Saturday, July 9, 2022

5G iPhones and iPads banned in Colombia after court grants Ericsson preliminary injunction over standard-essential patent; Apple seeking antisuit damages order in Texas

Less than six months after the current wave of Ericsson v. Apple patent infringement actions started, the first sales and import ban is already being enforced:

Apple is currently unable to sell 5G iPhones and iPads in Colombia, or import them into the South American country (though Apple says there is currently no 5G network available to consumers in Colombia, an unpersuasive argument that I'll comment on further below).

The Juzgado 043 Civil del Circuito de Bogotá--a court in the Colombian capital of Bogotá--found Apple's 5G iPhones and iPads to infringe claim 13 of Colombian patent no. NC2019/0003681, which has been declared essential to the 5G standard and was granted to Ericsson in 2019 an will remain valid until December 2037. That patent is a member of global patent family that also includes (among others) U.S. Patent No. 10,516,513 on "controllable CSI-RS density" and EP3510716 on "obtaining and indicating of component combination used for CSI-RS." The abbreviation CSI-RS stands for "channel state information reference signals."

The infringement determination was already made in April. In May, Ericsson posted a bond of approximately US$50K as a prerequisite to enforcement. On Wednesday (July 6), the court ordered a preliminary injunction, which Apple's Colombian subsidiary (Apple Colombia S.A.S.) now has to obey (while Apple is, unsurprisingly, appealing the decision).

The preliminary injunction bars Apple from the import, sale, commercialization, and advertisement of products infringing that patent. Under the order, Apple must "warn and communicate with" shops, retailers, owners of social media platforms, mass media, and e-commerce platforms within the territory of Colombia in order to ensure compliance. The affected devices are various iPhone 12 and 13 models, as well as newer iPads. The preliminary injunction furthermore directs the Dirección de Impuestos y Aduanas Nacionales (DIAN)--Colombia's customs authority--to prevent the importation into Colombia of infringing Apple devices.

In addition, Judge Ronald Neil Orozco Gómez decided that Apple must not seek or enforce an antisuit injunction from foreign country that prevent or restrict Ericsson's enforcement of the Colombian preliminary injunction. This kind of court order is called an anti-antisuit injunction: an injunction against an (actual or--as in this case--potential) antisuit injunction. The first court in the world to grant an anti-antisuit injunction in a standard-essential patent (SEP) case was the Munich I Regional Court (Nokia v. Continental, 2019; 21st Civil Chamber, then under Presiding Judge Tobias Pichlmaier). Since then, the Munich court has further developed its anti-antisuit case law to shield its jurisdiction over German patents (or, in most cases, the German parts of European patents) from foreign interference, including that anti-antisuit injunctions are available on a pre-emptive basis if certain conditions are met. Not only has at least one other German court (the Dusseldorf Regional Court) adopted that approach but courts in other jurisdictions have found at least some of the Munich court's logic compelling--which has now apparently also occurred in Colombia.

Apple's hands are tied now because of the anti-antisuit injunction: seeking an antisuit injunction against Ericsson to thwart the enforcement of that Colombian patent would be a flagrant violation of the Colombian anti-antisuit injunction, with potentially grave consequences for its Colombian subsidiary and its executives.

Another part of the problem for Apple is that Ericsson will find it easier in certain jurisdictions (particularly Germany) to obtain SEP injunctions if Apple, through its conduct, meets those courts' criteria for being an unwilling licensee. So far, in the SEP cases I've watched in Munich and Mannheim in recent years, each and every defendant--most recently, Chinese smartphone maker OPPO in its dispute with Nokia--has been deemed an unwilling licensee, and has consequently been enjoined. In an InterDigital v. Xiaomi case, the Munich court's Seventh Civil Chamber under Presiding Judge Dr. Matthias Zigann held that the pursuit of an antisuit injunction against the enforcement of a SEP injunction gives rise to a strong presumption of unwillingness to take a license.

