The fair and reasonable in essential patents
In panel 10 of ABPI’s 42nd Congress, which addressed “Judicial disputes over essential patents”, judge Flávia Romano, from TJ-RJ, resorted to semantics to debug the meaning of FRAND licenses ⎯ fair, reasonable, and non-discriminatory ⎯ standards set for essential patents. The judge participated in the debate alongside attorney Niclas Gajeck, moderated by the president of AIPPI, Luiz Henrique do Amaral.
As there is no standardization in Brazil for essential patents, declared the judge, the issue must be treated based on the legal nature of sharing and collaboration between the parties. She defined fair as “just and transparent, in the sense of providing complete information”. The reasonable is the “balance in the collection of royalties by the holder”, according to the “weight of the essential patent as a whole”. And non-discriminatory, for the magistrate, refers to the isonomic treatment that must be given to each potential licensee. Along the same lines, the judge reaffirmed the good faith in the relations between the parties. “I am referring to this basic principle of law, which must guide all negotiations, always with probity and ethics”, she pointed out.
Gajeck addressed lawsuits on essential patents in Germany. He clarified that there are several measures adopted by the courts, such as damages, cessation of rights, collection, and other restrictions, which vary by jurisdiction. In the case of the FRAND defense, he added that one can always use the argument of market dominance abuse, which is addressed within the scope of the European community. But for that, you must have a FRAND license. “It does not apply to all claims, but if it is a license under FRAND terms, the defense can argue with a claim for termination or damages,” Gajeck explained. “As for the implementer, he will have to provide information on how he obtained the FRAND license and nothing else.”