Acer and Asus secure key win over Nokia as Court of Appeal strips disputed licence term

The Court of Appeal has handed down a significant consequential judgement in Acer Incorporated & Anor v Nokia Technologies OY, ruling that a disputed term in Nokia's Adjustable Licence Offers is not RAND and must be excised as a condition of any case management stay. The judgement, delivered on 18 May 2026 by Lord Justice Arnold, Lord Justice Zacaroli and Lord Justice Peter Jackson, resolves a question that was deliberately left open in the main judgement handed down less than a week earlier.

The background lies in Nokia's attempt to obtain a case management stay of English proceedings brought by Acer and Asus, both of which sought licences to Nokia's codec standard-essential patent (SEP) portfolio. In the main judgement ([2026] EWCA Civ 564), the Court dismissed Nokia's jurisdiction appeal but allowed its appeal on the case management stay, finding that Nokia's Adjustable Licence Offers were capable of acceptance by the claimants and that, without acceptance, they would be treated as unwilling licensees unable to invoke the English courts' declaratory jurisdiction.

The contested issue concerned a specific term within those Adjustable Licence Offers. That term would permit either party to require that the arbitration encompass the terms of a FRAND cross-licence in respect of patents owned or controlled by the other side, and would oblige the other party to stay, withdraw or abandon any related litigation. The claimants argued that accepting the Offers inclusive of that term could prevent them and associated entities from enforcing their own SEPs in mobile telephony while arbitration remained ongoing.

Nokia maintained that whether final licences should take the form of cross-licences was a matter for arbitrators rather than for the Court to determine summarily. Lord Justice Arnold rejected that position directly. Having accepted Nokia's own argument that it could summarily determine the Adjustable Licence Offers to be RAND, the Court was equally competent to assess whether the disputed term met that standard.

The judgement identifies two independent grounds for finding the term incompatible with RAND obligations. First, the Court accepted that Nokia might legitimately contend before arbitrators that RAND terms should include a cross-licence in respect of the claimants' own SEPs. It was not, however, open to Nokia to impose through its licence terms an obligation on the claimants to submit disputes over such a cross-licence to arbitration. Lord Justice Arnold noted that, applying Nokia's own reasoning accepted in paragraphs 85 to 88 of the main judgement, the choice between arbitration and court proceedings for determining FRAND terms belongs to the SEP owner. Where the SEPs in question are owned or controlled by the claimants, that choice lies with them, not with Nokia.

Second, and independently, the Court held it was not arguable that Nokia's RAND obligations could be made conditional on an implementer's willingness to arbitrate cross-licence terms for SEPs in a different area of technology, declared essential to different standards, promulgated by a different standards development organisation, subject to a different intellectual property rights policy, and governed by a different law.

Nokia's application for declarations that its Adjustable Licence Offers were RAND and that it had complied with its RAND obligations was refused. The Court confirmed that declaratory relief was inappropriate where Nokia had applied for a case management stay rather than summary judgement.

Conditions attached to the stay will be incorporated into the Court's order rather than into the Adjustable Licences themselves, consistent with the claimants' position. Nokia obtained a clarification that those conditions do not limit the arbitrators' ordinary case management powers going forward.

The claimants' application for permission to appeal to the Supreme Court was refused. Costs remain outstanding, with both parties given until 26 May 2026 to reach agreement, failing which written submissions will be invited.

The case was argued by Mark Chacksfield KC and Edmund Eustace for Nokia, and by Andrew Lykiardopoulos KC, Isabel Jamal and Joshua Marshall for the claimants.