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`UNITED STATES DISTRICT COURT
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`NORTHERN DISTRICT OF CALIFORNIA
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`HUAWEI TECHNOLOGIES, CO, LTD, et
`al.,
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`Plaintiffs,
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`v.
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`SAMSUNG ELECTRONICS CO, LTD., et
`al.,
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`Defendants.
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`
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`Case No. 3:16-cv-02787-WHO
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`
`ORDER GRANTING SAMSUNG'S
`MOTION FOR ANTISUIT
`INJUNCTION
`Re: Dkt. Nos. 234, 235, 240, 244, 277, 278
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`INTRODUCTION
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`Defendants/counterclaim-plaintiffs Samsung Electronics Co., Ltd., Samsung Electronics
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`America, Inc., and Samsung Research America, Inc. (collectively, “Samsung”) seek to enjoin
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`plaintiffs Huawei Technologies Co., Ltd., Huawei Device USA, Inc. and Huawei Technologies
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`USA, Inc. (collectively, “Huawei”) from enforcing injunction orders issued by the Intermediate
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`People’s Court of Shenzhen (“Shenzhen Court”). The Shenzhen Court orders found that Samsung
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`is infringing two of Huawei’s Chinese standard essential patents (“SEPs”), and enjoined
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`Samsung’s Chinese affiliates from manufacturing and selling its 4G LTE standardized
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`smartphones in China. As a prerequisite to granting this relief, the Shenzhen Court considered
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`whether the parties had complied with their obligations to license their SEPs on fair, reasonable,
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`and nondiscriminatory (“FRAND”) terms. Both parties have asserted breach of contract claims in
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`this action based on the other’s alleged failure to license their SEPs on FRAND terms.
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`Under the framework established in E. & J. Gallo Winery v. Andina Licores S.A., 446 F.3d
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`984 (9th Cir. 2006), Samsung has demonstrated that it is entitled to an antisuit injunction
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`preventing Huawei from enforcing the injunction orders issued by the Shenzhen Court. Those
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`orders could render meaningless the proceedings here, and the risk of harm to Samsung’s
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`Case 3:16-cv-02787-WHO Document 280 Filed 04/13/18 Page 2 of 21
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`operations in China in the interim is great. Its motion is GRANTED.
`BACKGROUND1
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`I.
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`FACTUAL BACKGROUND
`The Parties
`A.
`Huawei and Samsung are major players in the world of wireless telecommunications—a
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`world governed by cellular technology standards, such as the 3G UMTS and 4G LTE standards
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`developed by the Third Generation Partnership Project (“3GPP”) and promulgated by standard
`setting organizations like the European Telecommunications Standards Institute (“ETSI”).2 Both
`Huawei and Samsung have agreed to license their declared standard essential patents (“SEPs”) on
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`fair, reasonable, and non-discriminatory (“FRAND”) terms and conditions under ETSI’s
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`Intellectual Property Rights (“IPR”) Policy. Compl. ¶ 63 (Dkt. No. 1[redacted], Dkt. No. 3-
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`4[under seal]); see also Samsung’s Answer and Am. Counterclaims ¶ 29 (“Samsung admits that
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`ETSI members who are subject to a commitment to offer licenses on FRAND terms and
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`conditions are obligated not to refuse to enter a license for declared, essential patents that is fair,
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`reasonable, and non-discriminatory.”)(Dkt. No. 91[redacted]; Dkt. No. 90-2[under seal]); id. ¶ 54
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`(“Samsung admits that SEC has submitted IPR licensing declaration forms to ETSI expressing
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`SEC’s [Samsung Electronics Co., Ltd.] preparedness to grant licenses on FRAND terms and
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`conditions for certain patents as set forth in those declarations in accordance with the ETSI IPR
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`Policy.”); Samsung’s Licensing Declarations (Samsung’s Answer and Am. Counterclaims, Exs.
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`14, 23–26, 29, 34; Dkt. Nos. 91-14, -18, -23-26, -29, -34); Huawei’s Licensing Declaration
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`(Huawei’s Compl., Exs. 2.1–2.43, Dkt. Nos. 3-1–13[under seal]).
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`1 Portions of the background are redacted in accordance with the administrative motions submitted
`by both parties. Those motions are addressed at the end of this order.
