The Schoen Court's Guidelines - Part 3
In its “FRAND” Guidelines (“guidelines”), the Schoen Court made a lot of mistakes in its baseline assumptions, its legal analysis and its conclusions. It even made a number of mistakes in its citations. One of those mistakes occurs in paragraph 6 of the guidelines where the Schoen Court complains that the European Commission’s amicus curiae briefs in the proceedings that led to the Federal Court of Justice’s (“BGH”) “FRAND Objection III” decision (BGH KZR 10/25, GRUR 2026, 383) focused “too one-sidedly on supposed consumer interests and fails to do justice to the complexity of the issue . . . [and] missed an opportunity to enrich the discussion on the topic of SEPs and FRAND by presenting compelling arguments and providing a balanced treatment of the arguments from both sides.”[1]
This statement is inaccurate as well as ironic coming from the Schoen Court, a court that repeatedly has failed to provide a “balanced treatment of the arguments from both sides.” It also displays a fundamental misunderstanding of competition law and of the FRAND obligation.
The Briefs Do Not Say What the Schoen Court Claims.
I have read all three of the amicus briefs that the European Commission filed in the HMD Global Oy gegen VoiceAge EVS GmbH & Co. KG matter.[2] Each of them focuses on how the European Commission believes the European Court of Justice’s decision in Huawei v. ZTE case should be applied in the VoiceAge/HMD cases. Each brief discusses the Huawei framework and how to determine willingness based on the negotiating steps taken, and in what order, by a licensor and a potential licensee. Each brief concludes that the applicable lower courts (Munich and Mannheim) should have applied the Huawei judgement in its totality and should have reviewed the VoiceAge case according to the Huawei steps in their prescribed order without skipping steps, and without putting the onus on the implementer to come up with a FRAND offer unless the SEP holder first had made a FRAND offer.
None of the three briefs discusses consumers (whether the Schoen Court’s “Verbraucher” or Konsumént). Even if I somehow missed a mention of consumers in the briefs, the briefs certainly are not “one-sidedly” focused on consumers. They are focused on the negotiations between a SEP licensor and a potential licensee, on how best to encourage the parties to reach a FRAND license and on the circumstances in which a court might award an injunction against a potential licensee based on the negotiating history.
The Schoen Court’s cite is not the kind of rigorous cite one would expect to find in a legal document from a court. This made it extremely difficult for me to determine to what brief the Schoen Court thought they were referring. So, German lawyers – what am I missing? To what amicus of the European Commission does the Schoen Court think it is referring? It certainly is not the three I have cited below.
The Schoen Court Fails to Grasp the Irony of Their Own Statement.
The Schoen Court is due for some introspection. It is beyond ironic for a court so focused on benefitting SEP holders to claim that the European Commission’s briefs are too one-sided. The Schoen Court, in its decisions and in the guidelines, has not considered the benefits or harms to consumers or to society as a whole from granting injunctions in essentially all cases. It has not performed any balancing of the interests of SEP holders and implementers. Instead, the Schoen Court has focused, very one-sidedly, on the benefits and harms to SEP holders. This is, after all, the court that has never – not once in over 70 cases – found an implementer to be willing.
The Schoen Court’s guideline’s one-sidedness is apparent from its discussion of costs. The guidelines contain numerous discussions about the costs born by SEP holders and about how those costs must be compensated by the implementer. The guidelines discuss:
the costs of litigation for the patent holder which “must be compensated” (parag. 13);
the purportedly “very high costs” involved in developing the standard (parag. 17);
“the costs of enforcing the portfolio” (parag. 52) which should lead to higher rates for “a technology user whose conduct has caused the patent holder particularly high costs” (parag. 73);
“[s]urcharges are justified when the user’s conduct has unduly delayed the conclusion of a settlement agreement. This is because the patent holder has incurred costs that were not factored into the standard calculation” (parag. 143).
that the 10% surcharge assessed in ZTE vs. Samsung was justified because the implementer filed a complaint with ETSI [which the Schoen Court enjoined them from doing, so it is extremely unclear how a $60M surcharge for the filing could ever be justified];
and the guidelines contain a veiled threat to add additional surcharges if an implementer files a claim in “an incompetent court” (parag. 145) - one assumes this means in a court that the Schoen Court dislikes such as the U.K. Courts.
The guidelines do not, however, contain an equivalent discussion of the costs born by implementers. Implementers face many of the same costs as SEP holders when faced with SEP assertions and litigation, including the costs of investigating the portfolio, the costs of negotiation and the costs of litigation.
None of these implementer-born costs are discussed or even mentioned in the guidelines. Nor do the guidelines discuss the high cost of developing a multi-faceted product – such as an automobile – that merely uses a standard as one small component part. Nor do the guidelines examine the incredibly high and disproportionate cost of an injunction when issued against such a multi-faceted product based on the use of that standard. The only time the guidelines discuss costs in the context of an implementer is when the Schoen Court discusses the need to address “the potential cost savings (efficiency gains) made possible by the licensed technology i.e. the SEPs” (parag. 204). In other words, the guidelines do not – ever – take into consideration the costs born by implementers, or by consumers or by society as a whole.
