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Case 5:19-cv-02520-LHK Document 95 Filed 07/19/19 Page 1 of 2

1 SHEPPARD, MULLIN, RICHTER & HAMPTON LLP


2
A Limited Liability Partnership
Including Professional Corporations
3 STEPHEN S. KORNICZKY, Cal. Bar No. 135532
4
MARTIN R. BADER, Cal. Bar No. 222865
MATTHEW W. HOLDER, Cal. Bar No. 217619
5 12275 El Camino Real, Suite 200
6 San Diego, California 92130
Telephone: 858.720.8900
7 Facsimile: 858.509.3691
8 E mail skorniczky@sheppardmullin.com
mbader@sheppardmullin.com
9 mholder@sheppardmullin.com
10
MICHAEL W. SCARBOROUGH, Cal. Bar No. 203524
11 MONA SOLOUKI, Cal. Bar No. 215145
12 Four Embarcadero Center, 17th Floor
San Francisco, California 94111
13 Telephone: 415.434.9100
14 Facsimile: 415.434.3947
E mail mscarborough@sheppardmullin.com
15 msolouki@sheppardmullin.com
16
Attorneys for Plaintiff Continental
17 Automotive Systems, Inc.
18 UNITED STATES DISTRICT COURT
19
NORTHERN DISTRICT OF CALIFORNIA
20
21 CONTINENTAL AUTOMOTIVE Case No. 5:19-cv-2520-LHK
SYSTEMS, INC., a Delaware
22 corporation, NOTICE OF LETTER TO COURT
23
Plaintiff, Judge: Hon. Lucy H. Koh
24
25 v.
26 AVANCI, LLC, et al.,
27
Defendants.
28

Case No. 19-cv-2520-LHK


NOTICE OF LETTER TO COURT
Case 5:19-cv-02520-LHK Document 95 Filed 07/19/19 Page 2 of 2

1 Plaintiff Continental Automotive Systems, Inc. (“Plaintiff”) hereby files, as


2 Attachment A, a true and correct copy of a letter from counsel to the Court in
3 response to the letter submitted by Defendants Nokia Corporation, Nokia of
4 America Corporation, Nokia Solutions and Networks US LLC, Nokia Solutions and
5 Networks Oy, and Nokia Technologies Oy (hereinafter “Nokia Defendants”) on July
6 17, 2019, regarding recent developments in the matter titled Nokia Solutions and
7 Networks Oy v. Daimler AG, First Munich Regional Court, Patent Division, No. 21
8 O 3889/19. (ECF No. 89.)
9
10 Dated: July 19, 2019
11 SHEPPARD, MULLIN, RICHTER & HAMPTON LLP
12
13
By /s/ Stephen S. Korniczky
14 STEPHEN S. KORNICZKY
15 MARTIN R. BADER
MATTHEW W. HOLDER
16 MICHAEL W. SCARBOROUGH
17 MONA SOLOUKI
18
Attorneys for Plaintiff
19 Continental Automotive Systems, Inc.
20
21
22
23
24
25
26
27
28

-1- Case No. 5:19-cv-2520-LHK


NOTICE OF LETTER TO COURT
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 1 of 46

ATTACHMENT A
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 2 of 46

Sheppard, Mullin, Richter & Hampton LLP


12275 El Camino Real, Suite 200
San Diego, California 92130-4092
858.720.8900 main
858.509.3691 fax
www.sheppardmullin.com

July 19, 2019


File Number: 64DR-285202

VIA ECF

The Honorable Lucy H. Koh


United States District Court for the Northern
District of California
280 South 1st Street
San Jose, California 95113

Re: Continental Automotive Systems, Inc. v. Avanci, LLC et al.,


Case No. 5:19-cv-02520-LHK

Dear Judge Koh:

I write on behalf of Plaintiff Continental Automotive Systems, Inc. (“Continental”) in response to


the July 17, 2019 letter submitted to the Court by counsel for Defendants Nokia Corporation,
Nokia of America Corporation, Nokia Solutions and Networks US LLC, Nokia Solutions and
Networks Oy, and Nokia Technologies Oy (collectively “Nokia”), advising the Court that Nokia
has obtained an “ex parte” injunction from a German Court, which orders Continental to
withdraw its June 12, 2019 motion for an anti-suit injunction “immediately after service of th[e]
injunction order” as to the ten pending Nokia lawsuits in Germany, or face severe penalties,
including “up to EUR 250,000.00 for each case of contravention,” and/or potential imprisonment
of Continental’s Chairman of the Board. (Dkt. 89-1 at 6-7.) These are the same lawsuits where
Nokia is seeking a permanent injunction against Daimler, based in material part on Daimler’s
incorporation of products sourced from Continental’s affiliates, for the alleged infringement of
Nokia’s purported Standard Essential Patents, despite the fact that Continental is a willing
licensee seeking to have this Court set the terms for a FRAND license to Nokia’s patents.

In its letter to the Court, Nokia asserted that this ex parte injunction already has “gone into
effect,” although by the terms of the Order, it is not effective until the Order has been properly
served, which Continental does not believe has taken place. (Dkt. 89-1 at 4.) Counsel for
Continental received “notice” of this ex parte injunction a mere eight minutes prior to Nokia’s
filing of its letter with the Court, via an e-mail from Nokia’s U.S. counsel to myself and another
colleague at my firm. Prior to this e-mail, no one associated with Continental, its affiliates who
are directly involved in the German litigation, or their counsel had received any notice
whatsoever that Nokia had even applied for the injunction in Germany, let alone that an
injunction had issued. The entire proceeding in Germany which resulted in the issuance of the
injunction took place in secret relative to everyone involved in the German litigation except
Nokia. In short, Continental was provided with no due process whatsoever in connection with
this injunction order, even though the order purports to subject Continental to severe penalties if
contravened.
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 3 of 46

The Honorable Lucy H. Koh


July 19, 2019
Page 2

Continental hereby attaches as Exhibit A a copy of Nokia’s ex parte application to the German
Court, seeking an expedited injunction order “without a hearing and without prior hearing from
[Continental] due to the particular urgency and in view of the imminent threat of motions for
countermeasures by Respondents in the US court to preempt the court seised [sic] here and
thus potentially rendering this request void.” (Ex. A at 3 (emphasis in original).) Nokia
misrepresented to the German Court that “there is an acute risk” that this Court would decide
the anti-suit injunction motion shortly after Nokia files its opposition on July 24, 2019, nowhere
mentioning that Continental’s reply brief is not even due until August 9. (Ex. A at 2, 17, 38.)
Accordingly, Nokia gave the German Court the incorrect impression that this Court would decide
Continental’s anti-suit injunction motion imminently after July 24. (See id. at 2 (claiming that “a
decision [by this Court] could be issued at [its] discretion … shortly, in particular from 24 July
2019 on.”) (emphasis added).)

Given Nokia’s representations to the German Court, we further note that on June 14, 2019,
when Nokia moved this Court to enlarge Nokia’s time to respond to the anti-suit injunction
motion, Nokia represented to this Court that Nokia required the requested “additional time to
respond to the Anti-Suit Motion” and that “such an extension would not prejudice Continental
US.” (Dkt. 45 at 2 (emphases added); see also id. at 4 (reiterating “the lack of prejudice to
Continental US”).) More specifically, Nokia represented to the Court that Continental would
suffer no prejudice because of “the lack of immediate deadlines in Germany[.]” (Id. at 5.)

None of the four “particularized reasons” Nokia offered to this Court in support of its requested
extension made any mention of Nokia’s intention to “respond” to Continental’s motion by moving
the German Court for an “ex parte” injunction in the interim, requiring Continental to withdraw its
motion before this Court “immediately” upon effective service, on pain of severe penalties, and
without any opportunity to have contested the injunction before its issuance. (Id. at 5-6; see
Dkt.. 89-1 at 6-7.) Indeed, Nokia indicated to this Court that it needed the extension to avoid
having “to rush and file an opposition” to a purportedly “complex” motion “that, in fairness,
should be briefed and heard later in the case under a more reasonable schedule after
predicate issues are considered in the named Nokia Defendants’ responses to the Complaint.”
(Id. at 5-6 (emphasis added).)

Subsequently, on June 18, 2019, this Court extended Nokia’s opposition time from June 26,
2019 to July 24, 2019, and set August 9, 2019 as the due date for Continental’s reply. (Dkt. 56
at 2.) Nokia then waited three weeks, until July 9, before secretly applying for the ex parte
injunction in Germany, even though it claimed the mere existence of the pending motion for anti-
suit injunction created an urgent and intolerable threat to its legal and commercial rights, such
that Continental should not even have an opportunity to respond to the motion before the
German Court acted. (See e.g., Ex. A at 5 (claiming that Continental’s “request [for an antisuit
injunction] threatens a direct infringement of the Petitioner’s patent rights”).) In hindsight, it is
clear that Nokia apparently never intended to actually oppose Continental’s motion by arguing
the relevant Ninth Circuit standard. Instead, its goal was to secretly obtain an order that would
purport to force Continental to withdraw its motion before Nokia ever had to explain itself to this
Court, and before this Court could rule on the motion in due course.
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 4 of 46

The Honorable Lucy H. Koh


July 19, 2019
Page 3

Nokia’s U.S. counsel asserts that Continental was properly served under the Hague
Convention, and is thus demanding that Continental immediately withdraw its motion. Based on
its inquiry to date, Continental believes that purported service of the German “ex parte” order by
Nokia’s German counsel upon Continental in the United States is ineffective because it
circumvents formal requirements under international laws of the Hague Convention. As formal
service is a legal requirement under German law for such an ex parte order to become effective,
Continental does not believe it is currently bound by the ex parte order – either in the United
States or Germany.

Very truly yours,

/s/ Stephen S. Korniczky

Stephen S. Korniczky
for SHEPPARD, MULLIN, RICHTER & HAMPTON LLP

cc: Counsel of Record, via e-mail and ECF


Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 5 of 46

EXHIBIT A
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 6 of 46

English translation

DR. BERNHARD ARNOLD* 1


ARNOLD RUESS Rechtsanwälte • Königsallee 59a • 40215 Düsseldorf
PROF. DR. PETER RUESS LL.M.* 1

CORDULA SCHUMACHER LL.M.* 1


Landgericht München I
DR. ARNO RISSE LL.M.* 1
(Regional Court of Munich I)
DÖRTHE MINDE
Patentstreitkammer
ALEXANDER M. LEISTEN LL.M. 2
(Chamber for Patent Disputes)
Lenbachplatz 7 DR. MARINA WEHLER 1

80316 Munich STEFANIA PARISE LL.M. 1

JAN WERGIN LL.M.

DR. LONI BREDIES LL.M.

