Case 2:21-cv-00376-JRG Document 73 Filed 04/10/22 Page 1 of 9 PageID #: 1061

IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF TEXAS
MARSHALL DIVISION

ERICSSON INC. AND

TELEFONAKTIEBOLAGET LM Civil Action No. 2:21-cv-376
ERICSSON,

Plaintiffs
v

APPLE INC.,

Defendant.

APPLE INC,

Counterclaim-
Plaintiff

ERICSSON INC. AND

TELEFONAKTIEBOLAGET LM
ERICSSON,

Counterclaim-
Defendants.

APPLE INC.’S OPPOSITION TO ERICSSON’S “MOTION TO

CONFIRM APPLE’S AGREEMENT TO BE BOUND”
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Ericsson’s motion tries to create uncertainty where none exists: Apple is committed to

being bound by this Court’s determination of FRAND terms for a global license between Apple

and Ericsson. Given that Apple has repeatedly and unambiguously committed to this outcome,

Ericsson’s motion is nothing more than a groundless request for reconsideration of the Court’s

prior rulings that Apple’s FRAND claims will be adjudicated alongside Ericsson’s this December.

ECF 46 at 11 (holding that Apple’s FRAND claims “in the ‑460 action are severed from Counts

V–VII and merged into the -376 action”); ECF 49 at 1. Ericsson appears to be in denial that the

entirety of the parties’ dispute is before, and will be resolved by, this Court.

Ericsson seems to fear the very thing it claimed it so desperately needs: a prompt

determination of binding FRAND terms. If Ericsson sincerely believes that a fair determination

of FRAND terms is warranted, then it should be eager for such a determination—Apple is. It was

Apple, not Ericsson, that wanted a trial date seven months earlier than previously scheduled. Apple

believes the parties should focus on preparing for the December trial, and Apple is doing just that.

But Ericsson has instead continued its focus on filing secret—and baseless—lawsuits in other

jurisdictions to subvert the determination that will be made in December, and is now trying to

persuade the Court to reconsider its clear rulings setting the framework for that trial.

Ericsson apparently has had second thoughts about the prospect that the fairness of Apple’s

offer to Ericsson will be weighed against Ericsson’s offer to Apple. Indeed, if Ericsson thinks it

can prove that it is entitled to its “sticker price” royalty of $5/unit, then it will have a chance to do

so in December. Ericsson’s attempt to subvert the December trial suggests that Ericsson does not

have confidence in its position on the merits.

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But whatever its state of mind, Ericsson cannot ignore Apple’s claims and treat this as a

one-sided proceeding in which “the central issue to be litigated is whether Ericsson’s offer to Apple

would result in a FRAND license.” ECF 64 (“Mot.”) at 3; see also id. (“This license offer will be

the focal point of the trial in this case.”). That is, Ericsson cannot convert this case into a “heads

I win, tails you lose” proceeding in which Ericsson either binds Apple to the excessive rate

Ericsson demands or it sneaks away, free to continue its abusive, non-FRAND worldwide

injunction campaign to coerce Apple into accepting an exorbitant rate. The Court has already

ruled that the December trial will involve more than that—it will also resolve Apple’s claim

seeking a determination of FRAND terms binding on both parties, including by weighing

evidence that includes Apple’s offer to Ericsson based on the parties’ 2015 license. See, e.g., ECF

46 at 3, 11.

At bottom, Ericsson’s motion rests on a series of previously-rejected assertions and is an

improper effort to relitigate settled issues for several reasons:

First, Apple has repeatedly, unequivocally, and unambiguously expressed its willingness

to be bound by this Court’s determination of FRAND terms to resolve the dispute with Ericsson—

and does so once again here—and any suggestion by Ericsson to the contrary is flatly incorrect.

• In its complaint in the -460 action, Apple stated unambiguously that it “seeks (iii)

a binding judicial determination of FRAND terms for Apple to license Ericsson’s

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SEPs globally, including by reference to the terms previously agreed upon by the

parties in their 2015 license.” -460 action ECF 4 ¶ 5. 1

• Likewise, at the March 16, 2022 scheduling conference, Apple made clear that

“Apple has brought to Your Honor on a voluntary basis, with no legal requirement

to do so, portfolio rate setting claims designed to get at the heart of the current

dispute between the parties” and affirmed that “we are here to do global rate setting

in a binding fashion where Apple will be bound.” March 16, 2022 Tr. at 4:24-5:2,

16:5-6.