It is the guidelines, and not the EC’s briefs, that are a “missed an opportunity to enrich the discussion on the topic of SEPs and FRAND by presenting compelling arguments and providing a balanced treatment of the arguments from both sides.” Rather than providing a balanced treatment, the guidelines (and the Schoen Court) myopically focus on the costs born by SEP holders which the Schoen Court believes "must be compensated" by implementers in addition to implementers paying "FRAND" rates.
The Schoen Courtt Misunderstands Competition Law and FRAND.
Finally, the Schoen Court’s comment shows a misunderstanding (or perhaps a disregard) for competition law, the FRAND obligation and the purpose of standards. Consumers are, after all, at the heart of competition law and of standard setting. Competition law, and the FRAND obligation that stems from competition law, only protects competition because of the theory that robust markets encourage “companies to offer consumers goods and services on the most favourable terms.”[3] Competition law has always focused on protecting consumers and the public from monopolies and unfair competition.
Standard setting organizations also understand that the purpose of standards is to benefit consumers, the public and society as a whole, not to benefit individual participating companies. The International Telecommunications Union goals include to “close the digital divide in access in all countries, regions and for all humanity” and to “to promote and enable digital transformation across spheres of life and activity, to address the dual climate and environmental crisis, and to foster the advancement of science, sustainable exploration of Earth and space, and the use of their resources for the benefit of all.”[4] The European Telecommunications Standards Institute (ETSI) states that its work is intended “for the benefit of the market, consumers and society at large.”[5]
The Schoen Court fails to understand that FRAND, and the competition laws underlying FRAND, are not intended to protect competing companies, SEP developers or even implementers. Nor is FRAND intended to provide a mechanism through which SEP holder’s can extract license fees or be reimbursed for their development, licensing, litigation or other costs. Instead, consumers are the people that competition law, including as applied to standards, is intended to benefit and that FRAND is intended to protect.[6] But, benefitting consumers and the public good do not form the basis of any of the conclusions reached in the Schoen Court’s guidelines and do not form any of the underlying rationale for them.
This is not a court, or a set of guidelines, that has considered the complexity of the issues. This is not a court, or a set of guidelines, that addresses the substantial arguments made by the European Commission in its amicus briefs about balance and fairness. This is not a court, or a set of guidelines, that has balanced the benefits and harms to the SEP holder with those of the implementer or with those of consumers or the public good. Instead, the Schoen Court fundamentally ignores important competition law principles in its one-sided pursuit of rationales to justify issuing injunctions in every SEP case which serves only to benefit SEP holders at the expense of everyone else.[7]
[1] In German:
Die Amicus Curiae-Stellungnahmen der Europäischen Kommission in dem Verfahren, welches zu der Entscheidung des BGH „FRAND-Einwand III“ (BGH KZR 10/25, GRUR 2026, 383) geführt hat, gebieten es, auf den typischen Ablauf von Verhandlungen zwischen Patentinhabern und Technologienutzern einzugehen. Denn bei genauer Betrachtung der Interessenlagen der an der Entwicklung von Standards beteiligten Forschungsinstituten und Unternehmen, als auch der Verbraucher, die ein Recht auf Teilhabe an moderner Technologie haben, wird deutlich, dass die seitens der Europäischen Kommission geäußerte Kritik in einer im Ergebnis zu einseitigen Weise auf vermeintliche Verbraucherinteressen abstellt und der Komplexität des gesamten Themas nicht gerecht wird. . . . Was genau die Kommission zu ihrer Stellungnahme bewogen hat, mag die Kammer nicht zu beurteilen. Festzustellen ist, dass eine wichtige Institution die Gelegenheit verpasst hat, durch das Einbringen gewichtiger Argumente und eine ausgewogene Behandlung der Argumente beider Seiten die Diskussion um das Thema SEP/FRAND zu bereichern.
[2] Available here: Amicus curiae observations - Competition Policy - European Commission (two were submitted in 2024 and one in 2025).
[4] See, ITU Strategic Plan 2024-2027.
[6] See, Back to Basics – An Overview of Competition Law, Standard Development and Standard Setting for a more indepth discussion of the intersection of competition law and standards and see Back to Basics Part 2 – Injunctions and Licensing for a discussion about how Germany’s Federal Court of Justice got it wrong in the VoiceAge v. HMD decision that resulted from them ignoring the EC’s briefs.
[7] My other posts in this series can be found here: Schoen Court's “Guidelines” Get A Chutzpah Award - No Process, No Transparency and The Matcha Latte Court's Guidelines – No Established, Reliable Economic Underpinnings.
