September 27, 2021
Optis Cellular Technology LLC claimed that its European Patent (UK), relating to “a mechanism for Radio LinkControl (RLC) polling for continuous transmission within the wireless communication network” (the Patent) was valid and essential to the relevant mobile telecoms standards and that it was therefore being infringed by the defendant, Apple Retail UK Ltd.
Apple conceded essentiality/infringement. Mr Justice Meade found that the Patent was valid. The main question was whether Apple had a defence of proprietary estoppel, which prevented Optis from enforcing the Patent, arising from the way in which the former owner of the Patent, Ericsson, had behaved in relation to the adoption of the solution of the Patent into the LTE standard.
The undisputed facts were that, on 8 January 2008, Ericsson filed a US Provisional Patent Application. It also uploaded a technical proposal (TDoc) onto the 3rd Generation Partnership Project’s server, which contained the same information as the US Provisional. At two 3GPP RAN Working Group 2 (WG2) meetings in 2008, Ericsson successfully made a case for the inclusion of the disclosure of the TDoc into the LTE standard, which led to it forming part of an ETSI technical specification. That technical specification was frozen on 11 December 2008. Ericsson did not mention the existence of the Ericsson US Provisional at the RAN WG2 meetings and did not declare it to ETSI until 20 May 2010.
Meade J noted that the three basic elements of proprietary estoppel are: (i) assurance made to the claimant; (ii) reliance on it by the claimant; and (iii) detriment to the claimant in consequence of the reliance.
Apple argued that ETSI and/or members of RAN WG2 were under an assurance that Ericsson had no IPR over the Ericsson TDoc, as a result of which a chance was lost for them to seek an alternative, unpatented solution. It said that the relevant assurance arose either by Ericsson acquiescing in the belief of RAN WG2 members that there was no IPR covering the Ericsson TDoc, or by Ericsson having made an implicit assertion by silence that there was no such IPR.
Meade J made various findings of fact, including:
- a large proportion of the inventions underlying potentially essential patents were generally made close in time to WG meetings when the engineers involved focused on the specific technical problems relevant to the parts of the standard they were working on; it was common to file a patent application in very similar terms to the TDoc just before provision of the TDoc to a WG, otherwise, the TDoc would anticipate any later application; in such cases, the patent application would likely be unpublished at the freeze date;
- at WG meetings (whether ETSI or 3GPP) a “Call for IPR” was routinely made, but it was not intended to result, and did not result, in participants declaring IPR at the meetings;
- it was well known that most declarations were made after the stage 3 freeze date;
- ETSI did not scrutinise whether IPR declared to it was essential; declarants did that themselves;
- the evidence overwhelmingly showed that there was in fact no practice of WG participants checking to see whether TDoc proposals up for discussion in a forthcoming meeting were or might be covered by IP; and
- no thought would have been given by RAN WG2 participants to whether there was likely to be IPR associated with the Ericsson TDoc.
As for ETSI, Meade J found that it had consistently taken the approach that:
- the key objective was to achieve the best technical solution;
- it was inevitable that members would have essential patents covering ETSI standards and there was nothing wrong with that in itself; and
- “late” disclosure was only a problem if a licence was not available for the IPR concerned, or if one was not available on FRAND terms.
As for Ericsson, Meade J found that Apple had no basis to assert that Ericsson had committed any act of deliberate concealment. Given the very high prevalence of declarations after the freeze date and ETSI’s own attitude, the inherent probability that Ericsson thought it was in breach of any ETSI rules was very low. There was also no basis for Ericsson to have thought that it was concealing anything when it submitted the Ericsson TDoc shortly after filing the Ericsson US Provisional. It was following common practice, which was not to review the IP status of any TDocs or to use any such analysis to prepare submissions to WGs.
Given his findings of fact, Meade J held that no member of the RAN WG2 could reasonably have been under the impression that the Ericsson TDoc was IPR-free. There was no evidence that any of them was under such an impression and, if any of them were, there was no reason why Ericsson could or should have been aware of it. Therefore, there was no assurance.
The findings of fact meant that Apple’s argument that Ericsson had made a representation by its silence also failed. Ericsson’s silence would, objectively, be understood to be consistent with its having filed a patent application, but not yet having declared it (or alternatively having declared it, but it still being in the “reflection” period when it had not yet been published by ETSI). Meade J rejected any contention that, through its silence, Ericsson had made a representation of “No-IPR”.
As for reliance, since the facts were that the WGs did not assess TDocs by reference to whether they were, or were likely, to be covered by IPR, there could be no reliance. Even if Ericsson had said that it had IPR over the Ericsson TDoc, the RAN WG2 would have acted in the same way and the Ericsson TDoc would have been adopted because it was the best technical solution. Any assurance about IPR would have been irrelevant.
Since IPR was simply not considered by the WGs, it was hypothetical to consider whether there was any detriment. Apple did not assert that some other non-patented solution would have been chosen, only that there was a chance that it might. In Meade J’s view, that chance was nil. Therefore, there was no detriment.
Apple’s defence of proprietary estoppel was dismissed. (Optis Cellular Technology LLC v Apple Retail UK Ltd  EWHC 1739 (Pat) (25 June 2021).