` 2 Standard Setting Organizations “establish technical specifications to ensure that products from
`different manufacturers are compatible with each other.” Microsoft Corp. v. Motorola, Inc., 696
`F.3d 872, 875 (9th Cir. 2012)(“Microsoft II”)(citing Mark A. Lemley, Intellectual Property Rights
`and Standard–Setting Organizations, 90 Calif. L.Rev. 1889 (2002)). Many courts have
`expounded on the benefits of standards in various industries. See, e.g., Microsoft Corp. v.
`Motorola, Inc., 795 F.3d 1024, 1030 (9th Cir. 2015)(“Microsoft IV”); Apple, Inc. v. Motorola
`Mobility, Inc., 2011 WL 7324582, at *1 (W.D. Wis. June 7, 2011).
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`Samsung’s Manufacturing Operations in China
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`B.
`Samsung’s Chinese manufacturing hubs have a production capacity of
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`, the second largest worldwide. T. Wang Decl. ¶ 5 (Dkt. No. 240-48[under seal]). In
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`2015 and 206, Samsung manufactured
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` in China, of which
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`Samsung sold
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` units of LTE devices in China for a total revenue of
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`were imported to the United States. Id. ¶¶ 6, 7. In the same years,
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`. Id. ¶ 7.
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`Negotiation History
`C.
`In 2011, the parties began discussing a cross-license for their respective patent portfolios,
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`but they disagreed on the scope of those licenses. E.g., 3/2/15 Letter from Huawei to Samsung re”
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`Patent Licensing Negotiation (Stake Decl. ¶ 19, Ex. 19, Dkt. No. 234-10[under seal]). I will not
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`recount the history of their failure to reach agreement in the ensuing years, since all of the
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`information has been filed under seal, except to wonder aloud how it can be in the interest of these
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`important multi-national corporations to slog through unending litigation around the globe rather
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`than figure out a process to resolve their differences if agreement is impossible.
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`II.
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`PROCEDURAL HISTORY
`Huawei filed this action on May 24, 2016, asserting infringement of 11 of its SEPs, and
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`alleging that Samsung breached “its commitment to enter into a SEP cross-license with [Huawei]
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`on FRAND terms and conditions.” Compl. ¶¶ 1, 4. Huawei also asks the court to set the terms
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`and conditions for a global FRAND cross license under the parties’ respective worldwide
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`portfolios of essential 3G and 4G patents, and to enjoin Samsung from “seeking injunctive relief
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`against Huawei (including affiliates) in any jurisdiction with respect to any alleged infringement
`of any patent essential to 3GPP standards.”3 Compl. at Prayer for Relief, E. Samsung answered
`and filed counterclaims, including patent infringement claims for its own declared essential SEPs,
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`declarations of non-infringement and invalidity of Huawei’s patents, and claims for antitrust
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`3 Huawei points out that it has not sought preliminary injunctive relief attempting to halt any of the
`seven remaining actions brought by Samsung in China, which seek injunctive relief against
`Huawei based on its alleged infringement of Samsung’s SEPs. Opp’n at 8.
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`United States District Court
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`Case 3:16-cv-02787-WHO Document 280 Filed 04/13/18 Page 4 of 21
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`violation in violation of section 2 of the Sherman Act,4 and breach of contract. Answer and Am.
`Counterclaims at 47–114.
`The next day,5 Huawei filed 11 separate actions in China, ten of which it filed in the
`Intermediate People’s Court of Shenzhen (“Shenzhen Court”) where Huawei is based. Xie Decl. ¶
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`3 (Dkt. No. 235-2). Eight of the actions involve 3G and 4G SEPs, including direct counterparts to
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`patents-in-suit. Id. Each action seeks a determination on whether the SEP is infringed, and if so,
`whether an injunction should issue.6 Id. Samsung countered with fourteen of its own actions in
`China, alleging Huawei is infringing Samsung’s SEPs and seeking injunctive relief. Wang Decl.
`¶¶ 2–8; Xie Decl. ¶ 2 n.1. Seven of those SEP actions remain pending.7 See Xie Decl. ¶ 2 n.1.
`The Chinese actions have proceeded quicker than this one. See Wang Decl. ¶ 9 (describing
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`status of the various actions). In particular, the Shenzhen court has held trials on two of Huawei’s
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`SEPs and two of Samsung’s SEPs. Wang Decl. ¶¶ 9, 10. The trials addressed both FRAND
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`issues and technical issues specific to each SEP. Id. ¶ 9. During these trials, the parties had full
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`opportunities to present their evidence and argument. Id. ¶ 11; see also id. ¶¶ 12–19 (explaining
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`the proceedings before the Shenzhen court that form the basis for this motion).
