich litigation

This morning, the Landgericht München I (Munich I Regional Court) held a first hearing in case no. 7 O 14390/21, Guangdong OPPO Mobile Telecommunications Corp.. Ltd. v. nokia solutions over EP3598819 on a "method, apparatus and system for transmitting periodic uplink information/signals." The asserted claim is (apparatus) claim 9. OPPO's lead counsel, Professor Tilman Mueller-Stoy, was accompanied by attorney-at-law Dr. Jan Boesing ("Bösing" in German) and patent attorney Tobias Kaufmann. The Bardehle Pagenberg team squared off with Boris Kreye of Bird & Bird, another lawyer (presumably from Bird & Bird) I didn't know, and Samson patent attorney Alexander Muenster ("Münster" in German).

While Nokia is pursuing injunctive relief against OPPO in numerous cases around the globe, it turned out that OPPO has not (yet) requested injunctions in its countersuits in Germany, though Professor Mueller-Stoy reserved his client's right to do so at a later stage if need be. For the time being, OPPO is just seeking a judgment on the merits, i.e., a finding that it's entitled to damages for past infringement (with the amount to be determined further down the road).

Whatever the remedies may ultimately be, this was a historic event. Unless I've missed something in an exotic jurisdiction, this was the first time in history for a court to hear a case in which OPPO is enforcing a patent. It's not that OPPO doesn't have plenty of them: it's a major SEP holder especially but not only in 5G, and owns numerous non-SEPs, too. But it makes huge volumes of consumer electronics products, so OPPO is a net licensee despite a formidable patent portfolio that it calls its own.

I hadn't seen Professor Mueller-Stoy in action for almost a decade. I've linked to a few of his write-ups, and today I saw him again in the vey same place and courtroom where he achieved great results for Microsoft v. Motorola in the early 2010s. His performance was impeccable: structured, coherent, compelling.

His counterpart Mr. Kreye was also very good (and the two treated each other with great respect and civility), but fighting an uphill battle on some issues. When Mr. Kreye argued that OPPO should have picked other defendants from the Nokia group than the two German legal entities it's presently suing in Munich, he insisted that the official minutes (in German proceedings, there's no transcript--it's up to the presiding judge to dictate the minutes) should mention that the same law firm representing OPPO, Bardehle Pagenberg, was representing Vivo in another case against Nokia, but targeting two Finnish entities (Nokia Corp. and Nokia Solutions and Networks). That's a Dusseldorf case I also found out about this month. But pointing to an unrelated case (with the overlap being limited to outside counsel) is not a substitute for clearly denying that the defendants in the present case have a hand in the allegedly infringing actions, which is why Judge Dr. Zigann (who previously alerted Nokia to the insufficiency of its attempted denial) asked: "So, what's your point?"

There are a couple of disputed claim constructions in the case, but Nokia's attempts to narrow the scope of the claims didn't appear to get much traction. Unless Nokia manages to persuade the court that the disputed limitations should be interpreted narrowly, the focus at the second hearing--the actual trial--on March 9, 2023 will likely be on the infringement analysis. While I don't mean to say that this is going to be a get-out-of-jail-free card for Nokia, this here is one of a minority of German SEP cases in which the defendant denies that its devices actually implement the relevant part of the standard. Most of the time, those cases turn on whether the SEP-in-suit reads on the standard that the accused devices are advertised to be compliant with. (In the event of an enforcement proceeding, actual infringement does come into play--but normally not before.)

A key term brought up by OPPO's counsel in this regard was URLLC: ultra-reliable low-latency communication. Here's a Nature Electronics article on the subject--and the Wikipedia article on 5G states in its "Application areas" section that URLLC is about "using the network for mission critical applications that require uninterrupted and robust data exchange."

Professor Mueller-Stoy started his argument today by stressing that low latency is absolutely key to the advantages 5G offers over 4G, and that the patent-in-suit covers a groundbreaking invention enabling low latency by minimizing the number of messages going back and forth between a base station and a handset seeking permission to send data on an uplink channel, and by organizing such coordination in a way that allows the base station to release some of its resources by determining it doesn't have to listen to a particular end-user device in a given situation.

In cellular SEP cases one can increasingly see 4G patents that also read on 5G (at least allegedly). 4G was named LTE: long-term evolution. LTE was a paradigm shift from 3G and meant to serve as a basis for several future standards. Some 4G techniques are found in 5G as well. A good example is EP'103, the patent the Mannheim court discussed at the recent Nokia v. OPPO trial. Presiding Judge Dr. Holger Kircher said that the implementation of the same technique in 5G didn't differ from the one in 4G to the extent that the court would even have to make a distinction for the purposes of that case.

5G-only patents like OPPO's EP'819 (today's patent-in-suit) are deemed particularly valuable. Based on what I heard in that Munich courtroom today, I start to see why: if a major performance increase can indeed be attributed to a specific patented invention, and if that performance enables particular applications such as fully autonomous driving, that means something.

Nokia pointed to the fact that the patent had only been granted last summer, so any infringement allegations would have to relate to the period since then. And Nokia asserts that the part of the standard that OPPO says the patent reads on isn't mandatory. However, in order for OPPO to win the case, it's sufficient if there are some scenarios in which an infringement occurs. OPPO appears convinced that the patent is infringed when 5G is used for low-latency communication, and in this context pointed to a private 5G network that Nokia set up for Volkswagen at its Wolfsburg HQ. I've googled a December 6, 2021 press release by Nokia on the Wolfsburg deployment, which indeed touts "reliable high-bandwidth and low-latency connectivity for sensors, machines, vehicles and other equipment".

The Munich court is so busy--in general, but also with this Nokia v. OPPO/OPPO v. Nokia dispute, in which there'll basically be hearings and trials every month now--that it couldn't give the parties a sooner trial date than next March. This means the parties now have several months for the next pleadings. Mr. Kreye stressed that Nokia had a "bunch" of defenses. But it's not a numbers game. If they have an availing defense, one is enough. Today it seemed like Nokia was on the defense, which is a rare sight--even more so in Munich.

By now I'm sure Nokia has realized that OPPO is an adversary of a different caliber than Daimler. I have no doubt that Nokia will ultimately earn very significant royalties as OPPO's exposure to patent assertions is far greater. But the question is how much more Nokia can get under the next deal than under the one that expired last summer--and at some point Nokia will have to ask itself whether protracted litigation is likely to be profitable. OPPO's countersuits make the FRAND analysis more interesting than in cases where you have only one licensor and one licensee.

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