In advance via fax (without exhibits): 089 / 5597-3003 and TIM SMENTKOWSKI

089 / 5597-1869 RECHTSANWÄLTE

* PARTNER
1 FA FÜR GEWERBLICHEN RECHTSSCHUTZ

Via beA 2 ATTORNEY-AT-LAW (NEW YORK)

KÖNIGSALLEE 59A
D-40215 DÜSSELDORF
T +49 211 54 24 40 40
F +49 211 54 24 40 44
Urgent! Please immediately submit to the chairperson! E INFO@ARNOLD-RUESS.COM
WWW.ARNOLD-RUESS.COM

SECRET / CONFIDENTIAL Our reference: CS08209/18


CONTAINS TRADE SECRETS! Doc. no.: 13018.9
7/12/2019

Motion for the Issuance of a Preliminary Injunction


Factual Connection inter alia with Case No. 21 O 3889/19

Nokia Technologies Oy, Karakaari 7, 02610, Espoo, Finland, legally represented by its
Management Board, at the same address;

- Petitioner 1)-

Nokia Solutions and Networks Oy, Karakaari 7, 02610 Espoo, Finnland, legally
represented by its Management Board, at the same address;

- Petitioner 2) –

Legal representatives: ARNOLD RUESS Rechtsanwälte PartmbB

versus

ARNOLD RUESS RECHTSANWÄLTE PARTNERSCHAFT MBB


UST-ID. NR. DE 268952950 • AMTSGERICHT ESSEN PR 2877
IBAN DE 78 3007 0024 0040 2032 10
SWIFT CODE: DEUTDEDBDUE • DEUTSCHE BANK DÜSSELDORF
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 7 of 46
2 / 41

Continental AG, Vahrenwalder Str. 9, 30165 Hanover, Germany, legally represented by


its Management Board, namely Dr. Elmar Degenhart, Wolfgang Schäfer, Helmut Matschi,
Nikolai Setzer, Frank Jourdan, Dr. Ariane Reinhart, Hans-Jürgen Duensing, and Christian
Kötz, at the same address;

- Respondent 1) -

Continental Automotive Systems, Inc., 1 Continental Drive, Auburn Hills, MI 48326-


1581, United States of America, legally represented by its board of directors, namely
Samir Salman, Wolfgang Schäfer, Andrew Martin, and Timothy Rogers, at the same
address;

Adressee for the purpose of service: Wolfgang Schäfer, Vahrenwalder Str. 9,


30165 Hannover as member of the Board of Directors being entitled to legally
represent and accept service

- Respondent 2) -

For: tort (inter alia, infringement of rights to the patent EP 2 797 239 B1)

Amount in dispute: EUR 5,000.000 provisionally estimated


______________________________________________________________________________________________

We appoint ourselves as the Petitioners' legal representatives.

On 21 March 2019, Petitioners filed several patent infringement actions in Germany


against Daimler AG in which they assert standard essential patents against cellular-
equipped automobiles. In reaction, Respondent 2) – as the U.S. affiilate of one of Daimler
AG's suppliers who, however, does not supply itself Daimer AG with products – filed
main proceedings in the United States against Petitioners alleging, among other things,
breach of FRAND.

Then, on 12 June 2019 – i.e. shortly after the oral hearing before this Court on 5 June
2019 – Respondent 2), upon instruction by Respondent 1), filed an intermediary motion
with the U.S. court to issue an anti-suit injunction. If granted, this injunction would with
immediate effect injunct Petitioners to pursue the patent infringement proceedings
between Petitioners and Daimler AG. Such a decision could be issued at the discretion of
the US court shortly, in particular from 24 July 2019 on.

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 8 of 46
3 / 41

Petitioners are therefore dependent on urgent judicial assistance before such an anti-suit
injunction is issued.

The German patent infringement proceedings are a legal dispute between two Finnish
companies (Petitioners) and a German automobile maker (Daimler AG) regarding the
infringement of German patents through acts commited in Germany. These proccedings
properly belong in the German courts. Respondents should not be allowed to prevent
Petitioners from pursuing these earlier filed cases through its actions in a foreign court.
The present PI request thus is (only) directed against the anti-suit injunction motion filed
against these pending proceedings.

Petitioners thus do not request this court to order Respondents to dismiss the pending
U.S. case completely. Petitioners respect the sovereignity of the U.S. courts. The goal of
the present motion is thus limited to require Respondents to likewise respect the
sovereignty of this German court and thus to ensure that there is a level-playing-field
between the parties, and that the main proceedings in both jurisdictions can proceed in
accordance with their respective applicable rules and governing laws.

In the name and on behalf of Petitioners, we therefore request – for Petitioner 1


regarding the proceedings identified hereunder as I.2.-8. and for Petitioner 2 regarding
the proceedings identified hereunder as I.1., 9. and 10.

– without a hearing and without prior hearing from Respondents due to the
particular urgency and in view of the imminent threat of motions for counter-
measures by Respondents in the US court to preempt the court seised here and
thus potentially rendering this request void -

the issuance of the following

Preliminary Injunction:

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 9 of 46
4 / 41

I. The Respondents are ordered, on penalty of payment of an administrative fine for


each case of violation in an amount of EUR 250,000.00, alternatively arrest for
contempt of court, or on penalty of arrest for contempt of court of up to six
months, in the event of repeated violations up to a total of two years, with the
arrest to be enforced on the respective chairman of the management board - i.e.,
Respondent 2) being ordered directly and Respondent 1) being ordered by
asserting its rights of control and instruction under company law -

to refrain from requesting an anti-suit injunction or other similar measures


which would enjoin Petitioners directly or indirectly from pursuing one or
more of the subsequently named patent infringement proceedings in
Germany, namely

1. Regional Court Munich I, docket no. 21 O 3889/19;


2. Regional Court Munich I, docket no. 21 O 3891/19;
3. Regional Court Munich I, docket no. 7 O 3890/19;
4. Regional Court Düsseldorf, docket no. 4a O 27/19;
5. Regional Court Düsseldorf, docket no. 4a O 26/19;
6. Regional Court Düsseldorf, docket no. 4c O 17/19;
7. Regional Court Mannheim, docket no. 2 O 37/19;
8. Regional Court Mannheim, docket no. 2 O 36/19;
9. Regional Court Mannheim. docket no. 2 O 35/19;
10. Regional Court Mannheim, docket no. 2 O 34/19;

whereby this obligation to refrain in particular also encompasses

- withdrawing the motion for an anti-suit injunction dated 12 June


2019 in the case no. 5:19-cv-02520-LHK docket entry no. 32 before
the United States District Court - Northern District of California
within 24 hours of service of this injunction order to this extent,

- and to immediately refrain from further pursuing these anti-suit


injunction proceedings except for the express purpose of the
withdrawal.

II. The Respondents are ordered to pay the costs of the proceedings.

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 10 of 46
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Statement of Grounds

On 12 June 2019, the Respondents filed a motion in the United States District Court -
Northern District of California for an anti-suit injunction. This request threatens a direct
infringement of the Petitioners' patent rights. Such an anti-suit injunction, if granted,
would force the Petitioners to discontinue the German patent infringement proceedings.
Otherwise, the Petitioners would have to fear considerable sanctions in the USA. As a
result, the Petitioners' patent rights in Germany (and worldwide) would be completely
devalued because a pursuit in court against multiple willful patent infringements in
Germany would no longer be possible under those circumstances.

In addition, the motion of the Respondents constitutes a blatant interference with


German jurisdiction, judicial independence (Article 97 para. 1 of the German Basic Law
(GG)), the right of due process (Recht auf den gesetzlichen Richter) pursuant to Article
101 para. 1, sent. 2 of the German Basic Law (GG), and the constitutionally guaranteed
right of recourse (Justizgewährungsanspruch) (Article 2 para. 1 in conjunction with the
rule of law (Article 20 para. 3 of the German Basic Law (GG))). It is not the Respondents,
but the German courts alone which, by virtue of their own sovereign rights, decide on
their jurisdiction to decide on the facts submitted to them. In the present case of patent
infringement actions for infringement acts in Germany the question of the jurisdiction of
the German courts is obvious.

By contrast, the torpedoed proceedings have no relevant connection with the USA
whatsoever - neither substantively nor procedurally. The Respondents here are not
involved in the German proceedings at all - not even as interveners. The Petitioners'
actions are directed solely against Daimler AG and especially not against its suppliers.

The unlawfulness of an action such as that of the Respondents has already been
established in German case law. The Higher Regional Court (Oberlandesgericht - OLG) of
Düsseldorf already established in 1996 with regard to a foreign anti-suit injunction (order
of 10 January 1996, 3 VA 11/95, margin no. 31 - quoted from juris):

"Ein rechtsstaatlich ordnungsgemäßes Gerichtsverfahren ist was keiner näheren


Erläuterung bedarf - nur gewährleistet, wenn die Beteiligten und ihre
Bevollmächtigten ohne jede Beschränkung dem Gericht alle nach ihrer Ansicht für
die Beurteilung durch das Gericht notwendigen Fakten unterbreiten und die nach
der Prozeßlage notwendigen Anträge stellen können. Diese Rechte sind durch die
deutschen Prozeßordnungen und das Grundgesetz in vielfacher Hinsicht

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 11 of 46
6 / 41

abgesichert. Die Gerichte sind verpflichtet, diesen Rechten Geltung zu


verschaffen." [emphasis added]

In the English translation:

"Proper judicial proceedings under the rule of law are guaranteed only - and this
requires no further explanation - if the parties involved and their representatives
can submit to the court, without any restriction, all facts which they consider
necessary for the assessment of the court and can file the motions which are
necessary according to the state of the proceedings. These rights are safeguarded
in many respects by the German Rules of Procedure and the German Basic Law.
The courts are obligated to enforce these rights." [emphasis added]

Against this background, we ask the Court Chamber to enforce the Petitioners' rights by
issuing the preliminary injunction requested in order to keep the current status quo and
to ensure the undisturbed continuation of the German proceedings.

A.
Facts of the Case

I.
The Parties

1. Petitioners

The Petitioners' group is one of the world's leading providers of


telecommunications services, hardware and software products with its registered
office in Espoo, Finland. It invests heavily in research and development of
telecommunications technologies and is therefore significantly involved in the
development of mobile communications standards. The group – apart from the
"original" Nokia business – includes the former Siemens Networks business as well
as the former Alcatel-Lucent and Bell Labs business. As part of this highly
innovative group of companies, the Petitioners and its affiliated company Nokia
Solutions and Networks Oy hold numerous intellectual property rights, including
in the field of second (GSM), third (UMTS) and fourth (LTE) generation mobile
telecommunications. Petitioners are the registered proprietors of the patents
concerned by the anti-suit injunction. As can be seen from current extracts from
the register of the German Patent and Trademark Office (Deutsches Patent- und
Markenamt - DPMA), Petitioner 1 is the registered proprietor of patents in suit

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 12 of 46
7 / 41

– DE 60 240 446 C5;


– EP 1 671 505 B1;
– EP 2 087 626 B1;
– EP 1 273 199 B2;
– EP 1 929 826 B1;
– EP 2 087 629 B1;
– EP 2 145 404 B1, cf.
Set of Exhibits AR 1;

and Petitioner 2 is registered proprietor of patents in suit

– EP 2 797 239 B1
– EP 2 286 629 B2;
– EP 2 981 103 B1, cf.
Set of Exhibits AR 1a.

