Oppo Injuncted after Refusing to Accept UK court's Global FRAND Rate

Oppo has chosen to be injuncted in the UK, rather than commit to accepting a global FRAND rate for Nokia’s 5G-eraportfolio determined by the High Court of England and Wales. Having been informed of this decision by Oppo last week, the court granted a FRAND injunction against it on 7 September.

This is the latest of several injunctions granted against Oppo in the parties’ global dispute. Most of those have been issued in Europe, where Nokia initiated a slew of patent lawsuits against the device maker in late-2021. However, the spat is also being fought elsewhere, including in China, Oppo’s home country and largest market, where the company seems determined to see the dispute resolved.

Last week’s developments follow on from a key decision handed down by the High Court of England and Wales in late-July. That saw the court reject Oppo’s argument that the licensing fee for Nokia’s portfolio – or at least for the Chinese part of that portfolio – should be set by the No. 1 Intermediate People’s Court of Chongqing Municipality, which has agreed set a global rate in the dispute.

Having previously failed to persuade the UK Supreme Court to stay rate-setting proceedings in London until the Chinese court hands down its judgment, Oppo had contended that its willingness to license on terms set in China was sufficient under Nokia’s ETSI undertaking to avoid an injunction.

The High Court disagreed, finding Oppo an unwilling licensee and Nokia a willing licensor. Oppo was told that it would have to decide whether to accept unconditionally to license Nokia’s patents globally on a rate determined in the UK or to be subjected to an injunction in the UK.

In a hearing last week, the Chinese company opted not to accept a global FRAND rate to be set in London. This is not quite as predictable a move as it might appear, given that the High Court’s recent InterDigital v Lenovo and Optis v Apple decisions –its second and third ever global rate-setting decisions – are perceived to have been broadly favourable to the implementers.

The High Court, in turn, granted an injunction based on Nokia’s 4G and 5G SEP, EP 2 981 103. This was found to be valid, infringed and standard-essential by the same court in a January 2023 decision resulting from one of several UK technical trials involved in the dispute. The injunction, however, has been stayed pending the outcome of Oppo’s appeal in that case, which is likely to last for between six and nine months.

Oppo has also had an injunction granted against it on the basis of an implementation patent – EP 3 716 560 B1 – which has been found to be infringed by some of Oppo’s 4G/LTE phones, and to be valid. This will automatically come into force 28 days after last week’s decision. But Oppo claims that it has a design-around for the patented technology, which will allow it to circumvent the sales ban.

The court has also ordered Oppo to pay Nokia’s legal costs.

This adds to the growing list of injunctions won by Nokia. Regional Courts in Germany awarded four injunctions against Oppo last year, prompting the Chinese company to leave the German market rather than come to the table.

Nokia, furthermore, won a Dutch injunction against Oppo’s German subsidiary Orope DE, which had filed an invalidity suit in the Netherlands against a patent belonging to the Finnish company. The District Court of The Hague found that the patent – EP2 981 103 – was valid, standard-essential for 4G and 5G, and infringed by Orope.

That injunction has had little impact on Oppo, however, because Orope DE does not operate in the Netherlands. In January, the District Court of The Hague turned down Nokia’s request for a preliminary injunction against Oleading, which operates Oppo’s online store in the country. Nokia is currently appealing that decision.

Oppo has, however, recently withdrawn its products from the French market, although this decision does not appear to be directly related to the patent dispute.

As such, despite having suffered some setbacks in Europe (see here, here and here), Nokia is clearly winning on this front, with Oppo having withdrawn, or having had injunctions imposed against it, in several key markets on the continent.

Nokia has also enjoyed significant victories in Brazil, where an injunction has been awarded against Oppo, and India, whose Supreme Court has ordered the Chinese company to hand over a significant security deposit while the dispute is being resolved.

None of these successes has yet been enough to bring Oppo to the table, though. The implementer is apparently determined to have the dispute’s outcome decided in China, where presumably it believes it will receive a more favourable ruling. Indeed, the fact that a significant share of Oppo’s overall revenue is derived from its home country gives the company a distinct strategic advantage in this respect.