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EU Court Rules That Royalties for Unpatented Technology Are Not Necessarily Anticompetitive

On 7 July 2016, the Court of Justice of the European Union (CJEU) handed down a judgment on whether Article 101 of the Treaty on the Functioning of the European Union (TFEU) must be interpreted as precluding effect being given to a licence agreement requiring the licensee to pay royalties for the use of a patent which has been revoked (Sanofi-Aventis v. Genentech, Case C-567/14). Background In 1992, Hoechst granted a licence to Genentech for a human cytomegalovirus enhancer. The licensed technology was subject to one European patent and two patents issued in the United States. In 1999, the European Patent Office revoked the European patent. Under the licence agreement with Hoechst, Genentech was obliged to pay a one-off fee, a fixed annual research fee and a running royalty based on sales of finished products. Genentech never paid the running royalty, however, and in 2008 it notified Hoechst and Sanofi-Aventis (Hoechst’s parent company) that it was...

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Patent Wars: EU’s Top Regulator Takes Front Line Position

by William Diaz, Alexander Harguth, David Henry, Stefan M. Meisner, Hiroshi Sheraton, Wilko van Weert and Philipp Werner There has been a spate of antitrust complaints to the European Commission and other antitrust authorities of late, regarding the licensing of "essential patents".  In the first months of 2012 alone, the European Commission received at least five new antitrust complaints over the potentially abusive use of technology patents.  These complaints are being used increasingly by alleged patent infringers as another line of defense against actions brought by patent holders in the United States and in Europe.  The use of complaints in this way has vital, strategic implications for the owners of technology patent portfolios and it is a tactic that should be taken into account by plaintiffs and defendants in the on-going “patent wars”.  To read the full article, click here.

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