2. Respondents

Respondent 1) is a German automotive supplier based in Hanover. It is the


operational head of the Continental Group, cf. excerpt from the 2018 Annual
Report of Respondent 1) (p. 38), submitted as

Exhibit AR 2:

"Heute ist die Continental AG, nach wie vor mit Sitz in Hannover,
Deutschland, die Muttergesellschaft des Continental-Konzerns.

[...]

Die Gesamtverantwortung für die Geschäftsleitung trägt der Vorstand der


Continental AG. [...] Die Zentralbereiche der Continental AG werden – bis
auf den Einkauf Konzern – durch den Vorstandsvorsitzenden, den
Finanzvorstand und den Personalvorstand vertreten. Sie übernehmen die
Funktionen, die divisionsübergreifend für die Steuerung des Konzerns
notwendig sind. Dazu gehören insbesondere die Bereiche Finanzen,
Controlling, Compliance, Recht und IT, Nachhaltigkeit sowie Qualität und
Umwelt.""

In the English translation:

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 13 of 46
8 / 41

"Today, Continental AG, still headquartered in Hanover, Germany, is the


parent company of the Continental Group.

[...]

The overall responsibility for the management lies with the Executive Board
of Continental AG. The core sectors of Continental AG are – except for
group sourcing – being represented by the chariman, the CFO and the
CHRO. They take over the functions that are necessary to control the group
over all its divisions. This includes in particular the sectors finance,
controlling, compliance, legal and IT, sustainability as well as quality and
environment."

Respondent 2) is ultimately a wholly-owned subsidiary of Respondent 1). The


motion for an anti-suit injunction, which is the subject of this dispute, was filed on
behalf of Respondent 2).

Prima facie evidence: 1. Current list of shareholdings of Continental AG,

2. Motion for an anti-suit injunction dated 12 June


2019 (partly redacted public version) and the
corresponding proposed court order together
with a German translation,

Exhibits AR 3, AR 4 and AR 4a.

3. Respondent 2) is executive organ of Respondent 1)

Respondent 2) is merely the executive organ of Respondent 1). This results from
several aspects:

a) The Annual Report of Respondent 1) clarifies that in particular the legal


responsibilities are concentrated on a group level and directed by the three
board members Chairman, Finance director and HR director (Exhibit AR 2,
p. 2 and citation above).

b) Respondent 2) has no connection whatsoever with the German


proceedings. It has no interest of its own in blocking these proceedings. As
can be seen from the third-party notices and interventions in the German
proceedings, Respondent 2) is not a direct supplier of Daimler AG. Instead,

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 14 of 46
9 / 41

the latter is supplied by the Group companies Continental Automotive


GmbH and Continental Automotive Hungary Ktf.

Prima facie evidence: Third party notices filed by Daimler AG against


these Continental group companies and
corresponding interventions,

Set of Exhibits AR 5a and 5b.

c) Respondent 2) acts solely as the "extended arm" of Respondent in 1)


bound by instructions. Respondent 2) itself admits this in its motion for
issuance of an anti-suit injunction, since it claims acts which actually
originate from other group companies to be acts of its own. Thereby, it
confirms that it does not act on behalf of its own interests but "on behalf"
of the actually involved Continental entities and the whole Continental
group:

"Plaintiff Continental Automotive Systems, Inc. ("Continental") …

With respect to Nokia, Continental tried for more than a year to


obtain a direct license to Nokia's cellular SEPs. …

Daimler and some of its suppliers, including Continental, individually


asked the European Commission to investigate Nokia's refusal to
directly license anyone other than OEMs. …

enjoining Continental's ability to further supply Daimler" (Exhibit


AR 4, p. 81, lines 2, 13 et seq., 18-20, 28)

In the German translation:

"Die Klägerin Continental Automotive Systems, Inc. („Continental")



In Bezug auf Nokia versuchte Continental mehr als ein Jahr lang,
eine direkte Lizenz für die Mobilfunk-SEPs von Nokia zu erhalten. …
…forderten Daimler und einige ihrer Lieferanten, darunter
Continental, die Europäische Kommission einzeln auf, die Weigerung

1 Exhibit AR 4 has a different page numbering in the header and in the footer. We use the page numbers
given in the header.

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 15 of 46
10 / 41

von Nokia zu untersuchen, direkte Lizenzen an andere Parteien als


OEMs zu vergeben. …

Continental die Möglichkeit zu nehmen, Daimler weiter zu beliefern."

Respondent 2) thus generally refers to itself in abbreviated form as


'Continental'. However, it did not carry out any of the above-mentioned
acts itself. The license negotiations for the Continental Group were
conducted through Continental Automotive GmbH. The Commission
complaint was lodged by Respondent 1). Suppliers of Daimler AG said to
be affected by the pending proceedings are Continental Automotive GmbH
and Continental Automotive Hungary Ktf.

Accordingly, the motions are also submitted "on behalf" of the entire
Continental Group and in particular on behalf of the parent company,
Respondent 1). This is because the motions are directed at preventing the
conduct of the proceedings against Daimler AG as the "customer of
Continental". As evidenced by the third-party notices and corresponding
intervention, however, Daimler AG is only the customer of the other group
companies mentioned and not of Respondent 2). In addition, it is to be
ordered that no further actions are brought against "Continental" and its
customers. This does not only mean Respondent 2) and its customers (in
the USA), but comprehensive protection of the parent company
(Respondent 1)) and all of its customers is sought.

d) The same also follows from the notice of intervention of 31 May 2019 filed
by the interveners from the Continental Group in the proceedings under
case no. 7 O 3890/19, cf. p. 2 and 7 of Exhibit AR 5b:

"Sofern es auf die konkrete Gesellschaft nicht ankommt, werden die


Nebenintervenientinnen und alle weiteren Gesellschaften der
Continental-Gruppe nachfolgend nur als "Nebenintervenientin" [...]
bezeichnet.

"Darüber hinaus hat die Nebenintervenientin in den USA beim


District Court des Northern District of California am 10. Mai 2019
gegen [...] und auch diverse Gesellschaften des Nokia-Konzerns,
darunter auch die hiesige Klägerin Nokia Technologies OY, Klage
eingereicht".

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 16 of 46
11 / 41

In the English translation:

"If the specific company is not important, the interveners and all
other companies of the Continental Group will hereinafter be
referred to only as "interveners" [...].

"In addition, on 10 May 2019, the intervener filed a lawsuit in the


District Court of the Northern District of California in the USA against
[...] and also various companies of the Nokia Group, including Nokia
Technologies OY, the plaintiff in these proceedings".

However, the US action was not brought by the "intervener", but by


Respondent 2).

e) The facts submitted by Respondent 2) in the US proceedings are not based


on its own findings. It may have heard this only from Respondent 1) and its
other subsidiaries. For example, Respondent 2) submits on the details of
the Commission complaint which, however, had been filed by Respondent
1) (cf. Exhibit AR 4, p. 16 et seq.). In addition, Respondent 2) quotes from
the statement of complaint of the German proceedings which - again -
does not involve Respondent 2) but two other subsidiaries (cf.
Exhibit AR 4, p. 17 et seq.). Hence, these subsidiaries provided Respondent
2) with information specifically for the purpose of conducting the anti-suit
injunction proceedings.

f) In fact, the dispute between the Petitioners and the Continental Group is
conducted directly with Respondent 1) as the Group's management.
Respondent 1) filed the complaint with the Commission, submitted in
extract as

Exhibit AR 6.

While direct correspondence with the Petitioners was generally conducted


via Continental Automotive GmbH as a further subsidiary of Respondent 1),
the latter in turn acted on behalf of the entire Continental Group (cf.
margin nos. 61 et seqq. of the US statement of complaint dated 10 May
2019 (docket no. 5:19-cv-02520-LHK document no. 1), submitted as

Exhibit AR 7.

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 17 of 46
12 / 41

g) Finally, the management bodies of Respondents overlap. Mr. Wolfgang


Schäfer is CFO of Respondent 1) and thus one of the three board members
who are responsible for the legal issues with the group (Exhibit AR 2, p. 2).
He is also Director of Respondent 2). As member of the Board of Directors
he directs the business of Respondent 2), cf. Excerpt from "The Corporate
Handbook" dated 2018, available under
https://ct.wolterskluwer.com/resource-center/articles/powers-and-duties-
of-corporate-directors-officers, see

Exhibit AR 8:

"A corporation is managed by directors and officers. Directors act as


a group known as a board of directors. The board of directors is the
corporation's governing body. It manages the corporation's business
and affairs and has the authority to exercise all of the corporation's
powers."

In German translation:

"Eine Gesellschaft wird von ihren Direktoren und Geschäftsführern


geleitet. Direktoren handeln in einer Gruppe, die als Board of
Directors bezeichnet wird. Das Board of Directors ist das
Entscheidungsgremium der Gesellschaft. Es leitet die Geschäfte und
Angelegenheiten der Gesellschaft und hat die Befugnis, alle
Befugnisse der Gesellschaft auszuüben.

Prima facie evidence: Excerpts from the German Commercial register


for Respondent 1) and from the Delaware
companies register for Respondent 2), including
a German translation,

Exhibits AR 8a, AR 8b and AR 8c.

The address stated there for Mr Schäfer is the same as Respondent 1)'s
registered business seat.

It follows from this that Respondent 1) controls and coordinates the activities of
Respondent 2) in this dispute. It is also in line with general life experience that
Respondent 2), who is uninvolved in the German proceedings and the license
negotiations, does not "act alone" in filing an action for the determination of a

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 18 of 46
13 / 41

global FRAND license for the Continental Group and the supplementary motion
for issuance of an anti-suit injunction in the USA. This is done at the behest of the
Group's management, namely Respondent 1).

II.
The German Patent Infringement Proceedings

On 21 March 2019, the Petitioners filed a total of ten patent infringement suits against
Daimler AG before the Regional Courts of Munich I, Mannheim and Düsseldorf. The
patents in suit and the corresponding docket numbers are listed below:

– EP 2 797 239 B1 (Regional Court Munich I, Az.: 21 O 3889/19);


– DE 60 240 446 C5 (Regional Court Munich I, Az.: 21 O 3891/19);
– EP 1 671 505 B1 (Regional Court München I, Az. 7 O 3890/19);
– EP 1 929 826 B1 (Regional Court Düsseldorf, Az.: 4a O 27/19);
– EP 2 087 626 B1 (Regional Court Düsseldorf, Az.: 4a O 26/19);
– EP 2 087 629 B1 (Regional Court Düsseldorf, Az.: 4c O 17/19);
– EP 1 273 199 B2 (Regional Court Mannheim, Az.: 2 O 37/19);
– EP 2 145 404 B1 (Regional Court Mannheim, Az.: 2 O 36/19);
– EP 2 286 629 B2 (Regional Court Mannheim. Az.: 2 O 35/19);
– EP 2 981 103 B1 (Regional Court Mannheim, Az.: 2 O 34/19).

