Court finds IP licensing violates Anti-monopoly law

O'Melveny & Myers
Nate Bush and Shan Lining
[email protected]; [email protected]

On February 4 2013, the Shenzhen Intermediate People's Court found that InterDigital, a licensor of standard-essential patents (SEPs) for mobile phones, had violated the PRC Anti-monopoly Law (中华人民共和国反垄断法) (AML) in the licensing and enforcement of SEPs. The court awarded Huawei Rmb20 million ($3.3 million) in damages and ordered InterDigital to licence the SEPs to Huawei at a court-determined royalty rate of 0.019%. Although InterDigital is appealing, the decision shows the potential impact of Chinese antitrust litigation risks on licensing and standard-setting worldwide.