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`4 As part of this claim, “Samsung seeks an order enjoining Huawei from pursuing injunctive relief
`for infringement of patents, including those asserted here and in the parallel Chinese actions, that
`Huawei contends are essential to ETSI and 3GPP standards.” Am. Counterclaims ¶ 322.
` 5 Huawei indicates that it filed the Chinese actions “simultaneously,” and that those actions reflect
`a different date due to the time difference between here and China. And it highlights Samsung’s
`acknowledgement that the actions were “simultaneous[ly]” filed. See Samsung’s Answer and Am.
`Counterclaims ¶ 340 (“Yet simultaneous with its filing of this action, Huawei filed eight actions
`against Samsung in China based on Huawei’s declared essential patents, seeking only injunctions
`as relief for Samsung’s alleged infringement… .”); id. ¶ 543 (“Around the same time as Huawei
`filed its Complaint here, Huawei initiated several patent infringement actions in China, seeking to
`enjoin Samsung from making, using, selling, or importing products that practice 3GPP
`standards.”).
` 6 Huawei has also initiated a rate-setting and royalty payment suit in China. Wang Decl. ¶ 2; Xie
`Decl. ¶ 22.
` 7 The parties filed a total of 42 infringement actions in China, one corresponding to each patent,
`both SEP and non-SEP. Wang Decl. ¶ 5. In parallel with those proceeding, all 42 patents
`underwent invalidation procedures at the Patent Reexamination Board (“PRB”). Id. ¶ 6. Once a
`patent is invalidated by the PRB, it must be withdrawn or dismissed. Id. ¶ 7. Twenty-two
`infringement suits remain between the parties—12 involving Huawei’s SEPs and 7 involving
`Samsung’s SEPs. Id. ¶ 8.
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`On January 11, 2018, the Shenzhen Court issued orders finding that Samsung is infringing
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`two of Huawei’s Chinese SEPs and enjoining Samsung’s Chinese affiliates from manufacturing
`and selling its 4G LTE standardized smartphones in China.8 Xie Decl. ¶ 7; Jan. 11, 2018
`Shenzhen Court Civil Judgment, certified translation (“Shenzhen Order”)(Stake Decl. ¶ 37, id.,
`Ex. 36, Dkt. No. 277-5[under seal]).9 The Chinese patents are direct counterparts to two of
`Huawei’s asserted patents, U.S. Patent Nos. 8,369,278 and 8,885,587. Xie Decl. ¶ 4. The
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`Shenzhen Court evaluated the evidence and found that “Huawei’s behaviors had complied with
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`FRAND principles while Samsung’s behaviors had not complied with FRAND principles.”
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`Shenzhen Order at 205. The Shenzhen Court decided that Huawei’s six presuit offers to Samsung
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`“were made within the reasonable range according to the strength of SEPs owned by Huawei” and
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`that Huawei’s offers “had complied with FRAND principles.” See Shenzhen Order at 200–203.
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`As to Samsung, the court found that its initial insistence on “binding SEP licensing and non-SEP
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`licensing … violated FRAND principles for SEP licensing negotiations” and contributed to
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`“serious[] delay[]” in the negotiations. Shenzhen Order at 180. It also found that “Samsung had
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`made significant mistakes during technical negotiations,” which “seriously delayed the
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`negotiations and clearly violated FRAND principles… directly leading to more than six years of
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`negotiations between both parties without any progress.” Id. at 185. It concluded that Samsung’s
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`sole SEP licensing offer “did not comply with FRAND principles.” Id. at 204.
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`Samsung filed a notice of appeal on January 26, 2018. Xie Decl. ¶ 8. It filed this motion
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`on February 1, 2018. Mot. to Enjoin Huawei from Enforcing the Injunction Issued by the
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`Intermediate People’s Court of Shezhen (“Mot.”)(Dkt. No. 278-2[redacted]; Dkt. No. 278-1[under
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`seal]). It claims that if its appeal is unsuccessful, it will have to close its factories in China,
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`8 The Shenzhen court ordered a further continuation of the trial on Samsung’s two SEPs, and
`presumably heard that additional evidence on February 27–28, 2018. Wang Decl. ¶ 9. The parties
`are awaiting decisions in those two suits. Id.
