Standard essential patent (SEP) litigation is anything but "standard," especially when it comes to determining remedies for patents that must be licensed under fair, reasonable, and non-discriminatory (FRAND) terms. Court decisions in recent years have outlined a number of different ways these issues can be handled, and parties still today are left with some uncertainty as to which approach to setting FRAND terms will stand.

Background on SEPs and FRAND

Standard essential patents (SEPs) cover technology that must be used in order to comply with an interoperability standard, such as the 3G and LTE standards for cellular telecommunications. These standards are typically developed by standard setting organizations (SSOs) comprised of members from companies across a given industry, all of whom work together to set the requirements and features of a new standard. The success of a standard depends on interoperability to achieve widespread use by numerous different participants in a given technology ecosystem.

In a cellular telephone network standard, for example, these industry participants can include mobile phone manufacturers and cellular service companies. If, say, a cellular service company owns a patent that covers the process by which a mobile phone must connect to a cellular tower, the cellular service company could in theory block other cellular service companies from connecting phones to their cell towers, or block mobile phone manufacturers from selling phones that connect to the cellular network.

If only a few select industry participants are permitted to implement such a standard, the standard can suffer, and consumers lose—the net result would be haphazard implementation and failure to achieve the widespread use that is the goal of standard setting organizations in the first place. In this sense, the goals of standard setting organizations, and the issuance of SEPs that allow a patent holder to restrict the use of standards, are at odds.