On August 24, 2026, the Hamburg Regional Division of the Unified Patent Court (UPC) issued a first-instance judgment: Finnish mobile phone manufacturer HMD Global was found to have infringed European Patent EP 2 380 167, held by the German Fraunhofer Society (Fraunhofer-Gesellschaft). The court ordered HMD to cease the sale, import, and use of the infringing products in Germany, France, Italy, Belgium, and the Netherlands, and to take measures such as recalling the products, removing them from distribution channels, and destroying them. At the same time, the court rejected HMD’s defenses regarding patent invalidity and FRAND.
The plaintiff in this case, Fraunhofer, is a German research organization focused on applied technology R&D. It comprises multiple institutes that have long been engaged in the research and development of technologies such as communications, audio, and video, and also participates in standard-setting as well as the development and licensing of standard-essential patents (SEPs). Previously, it joined the AAC patent pool as a licensor.
As early as 2017, VIA Licensing, on behalf of the AAC patent pool, began licensing negotiations with HMD. It provided a licensing package covering the entire patent pool, offering tiered discounts based on product volume and alternative fee structures tailored to patent coverage in different countries.
However, HMD did not accept the patent pool license but instead sought to enter into separate bilateral licensing agreements with Fraunhofer and other members of the patent pool. However, when VIA initially proposed the patent pool solution, it explicitly informed HMD that it could choose to enter into bilateral licensing agreements directly with individual patent holders. Therefore, the central issue in this case is whether an implementer can insist on a bilateral license—and whether persisting with this choice over the long term would still qualify as a valid FRAND defense—once an SEP rights holder has already provided a FRAND licensing offer through a patent pool.
Patent Pool Licensing and Bilateral Licensing Are Not a Simple Either/Or Choice
The UPC Hamburg Regional Chamber noted that, in principle, SEP holders are only required to provide implementers with a single licensing path that meets FRAND requirements and do not have a general obligation to offer both patent pool licensing and bilateral licensing simultaneously. This conclusion is consistent with the position previously taken by the UPC Munich Regional Chamber in the Huawei v. Netgear case.
However, a patent pool license is not the only option an implementer must accept. Under specific circumstances, an implementer may request a switch to a bilateral license. For example, an implementer may need to obtain a license covering multiple standards or wish to enter into a cross-licensing agreement with a single patent holder; if the implementer has previously concluded bilateral licenses with a significant number of other rights holders within the patent pool, thereby establishing a bilateral licensing arrangement covering the entire patent pool portfolio, this may also constitute a reasonable basis for choosing a bilateral license.
Therefore, what truly needs to be examined is not whether the implementer has the right to choose a bilateral license, but whether the implementer’s choice of this path was reasonable and whether subsequent conduct demonstrates that it was indeed seeking a license.
This is also the core of the FRAND dispute in this case. During the negotiations, HMD did not raise the need to obtain a multi-standard license from Fraunhofer, nor did it cite cross-licensing as a reason for insisting on a bilateral license. At the same time, although HMD stated that it had been pursuing bilateral licensing with other members of the AAC patent pool, nearly nine years had passed between the time it first received the AAC patent pool’s offer in October 2017 and the issuance of the judgment, yet the bilateral licensing agreements HMD had entered into still covered only a small portion of the licensors in the entire patent pool.
Therefore, this is insufficient to demonstrate that HMD had a genuine intention to accept the license. In particular, having already received a FRAND patent pool offer, if the implementer truly intended to obtain a license through bilateral means, it should have continuously pursued negotiations with other patent holders within a reasonable timeframe. Even if some patent holders were unwilling to enter into bilateral agreements, the implementer would have needed to adjust its negotiation strategy and provide safeguards—such as offering guarantees—to address any potential royalty claims from patent holders. HMD did not take these measures.
VIA’s Patent Pool Offer Complies with FRAND Principles
The court specifically emphasized that HMD did not raise sufficiently specific FRAND objections to this offer during either the pre-litigation negotiations or the litigation itself. In principle, FRAND objections should be raised in a timely manner during the licensing negotiation phase. If an implementer already possessed relevant information during negotiations but only raised new objections after facing the risk of infringement litigation and an injunction, such belated objections may not serve as grounds for rejecting the prior licensing offer.
Regarding the issues subsequently raised by HMD—such as the obsolescence of AAC technology, the impending expiration of relevant patents, and the unreasonableness of tiered royalty rates—the judgment noted that the list of patents at issue had been provided to HMD as early as 2017; therefore, HMD could have raised these issues during the negotiation process. Furthermore, the AAC patent pool has nearly 1,000 licensees, and HMD failed to prove that these licensees signed their license agreements without receiving volume discounts. Tiered volume discounts are not unique to the AAC patent pool; the Access Advance HEVC patent pool employs a similar mechanism.
Consequently, the patent pool licensing proposal offered by VIA was deemed FRAND. Since HMD had long rejected this proposal, failed to demonstrate reasonable grounds for insisting on a bilateral license, and consistently failed to show a genuine willingness to license, its FRAND defense ultimately failed.
Accordingly, in addition to the injunction, the Hamburg Regional Court ordered HMD to recall the relevant infringing products sold in the German, French, Italian, Belgian, and Dutch markets since August 6, 2018; to withdraw and destroy the relevant products; to disclose information regarding product sales volume, prices, distribution channels, costs, and profits; and to make an advance payment of 219,000 euros in damages.
Full text of the judgment attached
