Tesla, Inc and another v InterDigital Patent Holdings, Inc and others; Tesla, Inc and others v InterDigital Patent Holdings, Inc and another No 2

A patent owner’s FRAND undertaking remains relevant when it voluntarily licenses its standard-essential patents through a pool or platform agent. At the interlocutory jurisdiction stage, an implementer may have a real prospect of establishing that commercial reality makes a global platform licence the only FRAND licence, although the undertaking does not require every separate licence offer to be FRAND.

Declaratory relief may concern rights not vested in the defendant where the parties have a legitimate interest, the declaration serves a useful purpose and procedural fairness is protected. A claim to enforce a FRAND obligation attached to UK patents remains a claim concerning those patents even where the licence sought is worldwide. It may therefore be served at the UK patent address and may pass through the property gateway for service abroad.

Tesla wished to launch 5G-enabled vehicles in the United Kingdom. It sought declarations establishing the FRAND terms of a licence covering standard-essential patents offered through Avanci’s worldwide platform, including UK patents owned by InterDigital. It also advanced an alternative claim for a bilateral licence of InterDigital’s global portfolio.

Fancourt J struck out the licensing claims and set aside service: [2024] EWHC 1815 (Ch); [2024] RPC 29. A majority of the Court of Appeal dismissed Tesla’s appeal, while Arnold LJ dissented: [2025] EWCA Civ 193; [2025] RPC 12.

The Supreme Court considered whether the licensing claims presented a serious issue to be tried; whether declaratory relief could be granted against the patent owner and platform agent; whether service was valid under the Civil Procedure Rules 1998; and whether the Delaware Court of Chancery was an available alternative forum.

Appeal allowed unanimously. Lord Hamblen and Lord Kitchin delivered the judgment, with which Lord Sales, Lord Briggs and Lord Burrows agreed.

1. Serious issue to be tried. A SEP owner does not cease to be bound by its FRAND undertaking merely because it chooses to license through a pool or platform agent. Commercial practice is relevant when interpreting the ETSI IPR Policy and identifying FRAND terms. Tesla had a real prospect of establishing that, as a matter of commercial reality, the only FRAND licence of InterDigital’s UK SEPs was a global Avanci platform licence at a FRAND rate. The obligation nevertheless requires FRAND terms to be available; it does not require every distinct commercial licence offer to be FRAND.
2. Declaratory relief. The jurisdiction founded on section 19 of the Senior Courts Act 1981 and rule 40.20 of the Civil Procedure Rules 1998 is broad and discretionary. A cause of action against the defendant is unnecessary. A declaration may concern rights or obligations not vested in a party where the parties have a legitimate interest, the relief serves a useful purpose and it furthers justice without unfairly prejudicing absent persons. Unlike Vestel Elektronik Sanayi Ve Ticaret AS v Access Advance LLC [2021] EWCA Civ 440, Tesla asserted an enforceable right to a FRAND licence. It therefore had a real prospect of obtaining declarations against both InterDigital and Avanci, notwithstanding that Avanci had no independent FRAND obligation.
3. Fairness. The absence of every platform licensor did not make the claims unarguable. Avanci had devised the platform terms and was the essential party to their assessment. Individual licensors could apply to participate, with their interests addressed through case management. Tesla had also pleaded an alternative claim for the FRAND terms of a bilateral licence from InterDigital.
4. Characterisation and service. The licensing claims principally concerned InterDigital’s UK SEPs. That remained so although only a global licence extending to foreign patents might be FRAND. A licence claim which, if established, would preclude infringement relates to the UK patents for rule 63.14. Service on IDPH at its registered UK patent address was valid. IDH, which gave the ETSI undertaking on IDPH’s behalf, was a necessary or proper party under Gateway 3. The claim also related wholly or principally to property within the jurisdiction under Gateway 11.
5. Forum and discretion. The Delaware Court of Chancery was not an available forum for the dispute as properly characterised because it was unlikely to determine FRAND terms for UK patents. No compelling discretionary reason justified refusing service abroad after the applicable requirements had been met.

1. United Kingdom Supreme Court: In Tesla, Inc and another v InterDigital Patent Holdings, Inc and others; Tesla, Inc and others v InterDigital Patent Holdings, Inc and another No 2 [2026] UKSC 27 , the court unanimously allowed Tesla’s appeal.
2. Court of Appeal: By a majority, the court dismissed Tesla’s appeal; Arnold LJ dissented: [2025] EWCA Civ 193 ; [2025] RPC 12. The Supreme Court reversed that decision.
3. High Court, Chancery Division: Fancourt J granted the jurisdiction applications concerning the licensing claims, set aside service and struck out those claims. He dismissed the corresponding applications concerning the patent claims and stayed those claims by consent: [2024] EWHC 1815 (Ch) ; [2024] RPC 29.