The judgment (see here) overturns the decisions of the High Court ([2024] EWHC 1815 (Ch)) and the Court of Appeal ([2025] EWCA Civ 193), and has significant implications for standard-essential patent (“SEP”) licensing disputes in which licences must be offered on fair, reasonable and non-discriminatory (“FRAND”) terms pursuant to commitments made to the European Telecommunications Standards Institute (“ETSI”).
The UK Supreme Court unanimously allowed Tesla’s appeal and dismissed InterDigital’s cross-appeal, vindicating Arnold LJ’s dissent in the Court of Appeal ([2025] EWCA Civ 193). The case can now proceed on its merits.
The dispute arose in December 2023, when Tesla commenced proceedings against InterDigital and Avanci in the Patents Court ahead of its planned launch of 5G-enabled vehicles in the UK. Tesla sought new forms of declarations as to the FRAND terms for a licence to use SEPs owned by InterDigital and other patent holders, which are made available through Avanci’s 5G licensing platform. Tesla contended that Avanci’s offered rate of $32 per vehicle was not FRAND. Avanci is not an SEP holder itself; rather, it is a SEP platform provider offering licences to bundles of SEPs together. The question arose as to whether Tesla could challenge the rate offered by Avanci, even though Avanci, as a platform provider, had not made an ETSI declaration to offer licences on FRAND terms.
The most significant practical consequence of the judgment is that implementers may now proactively bring proceedings in England and Wales to challenge SEP platform or pool licensing rates as non-FRAND, without first needing to wait to be sued for patent infringement. Up until now, an implementer dissatisfied with an offered platform rate had two realistic options: accept it, or decline and risk being sued. The judgment establishes a third: initiate proceedings and invite the court to determine the appropriate FRAND rate. This has the potential to materially alter the negotiating dynamic in any SEP licensing discussion with a UK dimension.
The Supreme Court held that the FRAND obligation does not fall away when a SEP owner joins a licensing platform or pool. Thus, platform operators such as Avanci can be brought before the English courts as necessary parties to FRAND proceedings, even though they do not themselves owe a FRAND obligation to ETSI. The Court held that their role as agent for SEP owners who do owe that obligation is a sufficient basis for the grant of declaratory relief against them.
Platform operators will accordingly need to consider the implications of this decision for their governance, pricing transparency, and the terms on which they engage with both licensors and licensees. They should also factor in the possibility of being respondents in FRAND litigation before the English courts.
The Supreme Court also affirmed that jurisdictional competition is an inherent consequence of the ETSI regime, in which national courts are called upon to resolve disputes as to global FRAND terms, and rejected InterDigital’s forum-shopping objections. For any implementer selling products in the UK – which remains a significant market for most global technology and automotive companies – the English courts are now firmly established as a key forum for determining FRAND licensing rates for SEPs. We may now see an increase in implementer-initiated FRAND claims before the Patents Court, reinforcing London’s position as a leading centre for the resolution of SEP licensing disputes.