Telefonaktiebolaget LM Ericsson v. Intex Technologies (India) Ltd.

A defining Indian judgment establishing fairness in SEP licensing and preventing delaying tactics by smartphone manufacturers.

Summary

This case concerned Ericsson’s Standard Essential Patents (SEPs) covering 2G, 3G, and AMR technologies. Intex used these technologies in its mobile phones without securing a FRAND licence. Ericsson accused Intex of infringement, while Intex countered that Ericsson’s royalty demands were unfair, excessive, and anti-competitive. The Delhi High Court examined whether Intex acted as a “willing licensee” and whether Ericsson’s licensing practices complied with FRAND norms. The Court ultimately ruled in favour of Ericsson and emphasized the responsibility of implementers to negotiate honestly and without delay.

Facts of the Case

Ericsson owned several SEPs essential to mobile communication standards. To manufacture and sell phones in India, Intex needed access to these patented technologies. Ericsson repeatedly approached Intex to enter into a FRAND licence, but Intex delayed negotiations for several years while continuing to import and sell SEP-dependent phones. Intex filed complaints before the Competition Commission of India (CCI) alleging that Ericsson’s royalty model—based on the sale price of devices—was exploitative. At the same time, Intex continued using Ericsson’s technology without permission. Ericsson initiated infringement proceedings before the Delhi High Court seeking injunction and royalties.

Findings / Reasoning

The Court held that Intex failed to behave as a willing licensee. Despite knowing the patents were essential, Intex refused to sign even interim agreements and consistently prolonged negotiations. The Court observed that FRAND obligations apply equally to both SEP owners and implementers; a party cannot claim FRAND discrimination after years of non-cooperation. The Court also dismissed Intex’s allegation that royalty based on device price was anti-competitive because such models were standard practice worldwide. Ericsson’s conduct was found fair, transparent, and consistent with international licensing norms, while Intex’s conduct amounted to “hold-out.”

Suggestions / Observations

The Court highlighted that implementers must negotiate promptly and avoid strategies designed to delay payments while continuing commercial use. It emphasized the growing importance of respecting SEP rights in India’s rapidly evolving telecom market. SEP owners must offer clear FRAND proposals, but implementers must also show sincerity by responding, negotiating, and signing interim licences when necessary. This case reaffirmed judicial support for balanced FRAND licensing and discouraged misuse of competition law to avoid royalty obligations.

Judgment / Decision

The Delhi High Court granted an injunction against Intex and directed payment of royalty at FRAND-aligned rates as determined in comparable agreements. The Court confirmed that Intex’s prolonged delay and refusal to enter into meaningful negotiations showed unwillingness.

Decision Year: 2015