Preserving the Optionality of Arbitration and Mediation in Standard Essential Patent (SEP) Disputes

Brussels, December 9, 2021 – This paper builds on the FSA’s position paper of February 15, 2017, and sets out further detail on the FSA’s views on the role of arbitration and mediation in the resolution of standard essential patent (SEP) disputes. It explores the roles arbitration and mediation can play, looking at how they can best be structured to contribute to the fair and balanced settlement of SEP disputes about fair, reasonable, and non-discriminatory (FRAND) licensing terms, outside of court litigation.

Alternative dispute resolution (ADR) mechanisms such as arbitration and mediation must be consensual so the key principle is that the decision to resolve a SEP licensing dispute through arbitration and mediation must be voluntary. Thus, a party’s choice not to engage in arbitration or mediation to resolve a SEP dispute does not demonstrate a lack of interest in resolving that dispute, or that such a party is otherwise an unwilling licensor or licensee. Nor should such a decision create any presumptions or trigger any penalties, such as a disadvantage in litigation, against that party in any subsequent dispute resolution process. Equally, a mere offer to arbitrate or mediate by a licensor is insufficient to demonstrate that the SEP holder is a willing licensor.

Voluntary decisions to mediate may be helpful in resolving SEP disputes in some circumstances. Some courts offer or order mediation of SEP disputes after litigation is filed, but before a court action proceeds, which may help the parties to see if they can reach agreement in a facilitated process. Although the complexity of FRAND disputes means it is unlikely that that full agreement will be reached during mediation, it could narrow the issues in dispute, thereby usefully progressing matters towards a final resolution.

Download the full position paper here.

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