Tesla, led by CEO Elon Musk, has been allowed to resume a patent licensing lawsuit it filed ahead of launching 5G vehicles in the United Kingdom.

According to Reuters on the 27th (local time), the UK Supreme Court sided with Tesla, allowing the company to resume its lawsuit against American tech company InterDigital and patent licensing platform Avanci.

▲ Seeking Court to Determine FRAND License Terms Ahead of 5G Vehicle Launch

Tesla filed the lawsuit against InterDigital and Avanci in the UK High Court in 2023.

Avanci is a patent pool platform that collects patents from multiple patent holders and provides licenses to industries such as automobiles.

Tesla requested that the court directly determine licensing terms on Fair, Reasonable, and Non-Discriminatory (FRAND) conditions so that it could use Standard Essential Patents (SEPs) held by patent holders including InterDigital.

▲ Lower Court Loss Reversed at Supreme Court

InterDigital and Avanci requested that the court dismiss the claims, and the UK High Court accepted their arguments in 2024.

However, the court allowed Tesla's separate claim challenging the invalidity of three patents held by InterDigital to continue proceedings.

Tesla subsequently lost at the appellate court but appealed to the UK Supreme Court to contest the decision. In this process, industry lobby groups such as the Computer and Communications Industry Association (CCIA) and the Motion Picture Association participated as interested parties in support of Tesla.

▲ Supreme Court: "FRAND Obligations Do Not Disappear Even with Patent Pool Membership"

The UK Supreme Court ruled that patent holders do not escape the obligation to license patents under FRAND conditions simply because they participate in a patent pool or licensing platform.

This ruling is considered significant as it clarified that even when patent holders provide licenses through patent pools, their FRAND obligations remain in effect.

The case will be sent back to the UK High Court for merits hearings based on the Supreme Court's judgment.

Tesla [Reuters/Yonhapnews]

▲ Avanci: "Do Not Agree with the Ruling"

Lori Fitzgerald, president of Avanci Vehicle, said in a statement, "We respectfully disagree with this ruling" and "We believe Tesla's claims still lack legal merit."

Tesla and InterDigital did not immediately provide statements in response to media inquiries regarding the ruling.

The ruling is expected to have significant implications for standard essential patent licensing disputes as connected vehicles and 5G communication technology in the automotive industry accelerate.

Particularly, as the court has reopened the possibility of directly determining FRAND conditions, analysts suggest that changes in negotiating power and litigation strategy could emerge in future license negotiations between automakers and patent holders.