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Anna Samokhina

Pinsent Masons

KONINKLIJKE PHILIPS N.V. V. BELKIN GMBH, BELKIN LIMITED, BELKIN INTERNATIONAL, INC., UPC COURT OF FIRST INSTANCE – MUNICH (DE) LOCAL DIVISION, 13 SEPTEMBER 2024, CASE NO. UPC_CFI_390/2023

In a notable decision on 13 September 2024, the UPC’s Munich Local Division handed down the first full UPC decision concerning a standard essential patent (“SEP”), granting a permanent injunction in favour of Philips against Belkin. The court found the patent in suit to be valid as granted and, consequentially, infringed by Belkin. Notably, a FRAND defence was not available to Belkin.

The injunction granted covers several European countries including Germany, but carves out Belkin GmbH and Belkin Limited in Germany to avoid res judicata conflict, given there is a contradicting legally binding national judgement already in place there that involves both of these defendants.

Of further interest is the fact that the injunction extends to three Belkin directors.

Background

Philips and Belkin have been fighting this SEP battle both in national proceedings in Germany and the UPC. Philips is the proprietor of EP 2 867 997 B1 (“EP997”), an SEP which covers wireless inductive power transmission for charging of portable electronic devices. The invention introduces a negotiation phase between the power transmitter and receiver to agree on operating parameters, enabling higher power transmission levels. EP977 had been declared essential to the Qi wireless charging standard (Wireless Power Consortium, Inc IPR Policy).

In Germany, Philips has already been unsuccessful in its infringement action against Belkin. By judgement of 20 March 2023, the Düsseldorf Regional Court dismissed the action and found that Belkin’s products did not infringe Philips’ SEP relating to the Qi wireless charging standard. In April 2024, the Düsseldorf Higher Regional Court rejected Philips’ appeal for inadmissibility.

In parallel with the infringement proceedings, Belkin made an attempt to invalidate EP997 by bringing German national nullity proceedings. The validity of the patent was upheld by the Federal Patent Court of Germany.

Philips has made a decision to turn to the UPC in pursuit of success and emerged victorious. The decision handed down by the Munich Local Division addresses several important topics, including claim construction, liability of officers and directors as well as effect of a prior final German national court’s decision.

However, FRAND issues did not arise in this case. A FRAND defence can only succeed if the patent in issue confers market power (Case C-170/13 Huawei v ZTE) which it did not in this case because Qi is only one of various ways of charging a device. As such, Belkin did not run a FRAND defence, and such issues will need to be dealt with in future disputes before the UPC.

Decision and the reasoning

Stay of proceedings

The Munich Local Division rejected the stay of proceedings application in relation to both pending nullity proceedings and the infringement proceedings in Germany.

The pending nullity proceedings could not be considered due to the fact that a first-instance decision by the Federal Patent Court regarding the German part of the patent in suit has already been issued and, in case of an appeal being filed to the Federal Court of Justice, a decision would also not be expected in the short term. A stay to avoid the risk of contradictory decisions pursuant to Article 30(1) of the Brussels I Regulation was therefore not appropriate.

In relation to the infringement proceedings, it was explained that as the plaintiff’s appeal has been dismissed as inadmissible, there are no longer any infringement proceedings pending in Germany.

Claim construction

The judgement revolves around the interpretation of claim 20 of EP997 relating to a power transmitter with means for generating a power signal, initiating a mandatory configuration phase, receiving a request to enter a negotiation phase, confirming/rejecting the request, entering the negotiation phase and determining operating parameters through message exchange in negotiation cycles. The Munich Local Division found that the defendants’ devices meet all the features of claim 20 of EP997, resulting in a finding of infringement.

In reaching its decision, the Munich Local Division outlined that the description and drawings must be taken into account as explanatory aids for the purposes of claim construction rather than solely relying on the exact wording of the claim. It then clarified that this approach should not be abused and that an approach similar to that set out in the Protocol to Art. 69 EPC should be followed, meaning a balance must be struck between appropriate legal certainty for third parties and adequate protection for the patent proprietor. The Munich Local Division found that the skilled person would understand the technical meaning of the wording of the patent and take into account the entire disclosure of the patent.