In proceedings 7 O 3890/19, an oral hearing before the Regional Court Munich I already
took place, cf. minutes of the oral hearing of 5 June 2019 in

Exhibit AR 9.

In all proceedings, two subsidiaries of Respondent 1) intervened in those proceedings


(cf. Exhibit AR 2), i.e. Continental Automotive GmbH and Continental Automotive
Hungary Ktf (Exhibit AR 5b).

III.
Subsequent Proceedings in the United States

In response to the lawsuits filed by the Petitioners against Daimler AG, Respondent 1)
had Respondent 2) to file a main action against the Petitioners in the U.S. District Court -
Northern District of California on 10 May 2019, alleging violation of its FRAND
obligations (Exhibit AR 7).

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 19 of 46
14 / 41

Shortly after the first hearing date in the proceedings under case no. 7 O 3890/19 in
Munich and even before Petitioners had replied to the U.S. main action, the Respondents
(through Respondent 2)) requested the issuance of an anti-suit injunction as an
intermediary order (Exhibit AR 4).

1. Subject of the motion for issuance of an anti-suit injunction

If it were to grant the requested anti-suit injunction, the Californian court would
directly enjoin the Petitioners and its affiliated companies from further pursuing
the patent infringement suits already pending in Germany against Daimler AG.
The motion dated 12 June 2019 states, cf. Exhibit AR 4, p. 2, lines 9 to p. 3, lines
10 (emphasis added):

"Plaintiff Continental Automotive Systems, Inc. ("Continental") respectfully


requests that this Court enjoin Defendants Nokia Solutions and Networks
Oy, Nokia Technologies Oy, and any related entities (collectively, "Nokia")
from prosecuting the patent infringement actions filed in Germany
against Continental's customer, Daimler AG (the "German Actions"). The
German Actions are more specifically identified as follows:

 Nokia Solutions and Networks Oy v. Daimler AG, First Munich


Regional Court, Patent Division, No. 21 O 3889/19.
 Nokia Technologies Oy v. Daimler AG, First Munich Regional Court,
Patent Division, No. 7 O 3890/19.
 Nokia Technologies Oy v. Daimler AG, First Munich Regional Court,
Patent Division, No. 21 O 3891/19.
 Nokia Technologies Oy v. Daimler AG, Düsseldorf Regional Court,
Patent Division, No. 4a O 26/19.
 Nokia Technologies Oy v. Daimler AG, Düsseldorf Regional Court,
Patent Division, No. 4a O 27/19.
 Nokia Technologies Oy v. Daimler AG, Düsseldorf Regional Court,
Patent Division, No. 4c O 17/19.
 Nokia Technologies Oy v. Daimler AG, Mannheim Regional Court,
Patent Division, No. 2 O 37/19.
 Nokia Technologies Oy v. Daimler AG, Mannheim Regional Court,
Patent Division, No. 2 O 36/19.

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 20 of 46
15 / 41

 Nokia Solutions and Networks Oy v. Daimler AG, Mannheim


Regional Court, Patent Division, No. 2 O 35/19.
 Nokia Solutions and Networks Oy v. Daimler AG, Mannheim
Regional Court, Patent Division, No. 2 O 34/19."

In the German translation:

… die Klägerin Continental Automotive Systems, Inc. („Continental") …


respektvoll beantragen wird, dass dieses Gericht den Beklagten Nokia
Solutions und Networks Oy, Nokia Technologies Oy und allen mit diesen
verbundenen Unternehmen (gemeinsam „Nokia") untersagt, die in
Deutschland eingereichten Patentverletzungsklagen gegen den Kunden
von Continental, die Daimler AG, zu verfolgen (die „Deutschen Klagen").
Die Deutschen Klagen werden wie folgt konkretisiert:
 Nokia Solutions and Networks Oy v. Daimler AG, Landgericht
München I, Patentstreitkammer, Az. 21 O 3889/19.
 Nokia Technologies Oy v. Daimler AG, Landgericht München I,
Patentstreitkammer, Az. 7 O 3890/19.
 Nokia Technologies Oy v. Daimler AG, Landgericht München I,
Patentstreitkammer, Az. 21 O 3891/19.
 Nokia Technologies Oy v. Daimler AG, Landgericht Düsseldorf,
Patentstreitkammer, Az. 4a O 26/19.
 Nokia Technologies Oy v. Daimler AG, Landgericht Düsseldorf,
Patentstreitkammer, Az. 4a O 27/19.
 Nokia Technologies Oy v. Daimler AG, Landgericht Düsseldorf,
Patentstreitkammer, Az. 4c O 17/19.
 Nokia Technologies Oy v. Daimler AG, Landgericht Mannheim,
Patentstreitkammer, Az. 2 O 37/19.
 Nokia Technologies Oy v. Daimler AG, Landgericht Mannheim,
Patentstreitkammer, Az.2 O 36/19.
 Nokia Solutions and Networks Oy v. Daimler AG, Landgericht
Mannheim, Patentstreitkammer, Az. 2 O 35/19.
 Nokia Solutions and Networks Oy v. Daimler AG, Landgericht
Mannheim, Patentstreitkammer, Az.2 O 34/19."

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 21 of 46
16 / 41

The present injunction request by Petitioners is only directed against this part of
the motion for an anti-suit injunction. The proceedings listed there relate to the
patents in suit mentioned above.

Prima facie evidence: Submission of caption of the compaints and the


defence statements of Defendant Daimler AG, in

Set of Exhibits AR 10.

None of the proceedings torpedoed in this fashion have any substantive or


procedural connection with the USA. The present Respondents are not involved in
any of the aforementioned German proceedings – not even as interveners (cf.
Exhibits AR 5a and 5b). The Petitioners' actions are directed solely against
Daimler AG and precisely not against its suppliers.

Furthermore, it is requested to enjoin Petitioners and the further Defendants to


the US main proceedings:

"In addition, Continental seeks an order enjoining Defendants from


instituting against Continental or any of its customers (or their
subsidiaries or affiliates) any action alleging infringement of their global
2G, 3G and 4G SEPs during the pendency of the FRAND proceeding in this
Court, or from acting in concert with anyone to institute such an action."
(cf. Exhibit AR 4, p. 3, lines 11 - 15).

In the German translation:

"Darüber hinaus beantragt Continental eine Anordnung, die den


Beklagten untersagt, gegen Continental oder irgendeinen ihrer Kunden
(oder deren Tochtergesellschaften oder verbundenen Unternehmen)
während der Anhängigkeit des FRAND-Verfahrens vor diesem Gericht
irgendeine Klage einzureichen, die eine Verletzung der globalen 2G-, 3G-
und 4G-SEPs der Beklagten geltend machen, oder mit anderen gemeinsam
zu handeln, um eine solche Klage einzureichen."

The Respondents essentially trust that the anti-suit injunction will ensure

"[...] to broadly resolve all disputed issues between Continental on the one
hand and Nokia and Defendants on the other hand, related to Defendants'
wireless SEPs" (cf. Exhibit AR 4, p. 20, lines 5 - 7).

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 22 of 46
17 / 41

In the German translation:

"[...] soll dieser Rechtsstreit alle strittigen Fragen zwischen Continental


einerseits und Nokia und den Beklagten andererseits im Zusammenhang
mit den Wireless-SEPs der Beklagten umfassend lösen."

This surprises, as the Petitioners did not file a claim for patent infringement
against the Respondents, but against Daimler AG. Instead, it was the Respondents
themselves who filed a lawsuit before the US court only two months after
pendency of the German lawsuits. This was probably also done with the aim of
creating a supposedly "competing" proceeding here. However, the Respondents
fail to realize that competing jurisdiction cannot exist at all in the absence of party
identity between the proceedings.

Moreover, the Respondents rely in particular on the fact that a decision in


Germany would allegedly obstruct "important US principles" (cf. Exhibit AR 4, p.
27, lines 15 et seqq.), while at the same time interfering with the international
principle of recognition of foreign (here: German) sovereign rights (comitas) is
supposedly "tolerable" (cf. Exhibit AR 4, p. 31, lines 24 et seqq.). In contrast, the
Respondents apparently do not see any conflict between the FRAND proceeding
in the USA and the "FRAND proceeding" before the European Commission.

This is because Respondent 1) continues the Commission proceedings


unchanged. The Respondents therefore only want to circumvent the deciding
court panels they do not like.

2. Chronological sequence

The Petitioners currently have until 24 July 2019 to comment on the motion for
issuance of an anti-suit injunction. A hearing is provisionally scheduled for 10
October 2019. Under US law, however, a decision on the motion can also be made
beforehand based on the information available in the file. This is not an
uncommon practice. In fact, in anti-suit injunction proceedings between
InterDigital and Pegatron, the US court seised here issued such an injunction a
day before the originally scheduled oral hearing and then cancelled the hearing.
Thus, there is an acute risk that a decision will be made without a hearing, in
particular potentially shortly after the Petitioners have submitted their reply on
24 July 2019.

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 23 of 46
18 / 41

Also, the Petitioner could be ordered to immediately withdraw also this present
preliminary injunction request. This would then thwart the objective of legal
protection requested here. According to Rule 65 of the US Federal Rules of Civil
Procedures, a US court can issue so called Temporary Restraining Orders even
without prior notice to the adverse party.

Prima facie evidence: 1. Affidavit by Prof. Peter Bowman Rutledge, Dean


of the University of Georgia School of Law dated
5 July 2019, see there no. 3 at the end,

Exhibits AR 11 and AR 11a.


(Original will be submitted later and will be faxed to the Court
by Prof. Rutledge, cf. BayObLG, NJW 1996, 406.)

2. Excerpt from the US Federal Rules of Civil


Procedure,

Exhibits AR 12 and AR 12a.

To secure the status quo, the Petitioners are therefore crucially dependent on the
fact that a decision is made here prior to hearing from the Respondents. Should
Respondents oppose such descision, Petitioners are willing to defend.

IV.
Background to Anti-Suit Injunctions

In special circumstances, an anti-suit injunction is intended to prevent the respondent


from completing a competing foreign trial before a decision is made in the parallel US
trial. This is to ensure that the US courts have decision-making authority over certain
matters. Even though the injunction is formally addressed to the respondent, it de facto
prevents the foreign court from exercising its jurisdiction (see affidavit Prof. Rutledge, no.
5, Exhibit AR 11).

