Spanish Patent Court Upholds Patent Infringement Actions Against Telefónica Regarding Its Movistar+ Pay-TV Platform – Commentary

Introduction
Facts
Decision
Comment

Introduction

On October 17, 2022, Barcelona Commercial Court No. 4 upheld the actions brought by Two-Way Media Ltd (TWM) against Telefónica, SA, Telefónica de España, SAU and DTS, Distribuidora de Televisión Digital, SAU (together, Telefónica et al) for the infringement of its patents:

• European patent (EP) 2278775 (EP 775); and
• EP 2323333 (EP 333).

The two patents related to different aspects of Internet Protocol television technology used in the Movistar+ television platform. The judgment also dismissed the nullity actions filed by the companies of Telefónica et al against the aforementioned patents.

Facts

In July 2017, TWM sued Telefónica et al on the grounds that the Movistar+ television platform proposed, marketed and implemented by Telefónica et al fell within the scope of protection of patents EP 775 and EP 333.

Two of the defendants claimed the nullity of the two patents and the third retorted the nullity of the patents for exception. All of the defendants, however, advanced the same invalidity arguments:

• lack of technical character of inventions;
• the added object (three attacks per patent);
• lack of novelty (one attack against EP 775, three attacks against EP 333); and
• the absence of inventive step (four attacks per patent).

Telefónica et al also argued that TWM’s patents were not infringed because the technical characteristics of the Movistar+ television platform differed from the technology claimed in patents EP 775 and EP 333.

In March 2018, TWM filed its defense against the counterclaim and the nullity exception.

In July 2018, nearly a year after Telefónica et al filed their counterclaim and invalidity exception, Telefónica, SA and Acens Technology, SL (Acens) initiated a second legal proceeding. They brought a direct action for nullity, contesting the validity of patents EP 775 and EP 333 on the grounds of the lack of novelty and inventive step of the patents with regard to the new arguments and the state of the art.

TWM defended the validity of its patents and supported lis pendens between the two legal proceedings.

By order of November 24, 2020, Commercial Court No. 4 of Barcelona confirmed the lis pendens request. However, the Barcelona Court of Appeal upheld the appeal of Telefonica, SA and Acens against the aforementioned order, thus the second nullity proceedings continued.

In September 2021, the Court agreed to consolidate:

• the infringement proceedings initiated by TWM against Telefónica et al; and
• the invalidity proceedings initiated by Telefónica, SA and Acens.

The trial of the joined proceedings took place from May 2 to 5, 2022 and the fifth session took place on June 15, 2022.

Decision

On October 17, 2022, Commercial Court No. 4 in Barcelona rejected all nullity arguments advanced by Telefónica et al and Telefónica, SA and Acens, in both proceedings, confirming all of TWM’s arguments regarding the validity of its patents EP 775 and EP 333.

In addition, the judgment rejected all of the defendants’ non-infringement arguments, stating that the Movistar+ television platform violated patents EP 775 and EP 333. The court imposed on the defendants the legal costs arising from the actions in infringement and nullity actions filed by Telefónica. et al in the first proceeding and Telefónica, SA and Acens in the second proceeding.

Comment

The judgment touches on almost every issue related to intellectual property controversies:

• the scope of protection of the two patents;
• an in-depth analysis of the technical nature of the two patents and an in-depth study of the guidelines of the European Patent Office on the subject;
• topic added;
• inventiveness analysis – almost every step taken by Telefónica et al to perform the inventiveness analysis was controversial. Therefore, the Court analyzed almost all of them – namely:
  • application of the correct methodology;
  • the technical problem to be solved;
  • the a posteriori analysis; and
• various other considerations, including the state of the art as of the priority date.

The statement of patent infringement led the court to order Telefónica et al to pay TWM the damages claimed in the suit. According to Spanish patent law, the calculation of damages will take place within the framework of the enforcement proceedings.

For more information on this, please contact Ana-Laura Morales and Jesús Arribas to Grau & Angulo by phone (+34 93 202 34 56) or email ([email protected] Where [email protected]). The Grau & Angulo website can be accessed at www.ga-ip.com.