` 9 Huawei noted that Samsung submitted only the order in case number 840, but actually seeks to
`enjoin orders issued in both case numbers 840 and 816. Wang Decl. ¶ 12 n.1. It indicated that
`“[t]he FRAND issues contemplated, evidence and expert opinion presented, and Court’s decision
`were substantively the same in both the 840 and 816 cases.” Id. It also represented that it accepts
`the accuracy of the certified translation “[f]or purposes of this motion only[.]” Opp’n at 6 n.2.
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`Case 3:16-cv-02787-WHO Document 280 Filed 04/13/18 Page 6 of 21
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`affecting
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`, be forced into a negotiation at a disadvantage or be
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`compelled into a global adjudication of all FRAND issues with Huawei, which it stoutly resists.
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`Since the initial case management conference, Huawei has urged the court to bifurcate the
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`issues and address the breach of contract and related FRAND issues first, which would likely
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`moot the patent infringement claims. See Joint Case Management Conference St. at 2–5 (Dkt. No.
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`67); Minute Entry for Initial CMC held on 9/13/16 (Dkt. No. 75); Huawei’s Br. ISO its Request to
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`Bifurcate (Dkt. No. 84). Samsung has insisted that bifurcation was not the most efficient course
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`because the FRAND licensing obligation cannot be determined without “assessing whether and to
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`what extent [the patents-in-suit] are valid, infringed, enforceable, and essential to the relevant
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`ETSI standard.” Samsung’s Opp’n to Bifurcation at 2 (Dkt. No. 85). I denied Huawei’s request to
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`bifurcate, and issued a case management order setting a schedule for the parties to narrow the
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`issues in preparation for a two-week trial. Order Regarding Case Management Proposals (Dkt.
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`No. 143).
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`LEGAL STANDARD
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`“A federal district court with jurisdiction over the parties has the power to enjoin them
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`from proceeding with an action in the courts of a foreign country, although the power should be
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`‘used sparingly.’” Seattle Totems Hockey Club, Inc. v. Nat'l Hockey League, 652 F.2d 852, 855
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`(9th Cir. 1981). “Such injunctions allow the court to restrain a party subject to its jurisdiction
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`from proceeding in a foreign court in circumstances that are unjust.” E. & J. Gallo Winery v.
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`Andina Licores S.A., 446 F.3d 984, 989 (9th Cir. 2006)(“Gallo”). The Ninth Circuit employs “a
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`three-part inquiry for assessing the propriety of such an injunction.” Microsoft Corp. v. Motorola,
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`Inc., 696 F.3d 872, 881 (9th Cir. 2012)(“Microsoft II”); see also Gallo, 446 F.3d at 990
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`(establishing framework for determining whether to issue anti-suit injunction).
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`First, we determine whether or not the parties and the issues are the
`same in both the domestic and foreign actions, and whether or not
`the first action is dispositive of the action to be enjoined. Second,
`we determine whether at least one of the so-called Unterweser
`factors applies. Finally, we assess whether the injunction’s impact
`on comity is tolerable.
`Microsoft II, 696 F.3d at 881 (citations and internal quotation marks omitted); see id. at 882
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`Case 3:16-cv-02787-WHO Document 280 Filed 04/13/18 Page 7 of 21
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`(referring to three-part inquiry as the “Gallo framework”).
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`DISCUSSION
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`Samsung moves to enjoin Huawei from enforcing the injunctions issued in the Shenzhen
`Orders.10 As a preliminary matter, the parties dispute whether Samsung must establish the usual
`requirements for a preliminary injunction, in addition to satisfying the three-part Gallo test for an
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`anti-suit injunction. Huawei’s Opp’n to Samsung’s Mot. to Enjoin Huawei from Enforcing the
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`Injunction Issued by the Intermediate People’s Court of Shenzhen at 4, 13, 23 (“Opp’n”)(Dkt. No.