1. Case law of the US courts

Due to these drastic consequences, anti-suit injunctions are viewed critically by


the majority of US courts and granted only very restrictively (Kaltner, GRUR Int
2012, 1078 [1079]), submitted here for easier access as

Exhibit AR 13:

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 24 of 46
19 / 41

"Perhaps because of its drastic impact on a non-U.S. forum's ability to


adjudicate a case, the U.S. federal courts of appeal differ on when to grant
Anti-Suit Injunctions. [...]

A majority of the courts of appeal apply the conservative approach to


granting Anti-Suit Injunctions. These are the First, Second, Third, Sixth,
Eighth, and D.C. Circuits."

In the German translation:

"Möglicherweise wegen des drastischen Einflusses auf die Fähigkeit einer


Nicht-US-Jurisdiktion, einen Fall zu entscheiden, divergieren die US-
Bundesgerichte bezüglich des Erlasses von Anti-Suit Injunctions. [...]

Der Großteil der Berufungsgerichte wählt einen konservativen Ansatz beim


Erlass von Anti-Suit Injunctions. Das sind der Erste, Zweite, Dritte, Sechste,
Achte und der D.C. Bezirk."

In the present case, however, the Petitioner has applied to a court in the Ninth
Circuit. The literature states on anti-suit injunctions by these courts (Kaltner, GRUR
Int 2012, 1078 [1079], emphasis added):

"Courts following the liberal approach place greater weight on equitable


concerns that arise in cross-border parallel litigation than international
comity or deference to foreign courts. The Fifth, Seventh, and Ninth Circuits
follow the liberal view towards Anti-Suit Injunctions. When deciding
whether to enjoin non-U.S. litigation courts that follow this approach
consider equitable factors such as whether the foreign litigation is
vexatious and oppressive and whether it may lead to duplicative efforts,
inconvenience, delay, harassment, inconsistent results or a race to
judgment between the domestic and foreign courts. Courts in the Fifth,
Seventh, and Ninth Circuits also consider whether the foreign action would
frustrate the jurisdiction or public policy concerns of the domestic court. "

In the German translation:

"Gerichte, die dem großzügigen Ansatz folgen, gewichten


Billigkeitserwägungen, die in grenzüberschreitenden parallelen Verfahren
aufkommen, stärker als internationale Völkersitte oder Rücksicht vor den
ausländischen Gerichten. Der Fünfte, Siebte und Neunte Bezirk folgen

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 25 of 46
20 / 41

diesem großzügigen Ansatz bezüglich Anti-Suit Injunctions. Wenn Gerichte,


die diesem Ansatz folgen, darüber entscheiden, ob Verfahren in Nicht-US-
Gerichten untersagt werden sollen, erwägen sie Billigkeitsfaktoren wie die
Frage, ob das ausländische Verfahren lästig oder repressiv ist und ob es zu
Doppelarbeit kommen könnte, zu Unannehmlichkeiten, Verzögerung,
Schikane, inkonsistenten Ergebnissen oder einem Wettlauf zwischen dem
inländischen und dem ausländischen Gericht kommen könnte. Gerichte im
Fünften, Siebten und Neunten Bezirk erwägen zudem, ob das ausländische
Verfahren die Zuständigkeit des inländischen Gerichts oder seine
Überlegungen zur öffentlichen Ordnung behindern würde."

In the past, in particular the courts of the Ninth Circuit have granted many of the
requested anti-suit injunctions. Some examples are jurisdiction (see affidavit Prof.
Rutledge, no. 4, Exhibit AR 11):

- In the case of Microsoft v. Motorola, for example, the courts of the Ninth
Circuit issued an anti-suit injunction in favor of Microsoft in 2012, enjoining
Motorola from enforcing a patent infringement judgment against Microsoft
that had been duly won before the Mannheim Regional Court (US Court of
Appeals for the 9th Circuit, Microsoft v. Motorola, 696 F.3d 872 (2012),
judgment of 28 September 2012 = GRUR Int 2012, 1149).

- Furthermore, in the case of Huawei v. Samsung, the US District Court for


the Northern District of California seised here issued an anti-suit injunction
in 2018 enjoining Huawei from enforcing a judgment against Samsung that
had been won in China (Huawei v. Samsung, order of 13 April 2018, case
no. 3:16-cv-02787-WHO).

- In the already mentioned case Fall InterDigital v. Pegatron the Honorable


Judge Lucy Koh who is also handling the current case issued an anti-suit
injunction to prevent Pegatron from pursuing a lawsuit in Taiwan
challenging terms of a patent license agreement between Pegatron and
InterDigital.

Irrespective of the fact that the Petitioners do not consider the requirements for
an anti-suit injunction under US law to be met in this present case, there is
nevertheless still a considerable risk that the US court seised will nevertheless
issue such an order. Also in view of the severe consequences, such risk is not
acceptable for Petitioners.

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Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 26 of 46
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2. Effect of an anti-suit injunction

A prohibition decision would be directed against the Petitioners. The anti-suit


injunction has an immediate effect. A separate enforcement act is not required
(see affidavit Prof. Rutledge, no. 6, Exhibit AR 11).

Petitioners respect and comply with court decisions. In addition, the


consequences of non-compliance with any such issued anti-suit injunction would
be considerable. If the patent infringement proceedings were continued in
Germany, the Petitioners would be subject to contempt of court prosecution. This
means that the Petitioners would face significant consequences, for example,
substantial fines (cf. (see affidavit Prof. Rutledge, no. 7, Exhibit AR 11) and
Cepl / Voß, Prozesskommentar zum Gewerblichen Rechtsschutz [Commentary on
Industrial Property Litigation], 2nd edition 2018, Sec. 709 of the German Code of
Civil Procedure (Zivilprozessordnung - ZPO), margin no. 23). In fact, in the vast
majority, the companies concerned complied with the orders of the US courts and
did not proceed with the foreign proceedings (see affidavit Prof. Rutledge, no. 8,
Exhibit AR 11).

3. Anti-suit injunctions incompatible with EU law or German law

It is recognized in the case law and literature that anti-suit injunctions are
incompatible with EU law or German law.

a) The Higher Regional Court (OLG) of Düsseldorf states that anti-suit


injunctions constitute an interference with German sovereign rights, cf.

Exhibit AR 14.

"Solche Anordnungen stellen jedoch einen Eingriff in die Justizhoheit


der Bundesrepublik Deutschland dar, weil die deutschen Gerichte
ausschließlich selbst nach den für sie geltenden Verfahrensgesetzen
und nach den bestehenden völkerrechtlichen Verträgen darüber
befinden ob sie für die Entscheidung einer Streitsache zuständig sind
oder ob sie die Zuständigkeit eines anderen inländischen oder
ausländischen Gerichts (auch Schiedsgerichts) zu respektieren
haben. Auch können ausländische Gerichte keine Weisungen
erteilen, ob und in welchem Umfang (zeitlich und inhaltlich) ein
deutsches Gericht in einer bestimmten Streitsache tätig werden kann
und darf." (Higher Regional Court (OLG) of Düsseldorf, order of 10

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 27 of 46
22 / 41

January 1996, 3 VA 11/95, margin no. 28 - quoted from juris,


emphasis added)

In the English translation:

"However, such orders constitute an interference with the judicial


sovereignty of the Federal Republic of Germany, because the
German courts themselves decide exclusively, in accordance with the
procedural laws applicable to them and in accordance with the
existing international treaties, whether they are competent to
adjudicate on a dispute or whether they have to respect the
jurisdiction of another domestic or foreign court (including arbitral
tribunal). Nor can foreign courts issue instructions as to whether and
to what extent (in terms of time and subject matter) a German court
can and may act in a specific dispute." (Higher Regional Court (OLG)
of Düsseldorf, order of 10 January 1996, 3 VA 11/95, margin no. 28 -
quoted from juris, emphasis added)

The Higher Regional Court continues that it is also irrelevant that the anti-
suit injunction is not directed directly against the German court, but against
the party. Because of the disposition maxim, the court is dependent on the
cooperation of the party (Higher Regional Court (OLG) of Düsseldorf, loc.
cit., margin nos. 29 et seqq.).

In addition, anti-suit injunctions constitute an interference with the


constitutional guarantee of proper judicial proceedings in accordance with
the rule of law. The courts are obligated to enforce these rights:

"Unabhängig davon wird die Justizhoheit der Bundesrepublik aber


auch allgemein dann beeinträchtigt, wenn - wie hier - ein
ausländisches Gericht den Beteiligten eines Verfahrens vor einem
deutschen Gericht Weisungen darüber erteilt, wie sie sich zu
verhalten oder einzulassen haben und welche Anträge sie stellen
dürfen. Ein rechtsstaatlich ordnungsgemäßes Gerichtsverfahren ist –
was keiner näheren Erläuterung bedarf – nur gewährleistet, wenn die
Beteiligten und ihre Bevollmächtigten ohne jede Beschränkung dem
Gericht alle nach ihrer Ansicht für die Beurteilung durch das Gericht
notwendigen Fakten unterbreiten und die nach der Prozeßlage
notwendigen Anträge stellen können. Diese Rechte sind durch die

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Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 28 of 46
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deutschen Prozeßordnungen und das Grundgesetz in vielfacher


Hinsicht abgesichert. Die Gerichte sind verpflichtet, diesen Rechten
Geltung zu verschaffen. Weisungen ausländischer Gerichte an die
Prozeßbeteiligten über Art und Inhalt der Prozeßführung sind
geeignet, die deutschen Gerichte bei der Wahrnehmung dieser
Aufgabe zu behindern. Es kann deshalb auch den für die Erledigung
von Rechtshilfeersuchen zuständigen Stellen, die die Justizhoheit zu
respektieren haben, nicht gestattet sein, derartige Weisungen an
Verfahrensbeteiligte weiterzuleiten (zuzustellen) und so
ausländischen Gerichten Einfluß auf Gestaltung und Ablauf
anhängiger Gerichtsverfahren zu erlauben oder die betroffenen
Verfahrensbeteiligten der Gefahr einer Bestrafung wegen "Contempt
of Court" auszusetzen, nur weil sie die ihnen nach dem deutschen
Prozeßrecht garantierten Rechte in Anspruch nehmen wollen."
(Higher Regional Court (OLG) of Düsseldorf, loc. cit., margin no. 31,
emphasis added)

In the English translation:

" Irrespective of this, the judicial sovereignty of the Federal Republic


of Germany is also generally impaired if - as here - a foreign court
gives instructions to the parties to proceedings before a German
court as to how they must behave or engage themselves and which
motions they may file. Proper judicial proceedings under the rule of
law are guaranteed only - and this requires no further explanation -
if the parties involved and their representatives can submit to the
court, without any restriction, all facts which they consider necessary
for the assessment of the court and can file the motions which are
necessary according to the state of the proceedings. These rights are
safeguarded in many respects by the German Rules of Procedure
and the German Basic Law. The courts are obligated to enforce these
rights. Instructions by foreign courts to the parties to the
proceedings on the nature and content of the conduct of the
proceedings are likely to hinder the German courts in performing
this task. It may therefore also not be permitted for the authorities
responsible for the execution of letters rogatory, which must respect
the judicial sovereignty of the courts, to forward (serve) such
instructions to parties to proceedings thus allowing foreign courts to
influence the organization and conduct of pending court

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Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 29 of 46
24 / 41

proceedings or to subject the parties to the proceedings concerned


to the risk of sanctions for contempt of court simply because they
wish to avail themselves of the rights guaranteed to them under
German procedural law." (Higher Regional Court (OLG) of
Düsseldorf, loc. cit., margin no. 31, emphasis added)

b) The Court of Justice of the European Union (CJEU) has ruled that anti-
suit injunctions are incompatible with European civil procedural law,
namely the Brussels Convention, cf.