Belkin attempted to argue lack of realisation of features 20.6 and 20.6.1 but the Munich Local Division rejected the defendants’ arguments. The parties were in dispute in relation to whether the requirements for entering the negotiation phase are always confirmed with an acceptance. The judges considered several interpretations of feature 20.6, including the interpretation of the Düsseldorf Regional Court and Federal Patent Court. The judges focused on identifying the following:

1. If, in the view of the skilled person, the description of the patent in suit also describes a constellation in which a declaration of acceptance is always transmitted to the recipient of the service as confirmation; and

2. Whether this constellation is reflected in the wording of the claim.

The Munich Local Division decided that the first question is answered in affirmative by the implementation described in paragraph [0046] of EP997 and that the constellation outlined in paragraph [0046] corresponds to the objective of the patent in suit to create the possibility of carrying out a patent-compliant negotiation phase in further development of the Qi standard existing at the time of priority.

As to the second question, the judges found that the patent specification must be read in a meaningful context and, in case of doubt, the patent claim must be understood in such a way that there are no contradictions with the description and the drawings.

Claim 20 indicated sufficiently clearly in its feature 20.6.1 that the embodiment described in paragraph [0046] is also intended to be covered. The judges confirmed that a function-oriented interpretation of the wording should be applied that meant that according to feature 20.6, there must be:

a. means for receiving a request to enter the negotiation phase; and

b. means for confirming the request, whereby the service sender not only declares with the confirmation that it has received the request, but also whether it accepts or rejects it.

The response of the service sender to the request of the service recipient can therefore be “yes” or “no”.

The judges then moved to consider if a claim-compliant power transmitter must also be able to reject a request, or whether the wording of feature 20.6 also includes embodiments that always accept requests from power recipients to enter the negotiation phase, i.e. do not provide for rejection. From a linguistic point of view, the Munich Local Division found that the subordinate clause “Transfer of a confirmation, … whereby the confirmation is indicative of an acceptance or rejection” can be understood to mean that the confirmation can alternatively be “yes” or “no”. But the judges thought the fact that the answer, according to the wording of the feature 20.6, must also be able to read “no” was difficult to justify from a purely linguistic point of view.

From a technical point of view, the judges stated that it cannot be justified that a patent-compliant performance transmitter must also be able to reject a request to enter the negotiation phase. They decided that there was no apparent technical reason why a power transmitter must be able to respond to a request with a rejection as it is not necessary or functionally intended according to the patent in suit.

Importantly, the Munich Local Division established that the core of the invention is precisely in the fact that the service provider and the service recipient can enter into a bidirectional negotiation phase, if they can, to achieve a higher performance. This objective is achieved even in the case of a service sender that always declares its willingness to enter into this phase of negotiations.

Overall, the judges sided with Philips whose interpretation of the contested features was that a power transmitter that always responds to the request with an acceptance, and never a rejection, still falls within the scope of the claim.

Validity

Belkin counterclaimed for invalidity on a number of grounds, including added matter, novelty and lack of inventive step. The judges confirmed the validity of the patent and dismissed Belkin’s counterclaim.

Directors’ liability

Independent liability of Belkin’s directors arose from their roles and that, despite knowledge of the infringing acts, did not take action to prevent infringement of the patent.

The Munich Local Division found that the named directors provide services to the defendant companies which enabled the companies to carry out infringing acts, and that they could influence the infringing acts by issuing instructions to subordinates. As such, the directors were considered an intermediary within the meaning of Article 63(1) UPCA against whom an injunction could be sought.

Considerations

The Munich Local Division’s findings in this case, including the willingness to diverge from national decisions in relation to the same patent and the imposition of the injunction on three Belkin directors may increase the pressure on implementers operating in the QI wireless charging technology space to enter into a licence agreement.

However, the burning question of how the UPC is to deal with SEP/FRAND issues has been deferred to another time. Further, the speed of the UPC’s decision – around 11 months after Philips filed the action – is extremely quick, but as the court did not have to consider FRAND issues, it is likely not typical example of how SEP/FRAND disputes may unfold before the UPC.

The order (in German) can be read here.