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Cont'l Auto. Sys. v. Avanci

United States District Court for the Northern District of Texas, Dallas Division

September 10, 2020, Decided; September 10, 2020, Filed

Civil Action No. 3:19-cv-02933-M



Before the Court is Defendants' Amended Motion to Dismiss First Amended Complaint. [ECF No. 270]. Defendants move to dismiss Plaintiff's claims for lack of subject matter jurisdiction, lack of personal jurisdiction, and failure to state a claim under Federal Rules of Civil Procedure 12(b)(1), 12(b)(2), and 12(b)(6). For the following reasons, the Motion is GRANTED.

I. Factual and Procedural Background

In [*7]  its First Amended Complaint (the "FAC") [ECF No. 97], Plaintiff Continental Automotive Systems, Inc., a producer and supplier of telematics control units ("TCUs") for vehicles, alleges as follows. It sells TCUs to car manufacturers ("OEMs") that use the TCUs to provide their cars various functionalities, including cellular connectivity. To connect to cellular networks, the TCUs include a baseboard processor in a network access device built into the TCU. To access second generation ("2G"), third generation ("3G") and fourth generation ("4G") cellular networks, the baseboard processors, network access devices, and TCUs must comply with standards set by standard setting organizations ("SSOs").

Plaintiff alleges that SSOs are private organizations that establish uniform industry standards that provide guidance to product manufacturers. When an SSO sets a standard, it designates patented technologies that satisfy the standard, and a manufacturer that wishes to produce products that practice the standard must obtain licenses to the standard essential patents ("SEPs"). For a patent to be designated essential, Plaintiff contends that SEP holders must agree with the SSOs that they will license [*8]  their SEPs on fair, reasonable, and non-discriminatory ("FRAND") terms and conditions. Plaintiff asserts that these terms should reflect the ex-ante value of the SEP, excluding its value obtained solely from its inclusion in the standard.

Plaintiff alleges that Defendants Nokia Corporation, Nokia of America Corporation, Nokia Solutions and Networks US LLC, Nokia Solutions and Networks Oy, Nokia Technologies Oy (the "Nokia Defendants"), Conversant Wireless Licensing SARL (the "Conversant Defendant"), Optis UP Holdings, LLC, Optis Cellular Technology, LLC, Optis Wireless Technology, LLC (the "Optis Defendants"), and Sharp Corporation (the "Sharp Defendant") (collectively, the "Licensor Defendants") own SEPs for 2G, 3G, and 4G connectivity standards established by various SSOs, including the European Telecommunications Standards Institute ("ETSI"), the Telecommunications Industry Association ("TIA"), and the Alliance for Telecommunications Industry Solutions ("ATIS"). Plaintiff claims that as a result, the Licensor Defendants are obligated to license those SEPs to Plaintiff on FRAND terms and conditions.

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2020 U.S. Dist. LEXIS 173799 *

CONTINENTAL AUTOMOTIVE SYSTEMS, INC., Plaintiff, v. AVANCI, LLC, et al., Defendants.


licenses, antitrust, anticompetitive, patent, monopoly, monopolize, declaratory, non-FRAND, conspiracy, holder, competitors, consumers, royalties, platform, restrain, pool, ripe, commerce, Technology, deception, indemnity, suppliers, Networks, infringement, manufacture, proximately, promissory, causation, customers, decreased