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`277-4[redacted]; Dkt. No. 277-3[under seal]); Reply ISO Samsung’s Mot. for a Preliminary
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`Antisuit Injunction at 2 (“Reply”)(Dkt. No. 277-3[under seal]; Dkt. No. 277-4[redacted]). As the
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`district court noted in Microsoft Corporation v. Motorola, Inc., “[u]nder a literal reading of Gallo,
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`a showing of irreparable harm, balance of equities, and public interest might still be required to
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`obtain an anti-suit injunction.” 871 F. Supp. 2d 1089, 1097 n.10 (W.D. Wash. 2012)(“Microsoft
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`I”); see Gallo, 446 F.3d at 991 (“[Movant] need not meet the usual test of a likelihood of success
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`on the merits of the underlying claim to obtain an anti-suit injunction . . . . Rather, [movant] need
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`only demonstrate that the factors specific to an anti-suit injunction weigh in favor of granting the
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`injunction.”).
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`The court went on to note two things—the absence of an analysis on the traditional Winter
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`factors in Applied Medical Distribution Corp. v. Surgical Co. BV, 587 F.3d 909, 913 (9th Cir.
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`2009), and the fact that the Third Circuit explicitly replaced all four Winter factors with the three-
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`part Gallo test. Microsoft I, 871 F. Supp. 2d at 1097 n.10. It nonetheless analyzed the remaining
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`Winter factors “[f]or completeness[.]” Id. But the Ninth Circuit, in affirming the district court’s
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`grant of the foreign anti-suit injunction, focused only on the three-part Gallo test. Microsoft II,
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`696 F.3d at 881. But see id. at 883–84 (“Ordinarily, we do not assess at all the likelihood of
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`success on the merits in a case like this, because when a preliminary injunction is also a foreign
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`anti-suit injunction, the likelihood-of-success aspect of the traditional preliminary injunction test is
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`10 As previously mentioned, Samsung references one order from the court, but it actually seeks to
`enjoin Huawei from enforcing two orders issued by the Shenzhen court on January 11, 2018. See
`supra note 9.
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`replaced by the Gallo test.”). The Ninth Circuit’s analysis convinces me that I need only focus on
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`the three-part inquiry under Gallo, and need not analyze the traditional Winter factors for
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`obtaining a preliminary injunction.
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`Because Samsung relies so heavily on that Ninth Circuit decision, see Mot. at 11–17, 19–
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`21, I will begin with a background of that case.
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`I.
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`MICROSOFT V. MOTOROLA
`The decision in Microsoft v Motorola addressed the parties’ obligations with respect to
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`patents they declared essential to the H.264 video coding standard set by the International
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`Telecommunications Union (“ITU”). Microsoft II, 696 F.3d at 875–876. The ITU’s Common
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`Patent Policy requires each member to “submit a declaration to the ITU stating whether it is
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`willing to ‘negotiate licenses with other parties on a non-discriminatory basis on reasonable terms
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`and conditions.’” Id. at 876. Motorola submitted numerous declarations to the ITU promising to
`grant licenses to its SEPs on “reasonable and nondiscriminatory,” or “RAND” terms.11 Id.
`“In October 2010, Motorola sent Microsoft two letters offering to license certain of its
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`standard-essential patents.” 696 F.3d at 876. Motorola attached to the letter a “non-exhaustive
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`list” of its U.S. and foreign patents that it declared essential to the H.264 standard and included in
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`its license offer. Id. On November 9, Microsoft filed a breach of contract action against Motorola
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`based on the theory that it was a third-party beneficiary to Motorola’s RAND obligations, which it
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`alleged Motorola breached by proposing unreasonable royalty terms. Id. at 878. The next day,
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`Motorola filed a patent infringement suit, and the two cases were consolidated. Id. In February
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`2012, the district court granted partial summary judgment for Microsoft, concluding that (1)
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`Motorola had binding commitments to offer its declared SEPs on RAND terms, and (2) Microsoft
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`was a third-party beneficiary of those commitments. Id. The court denied summary judgment on
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`the two remaining issues of whether Motorola’s initial offer letter had to include RAND terms,
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`and whether its offers breached RAND obligations. Id. at 879. It scheduled those claims for a
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`11 “RAND” and “FRAND” are “legally equivalent abbreviations.” Microsoft II, 696 F.3d at 877
`n.2.
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`Case 3:16-cv-02787-WHO Document 280 Filed 04/13/18 Page 9 of 21
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`bench trial in November 2012. Id.
