Judicial Determination Of Royalty In Standard-Essential Patents Licensing

Due to the trend of technology specialization and patent standardization,there will be more and more disputes over standard essential patents.The standard essential patent license fee is the core of the dispute between the standard essential patentee and the implementer.Standard essential patents may lead to patent hold-up and royalty stacking,standard-setting organization to deal with the problem,often require the patentee FRAND requirement commitment in advance(fair,reasonable and non-discriminatory foreign license),but for the FRAND requirement specific connotation and the principle of how to determine the license fee is in line with the principle of FRAND requirement not made provision.The standard essential patent license fees are often brought to justice,our country confirms in judicial practice and relevant laws and regulations that the standards essential patent license fee should be determined according to FRAND principle.In China,the comparative license method is mainly used to calculate the license fee,but whether the license fee in the reference license contract conforms to FRAND principle is not considered.In addition,the method of calculating the standards essential patent license fee in China is relatively simple,and the factors put forward are often not analyzed in combination with specific cases,but the final license fee is obtained directly according to other license contracts.Although the high people's court of Guangdong province proposed in the "work guidelines(trial)" that it is of great significance to calculate the standardsessential patent license fee based on the market value of the involved standards essential patent or the information in the comparable patent pool.However,it fails to further put forward the factors of implementing the patent pool comparison method and determining the necessary patent market value of the involved standard.Based on the analysis and summary of typical standard essential patent license fee cases in the United States and Japan,the principles to be followed should not only be able to cope with the problems of patent holdup and patent royalty stacking,but also ensure that the necessary patentee of the standard can obtain reasonable license fee,so as to promote the formulation and wide implementation of the standard.Factors to be considered include the revised Georgia-Pacific factor and the contribution of the essential patents to the standards and products involved.The significance,characteristics,applicable premises and typical cases of calculation methods such as hypothetical negotiation method,comparative licensing method,patent pool comparison method and top-down method are further analyzed.Combined with the United States and Japan's judicial experience and the actual situation of our country,to calculate the standards essential patent license fee,in addition to follow the principle of anti-patent holdup,anti-patent royalty stacking and anti-FRAND holdup,also needs to follow the principle of promoting standards and widely implemented,ensure the criteria necessary to the patentee can obtain reasonable principle of licensing fees.Also,it is necessary to consider some factors,like The contribution of necessary patents to product sales and profit;The contribution of necessary patents to standards involved;The utility and advantages of the necessary patent of the involved standard over the substitutable technology before being included in the standard;The research and development difficulty of necessary patents involved in the standards and the amount of research and development funds invested;The accumulative license fee of the involved standard that must be paid for the necessary patented product using the involved standard;Under the FRAND principle,the patentee collects the license fee for the necessary patent or similar patent involved in the standard,and the implementers pays the license fee for similarpatent;The involved standard involves the geographical scope of the necessary patent license and the remaining term of validity of the patent.In addition to the comparative licensing method,the comparative pool method and the top-down method can also be added in China.Under the patent pool comparison law,the licensing rate available to the standards essential patentee should not only include the licensing rate that can be Shared from the patent pool in the calculation scenario,but also include the value involved in the membership of the patent pool;the value of membership of the patent pool can be compared.If the patent pool is not joined,the fee paid by the patentee to obtain the necessary patent license for other standards of the patent pool and the fee collected from the patent pool after joining the patent pool can be obtained.The top-down method refers to that the total SEPs license fee,and then according to the proportion of the number of essential patents in the standard and the technical contribution to the standard,the license fee of the particular standards essential patent can be determined.The accumulated license fees may be assessed by professional institutions or declared by the standard essential patentee as a reference.Where the case involves only a small number of standard essential patents,and the coverage of its claims and the functions it implements are limited to a specific component(which is The Smallest Salable Patent-Practicing Unit),the average profit of the component can be used as the accumulated license fee available for the standard.To some extent,there is no optimal method to calculate the standard essential patent license fee,only a relatively more suitable method for a specific case.When there is a similar license contract considering FRAND principle in a specific case,the court may adopt the comparative license method to calculate the necessary patent license fee.If there is a patent pool that can promote the implementation of the standard,the court can use the patent pool comparison method.If the total SEPs license rate in the case can be determined based on relevant evidence,the court can calculate the standard essential patent license fee by top-down method.The three methods are not exclusive and can be mutually verified to determine the final standard involved in the necessary patent licensing rate.In addition,it can be stipulated that the standard-setting organizations should bear the responsibility ofidentifying the necessity of the standards essential patent and establish the system of relative disclosure of the standards essential patent license fee to further assist the judicial determination of the standards essential patent license fee.