Exhibit AR 15:

"However, a prohibition imposed by a court, backed by a penalty,


restraining a party from commencing or continuing proceedings
before a foreign court undermines the latter court's jurisdiction to
determine the dispute. Any injunction prohibiting a claimant from
bringing such an action must be seen as constituting interference
with the jurisdiction of the foreign court which, as such, is
incompatible with the system of the Convention." (CJEU, judgment
of 27 April 2004, C-159/02 - Turner / Grovit margin no. 27, emphasis
added).

The CJEU also emphasizes that such an interference cannot be justified by


the fact that it is allegedly only "indirect" (CJEU, loc. cit., margin no. 28) -
because the prohibition is not directed directly against the court but
against the party.

c) Continuing this case law, the CJEU has ruled that anti-suit injunctions are
also incompatible with the Brussels I Regulation. An anti-suit injunction
prevents a state court from deciding on its own jurisdiction, which would
violate the principle of mutual trust (comitas) (CJEU, judgment of 10
February 2009, C-185/07 - Allianz / West Tankers, margin nos. 28 et seqq.),
cf.

Exhibit AR 16.

d) Therefore, it is also agreed in the literature that anti-suit injunctions cannot


be recognized within the meaning of Section 328 of the German Code of
Civil Procedure (ZPO) (cf., for example, BeckOK ZPO, 32nd edition, as of:
1 March 2019, Section 328, margin no. 4.2; MüKo-ZPO, 5th edition 2016,

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Section 328 margin no. 127; Saenger, ZPO, 8th edition 2019, Section 328,
margin no. 54). We submit these references collectively as

Set of Exhibits AR 17.

B.
Legal Assessment

The motion filed by the Respondents for the issuance of an anti-suit injunction threatens
to devalue the exclusive rights conferred by the Petitioners' patents in Germany. The
present case is not a classical patent infringement case within the meaning of Sections 9
and 10 of the German Patent Act (Patentgesetz - PatG), but an interference with the
Petitioner's exclusive rights otherwise. With respect to this interference, the Petitioners
are entitled to preventive injunctive relief, Sections 1004 para. 1 sent. 2 of the German
Civil Code (Bürgerliches Gesetzbuch - BGB) by analogy in conjunction with Section 823
para. 1 of the German Civil Code (BGB) (cf. I.). At the same time, the filing of a motion by
Respondent 2) constitutes intentional, immoral damage (vorsätzliche, sittenwidrige
Schädigung) within the meaning of Section 826 of the German Civil Code (BGB) (cf. II.).

I.
Injunctive relief under
Sections 1004 para. 1 sent. 2 by analogy, 823 para. 1 BGB

1. Violation of legal rights

The motion for the issuance of an anti-suit injunction interferes with various legal
rights protected by Sections 1004 by analogy, 823 of the German Civil Code
(BGB), in particular with the patent rights of the Petitioners as such as well as with
their established and practiced business enterprises.

a) Patent rights

Patents are protected as other rights within the meaning of Section 823
para. 1 of the German Civil Code (BGB) (Palandt, BGB, 78th edition 2019,
Section 823, margin no. 15; BeckOGK, as of: 1 May 2019, Section 823 BGB,
margin no. 173, MüKo-BGB, 7th edition 2017, Section 823, margin no. 282).
Pursuant to Section 9, sent. of the German Patent Act (PatG), the patent
primarily confers on its owner a right to prohibit the use of the protected
invention by unlicensed third parties and demand damages in case of

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infrinegment. It is part of the core of the right to a patent to take action


against an infringer - by means of legal assistance, if necessary.

The anti-suit injunction irrevocably devalues the Petitioners' rights to their


patents for the duration of the anti-suit injunction. This is because the
Petitioners are enjoined from asserting their patent rights in Germany. This
means in this specific case that the Petitioners cannot have potential acts of
patent infringement by Daimler AG reviewed and confirmed by a court.
This de facto amounts to a deprivation of its statutory claims according to
sections 139 et seq. Patent Act. At the same time this incident would
certainly also be noticed with interest by all other patent infringers. This
would thus indirectly also severely limit the possibilities of Petitioner to
enforce its patents against such other third parties and endangers the
licensing of the Nokia SEP portfolio as a whole.

If the Petitioners were to oppose the requested anti-suit injunction, it


would be subject to substantial sanctions in the USA. The Petitioners are
therefore forced to comply with the anti-suit injunction (see above, IV.2.).
Accordingly, it is recognized in the case law that, due to the considerable
coercive effect of an impending "contempt of court", the issuance of an
anti-suit injunction against the party is adequately causal for the
termination of the prosecution by the addressee of the prohibition and
thus - all things considered - has the effect as if the prohibition had been
issued directly against the German court:

"Eine andere Beurteilung ist auch nicht deshalb geboten, weil die
streitigen "Antisuit Injunctions" nicht unmittelbar gegen den
deutschen Staat oder gegen deutsche Gerichte, sondern gegen
Herrn ... als den Kläger der von ihm in Deutschland anhängig
gemachten Verfahren und Potentieller weiterer Verfahren gerichtet
sind, und zwar im wesentlichen aus folgenden Gründen:

Einmal sind die Gerichte nach deutschem Prozeßrecht bei der


Fortführung von bereits anhängigen Prozessen auf die Mitwirkung
der Verfahrensbeteiligten angewiesen. Insbesondere kann eine
fehlende Mitwirkung der Verfahrensbeteiligten unter hier nicht
näher zu erläuternden Voraussetzungen zwingend zu einem
Stillstand des Verfahrens führen, womit dann der zuvor geschilderte
Zweck der "Antisuit Injunctions" erreicht wäre, so daß die gegen

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Verfahrensbeteiligte gerichtete "Antisuit Injunction" durchaus


geeignet ist, die Tätigkeit der deutschen Gerichte unmittelbar zu
beeinflussen und in ihrer Wirkung unter bestimmten Umständen
einer unmittelbar gegen das Gericht gerichteten Anordnung (die
wohl auch nach angelsächsischem Rechtsverständnis unzulässig
wäre) gleichkommt.

[...]

Es kann deshalb auch den für die Erledigung von


Rechtshilfeersuchen zuständigen Stellen, die die Justizhoheit zu
respektieren haben, nicht gestattet sein, derartige Weisungen an
Verfahrensbeteiligte weiterzuleiten (zuzustellen) und so
ausländischen Gerichten Einfluß auf Gestaltung und Ablauf
anhängiger Gerichtsverfahren zu erlauben oder die betroffenen
Verfahrensbeteiligten der Gefahr einer Bestrafung wegen "Contempt
of Court" auszusetzen, nur weil sie die ihnen nach dem deutschen
Prozeßrecht garantierten Rechte in Anspruch nehmen wollen."
(Higher Regional Court (OLG) of Düsseldorf, order of 10 January
1996, 3 VA 11/95, margin nos. 29, 30 and 31, cf. Exhibit AR 14;
emphasis added)

In the English translation:

"Nor is a different assessment required because of the fact that the


contested "anti-suit injunctions" are not directed directly against the
German State or against German courts, but against Mr. ... as the
claimant in the proceedings brought by him in Germany and
potential further proceedings, essentially for the following reasons:

Firstly, under German procedural law, the courts are dependent on


the cooperation of the parties to the proceedings in order to
continue proceedings which are already pending. In particular, a lack
of cooperation on the part of the parties to the proceedings under
conditions which cannot be explained in more detail here can
necessarily lead to a standstill of the proceedings, whereby the
purpose of the "anti-suit injunctions" described above would then
be achieved, so that the "anti-suit injunction" directed against the
parties to the proceedings is quite capable of directly influencing the

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activities of the German courts and, under certain circumstances, is


equivalent in its effect to an order directed directly against the court
(which would probably also be inadmissible according to the Anglo-
Saxon legal understanding).

[...]

It may therefore also not be permitted for the authorities


responsible for the execution of letters rogatory, which must respect
the judicial sovereignty of the courts, to forward (serve) such
instructions to parties to proceedings thus allowing foreign courts to
influence the organization and conduct of pending court
proceedings or to subject the parties to the proceedings concerned
to the risk of sanctions for contempt of court simply because they
wish to avail themselves of the rights guaranteed to them under
German procedural law." (Higher Regional Court (OLG) of
Düsseldorf, order of 10 January 1996, 3 VA 11/95, margin nos. 29, 30
and 31, cf. Exhibit AR 14; emphasis added)

This is also confirmed by the CJEU:

"However, a prohibition imposed by a court, backed by a penalty,


restraining a party from commencing or continuing proceedings
before a foreign court undermines the latter court's jurisdiction to
determine the dispute. Any injunction prohibiting a claimant from
bringing such an action must be seen as constituting interference
with the jurisdiction of the foreign court which, as such, is
incompatible with the system of the Convention.

Notwithstanding the explanations given by the referring court and


contrary to the view put forward by Mr Turner and the United
Kingdom Government, such interference cannot be justified by the
fact that it is only indirect and is intended to prevent an abuse of
process by the defendant in the proceedings in the forum State."
(CJEU, judgment of 27 April 2004, C-159/02 - Turner / Grovit, margin
nos. 27, 28, cf. Exhibit AR 15, emphasis added)

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b) Interference with the rights of the established and practiced business


enterprise

In any case, an anti-suit injunction constitutes an interference with the


Petitioners' right to their established and practiced business enterprises.

The scope of protection extends to everything that, in its entirety, enables


the business to develop and operate in the economy and thus constitutes
the economic value of the business (Palandt, 78th edition 2019, Section 823,
margin no. 134). A business-related interference exists in particular
whenever the property rights of an enterprise are encroached upon
(BeckOGK, as of: 1 May 2019, Section 823 BGB, margin no. 219).

In the present case, the requested anti-suit injunction interferes directly


and purposefully with the Petitioners' businesses. The exclusive rights
resulting from the patent portfolio of the Petitioners are completely
devalued by the requested prohibition decision in view of infringements by
Daimler AG. The anti-suit injunction thus considerably restricts the
Petitioners' entrepreneurial freedom of decision.

The business activities of the Nokia Group consist inter alia in the licensing
of inventions developed by the group. Through such licensing, Petitioner 1)
contributes significantly to the business result of the Nokia group.