• The day that Ericsson filed this motion, Apple reaffirmed in its counterclaims that

it “seeks (iii) a binding judicial determination of FRAND terms for Apple to

license Ericsson’s SEPs globally, including by reference to the terms previously

agreed upon by the parties in their 2015 License.” ECF 67 ¶ 10.

On this record, there is no ambiguity regarding Apple’s willingness to have this Court set binding

FRAND terms—and certainly none was expressed by Ericsson at the scheduling conference just

three weeks ago. See generally March 16, 2022 Tr.

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Throughout this Opposition, emphasis is added unless otherwise stated.
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Second, equally clear is that Ericsson has simply contrived the position that it is only

Ericsson’s “license offer [that] will be the focal point of the trial in this case.” Mot. at 3. 2 From

the outset, Apple has argued that a FRAND determination here should be based on a body of

evidence that includes the parties’ prior agreement—not simply a myopic consideration of

Ericsson’s “sticker price” offer. Indeed, in its complaint, Apple requested as relief that the Court

“declare FRAND terms and conditions for a license for Apple to Ericsson’s global portfolio of

cellular SEPs, including by reference to the terms previously agreed upon by the parties in their

2015 license.” -460 action, ECF 4 ¶ 151(e). Likewise, at the March 16 scheduling conference,

Apple made abundantly clear that it would advocate for determining FRAND royalties based on

the 2015 license: “one of the major arguments that we’re going to be making as part of the rate

setting case, Your Honor, is that the prior license agreement between the parties, which expired

only recently, will be an important benchmark.” March 16, 2022 Tr. at 12:16-20.

Third, Apple’s recent correspondence is in no way “walking back” (Mot. at 8) its

commitment that this Court will set binding FRAND terms to resolve the parties’ dispute. Apple’s

March 25, 2022 letter actually underlines Apple’s commitment to have this case effect a full and

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Equally unfounded is Ericsson’s counsel’s baseless certification that they “conferred with
counsel for Apple regarding the relief requested herein and that counsel for Apple indicated that
Apple is opposed.” Mot. at 10. In fact, Ericsson’s counsel never mentioned to Apple’s that it
would be filing this motion and would seek this relief, and Apple’s counsel never could have
“indicated that Apple is opposed.” Counsel did meet and confer on Apple’s request to stay the
-460 litigation in favor of focusing on this case about two hours before Ericsson filed its motion.
Not once during that call did Ericsson’s counsel indicate or even intimate that they intended to file
this motion. Yet shortly thereafter, Ericsson filed its nearly eight-page brief.
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final resolution of the parties’ dispute. As the letter makes clear, Apple first made its offer to

extend the parties’ 2015 license to Ericsson on November 19, 2021 with a proposed annual

payment from Apple to Ericsson. ECF 64-3 at 3. 3 The only change in the renewed agreement

attached to Apple’s March 25 letter leaves the monetary terms blank, to be filled in based on the

result of this case. Id. at 1. That is, Apple was inviting Ericsson to continue the exact same non-

monetary license terms as the last agreement, and to resolve the parties’ monetary dispute through

this case. Ericsson can argue for its own vision of FRAND terms at the December trial. And

Apple will do the same. After hearing all the evidence, a decision will be made regarding FRAND

terms, and the parties will be bound by that determination.

Fourth, and most significantly, the Court already has resolved that the December trial will

involve more than just consideration of Ericsson’s offer. On Ericsson’s motion, the Court

concluded that “all the claims in Apple’s Counts I–IV are directed to the same FRAND and 2015

License issues in dispute in the -376 action.” ECF 46 at 11. And on that basis, the Court ordered

that “Counts I–IV of Apple’s Complaint in the ‑460 action are severed from Counts V–VII and

merged into the -376 action.” Id. The Court then set those merged claims for trial starting on

December 5, 2022. ECF 49 at 1. Those claims include Apple’s contention that the FRAND terms

should be set by reference to the parties’ 2015 license, as reflected in Apple’s November 19, 2021

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Ericsson now claims that “Apple’s terms are legally defective and not capable of resolution
in a breach of FRAND case.” Mot. at 2. But Ericsson never moved to dismiss any of Apple’s
claims on that basis, and it is too late to do so now.

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offer to Ericsson to extend the 2015 license. -460 action ECF 2 ¶¶ 93, 151(e). Nothing in the

Court’s prior determinations countenance the one-sided approach to the trial that Ericsson now

advocates. Addressing the entirety of the FRAND relationship between the parties reflects reality.

