TQ Delta, LLC v Zyxel Communications UK Ltd & Anor

Trial dates for RAND or FRAND disputes should be fixed by proportionate case management, having regard to the parties’ preparation, prejudice caused by delay and the realistic scope of the issues. Counsel’s availability alone is not a sufficient reason to postpone a hearing. Expert evidence should be admitted only where its likely benefit justifies its cost and effect on the trial. A statistical essentiality review may be suitable as a cross-check, but detailed disputes about individual patents should not be allowed to overwhelm a RAND trial where they are unlikely materially to affect the result.

The claimant brought patent infringement proceedings concerning DSL technology and sought a RAND trial concerning licensing terms for its patent portfolio. The technical trial had not yet been determined. Following amendments to the RAND case and the exclusion of part of expert evidence by Arnold J in [2018] EWHC 3651, the claimant sought a RAND trial in 2019. The defendants sought an adjournment until April 2020 or later, relying principally on preparation requirements, expert evidence and counsel availability.

The central issue was the appropriate trial date and the proportionate time to allow for the proposed RAND issues.

1. The court ordered that the RAND trial take place in September 2019, allowing ten days for trial and two days for pre-reading. The precise date was left to listing and Birss J’s availability.

2. Trial dates had to be fixed by assessing the evidence, the parties’ preparation needs and the prejudice caused by delay. The court accepted that the claimant’s reliance on newly available licence evidence required an adjournment, but held that the question of fault was irrelevant to fixing the new date.

3. The claimant was permitted to amend its RAND case to advance an economic-benefits analysis as a cross-check. The proposed essentiality evidence was not admitted at that stage. Its admission would depend on its contents, proportionality, likely effect on trial length and practical benefit.

4. The court considered that a statistical sample of patents could be used for a cross-check, following the approach discussed in Unwired Planet v Huawei. The experts should meet and identify agreed essentiality conclusions where possible. Extensive cross-examination on individual patents was unlikely to be proportionate.

5. The court rejected the suggestion that the hearing should be delayed because chosen counsel might be unavailable. Following Alan Bates and Others v Post Office Limited, counsel availability was not a proper basis for postponing the trial. The parties could be adequately represented by other advocates.

6. The court also referred to the Copyright Tribunal’s robust case management as an example of proportionate handling of complex licensing disputes. The relevant statutory provisions required reasonable orders, regard to comparable licensing schemes and all relevant considerations.

This was a first-instance case-management decision. The judgment records an earlier hearing before Arnold J, whose decision is reported at [2018] EWHC 3651, concerning amendments, disclosure and admissibility of evidence.