Prima facie evidence: Quartely report of Nokia Corp., see p. 3


"Licensees", p. 13

Exhibit AR 18.

Also Petitioner 2) is proprietor of various patents which are part of the SEP
portfolio of the Nokia group and are thus licensed on FRAND terms as part
of its business activities:

Prima facie evidence: Excerpt from a presentation that Petitioners


have sent to Daimler AG by E-Mail of 26
February 2018,

Exhibit AR 19.

Petitioners would no longer be able to exercise this business purpose if


they are prohibited from asserting their exclusive rights vis-à-vis certain

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third parties. Indirectly, the requested anti-suit injunction would impact the
possibility to assert its patents also against any other third party because it
would show that such torpedoing of German infringement proceedings is
possible. In negotiations with unlicensed third parties, they would thus lack
the necessary counterbalance to obtain fair, appropriate and non-
discriminatory compensation for its innovation performance and to oppose
a hold-out by the infringers.

The present constellation is comparable to an unjustified warning of


industrial property right infringement, which also constitutes an
interference with the business enterprise. This is an interference because
the free continuation of the business is restricted without material
justification and the aggrieved party is faced with the risk of substantial
claims for damages (cf. BeckOGK, as of: 1 May 2019, Section 823 BGB,
margin no. 220). Likeweise, Petitioners' businesses would be significantly
restricted and exposed to severe potential harm by the - unjustified - anti-
suit injunction.

2. Unlawfulness / no obligation to tolerate

The infringement of the Petitioners' patent rights is unlawful. The unlawfulness is


indicated by the interference with the patent rights (Spohnheimer, in: Gsell /
Krüger / Lorenz / Reymann (ed.), BeckOGK, as of: 1 May 2019, Section 1004 BGB,
margin no. 46).

Incidentally, a justification is not apparent and hardly conceivable in view of the


blatant interference with the sovereignty of German courts and constitutionally
rights guaranteed to Petitioners.

Fundamental rights contain not only a defense claim against the state, but at the
same time a protective function, which is also referred to as the indirect third-
party effect of fundamental rights. This protective function comprises in particular
the obligation of the state and its organs, including the ordinary courts, to
guarantee the enforcement of fundamental rights in private law relationships (cf.
BeckOGK, as of: 1 April 2019, Section 134 BGB, margin no. 36).

The anti-suit injunction of the Respondents aims to temporarily enjoin the


German courts seised from continuing the proceedings already pending. At the
same time, it intends to prohibit a decision on the infringement of the patents in
suit under the application of German patent and European antitrust law (cf. III.1.

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above). The Respondents thus seek an individual order by a US court which does
not have jurisdiction over these questions and thereby interferes specifically with
the constitutionally guaranteed judicial independence under Article 97, para. 1 of
the German Basic Law (GG) (cf. in general Hillgruber, in: Maunz / Düring,
Grundgesetz-Kommentar [Basis Law Commentary], as of: 86. EL January 2019, GG,
Art. 97, margin no. 75). This interference with judicial independence also violates
the Petitioners' right of due process (Recht auf den gesetzlichen Richter) under
Article 101 para. 1 sent. 2 of the German Basic Law (GG) (Hillgruber, in: Maunz /
Düring, Grundgesetz-Kommentar [Basis Law Commentary], as of: 86. EL January
2019, GG, Art. 97, margin no. 5).

The Respondents' attempt to thwart the use of judicial assistance against the
deliberate and continued patent infringement in Germany is at the same time a
violation of the right to effective and efficient legal protection (the so-called right
to recourse), which is guaranteed by Article 2 para. 1 of the German Basic Law
(GG) in conjunction with the rule of law. This guarantee also covers civil law
enforcement and requires, in particular, that the legal process in civil law disputes
may not be unreasonably impeded without objective justification (Di Fabio, in:
Maunz / Düring, Grundgesetz-Kommentar [Basic Law Commentary], as of: 86. EL
January 2019, GG Art. 2 para. 1 GG, margin no. 73). Only the German civil courts
are called upon to decide on patent infringement in Germany. The motion for an
anti-suit injunction of the Respondents, on the other hand, pursues the purpose
of cutting the Petitioners off from this legal process. It is thus intended to prevent
effective legal protection.

For these reasons, the Respondents cannot invoke the fact that they are merely
seeking legal remedies under foreign law. Not every exercise of legal remedies is
justified in individual cases. Even the exercise of rights to which the injuring party
might be entitled per se (under US law) may be immoral (BeckOGK, as of: 1 May
2019, Section 826 BGB, margin no. 131).

The Petitioners therefore do not have to tolerate the interference.

3. Risk of first infringement

By filing their motion with the US court, the Respondents have created the
concrete risk of an illegal interference with the patent rights of the Petitioners and
its established and practiced business enterprise.

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According to current knowledge, the US court may decide on the issuance of an


anti-suit injunction after the oral hearing currently scheduled on 10 October 2019,
or – at the discretion of the court – even earlier if necessary (see affidavit Prof.
Rutledge, no. 3, Exhibit AR 11). The courts of the Ninth Circuit represent a
particularly extensive legal opinion with regard to anti-suit injunctions and have
already issued several anti-suit injunctions in the past, by means of which patent
owners have been enjoined, for example, from enforcing their patent rights in
Germany (cf. IV.1. above).

4. Disturber quality

The Respondents are disturbers. A person is a disturber if he or she contributes to


the impairment of a legal interest in a deliberate and adequately causal manner or
if his or her conduct gives rise to a fear of an impairment of a legal interest
(Palandt, 78th edition 2019, introduction to Section 823, margin no. 31). This
applies to Respondent 2). For Respondent 2) is the direct claimant before the US
court and has thus caused the tangible risk of an interference with the legal
interests of the Petitioner deliberately and adequately causally.

A person who causes the impairment by a third party in an adequately causal


manner and is in a position to prevent or remedy it is also a disturber in the form
of a action disturber [Handlungsstörer] (BeckOK BGB, as of: 1 May 2019, Section
1004, margin no. 18). In the case law, for example, the responsibility of the
economic owner, of a company for impairments by customers and suppliers, of an
operator of a sports facility for sports noise by users, or of a building owner for
impairments by building contractors is recognized (cf. BeckOK BGB, loc. cit.,
margin no. 18.1). Equally, a parent company which is not limited to a mere
holding entity but is actively involved in the business is liable for the infringing
activities of the daughter company, in particular if this daughter company is part
of the distribution network of the parent company (Federal Court of Justice, GRUR
2005, 864, 865 – Meißner Dekor II).

Respondent 1) is the top management of the Continental Group. Respondent 2) is


not involved in the patent infringement proceedings against Daimler in Germany -
either economically or procedurally. It acts only as an "extended arm" at the
behest and under the control of Respondent 1) (cf. above under I.3.). Respondent
1) has thus deliberately caused the (threatened) impairment by Respondent 2).
Due to the existing relationship of control (cf. Exhibit AR 2), it can instruct

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Respondent 2) at any time to refrain from pursuing the motion. Thus, Respondent
1) is also a disturber.

5. Remedy

The motion of the Respondents for issuance of an anti-suit injunction creates the
immediate and tangible risk of interference with the legal interests of the
Petitioners. The Petitioners are entitled to preventive injunctive relief against this
(Palandt, loc. cit., introduction to Section 823, margin no. 30). Behavior is owed
which causes the non-occurrence of the imminent impairment (Palandt, loc. cit.,
Section 1004, margin no. 33; German Federal Court of Justice (Bundesgerichtshof
- BGH), NJW 04, 1035).

Consequently, the Respondents must refrain from pursuing the anti-suit


injunction proceedings initiated by them. Since the corresponding motion has
already been filed and the US court seised can decide at its own discretion
without a hearing, i.e. without further action by the Respondents, this obligation
cannot be fulfilled by a simple "cessation" (BGH, GRUR 2018, 292 [293] Rn. 20
mwN – Produkte zur Wundversorgung). Rather, Respondent 2) must withdraw the
motion of 12 June 2019. Respondent 1) must act accordingly on Respondent 2) by
virtue of its relationship of control. In addition, an order against Respondent 1)
will prevent Respondent 1) from instructing another affiliated company to file a
further similar motion for an anti-suit injunction at a later stage.

II.
Immoral intentional damage
(Sections 1004 para. 1, sent. 2 by analogy, 826 BGB)

In addition, the action of the Respondents constitutes immoral intentional damage.

1. Damage

The concept of damage within the meaning of Section 826 of the German Civil
Code (BGB) is broad. It covers not only the violation of certain legal interests, but
any adverse effect on the financial situation, impairment of a legally recognized
interest or burden with an unintentional obligation (German Federal Court of
Justice (BGH) NJW 2004, 2971 [2972]).

The issuance of an anti-suit injunction by the US Court devalues the Petitioners'


intellectual property rights. They are deprived of the opportunity to assert its

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exclusive rights in court and to claim injunctive relief or damages etc. from the
Respondents or their customers.

In addition, the Petitioners are to be obligated against their will not to further
pursue the actions before the seised court. As immediate effect, this will have
significant financial impact in view of the statutory cost reimbursement
stipuations. The substantial internal and external costs in connection with these
proceedings would be lost. An even more grave implication on the Petitioners'
assets follows from the fact that they will be forced to continue to accept the
patent infringements by Daimler AG, which have lasted for years, without
compensation.

2. Immorality

The Respondents' conduct is immoral.

a) Objective immorality

Acts which are incompatible with the fundamental values of the legal and
moral order are objectively immoral (Palandt, loc. cit., Section 826 margin
no. 4).

aa) There is agreement in the case law and literature that anti-suit
injunctions are incompatible with European civil procedural law and
German constitutional law (cf. above under IV.3. and Exhibits AR 14
to AR 17).

bb) The exercise of rights to which the injuring party is entitled per se
may also be immoral (BeckOGK, as of: 1 May 2019, Section 826 BGB,
margin no. 131). The Petitioners observe and respect court decisions,
especially those of US courts. They have themselves often sought
judicial assistance from US courts in the past.

However, the motion for issuance of an anti-suit injunction in


question here is an immoral act of the Respondents, since they are
trying to subsequently withdraw jurisdiction from courts already
seised and to prevent decisions on the alleged patent infringement
in Germany. At the same time, Petitioners - de facto - are to be
denied access to the only competent jurisdictions. Naturally, only the
competent German courts are called upon to decide whether the

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German part of a European patent is infringed by actions in


Germany or not.

These aspects will certainly also be considered in the decision of the


US court concerned. It cannot, however, be expected of the
Petitioners to wait for a decision by the US court. If the motion were
granted, the Petitioners would be forced under certain
circumstances to immediately discontinue the German proceedings.
The present motion for a preliminary injunction is unavoidable as a
defensive measure against this attempted circumvention of the
competent German jurisdiction.

cc) The Imperial Court of Justice (Reichsgericht) already recognized such


a defensive claim in a comparable case based on Section 826 of the
German Civil Code (BGB). There, too, one party wanted to
circumvent the jurisdiction of the competent German courts by
invoking a foreign court (RG, judgment of 3 March 1938, IV 224/37),
cf.

