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Samsung Gets Fast Appeal Of China FRAND Injunction Ruling

The Federal Circuit on Wednesday agreed to speed up Samsung's appeal of U.S. District Judge Rodney Gilstrap's decision to bar the South Korean tech giant from having a dispute with Ericsson over patents essential to the 4G and 5G wireless standards heard exclusively in China.

The appeals court issued an order saying Samsung must file its opening brief by Feb. 22, as the company had requested. Samsung's appeal stems from the Eastern District of Texas judge's preliminary injunction earlier this month that maintained his right to hear a dispute claiming Samsung refused to accept a fair, reasonable and nondiscriminatory, or FRAND, rate offered by Ericsson when renegotiating a cross-license agreement, but didn't fully stop a Chinese court from doing the same.

Samsung's motion for an expedited appeal asserted that the judge's decision didn't square with a Chinese anti-suit injunction that would have stopped Ericsson from seeking its own injunctive relief on the patents anywhere else in the world. This meant Samsung was now "subject to conflicting obligations in two courts," it argued.

The Federal Circuit's Wednesday order also directed Ericsson to file a response to Samsung's motion by Feb. 3, adding that any replies backing the motion must be filed by Feb. 8.

Counsel for the parties did not immediately return requests for comment Wednesday.

When the parties failed to agree on a license, Samsung sued in China on Dec. 7, and Ericsson sued in Texas four days later. The Chinese court in late December issued an anti-suit injunction and also stopped Ericsson from seeking an anti-anti-suit injunction, under which someone like Judge Gilstrap would bar the Chinese court from blocking Ericsson from asking for an injunction.

Judge Gilstrap's Jan. 11 injunction also bars Samsung from using the Chinese suit to stop Ericsson from enforcing its own patents in the U.S., and indemnified Ericsson from any related fines or penalties levied by the Chinese court over the anti-suit injunction.

Judge Gilstrap didn't make Samsung withdraw its anti-suit injunction or block the Chinese court from reviewing the merits of the patent dispute.

"This court affirmatively finds that a tailored indemnification provision will adequately address this court's concern that Samsung may seek the imposition of substantial fines in the Chinese action for the purpose of creating economic leverage against Ericsson to achieve practically what it may not be able to obtain legally," the judge said. "This court finds that a narrowly focused indemnification provision will ensure that both proceedings can progress on the merits without the risk of unbalanced economic pressure being imposed by one party on another."

Judge Gilstrap had issued a temporary restraining order and anti-interference injunction on Dec. 28, trying to keep the status quo while deciding the preliminary injunction. The dispute drew opposing takes from former Federal Circuit chiefs, with Judge Randall R. Rader throwing his weight behind Samsung in support of China, and Judge Paul Michel backing Ericsson.

The patents-in-suit are U.S. Patent Nos. 8,102,805; 8,607,130; 9,949,239; 9,532,355; 10,454,655; 10,193,600; 10,425,817; and 10,516,513.

Ericsson is represented by Blake H. Bailey, Christine M. Woodin, Jennifer L. Truelove, Nicholas M. Mathews, Nicholas T. Matich, Samuel F. Baxter and Theodore Stevenson of McKool Smith PC.

Samsung is represented by Gregory S. Arovas, John S. O'Quinn, F. Christopher Mizzo and William H. Burgess of Kirkland & Ellis LLP.

The case is Ericsson Inc. v. Samsung Electronics Co. Ltd., case number 21-1565, in the U.S. Court of Appeals for the Federal Circuit.