ITC LogoWe’ve previously covered the bilateral standard-essential patent battle brewing between Ericsson and Samsung in the U.S. International Trade Commission (as well as the Eastern District of Texas).  The ITC has instituted two investigations surrounding the parties’ claims: Inv. No. 337-TA-862 (based on Ericsson’s complaint) and Inv. No. 337-TA-866 (based on Samsung’s complaint).  Yesterday, Samsung filed the public version of its Response to the Complaint and Notice of Investigation (essentially, an answer to Ericsson’s complaint) in the -862 investigation.  Below is an overview of this filing, in which (surprise!) F/RAND-related issues and defenses have a starring role.

In its introduction, Samsung waste no time accusing Ericsson of violating its F/RAND commitments.  Samsung notes that the parties have “a long licensing history,” including a now-expired 2007 cross-license to each other’s wireless standard-essential patents.  But according to Samsung, Ericsson has now “willfully breached its commitments and continues to refuse to offer a license to Samsung under FRAND terms despite Samsung’s continued willingness to accept such a license.”  Samsung further alleges that Ericsson is demanding different payment terms than what was in the parties’ prior license, including royalty rates “that are orders of magnitude greater” (although there is no publicly-available detail about the royalty amounts demanded).  Samsung claims that Ericsson’s ITC complaint is an improper and unlawful attempt to force Samsung to pay royalties that bear no relation to the value of Ericsson’s technology.

Samsung’s Defenses – Generic & Specific to SEPs

Samsung asserts a litany of defenses in response to Ericsson’s allegations of infringement.  These defenses include those typically seen in ITC Section 337 investigations, such as: non-infringement, invalidity, lack of domestic industry for the asserted patents, no “unfair act” under the trade laws, immunity of Samsung’s sales to the government of accused products, public interest considerations, covenant not to sue/license/exhaustion, patent misuse/unclean hands, failure to state a claim, and a catch-all “other defenses” category.

But Samsung also asserts several defenses that stem from the fact that Ericsson has asserted seven patents that are essential to various IEEE and 3GPP/ETSI wireless standards (LTE, UMTS, GPRS, GSM, AMR speech coding, and 802.11n Wi-Fi).  These SEP-specific defenses are:

  • Unenforceability: Samsung claims that Ericsson’s infringement claims relating to its standard-essential patents are barred in whole or in part by the equitable doctrines such as unclean hands, waiver, and estoppel, because Ericsson allegedly failed to comply with its contractual F/RAND promises to the IEEE, 3GPP, and ETSI.    Samsung alleges that Ericsson failed to offer F/RAND terms and did not negotiate in good faith toward a F/RAND license.
  • Patent Misuse: In addition to its defense of patent misuse relating to a non-SEP, Samsung asserts that Ericsson is prohibited from enforcing the seven standard-essential patents based on the doctrine of patent misuse.
  • Lack of Standing: Samsung claims Ericsson lacks standing to obtain exclusionary relief for the seven standard-essential patents at issue because it has not offered Samsung, a willing licensee, a license on F/RAND terms.

(Note that Samsung did not assert an absolute bar against exclusion orders for F/RAND-encumbered standard-essential patents, which comes as no surprise given that it is currently asserting SEPs in Secton 337 cases against both Apple and Ericsson).

ALJ David P. Shaw is the presiding administrative law judge over this case, which is fitting given his experience dealing with standard-essential patent issues in Inv. No. 337-TA-752 (Motorola-Microsoft) and 337-TA-800 (InterDigital, hearing ongoing).  But as with nearly all standard-essential patent infringement issues at the ITC, some of Samsung’s defenses may be affected by the Commission’s pending Final Determination in Investigation No. 337-TA-794 (Samsung’s complaint against Apple), so stay tuned.

[February 11, 2013 Samsung Response to Complaint/Notice of Investigation]