Tuesday, July 5, 2022

Nokia wins second Mannheim patent case against OPPO (4G/5G standard-essential patent) two weeks after previous injunction

On May 3, the Mannheim Regional Court held a Nokia v. OPPO trial over a patent that was originally declared standard-essential to the 4G (LTE) standard and later to 5G: EP2981103 on an "allocation of preamble sequences". That same patent won Nokia an injunction against Daimler two years ago, but I believe OPPO developed a stronger non-infringement (non-essentiality, to be more precise) argument. Nevertheless, the Mannheim Regional Court's spokesman has just informed me that Nokia's complaint "has succeeded for the most part."

Two weeks ago, the same division of the same court granted Nokia a non-standard-essential patent injunction against OPPO.

OPPO is countersuing Nokia over 5G SEPs. The Munich I Regional Court conducted a first hearing in one of those cases in May, which went very well for OPPO. At least at the time of that hearing, OPPO wasn't pursuing injunctions, though its counsel kept that option on the table for the future.

What's next?

The Karlsruhe Higher Regional Court has the authority to stay the enforcement of patent injunctions during the appellate proceedings, provided that an appellant-defendant is more likely than not to prevail on appeal. OPPO is in a position to raise important questions, such as

  • the validity of the WiFi-related non-SEP (first injunction),

  • the essentiality of EP'103 (today's judgment), and

  • FRAND-related questions (today's judgment), which are particularly interesting here given that Nokia sued within days of expiration of a prior license agreement and it's a two-way dispute.

In a scenario in which the appeals court doesn't stay enforcement, the next question would be whether OPPO could work around those patents. Assuming that at least one of the patents can't just be worked around, its German resellers (telecommunications carriers, retail chains like MediaMarkt) could still buy OPPO's products before enforcement begins--and even after enforcement has begun, they could source those products in countries in which Nokia has not won an injunction, though Nokia could theoretically sue them (which in the case of mobile carriers would be a difficult decision as they are Nokia's network infrastructure customers).

Only a rather small part of OPPO's worldwide sales is generated in Germany. So even if OPPO's German sales were materially affected, the impact on a global scale may still be limited. Settlements can fall into place anytime, and patent infringement rulings are a driver of settlements. Here, however, it is not a given that Nokia already has enough leverage over OPPO, given that OPPO sells most of its devices in other markets, particularly in some rather price-sensitive geographies. It will be interesting to watch what happens next.

Other parties who have yet to renew their license agreements with Nokia, and who generate a larger portion of their global sales in Germany than OPPO does, will now have to think really hard about the prospect of litigation.