Delhi High Court slaps ₹5 lakh penalty on Oppo in patent case; warns of ban on sale if it fails to deposit royalties

The Delhi High Court recently expressed strong displeasure with mobile phone maker Oppo for causing delays in its ongoing patent dispute with InterDigital and directed the Chinese company to deposit all pending royalties as interim security with the High Court [Interdigital Technology Corporation & Ors v Guangdong Oppo Mobile Telecommunications Corp Ltd & Ors]..If Oppo fails to deposit the security in an interest-bearing account, InterDigital can move court to restrain sale of any further devices by Oppo in India.“The Defendants shall deposit a sum of xxxxxx xxxxxx covering all past sales for the years 2021-22, 2022-23, 2023-24, with the worthy Registrar General of this Court, within a period of three months. The said amount shall be kept in an interest-bearing fixed deposit on auto-renewal mode,” the Court said.Justice Prathiba M Singh also imposed a penalty of ₹5 lakh on Oppo for its conduct and causing ‘substantial delays’ in the case.The trial has now been expedited and shall be concluded in 2024 itself.If the case fails to conclude for any reason by December 2024, Oppo will have to deposit additional money with the High Court.“The trial in the suits shall now be concluded in 2024 itself. Should the trial not conclude for any reason, by December, 2024, the Defendants shall deposit an additional sum of xxxxxx xxxxxx with the worthy Registrar General by 31st March 2025. Failure to deposit the amount would entitle InterDigital to move an application before the Court for seeking an injunction/restraint order from sale of any further devices by the Defendants in India, due to non-compliance of Court orders,” the single-judge directed. .The Court passed the order in the two suits filed by InterDigital against Oppo for the alleged infringement of former’s cellular (3G, 4G and 5G) as well as video coding technology (HEVC). The technology is stated to be used in handsets under the Oppo, RealMe and OnePlus brands.According to InterDigital's suit, it was negotiating with the Oppo group for a number of years for a license agreement on Fair, Reasonable and Non-Discriminatory (FRAND) terms. When the parties could not find a common ground, InterDigital initiated a multi-jurisdictional campaign against the Oppo Group in UK, Germany, India etc in December 2021..In a detailed order, Justice Singh also pulled up HSBC Bank for its failure to appear before the Court to satisfy it about the veracity of the bank guarantees drawn by Oppo.“A substantial amount of judicial time and effort has been expended solely because HSBC has been unwilling to assure this Court that the bank guarantees for approx. xxxxxx xxxxxx would be subject to the orders of this Court. The Defendants (Oppo) also had a duty to ensure that their bankers, HSBC — whether from Paris or India— appear and subject the bank guarantees to the jurisdiction of this Court. However, the Defendants have miserably failed to fulfil this obligation.”.Meanwhile, Justice Singh also allowed the applications moved by Oppo for constitution of a confidentiality club for exchange of confidential information including agreements between InterDigital and them.It will comprise of designated experts, internal representatives of both the parties, and their lawyers. Only members of this club will have access to the documents exchanged during the trial..InterDigital was represented by a team from Anand and Anand comprising advocates Pravin Anand, Vaishali Mittal, Siddhant Chamola, Pallavi Bhatnagar and Gitanjali Sharma.Oppo was represented by advocates Saikrishna Rajagopal, Julien George, Anu Paarcha, Aniruddh Bhatia, Arjun Gadhoke, N Parvati, Avijit Kumar and Vivek Ayyagiri. .[Read Order]