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BE – Tunstall v. Télé-Secours and Victrix Socsan / forced licence

22 Aug 2022

Tunstall Group Holdings Limited, Tunstall Group Limited, Tunstal SA v. Victrix Socsan and Télé-Secours, French-speaking Enterprise Court of Brussels, Belgium, 26 July 2022, Case no. A/21/01929 

Health solutions provider Tunstall holds EP 2 160 038 B2, a patent relating to tone signaling and more specifically to a method of encoding dual-tone multi-frequency (DTMF) digital elements into sequential tone multi-frequency (STMF) signals and to a system for generating, sending, receiving and decoding STMF signals. The patented technology offers greater reliability in the transmission of information between end-subscriber reception units and the software that processes the signal.

Tunstall alleges that Télé-Secours -one of the major Belgian providers of telecare services-  and platform provider Victrix Socsan infringe EP ‘038. Télé-Secours and Victrix Socsan argue that TUNSTALL is abusing its dominant position, as Tunstall refuses to grant them a licence to use the technology protected by said patent.

The Court, after a review of the facts, rules that there is insufficient evidence of Tunstall’s dominance in the relevant markets. However, the Cout rules that there is an abuse of economic dependence. This is a relatively new addition to the Code de droit économique (Economic Law Code).

The Code de droit économique (CDE)  defines the position of economic dependence as “the position of dependence of an undertaking on one or more other undertakings, characterised by the absence of a reasonably equivalent alternative available within a reasonable time, on reasonable terms and at reasonable cost, which would enable the undertaking or each of them to impose obligations or conditions which could not be imposed under normal market circumstances”.

Legislative history shows that Economic dependence must be considered in the individual relationship between two companies “If it is impossible to change trading partners on the same terms or if the cost of doing so is unreasonably high, there is economic dependence. As long as there are sufficient and reasonable possibilities to change trading partners under the same conditions, there is no question of economic dependence”.

After a review of the facts, the Court comes to the conclusion that there are no sufficient or reasonable alternatives for Télé-Secours to change its platform provider under the same technical conditions as those offered by competitors who do not have the patented technology, and that  Télé-Secours is therefore economically dependent on Tunstall.

Tunstall’s behavior forces Victrix Socsan to stay out of the platform market in Belgium. This causes it commercial damage and damage to its reputation. It is completely dependent on the goodwill of Tunstall to be able to execute two important contracts on the Belgian market, which demonstrates its economic dependence on Tunstall.

The Court therefore rules that in the present case, Tunstall should be ordered to grant Victrix Socsan and Télé-Secours a non-exclusive licence to use its European patent, allowing them to use, on the Belgian territory and for as long as the royalties are paid, at the latest until the expiry of the patent, the communication protocols falling under the scope of protection of the patent.

The price of this licence shall be equal to the average price paid by other Tunstall licensees for the said licence in the Belgian territory and prorated according to the remaining period of validity of the patent at the date of the conclusion of the licence agreement.

A copy of the decision (in French) can be read here.
A copy of the decision (in English) can be read here.