The Delhi High Court on September 02, 2015 has issued an injunction against iBall from importing the devices that are infringing Ericsson’s essential patents. The interim order would become operative from September 09, 2015 and will be effective till the next hearing date.
Standard Essential Patents (SEPs) are necessarily required to be used by any party (manufacturing, selling, offering for sale etc.) to comply with technical standards. Standardization organizations require licenses of essential patents to be on fair, reasonable, and non-discriminatory (FRAND) terms.
Brief facts of the case
- Telefonaktiebolaget Lm Ericsson (the plaintiff) has filed the suit for permanent injunction on August 21, 2015 restraining infringement of patents, damages, rendition of accounts, delivery up etc. against M/s Best It World (India) Private Limited (the defendant) popularly known as iBall.
- Prior to said suit, the defendant instituted a complaint before the Competition Commission of India (CCI) alleging that the plaintiff being the owner of Standard Essential Patents has abused its dominant position.
- Thus, the plaintiff submitted that due to lack of good faith on part of the defendant, the suit for permanent injunction was filed.
- Further, the plaintiff also alleged that from November, 2011 till date the defendant has refused to even execute a mutually agreeable NDA so that commercial discussions can commence between the parties.
- However the defendant alleged that the plaintiff failed to provide relevant details thereby enabling the defendant to be aware about the legal rights of the plaintiff. Also that the plaintiff in the suit has incorrectly mentioned that the defendant is unwilling to execute the FRAND Agreement.
- Further, the defendant insisted that it is not the manufacturer and is merely an importer of the products in question.
Core Contention of Ericsson
It is contented that the suit patents relate to three technologies in the field of telecommunications pertaining inter alia to 2G, EDGE and 3G devices (mobile handsets, tablets, dongles etc.):
- Adaptive Multi-Rate (AMR) speech codec – a feature that conserves use of bandwidth and enhances speech quality; (AMR)
- Features in 3G phones – Multi service handling by a Single Mobile Station & A mobile radio for use in a mobile radio communication system; (3G)
- Enhanced Data Rates for GSM Evolution (EDGE) – A transceiving unit for block automatic retransmission request; (EDGE)
The details of patents infringed by iBall as alleged by Ericsson are following:
The plaintiff has also filed an expert affidavit of Mr. Vijay Ghate along with reports of internal tests which were performed on three devices namely:
- iBall Andi Xotic;
- iBall Cobalt Oomph;
- iBall Andi Sparkle.
Observations and Decision of court
The Court felt that the defendant has not taken any step or shown any interest for the purpose of execution of the FRAND Agreement.
Further on one hand the defendant has alleged that it has not infringed the suit patents of the plaintiff and on the other hand the defendant itself has filed the complaint before the CCI wherein certain admissions of the rights of the plaintiff have been made.
The court was of the opinion that if the interim direction/ order is not granted, the plaintiff would suffer irreparable loss and injury because of the reason that the defendant would keep on marketing the mobile devices without the FRAND agreement and without paying any royalty.
Therefore, an injunction was issued against iBall from importing the devices that are infringing Ericsson’s essential patents which would become operative from September 09, 2015 and will be
effective till the next hearing date.
In this case, the Court has strongly condemned the actions of iBall of not taking any step for execution of FRAND Agreement and alleging that it has not infringed Ericsson’s SEPs, while in the meantime, it filed a complaint before the CCI against Ericsson for abusing its market dominance. The Court granted the interim injunction keeping into consideration that Ericsson would suffer huge loss due continuous operations of marketing and sale of iBall devices without the execution of FRAND