The Munich I Regional Court is the world's most popular patent injunction forum. Five years ago, standard-essential patent (SEP) cases were rarely filed in Munich. By now it's a major SEP venue, which increasingly also involves video and audio codecs as the Seventh Civil Chamber's Presiding Judge Dr. Matthias Zigann noted at a K.Mizra v. Niantic trial in July (that one was not a codec case, but there was an analogy).
I've been able to find out from the court's press office about some interesting developments in connection with EVS (Enhanced Voice Services) enforcement actions. OPPO has won a reopening of the record (a retrial before a decision even came down) in a case brought by VoiceAge EVS; meanwhile, they as well as Apple and Xiaomi are defending themselves in Munich against various infringement lawsuits filed by Crystal Clear Codec, a non-practicing entity (NPE) equipped with patents that originally belonged to Huawei.
Reopening of record in VoiceAge EVS v. OPPO case
Things were going smoothly--in fact, perfectly--for VoiceAge EVS in Germany: it had won every single one of half a dozen cases, which was amazing and possibly unprecedented, and it had licensed more than half of the global smartphone market, with Xiaomi apparently settling in the summer. Then came OPPO, which after its withdrawal from the German market is not going to come under pressure soon--a nightmare for patentees--and which is also giving Nokia's world-class in-house and outside litigators a hard time:
The first VoiceAge EVS v. OPPO decision resulted in a stay, as OPPO's challenge to the patent-in-suit succeeded to some degree in the Federal Patent Court.
The second VoiceAge EVS v. OPPO decision (case no. 7 O 9609/21 over EP2102619 on a "method and device for coding transition frames in speech signals"; HMD was enjoined over the same patent in May) came down on Thursday (October 13), and it's not an injunction either. Instead of rendering a final judgment at this stage, the Seventh Civil Chamber under Presiding Judge Dr. Zigann decided to reopen the record, with a new trial date to be determined at a later stage. The court will firstly await the written decision of the Federal Patent Court, which at the end of a June 30, 2022 nullity hearing upheld the patent in a modified form.
OPPO argued that the Federal Patent Court construed the patent-in-suit differently from the Munich I Regional Court's claim construction in the infringement proceedings. VoiceAge EVS didn't deny that divergence, but asserted that the patent was infringed either way. As the Munich I Regional Court has not heard oral argument from the parties on the basis of the allegedly divergent claim construction by the Federal Patent Court, it determined that a retrial (even prior to a judgment following the first trial) was warranted.
While I can't predict the final outcome, it's clear based on the information the court provided to me that there won't be a judgment too soon. It usually takes quite some time until the Federal Patent Court hands down its written reasons. Thereafter, the parties will be able to amend their pleadings accordingly. And sometime thereafter the court will conduct the retrial.
This is almost as good for OPPO as a stay.
Non-practicing entity Crystal Clear Codec asserting former Huawei patents in Munich against Apple, Xiaomi, and OPPO
A whole new enforcement campaign over EVS SEPs is pending in Munich, and the plaintiff is named Crystal Clear Codec (CCC). It has offices in the United States and in Poland (where the address is apparently a letterbox in a Sheraton hotel). Chinese website C114 reported in late August on post-grant challenges brought by OPPO and Xiaomi over six Chinese patents. Those six patents are from the same patent families as patents that CCC asserted against LG.
All of the patents listed on CCC's website were originally obtained by Huawei, and some of the assignments haven't even been recorded yet in certain patent databases. CCC notes that the founder of CCC, David Sewell, had previously set up another NPE named EVS Codec Technologies (ECT), which settled litigation with Huawei, a while after which Huawei assigned patents to CCC.
The Chinese report furthermore says that CCC is asserting patents in multiple jurisdictions. Today the Munich I Regional Court has confirmed the pendency of the following CCC lawsuits:
against Apple: cases no. 21 O 3789/22, 21 O 3790/22, and 21 O 3791/22 (with a different Apple entity being named as the defendant in each of those cases, so practically it's like a single case with multiple defendants) over EP2940685 on a "prediction method and decoding device for bandwidth expansion band signal"
against Xiaomi: case no. 21 O 11199/21 over the same patent (EP'685)
against OPPO: cases no. 21 O 11198/21 over EP2983170 on a "frequency domain envelope vector quantization method and apparatus" and no. 21 O 10517/22 over EP2352145 on a "transient speech signal encoding method and device, decoding method and device, processing system and computer-readable storage medium"
Xiaomi is conducting discovery of CCC in the United States for the purpose of using the information in the Munich proceedings. Here are a couple of related U.S. court documents:
September 19, 2022 order on report and recommendation
Presumably the companies defending against CCC's infringement actions are not licensed to Huawei's patents, or at minimum were not licensed at the time when those patents were assigned to CCC.
Huawei has been on the receiving end of NPE lawsuits involving patents formerly owned by operating companies, most famously Unwired Planet. That litigation reached the UK Supreme Court, which held that implementers may be enjoined in the UK market if they refuse to take a global portfolio license (at the time, just prior to Brexit taking effect, applying Huawei v. ZTE).
It is unfortunate for consumers in the Western hemisphere that--starting under the Trump Administration and continuing under President Biden--Huawei has been forced out of key network infrastructure markets and lost its competitiveness in Western smartphone markets (by not being able to distribute Google's Android apps such as the Google Play Store; a non-issue in China, but a huge disadvantage elsewhere). Huawei continues to be very innovative, but it must seek compensation for the use of its patented inventions more than ever. In July, Huawei was announced as an initial contributor to a WiFi 6 patent pool run by Sisvel. Huawei is not only a licensor, but continues to be a major implementer of the WiFi standard, even if no longer on a worldwide basis.
My recommendation to implementers is to take a license to Huawei's portfolio and to ensure that the license will travel with patents as they get assigned (normally that's the way license agreements work). But if some infringement lawsuits by assignees of Huawei patents--such as CCC--are already pending, they must be resolved separately.
