New standard-essential patent dispute between ZTE and Lenovo discovered in UK

Context: Earlier this month, Lenovo reached a settlement of with InterDigital, in the sense of an agreement to resolve their standard-essential patent (SEP) and non-SEP dispute through binding arbitration (October 9, 2024 ip fray article). Its dispute with Ericsson is still ongoing (October 24, 2024 ip fray article).

What’s new: A Lenovo v. ZTE patent-related lawsuit has become discoverable in the High Court of Justice for England & Wales (EWHC). The details of the claim are not known yet. Between the two companies, Lenovo would be the net licensee. Lenovo must be asserting one or more of its own SEPs against ZTE, given that four of the six defendants are ZTE resellers, but sooner or later (and more likely already at this stage) Lenovo is seeking a reciprocal FRAND license.

Direct impact & wider ramifications: This “England first” approach to SEP litigation underscores the growing importance of the courts of England and Wales as a SEP venue, which was particularly visible on Friday when Panasonic, after an interim-license decision by the England & Wales Court of Appeal (CoA) in Xiaomi’s favor, settled with Xiaomi and OPPO. Plus, it became known that the Unified Patent Court’s (UPC) Munich Local Division (LD) would not have turned a blind eye to a UK FRAND determination (October 25, 2024 ip fray article).

These are the known data points of the new Lenovo-ZTE action in the EWHC, with the geographic diversity of plaintiffs and defendants increasing the likelihood that this is both a UK patent enforcement action as well as a FRAND claim for the purpose of obtaining a cross-license on terms to be determined by the English courts:

·Case Title: Lenovo Group Limited and others v ZTE Corporation and others

·Case Type: Patents Court – Part 7 Claim – Patents and registered designs

·Case Number: HP-2024-000038

·Filed Date: 21-10-2024 01:10 PM

·Claimants (represented by Kirkland & Ellis, the firm that also achieved that recent breakthrough for Xiaomi):

·Lenovo Group Limited

·Lenovo (United States) Inc.

·Lenovo Technology (United Kingdom) Limited

·Motorola Mobility LLC

·Motorola Mobility UK Limited

·Lenovo Innovations Limited (Hong Kong)

·Defendants:

·ZTE Corporation

·ZTE (UK) Limited

·Nubia Technology Co., Ltd. (originally a wholly-owned subsidiary of ZTE, somewhat independent since 2015, but ZTE apparently remains a major shareholder)

·Gamegeek Limited (a reseller)

·Livewire Telecom Limited (a reseller)

·EFones.Com Limited (a reseller)

Against Ericsson, Lenovo also argued that the ETSI FRAND pledge in question covers cross-licenses. It is plausible that they are suing ZTE and some of its resellers over one or more Lenovo patents, but primarily just want to obtain a cross-license: freedom to operate.hi

ZTE may now file enforcement actions in other jurisdiction such as China, the UPC and Germany.