Key Facts
- •Motorola and Ericsson have a global patent cross-licence agreement (2011 Licence).
- •Motorola seeks a declaration that 354 of its products are within the 2011 Licence.
- •The dispute centers on the construction of clause 2.4A of the 2011 Licence.
- •Motorola proposes four alternative constructions of clause 2.4A.
- •Ericsson disputes Motorola's constructions and offers its own interpretation.
- •Motorola also seeks a declaration that an implied term exists in the 2011 Licence.
- •A preliminary issue hearing was held to determine whether to try the construction of clause 2.4A and the implied term as preliminary issues.
Legal Principles
The decision to order a trial of a preliminary issue is a case management one, considering factors such as whether it would dispose of the case or a significant aspect, reduce costs and time, and whether it would fetter a just result.
Steele v Steele [2001] CP Rep; Wentworth Sons Sub-Debt SARL v Lomas [2018] 2 BCLC 696; Binstead v Zytronic [2018] EWHC 2182 (Ch)
Outcomes
The court ordered a preliminary issue trial for the construction of clause 2.4A of the 2011 Licence and the implied term.
Determining the construction of clause 2.4A would significantly impact the scope of the trial, potentially shortening it considerably depending on the outcome. Even if Ericsson's construction is preferred, clarity on the scope of the trial is beneficial. The implied term is a discrete point of construction that would resolve a substantial aspect of the case. The court weighed the factors outlined in Steele v Steele and found it just to order the preliminary issue.