Exhibit AR 20.

The plaintiff had first turned to the German courts to assert his
claims (for divorce from his wife) against the other side. After this
was unsuccessful, he appealed to a foreign court, which offered a
supposedly more favorable legal situation for him (i.e. which would
possibly pronounce the intended divorce). The Imperial Court of
Justice considered this to be immoral,Exhibit AR 20, p. 138:

"Nach der feststehenden Rechtsprechung des Reichsgerichts


muss § 826 BGB auch auf eine in Ausübung eines formalen
Rechts vorgenommene Handlung Anwendung finden, falls
diese einem anderen in einer gegen die guten Sitten
verstoßenden Weise Schaden zufügt. [...] Besteht die gegen
die guten Sitten verstoßende Handlung in der Anrufung eines
ausländischen Gerichts, so ist es im Gegensatz zur Ansicht der
Revision rechtlich statthaft, dies zu verhindern, selbst wenn
das ausländische Gericht nach deutschem Recht an sich
zuständig ist. Darin liegt kein Eingriff in die ausländische
Gerichtsbarkeit."

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In the English translation:

"According to the established case law of the Reichsgericht,


Section 826 of the German Civil Code (BGB) must also apply
to an act taken in the exercise of a formal right if such act
causes damage to another person in a manner contrary to
morality. [...] If the act contrary to morality consists of an
appeal to a foreign court, it is legally permissible, contrary to
the view of the court of appeal, to prevent this, even if the
foreign court per se has jurisdiction under German law. This
does not constitute an interference with the foreign
jurisdiction."

In particular, such a procedure cannot be excused by the fact that


the party considers German law to be defective (Exhibit AR 20 p.
140).

Ultimately, the Imperial Court of Justice countered this


circumvention attempt by ordering the party to eliminate the risk of
further damage to the other party caused by the immoral filing of an
action abroad by withdrawing the action abroad.

The present case is comparable. Here, too, the Respondents


apparently consider the legal situation in the USA to be more
advantageous and therefore want to circumvent the jurisdiction of
the German courts. Conversely, the purpose of Petitioners' present
motion is not to deny jurisdiction to the court of another country,
but only to ensure that the Respondents do not evade German
jurisdiction. This is immoral and cannot be tolerated according to
the above case law.

dd) In the assessment of immorality, the constitutional fundamental


values in private law are also taken into account in particular
(BeckOGK, as of: 1 May 2019, Section 826 BGB margin, no. 4).

As explained above under B.I.2., the conduct of the Respondents


violates high-ranking constitutional principles, namely in particular
the right of recourse (Justizgewährungsanspruch) and the right of
due process (Recht auf den gesetzlichen Richter), which the

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Petitioner can rely on in the context of the indirect third-party effect


of fundamental rights.

ee) Furthermore, in the overall assessment of immorality, the effects on


other legal relations must be taken into account, in that reckless or
abusive conduct could find imitators and thus result in serious
disruptions of legal relations (BeckOGK, as of: 1 May 2019, Section
826 BGB, margin no. 4).

If the Respondents were allowed to carry on in this way, it would be


expected that the torpedoing of German patent infringement
proceedings with FRAND relevance, which they are seeking, would
find imitators. This would result in considerable legal uncertainty and
Germany would be devalued as the place of jurisdiction.

However, intellectual property rights holders in Germany must be


able to rely on the fact that the German state makes full use of the
possibilities available to it to guarantee the constitutionally
guaranteed right of recourse (Justizgewährleistungsanspruch) and to
decide on patent infringements in Germany itself and without
restrictions by third parties. This also protects the legally guaranteed
exclusive rights of the proprietors of intellectual property rights
against interferences by third parties.

b) Reprehensibility

The behavior of the Respondents is altogether reprehensible.

The aim of torpedoing German patent infringement proceedings without


any basis in international law is reprehensible. The Respondents do not
wish to accept the jurisdiction of the German courts and therefore try to
circumvent it by means of pressure on the Petitioners. The choice of the
remedy, namely the anti-suit injunction, is also reprehensible. This is
because the instrument is incompatible with the legal system in Germany.
Finally, the consequences for the Petitioners are serious, whose patent
rights would be completely devalued and whose entrepreneurial freedom
of decision would be severely encroached upon.

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3. Intent to cause damage

The Respondents act with the intent to cause damage. This is already apparent
from the wording of the requests submitted in the motion (cf. A.III.1. above). The
motion for issuance of an anti-suit injunction is deliberately and intentionally
aimed at thwarting the assertion of the exclusive rights by the Petitioners in
Germany. The Respondents who were advised by lawyers are aware that anti-suit
injunctions violate the principle of comity between nations (comitas) (cf. Exhibit
AR 4, p. 31, line 13).

4. Remedy

The Petitioners are entitled to preventive injunctive relief, Section 1004, para. 1,
sent. 2 of the German Civil Code (BGB) in connection with Section 826 BGB. In
analogous application of Section 1004 of the German Civil Code (BGB), all legal
interests protected in tort by Section 826 BGB are covered (Palandt, loc. cit.,
Section 1004, margin no. 4).

VI.
Ground for injunction

Finally, the required ground for injunction also exists. Without the order being issued,
the Petitioners would suffer considerable disadvantages.

1. Urgency

The motion is extremely urgent. Immediately after the filing on 12 June 2019, the
Petitioners became aware of the motion for issuance of an anti-suit injunction.
The US court has currently scheduled the date for the hearing for 10 October
2019. However, an anti-suit injunction may be issued considerably earlier and in
particular after 24 July 2019 because the US court can then decide based on the
information available in the file. US courts have a wide discretion with the
handling of decisions on intermediary motions of the parties.

In addition, if Respondents would be aware in advance, they could inform the US


court about this PI request and request interim measures which could undermine
the present motion pending a US court ruling (see affidavit Prof. Rutledge, no. 3,
Exhibit AR 11 and Exhibit AR 12). The requested injunction is necessary to
prevent irreversible measures.

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 44 of 46
39 / 41

2. Balance of interests

The Petitioners' interests in obtaining the requested preliminary injunction far


outweigh those of the Respondents.

In the present case, there is a threat of considerable and unending interference


with the patent rights and business operations of the Petitioner. The judicial
independence (Article 97 para. 1 of the German Basic Law (GG)), the right of due
process (Recht auf den gesetzlichen Richter) pursuant to Article 101 para. 1, sent.
2 of the German Basic Law (GG), and the constitutionally guaranteed right of
recourse (Justizgewährungsanspruch) (Article 2 para. 1 in conjunction with the rule
of law [Article 20 para. 3 of the German Basic Law (GG)])are severely affected.

With the present motion for a preliminary injunction, the Petitioners demand no
more than the issuance of a measure enabling the proper continuation of the
patent infringement actions pending before the competent German courts seised
against another party. The Petitioners are therefore worthy of protection, in
particular against the background that these proceedings were brought before
the courts long before the main action was filed in the USA.

On the part of the Respondents, however, no interest worth protecting can be


seen. They themselves are not a party to the German patent infringement
proceedings, the proper continuation of which they want to torpedo here. At the
same time, their interests are represented by the intervention of the subsidiaries
Continental Automotive GmbH and Continental Automotive Hungary Ktf.

Furthermore, the present motion is not intended to deny the Respondents' access
to the US courts altogether. For the present motion is not directed against the
USmain proceedings filed of 10 May 2019 (Exhibit AR 7), but solely against the
supplementary motion for issuance of an anti-suit injunction. This is an essential
difference to the approach of the Respondents. The Respondents are seeking a
comprehensive prohibition of all current and future patent infringement actions
brought by the Petitioner against Continental or on of their customers under a
mobile communications SEP for the duration of the anti-suit injunction. The
defensive measure requested here is therefore only aimed at preserving the status
quo and a considerably smaller curtailment of the legal position of the
Respondents.

/..
Case 5:19-cv-02520-LHK Document 95-1 Filed 07/19/19 Page 45 of 46
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VII.
Jurisdiction

The Munich Regional Court has jurisdiction.

1. The subject-matter jurisdiction of the Court seised follows from Section 143
para. 1 of the German Patent Act (PatG). The term "patent litigation" must be
interpreted broadly (German Federal Court of Justice (BGH), GRUR 2011, 662).
Pursuant to Section 143 of the PatG, this includes all actions by which a claim is
asserted under one of the legal relationships governed by the German Patent Act
(PatG) (Higher Regional Court (OLG) of Düsseldorf, GRUR-RR 2012, 305). It is not
necessary that the basis of the claim follows from the German Patent Act (Higher
Regional Court (OLG) of Düsseldorf, GRUR-RR 2012, 305). The present motion for
issuance of a preliminary injunction is intended to ensure the undisturbed
continuation of the German patent infringement proceedings and therefore
affects the exclusive rights arising from the patents in suit there.

2. Territorial jurisdiction follows from Section 32 of the German Code of Civil


Procedure (ZPO). If Petitioners are injuncted to pursue the German patent
infringement proceedings, this takes away their claims acc. to sections 139 et seq.
This interference has a nationwide impact, as the respective court proceedings
deal with nationwide infringement activities and aim at obtaining corresponding
judgments for injunctive relief, rendering of information and damages. This also
includes infringement acts by Daimler AG and Petitioners' claims following
therefrom within the judicial district of the Regional Court Munich I, irrespective of
whether they are currently asserted in Düsseldorf, Mannheim or Munich.
Accordingly, Petitioners' patent rights are in all cases devalued also in the judicial
district of the Munich District Court.

3. The present injunction request is aimed at a uniform defensive claim based on a


uniform set of facts, i.e. the motion to order an anti–suit injunction. The
jurisdiction of the 21st chamber follows from the fact that proceeding 21 O
3889/19 is concerned. Other courts and in one case also the 7th chamber of the
seised court have been involved in the broadest sense. As this is a uniform claim
and a uniform set of facts, a (partial) referal would however not be appropriate.

/..
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We therefore request that the preliminary injunction be issued without prior hearing of
the Respondents. In addition, we ask to be notified by telephone of the intended
issuance of an injunction so that we can initiate the necessary steps for service. Pursuant
to Sec. 170 Civil Procedure Code, service upon Respondent 2) can be effected directly to
Mr. Schäfer as a member of the Board of Directors and thus an organ of Respondent 2),
cf. Court of Appeal Stuttgart, decision of 28 May 2013, 20 U 5/12, BeckRS 2013, 12075.
He has his place of business at the seat of Respondent 1) (Exhibit AR 8b).

Cordula Schumacher Dr. Arno Riße


(Attorney-at-Law) (Attorney-at-Law)

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