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No strike-out for Nokia

By Jeremy

What with all the excitement of his foreign travels last week, IPKat team member Jeremy keeps finding odds and ends that he missed while in transit. One such morsel is InterDigital Technology Corporation v Nokia Corporation and another [2008] EWHC 504 (Pat), a Patents Court decision of Mr Justice Floyd on Monday 17 March.

Right: happier days for Nokia, when fishing lines were more important than telephone lines ...

This case is not (yet) on BAILII and has so far surfaced only on the subscription-only LexisNexis Butterworths service.

Nokia -- not for the first time (see IPKat note here) -- sought declarations that some 35 patents were inessential to the standard for European 3G mobile telecoms. In its re-amended defence InterDigital argued that this action had not been brought for genuine commercial reasons but for tactical reasons relating to the ongoing litigation between the parties. InterDigital provided further particulars when asked by Nokia, which then sought to have these assertions struck out of InterDigital's defence under the Civil Procedure Rules (CPR 3.4(2)(a) and/or CPR 3.4(2)(b)) on the basis that (i) they provided no reasonable defence or, if they did, that (ii) they were an abuse of the process of the court.

According to Nokia, once a real commercial reason for commencing litigation was shown, the fact that there might be tactical considerations was irrelevant: no amount of tactical benefit could cause the commercial interest in having the declaration, and therefore its practical utility, to cease to exist. InterDigital disagreed: Nokia's motives were relevant in two ways: (i) in arriving at a factual conclusion as to whether Nokia had a real commercial interest in obtaining the declarations and (ii) in exercising the court's discretion, even if it was established that Nokia had a real commercial interest. What's more, since this case concerned a "developing area of jurisprudence" [the IPKat says: this means there are litigants around but not much law], special care was called for before striking out claims such as these.

Floyd J dismissed Nokia's application to strike out that bit of InterDigital's defence. In his view

* there was no authority for the proposition that, provided that the declaration sought by Nokia would serve a useful purpose, the court should close its mind to other discretionary factors;

* on the contrary, the court had to consider justice to Nokia, justice to InterDigital and special reasons why the declaration should (not) be granted;

* it was not appropriate, when being asked to exercise a broad discretionary power, for the court to determine on an interim application what factors could (not) affect the exercise of that discretion -- unless the matter relied upon could clearly be said to be irrelevant;

* in this case it was impossible to determine at this stage that the reasons advanced by InterDigital as to why the litigation was started and pursued by Nokia could not conceivably have a bearing on whether the declarations should be granted. InterDigital's allegations might be relevant to the exercise of discretion to grant declarations in a number of ways.

The IPKat loves green-field litigation and admires the pioneering spirit of Nokia and InterDigital in this dispute. Merpel wonders, though, whether the issue of technical standards is too important to leave to mere chance and contractual arrangements between the patent-pool contributors: perhaps IP and competition legislators should be identifying the key policy issues and then seeing what, if anything, should be done about each.

Full post as published by IPKat on March 27, 2008 (boomark / email).