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`Eight months after the domestic actions were filed, Motorola sued Microsoft in Germany
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`for infringement of two of its German patents, and it sought to enjoin Microsoft from selling
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`allegedly infringing products in Germany. 696 F.3d at 879. On May 2, 2012, the German court
`issued its ruling,12 holding that (1) Microsoft did not have a license to use Motorola’s patents, (2)
`any commitment between Motorola and the ITU was not enforceable by Microsoft because
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`German law does not recognize third-party contractual rights, and (3) Microsoft infringed
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`Motorola’s German patents. Id. It enjoined Microsoft from “offering, marketing, using or
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`importing or possessing” the accused products in Germany. Id.
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`The “German injunction [was] not self-enforcing.” 696 F.3d at 879. Motorola had to
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`“post a security bond covering potential damages to Microsoft should the infringement ruling be
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`reversed on appeal[,]” then Microsoft could file a motion to stay the injunction in the German
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`appellate court. Id. Alternatively, Microsoft could avoid enforcement of the injunction by
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`employing “the Orange Book procedure,” under which it would make “an unconditional offer to
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`conclude a license agreement” with Motorola. Id.
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`On May 14, the district court converted the TRO, see supra note 12, into a preliminary
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`injunction. Id. at 880. The Ninth Circuit affirmed this decision. I will reference its reasoning as I
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`analyze each factor.
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`II.
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`APPLICATION OF THE GALLO TEST
`The Parties and the Issues are the Same
`A.
`“The threshold consideration for a foreign anti-suit injunction is ‘whether or not the parties
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`and the issues are the same’ in both the domestic and foreign actions, ‘and whether or not the first
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`action is dispositive of the action to be enjoined.’” Microsoft II, 696 F.3d at 882 (quoting Gallo,
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`446 F.3d at 991). The consideration should be approached functionally, “not in a technical or
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`formal sense, but in the sense that all the issues in the foreign action … can be resolved in the
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`local action.” Id. at 882–83 (internal quotation marks omitted). “[W]hen the parties in the two
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`12 By this time, Microsoft had already obtained a temporary restraining order (“TRO”) enjoining
`Motorola from enforcing any injunction obtained in the German action. 696 F.3d at 880.
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`Case 3:16-cv-02787-WHO Document 280 Filed 04/13/18 Page 10 of 21
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`actions are the same, the two questions of whether ‘the issues are the same’ and whether ‘the
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`domestic action is dispositive of the foreign action’ collapse into one.” Microsoft I, 871 F. Supp.
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`2d at 1098.
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`The Parties Are Functionally the Same
`1.
`Both sides agree that the parties are functionally the same (although not identical). Mot. at
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`12; Opp’n at 16. Huawei Technologies Co., Ltd. and Samsung Electronics Co., Ltd. are parties to
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`both actions, and some of their affiliates or subsidiaries are parties in each action. Xie Decl. ¶ 3;
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`Since “[p]erfect identity of parties is not required for an anti-suit injunction[,]” Microsoft I, 871 F.
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`Supp. 2d at 1098, this is sufficient to establish that the parties are functionally the same.
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`The Issues Are Functionally the Same
`2.
`Samsung insists that the primary issue in the Shenzhen cases is at issue here—namely, the
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`availability of injunctive relief for Huawei’s SEPs, which are subject to contractual licensing
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`obligations under Huawei’s FRAND commitments. See Mot. at 12–15. It argues that “[e]ach
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`party acknowledges it has contractual FRAND obligations for its global portfolio of
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`telecommunications SEPs, contends it has complied with those obligations and that the other party
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`has not, and has asked this Court to bar the other party from obtaining injunctive relief anywhere
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`in the world on those SEPs.” Mot. at 12; see Compl. ¶ 1 (“Huawei and Samsung have made
`binding commitments to the European Telecommunications Standards Institute (“ETSI”)—a
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`3GPP organizational partner which promulgates standards developed by 3GPP—to license these
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`standard-essential patents (“SEPs”) on terms and conditions that are fair, reasonable, and non-
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`discriminatory (“FRAND”).)(Dkt. No. 59).
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`It urges that Microsoft v. Motorola is instructive because it “involved highly similar
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`facts[.]” Id. at 13. Motorola argued that the U.S. action could not resolve the German action
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`“because patent law is uniquely territorial and patents have no extraterritorial effect.” Microsoft
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`II, 696 F.3d at 883. The district court rejected this argument, and the Ninth Circuit agreed.
