UK High Court Rules Samsung to Pay ZTE $392 Million: Was Patent Value Undervalued?
Recently, the London High Court issued a judgment in the global patent licensing dispute between Samsung Electronics and ZTE, ruling that Samsung must pay ZTE a one-time fee of $392 million as a licensing fee for using its mobile communication patents. Notably, ZTE requested a maximum amount of $731 million in this case, while Samsung claimed a maximum of $200 million, with significant disagreement on the licensing fee. The case is currently at the first instance judgment stage and has not taken effect. Previously, courts in multiple countries have explicitly supported ZTE's FRAND quotes.
Courts in Multiple Countries Support ZTE’s FRAND Quotes
According to previous media reports, the dispute originated from the failure to reach an agreement on renewal terms after the patent licensing agreement reached in 2021 expired. Samsung filed a lawsuit in London in December 2024, requesting the court to determine fair, reasonable, and non-discriminatory licensing terms. ZTE simultaneously filed parallel lawsuits in China, Germany, and Brazil.
The patents involved are essential standard patents necessary to ensure smartphones access mobile networks. The UK is the jurisdiction for several patent cases because its courts can set global FRAND terms based on the landmark ruling by the UK Supreme Court in 2020. Both parties have the right to appeal the judgment.
According to foreign media reports, while courts in Germany, UPC, and Brazil all support ZTE’s position and quotes, the UK court adopted a completely wrong approach in making its ruling. Foreign media also pointed out that the judgment made in this licensing dispute is suspected of being subjective and arbitrary, and ignoring other jurisdictions.
According to previous litigation conclusions in other European courts, for example, on February 25th, in parallel litigation between the two parties, the Frankfurt Court ruled that ZTE’s quote complied with FRAND, while Samsung’s counter-offer was abnormally low; on March 25th, the Munich Court dismissed Samsung’s infringement lawsuit after calculating ZTE’s quote; on April 30th, in another parallel lawsuit between the two parties, the Munich Court issued an injunction against Samsung, finding that Samsung’s infringement of patent rights was established and that ZTE complied with FRAND, among other findings.
Experts Say Patent Value Was Undervalued
Why are there obvious differences in judgments in the same case? This depends on the different calculation methods. In the UK judgment, the court adopted a purely comparable agreement method to calculate the license fee. However, the courts in Munich and Frankfurt, Germany, both adopted a Top-down approach when calculating the license fee.
“Not only does it obviously deviate from the core requirements of the FRAND principle, but it also underestimates the value of ZTE’s mobile communication patents,” industry insiders said bluntly, expressing incomprehension at the court’s refusal to adopt the Top-down approach to calculate the fee, and the method it selected. The judge stated, “has the right to adopt but is not obligated to adopt” Top-down. This clearly deviates from the common practice of “Top-down cross-validation” by German courts, UPC, and even UK courts previously. The person believes that the court’s insistence on its “forum selling” strategy may be to attract more entities to bring lawsuits to the jurisdiction.
In addition, the UK court believes that the Big Two (referring to agreements historically reached between ZTE and Samsung, and Apple) are the best comparable agreements. However, the Frankfurt Court pointed out that historical agreements have expired and have specific characteristics, with significant differences from the current license in terms of license duration, patent scope, and licensing methods, and are not suitable as comparable agreements. Directly referencing the Big Two as comparable agreements to calculate the fee led to ZTE’s patent value being excessively devalued.
Recently, the China Academy of Information and Communications Technology (CAICT) released the “5G Standard Essential Patent and Standard Proposal Research Report (2026)”. Among the industrial entities declaring 5G standard essential patents in ETSI, the top ten enterprises’ valid patent families account for approximately 67.03% of all valid patent families. ZTE’s valid global patent families rank fourth, accounting for 6.82%, firmly ranking it among the top tier of global patent layouts, and is a major contributor and participant in global 5G technology research and standard setting.