According to foreign media reports, according to foreign media reports, the Dutch District Court in The Hague made a judgment rejecting the lawsuit filed by smart phone maker Archos for Philips. Archos claimed that Philips abused its dominant position in the negotiation of fair, reasonable and non-discriminatory (fair) terms concerning standard basic patents.
In June 2014, Philips found that Archos used three patents from Philips, covering UMTS and LTE technologies. Philips' patents cover standards for the transmission of data through smartphones that are registered with the European Telecommunications Standards Institute's Sheppes.
Subsequently, Philips notified Archos of its patent infringement, and the two parties entered the negotiation stage. In July 2015, Philips proposed a fee of 0.7 euros for each product that uses its UMTS and/or LTE capabilities. Archos has proposed in January 2016 that the patent licensing fee for each product only accepts 0.07 euros.
These proposals were made within two weeks after Huawei and ZTE’s lawsuits were filed. In this case, the European Court of Justice promulgated the FRAND clause (FRAND, reasonable and non-discriminatory fair, reasonable and non-discriminatory). Three core principles of SEPs (Industry Standard Essential Patents) license:
The power to provide a quote lies with the SEP holder.
Determining what constitutes a FRAND quote is decided by the national court of the European jurisdiction.
Before the SEP holder's application for an injunction against the alleged infringer does not give the alleged infringer the opportunity to grant the patent under the FRAND clause, this is an abuse of dominance.
After reaching an agreement with Huawei, Philips sought a ban on Archos to prevent its use of Philips SEPs. At the same time, Archos filed a lawsuit in the same court, arguing that Philips, like Huawei, was not based on FRAND's terms and that it abused patents because of its dominant position. Archos explained that the profits of the smart phones that they had produced were not high, and Philips’ patent quotations were too high to be accepted. Archos further claimed that Philips would not be flexible at all in negotiations and would be too rigid.
The Dutch court in The Hague dismissed Archos's lawsuit, arguing that Archos could not prove that Philips was not in accordance with the fairness principle of the FRAND Treaty, and that the Philips application ban was abusing its dominant position. The court held that Philips did not mean that he did not want to negotiate properly, but that Archos had been procrastinating and did not want to reach a settlement. Archos didn't advance Philips' initiative to provide royalties, but after Philips proposed that it had been too expensive to claim patents, it was resolved through legal channels. In fact, it has been protracted and has been reluctant to negotiate.
The Hague Court also proposed that the low profitability of Archos own smart phone cannot blame the high patent of Philips, and this does not necessarily mean that Philips’ proposal does not comply with the FRAND principle.
As a result, Archos’s claim was rejected and a large amount of legal fees will be paid for it.
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