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`According to the district court, Microsoft’s contract claim would resolve Motorola’s German
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`patent claims “because the European Patents at issue in the German Action were included in
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`Motorola’s October 29 Letter offering a worldwide license for Motorola’s H.264 Standard-
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`essential patents, and because Motorola contracted with the ITU to license the European Patents
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`on RAND terms to all applicants on a worldwide basis.” Id. (quoting district court decision). It
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`determined that the district court’s decisions on summary judgment (that Motorola’s RAND
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`declarations to the ITU created a contract enforceable by Microsoft as a third-party beneficiary
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`and that the contract governed the availability of injunctive relief for declared SEPs) were not
`“legally erroneous,”13 and therefore, it was not “an abuse of discretion for the district court to rule
`that the U.S. contract action might dispose of the German patent action.” Id. at 884.
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`The Ninth Circuit cited Motorola’s “sweeping promise” in its declarations to the ITU,
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`which included “a guarantee that the patent-holder [would] not take steps to keep would-be users
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`from using the patented material, such as seeking an injunction, but [would] instead proffer
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`licenses consistent with the commitment made.” Id. at 884. The court summarized, “that there
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`[was] a contract, that it [was] enforceable by Microsoft, and that it encompasse[d] not just U.S.
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`patents but also the patents at issue in the German suit.” Id. at 885 (emphasis in original). It
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`concluded that irrespective of the district court’s ultimate determination as to whether Motorola
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`actually breached its contract, “injunctive relief against infringement is arguably a remedy
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`inconsistent with the licensing commitment.” Id.
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`As in Microsoft v. Motorola, Huawei alleges that Samsung breached its contractual
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`obligations under ETSI, Compl. ¶ 1, and seeks relief barring Samsung from obtaining injunctive
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`relief on its declared SEPs anywhere in the world. Samsung insists, therefore, that “this action
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`will necessarily resolve the fundamental issue presented in the Shenzhen injunction action,
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`namely, whether injunctive relief is appropriate for alleged infringement of SEPs that are subject
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`to contractual FRAND licensing obligations.” Mot. at 14. It also notes that there is no dispute
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`that the Chinese SEPs fall within the global portfolios of SEPs, Xie Decl. ¶ 3, and Huawei listed
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`those Chinese SEPs in the Letters of Assurance attached to its complaint, Huawei’s Licensing
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`Declarations (Compl., Exs. 2.1–2.43). And it emphasizes that the two Chinese SEPs are direct
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`counterparts of patents asserted here. Xie Decl. ¶¶ 4, 7.
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`13 It emphasized that it was not deciding whether the district court’s determinations were “proper”
`because those issues were not before it on this interlocutory appeal. Microsoft II, 696 F.3d at 884.
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`United States District Court
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`

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`But Huawei underscores critical factual distinctions here; namely, differences in the
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`positions of the parties and the decision of the foreign court. See Opp’n at 13–15. First, Microsoft
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`initiated the domestic action and asked the court to set the FRAND rate. Microsoft I, 871 F. Supp.
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`2d at 1099. In addition, it did not contest the essentiality or infringement of Motorola’s standard-
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`essential patents. Microsoft Corp. v. Motorola, Inc., 2013 WL 2111217, at *59 (W.D. Wash. Apr.
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`25, 2013)(“Microsoft III”); id. at *61. So, Huawei contends, “Samsung’s attempt to cast itself in
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`the role of Microsoft … is perverse.” Opp’n at 13. Samsung did not initiate this action, and it is
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`contesting the essentiality and infringement of Huawei’s declared SEPs. Second, Huawei
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`distinguishes its own conduct from Motorola’s. It notes that it filed this action and the Chinese
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`actions “at the same time,” not as “an end run around this action.” Id. at 14. This is unlike what
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`happened in Microsoft, where Motorola filed its German suit several months into the U.S. RAND
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`litigation, in a deliberate effort to force Microsoft to accept non-RAND terms. See Microsoft IV,
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`795 F.3d at 1046 (“The evidence that the rates Motorola sought were significantly higher than the
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`RAND rate found by the court suggested that Motorola sought to capture more than the value of
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`its patents by inducing holdup, and that it filed infringement actions to facilitate that strategy by
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`preventing Microsoft from using its patents—and therefore from implementing the 802.11 and
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`H.264 standards—until it obtained a license at a rate significantly higher than the RAND rate.”);
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`id. (“In the absence of a fear of irreparable harm as a motive for seeking an injunction, the jury
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`could have inferred that the real motivation was to induce Microsoft to agree to a license at a
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`higher-than-RAN