In the telephony industry, the SEPs (Standard Essential Patents) are numerous and are owned by majors that, thanks to their patents, can afford to put competitors out of business, denying the use of essential standards.
How to protect competition
In order to avoid this distorting effect the community legislation envisages that SEPs’ owners are obliged to license them under equal conditions called FRAND (Fair, Reasonable, Non-Discriminatory). Whether a condition is FRAND, especially with regard to the total of the requested royalty, the decision is up to the national Court.
The Commission checks for abuses and at the moment there is an investigation on Motorola for probable abuse of his dominating position. The case has not been disposed yet, but in the last days a Statement of Objections, i.e. a preliminary objection, has been notified.
The case
The investigation started after a request filed by Motorola to a german Court in order to obtain a court injunction against Apple for its violation of SEPs. Nothing out of the ordinary here except that Apple, after having received the injunction, has immediately stated its will to accept the FRAND conditions imposed by the german Court. Such a circumstance, according to the Commission, makes Apple a voluntary licensee. The fact that the licensee could object to the validity of the owner’s patents does not prevent a FRAND license subscription, and this is a clause present in the agreement wanted by Motorola and contested by Apple.
After all, during a negotiation, it can happen that the parties don’t come to an agreement and they refer to the Judge to evaluate and decide on the FRAND terms as it happened in the case described above.
Another scenario
It could have been different, had Apple rejected cooperation or procrastinated the negotiation itself with excuses or artifices in order to avoid signing an agreement, in which case it wouldn’t have been considered a voluntary licensee and Motorola could well have had the possibility to request an injunction against it.