Parties do not settle these disputes piecemeal—doing so would be commercial malpractice.

Indeed, while Ericsson accuses Apple of changing positions, it is Ericsson that is doing so.

When it started this case, Ericsson stressed that a FRAND license with Apple would be subject to

reciprocity: “Ericsson, as the owner of patents it contends are essential, and remain essential, to

ETSI standards, has contractually committed to ETSI that it is prepared to grant licenses under its

Essential Patents on FRAND terms and conditions to third parties, such as Apple, who provide

equipment fully conforming to the ETSI standards, subject to reciprocity.” ECF 1 ¶ 59. Ericsson

also pled that “[a]s a manufacturer of cellular infrastructure equipment, Ericsson typically

negotiates cross-license agreements that provide Ericsson a reciprocal license to the other

company’s technology,” and noted that “Ericsson’s previous two licenses with Apple were cross-

licenses where Ericsson also received a license from Apple.” Id. ¶¶ 41, 43. Now Ericsson seeks

to change the trajectory of this case and commercial reality by insisting that the only path to a

FRAND resolution is limiting this case to evaluation of its one-way demand of Apple.

Try as it might, Ericsson cannot rewrite the clear record of Apple’s willingness to be bound

by this Court’s FRAND determination, nor change this Court’s rulings that this case will

encompass both parties’ claims. Nor can Ericsson back out of the December trial by asking the

Court to reconsider its prior rulings, even if it studiously avoids use of the word “reconsider.”

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There are no grounds for reconsideration. The only thing that has changed is Ericsson’s growing

apprehension of the risks to its ability to demand exorbitant rates from a ruling at the December

trial in Apple’s favor. Ericsson now apparently understands that a fully equitable FRAND

determination will undermine the non-FRAND demands it has made across the industry. To limit

its risk, Ericsson now proposes that the only issue for consideration will be its offer to Apple, as if

Apple’s claims did not exist. Ericsson’s invitation for the Court to reconsider its prior

determinations has no merit, and this case should proceed as the Court has already decided it will—

with a determination on the merits after trial of both parties’ FRAND positions.

***

Apple will be ready for the trial in this Court in December to set binding FRAND portfolio

terms.

DATED: April 10, 2022 Respectfully submitted,

__/s/ Melissa R. Smith_________________

Melissa R. Smith
State Bar No. 24001351
melissa@gillamsmithlaw.com
GILLAM & SMITH, LLP
303 South Washington Avenue
Marshall, TX 75670
Telephone: 903-934-8450
Facsimile: 903-934-9257

Ruffin Cordell Joseph J. Mueller (pro hac vice)

cordell@fr.com Timothy D. Syrett (pro hac vice)
State Bar No. 04820550 joseph.mueller@wilmerhale.com
FISH & RICHARDSON P.C. timothy.syrett@wilmerhale.com
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Case 2:21-cv-00376-JRG Document 73 Filed 04/10/22 Page 9 of 9 PageID #: 1069

1000 Maine Ave SW, Suite 1000 WILMER CUTLER PICKERING

Washington, DC 20024 HALE AND DORR LLP
Telephone: 202-783-5070 60 State Street
Facsimile: 202-783-2331 Boston, MA 02109
Telephone: 617-526-6000
Benjamin C. Elacqua Facsimile: 617-526-5000
State Bar No. 24055443
elacqua@fr.com Mark D. Selwyn (pro hac vice)
FISH & RICHARDSON P.C. mark.selwyn@wilmerhale.com
1221 McKinney Street, Suite 2800 WILMER CUTLER PICKERING
Houston, TX 77010 HALE AND DORR LLP
Telephone: 713-654-5300 2600 El Camino Real, Suite 400
Facsimile: 713-652-0109 Palo Alto, CA 94306
Telephone: 650-858-6000
Betty Chen Facsimile: 650-858-6100
State Bar No. 24056720
bchen@fr.com
FISH & RICHARDSON P.C. Attorneys for Defendant Apple Inc.
500 Arguello Street, Suite 500
Redwood City, CA 94063
Telephone: 650-839-5070
Facsimile: 650-839-5071

CERTIFICATE OF SERVICE

I certify that on April 10, 2022, I electronically filed the foregoing with the Clerk of the

Court using the CM/ECF system which will send notification of such filing to all counsel of

record.

/s/ Melissa R. Smith

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