The Delhi HC in the case of INTEX TECHNOLOGIES (INDIA) LTD versus TELEFONAKTIEBOLAGET L M ERICSSON (PUBL), has observed that “One also cannot lose sight of the fact that legal regimes that do not preserve a reasonable expectation of injunctive relief against infringers in Standard Essential Patent litigations will have a counterproductive “domino effect” that shifts bargaining leverage to implementers in all Standard Essential Patent licensing negotiations, devaluing existing patent-protected technologies and disincentivising firms from developing new technologies.”

An appeal was moved against the order of a single judge that observed Telefonaktiebolaget LM Ericsson’s eight suit patents prima facie valid and further ruled that Intex Technologies (India) Limited has prima facie infringed Ericsson’s patent. Court also defined Standard Essential Patent as “patent claiming technology that is essential to an industry standard’s use. ‘Essential’ in the facts of the present case means that a patent is essential to a standard i.e. it is not possible on technical grounds to comply with the standard without infringing the patent.”

The division bench of Justice Manmohan and Justice Saurabh Banerjee, while relying on the judgement of Huawei v. ZTEI further observed that “an injunction or a direction to pay royalty in the interim is likely to be a more effective remedy, as it does not merely result in a small increment to the cost of products which infringe the patents, but prohibits infringement altogether. A well-resourced infringer would rationally reject any licence offer and compel the Standard Essential Patent owner to enter into litigation that typically requires millions of dollars in legal expenses in multiple venues around the world. In the worst-case scenario, the infringer would be compelled to pay monetary damages that are typically calculated using a methodology designed to mimic the rate in a negotiated licensing transaction.”