So, instead of an antisuit injunction, Apple's lawyers are now seeking antisuit damages in the Eastern District of Texas. On Friday, Apple brought an emergency motion with the court, saying that the Colombian inunction gives Ericsson "economic and logistical leverage [...] to pressure Apple to abandon this litigation and capitulate to Ericsson’s [royalty] demand," and asks Chief Judge Rodney Gilstrap to decide as swiftly as possible that Ericsson must "indemnify Apple from any fines, fees, penalties, and costs it incurs as a result of the Colombian injunction." Elsewhere, Apple describes this as "tak[ing] financial responsibility" in Texas for what it's doing in Colombia. Apple wants to "hold Ericsson accountable" in Texas for any damages, hoping that Ericsson would then "reconsider" its patent enforcement campaign.

Apple is apparently hoping that the distinction between seeking an antisuit injunction (a court order under which Ericsson would be penalized in the U.S. for enforcing a patent injunction in Colombia) and an antisuit damages claim may help Apple avoid contempt-of-court sanctions in Colombia. But I'm not sure:

  • Ericsson could now seek another preliminary injunction in Colombia (or an extension of the existing one) against Apple's antisuit damages claim in Texas. While the current Colombian anti-antisuit injunction is an anti-antisuit-injunction injunction, Ericsson would now additionally obtain an anti-antisuit-damages injunction.

  • Tellingly, Apple's legal argument is based on the Unterweser case law for U.S. antisuit injunctions.

  • The course of action that Apple has chosen could be taken into consideration by courts in other jurisdictions, particularly Germany, in their analysis of Apple's (un)willingness to take a license.

  • Ericsson might seek a German anti-antisuit injunction (which would protect against both antisuit injunctions and antisuit damages claims) now. It could also go back to a court in the Netherlands, which denied an anti-antisuit injunction last year because Apple said it didn't intend to seek an antisuit injunction.

There are interesting questions involved, but what I find extremely weak (if not absurd) is that Apple likens its antisuit damages claim to an anti-antisuit injunction Ericsson sought and obtained from Judge Gilstrap last year in its dispute with Samsung. That's an apples-to-oranges comparison at best. Ericsson went to the Texas court because Samsung had obtained an antisuit injunction from a Chinese court that interfered with the Texas proceedings, including the potential enforcement of U.S. patents. In Ericsson v. Apple, there is no foreign antisuit injunction that would affect Apple's ability to litigate the FRAND dispute in Texas, or (if it so elected) to enforce any U.S. patents in the Texas court. Apple's argument is that the Colombian injunction might force Apple to "capitulate"--i.e., settle--in which case the Texas case might never go to trial.

Judge Gilstrap himself has actually made it clear before that Ericsson simply has the right to enforce its patents, and that Apple, by not taking a license, "subject[s] itself to actions for infringement."

No (public) 5G network in operation in Colombia

A sworn declaration by Apple's Colombian counsel is attached to Apple's filing in Texas and says, among other things, that "5G networks are still not available for consumer use in Colombia." The U.S. court filing indicates that Apple wants the Colombian court to "confirm[] that an injunction on a purportedly 5G essential method patent cannot be enforced until a 5G network is activated in Colombia."

The patent claim underlying the injunction is a method claim ("un método para obtener, en un dispositivo inalámbrico [...]"--"a method for obtaining, in a wireless device..."). Infringement occurs when the method is executed. However, Apple cannot rule out that

  • infringement may already occur, such as when Colombian network operators conduct 5G tests in preparation of a rollout, and

  • infringement will occur as soon as any Colombian network operator activates 5G service.

I've found articles according to which 5G trials by major Colombian carriers were already authorized in June 2020 (with one company, Claro, already conducting the first tests in 2018), and the plan was for 5G networks to be "deployed before the end of 2022." A more recent article, however, suggests that Colombia's 5G deployment could be delayed by a couple more years.

Even limited pilots make it a possibility that the method covered by the relevant patent claim would be executed in Colombia at this point. Furthermore, it could be that Colombian patent law is violated even if Colombian iPhone buyers only infringed when traveling to countries where 5G is already widely available.

Apple could theoretically--though for practical reasons it presumably wouldn't want to--sell 4G phones only in Colombia, thereby working around the injunction.

Finally, let me share the key documents. First, Apple's motion for emergency relief in the form of an antisuit damages order:

Second, an exhibit to that motion, which also includes translations of Colombian court orders: