Huawei Technologies Co, Ltd v Conversant Wireless Licensing S.A.R.L.

A dispute concerning the validity, essentiality and infringement of UK standard-essential patents is substantively connected to the United Kingdom. The patent-holder’s FRAND undertaking and any dispute about a global licence form part of the inquiry into whether relief should be granted for infringement; they do not convert the claim into enforcement of a global portfolio right.

For forum purposes, the court must characterise the whole dispute without defining it so narrowly or broadly that the answer is predetermined. Proceedings upon different foreign patents concern different property rights and do not constitute an alternative trial of the same dispute. The English court is therefore the proper forum for claims enforcing UK patents. FRAND issues embedded in those claims cannot ordinarily be severed and stayed in favour of proceedings which would determine only a licence under foreign patents.

Conversant owned a multinational portfolio containing patents said to be essential to telecommunications standards. It sued Huawei and ZTE group companies for infringement of four UK patents and sought declarations concerning its compliance with its obligation to offer licences on fair, reasonable and non-discriminatory terms. It also sought determination of the FRAND terms for licensing its portfolio.

Henry Carr J dismissed challenges based on justiciability and forum non conveniens in [2018] EWHC 808 (Pat). Following Unwired Planet International Ltd v Huawei Technologies Co Ltd [2018] EWCA Civ 2344, the appellants accepted that their justiciability argument could not succeed in the Court of Appeal. The central issue was whether China was an available and clearly more appropriate forum, having regard to the global licensing dispute, Chinese patent proceedings and the comparatively small proportion of the appellants’ business conducted in the United Kingdom.

1. Appeal dismissed unanimously. The judge correctly characterised the proceedings as a dispute about the validity, essentiality and infringement of UK patents and the relief available for their infringement. The associated FRAND questions did not turn the proceedings into a claim enforcing a global portfolio right, because no such right exists.

2. A forum dispute must be characterised by examining the parties’ whole dispute, including known defences. The characterisation must avoid both undue specificity and excessive generality. A definition based merely on English forms of relief may prejudge the answer, but a definition which would leave the claimant to sue upon different property rights and different underlying facts abroad is too broad.

3. Conversant’s FRAND undertaking was inseparable from whether it was entitled to relief for infringement. If a willing licensor and willing licensee would agree a global FRAND licence, the implementer’s refusal to enter that licence may permit an injunction restraining infringement of the UK patents. That result neither alters the territorial character of the patents nor involves deciding the validity of foreign patents.

4. The Chinese patents were different property rights, with different claims, prior art, technical issues and domestic acts of infringement. Proceedings upon them were not the same dispute viewed through Chinese law. Resolution of the present dispute required decisions on UK patent validity, essentiality and infringement. England was therefore clearly the most appropriate, and effectively the only possible, forum.

5. The FRAND issues could not be severed for forum purposes. The requested declaration of licence terms arose from the same facts and was dependent upon at least one UK patent being valid and essential. Nor was a case-management stay justified: the pending Chinese proceedings concerned Chinese patents and would not determine a licence extending to the United Kingdom.

6. The English-domiciled defendants had to be sued here under article 4(1) of the Brussels I Recast Regulation. Reflexive application of article 24(4) could not extend exclusive jurisdiction to disputes merely “closely allied” to foreign-patent validity. The substantial UK businesses and direct-infringement allegations were not artificial devices for anchoring claims against the Chinese defendants.

7. The additional Chinese-law material did not establish that a Chinese court would determine a global licence without both parties’ consent or decide essentiality and infringement of foreign patents. Its implications remained speculative. The court also refused a reference to the CJEU because the relevant EU law was sufficiently clear.

1. Court of Appeal (Civil Division): In [2019] EWCA Civ 38, the court unanimously dismissed the appellants’ forum non conveniens appeal. It also refused the requested reference to the CJEU.

2. Patents Court: Henry Carr J dismissed both limbs of the jurisdiction challenge in [2018] EWHC 808 (Pat). He held that the claims passed through the relevant service-out gateways, raised a serious issue to be tried, and should be tried in England.