Delhi High Court’s Examination of  Pro Tem Security in SEP and FRAND Litigation in Malikie v. Xiaomi

Can a court compel an SEP implementer¹ to furnish interim security at a prima facie stage before final adjudication of validity, infringement, and FRAND royalties? This question lay at the centre of the Delhi High Court’s decision in Malikie Innovations Ltd. v. Xiaomi Corporation & Ors.², a ruling that marks another significant development in India’s evolving SEP jurisprudence.

SEPs are patents that protect technologies considered indispensable for implementing industry-wide technical standards such as 3G, 4G, and 5G telecommunications protocols. Because manufacturers cannot produce standard-compliant devices without using such patented technologies, SEP holders are generally required to license them on FRAND terms ensuring that access to standardised technology remains commercially fair, reasonable, and non-discriminatory. SEP disputes therefore differ from ordinary patent litigation, as courts must balance the patent rights of innovators against the need to preserve access to standardised technologies in competitive markets.

The dispute before Justice Tejas Karia arose from allegations concerning the unauthorised use of patents relating to 3G, 4G, and 5G cellular technologies, but the matter extended far beyond a conventional infringement action. The case required the Court to examine how interim equitable remedies should operate where licensing negotiations have failed, parallel FRAND proceedings are unfolding across jurisdictions, and allegedly infringing products continue to remain commercially available in the market. In addressing these issues, the Court affirmed that SEP disputes must be evaluated within the broader framework of FRAND obligations, commercial fairness, and the reciprocal responsibilities imposed on both SEP holders and implementers.

The suit was instituted by Malikie Innovations, which acquired and manages a portfolio of cellular SEPs originating from BlackBerry, including the Indian patents asserted in the proceedings. Malikie alleged that Xiaomi had continued manufacturing and selling standard-compliant mobile devices in India without executing a licence on Fair, Reasonable, and Non-Discriminatory (FRAND) terms despite prolonged negotiations between the parties. Xiaomi, however, contested the claims on multiple grounds. It argued that BlackBerry was a necessary party under Section 109 of the Patents Act³, challenged the essentiality and validity of the asserted patents, questioned the absence of comparable third-party licence agreements, and contended that its proceedings before the Shenzhen Intermediate People’s Court were confined solely to Chinese patents and could not be treated as admissions concerning the Indian suit patents.

The Court’s Reliance on Established SEP Jurisprudence

While examining the request for pro tem security, the Court relied extensively on the evolving body of Indian SEP jurisprudence developed through earlier decisions of the Delhi High Court. A central pillar of the Court’s reasoning emerged from Xiaomi Technology v. Telefonaktiebolaget LM Ericsson⁴, where the Division Bench recognised that interim royalty-based arrangements may be necessary to balance equities during the pendency of SEP disputes, particularly where continued commercial use of patented technology may cause ongoing revenue loss to the patentee. The Court also drew support from Intex Technologies v. Ericsson⁵, which clarified that the SEP ecosystem imposes reciprocal FRAND obligations on both licensors and implementers. In that decision, the Division Bench observed that an implementer cannot remain silent during licensing negotiations and may be expected to either make a counteroffer or furnish appropriate security to demonstrate its status as a willing licensee. Equally significant was the Court’s reliance on Nokia Technologies OY v. Oppo⁶, where the Delhi High Court recognised that party conduct during negotiations, including initiation of foreign FRAND proceedings, may become relevant while assessing interim equities and determining whether pro tem arrangements are justified.

Why the Court Directed a Pro Tem Security Deposit

The Court treated Xiaomi’s initiation of FRAND rate-setting proceedings before the Shenzhen Court as a relevant circumstance at the prima facie stage, notwithstanding Xiaomi’s submission that the Chinese proceedings were confined to China-specific patents. The Court noted that Malikie had established a prima facie case regarding validity, essentiality, and infringement of the suit patents through claim-chart mapping, technical analysis, and Xiaomi’s own declarations of compliance with cellular standards. It further observed that SEP litigation involves continuing commercial exploitation of standardised technologies during lengthy adjudicatory timelines, making interim balancing mechanisms necessary in appropriate cases. Importantly, the Court clarified that a pro tem direction does not amount to a final determination of FRAND royalties or patent liability, but merely functions as a temporary arrangement intended to preserve equities pending trial. Consequently, Xiaomi was directed to deposit approximately ₹272 crore with the Registrar General of the Court or furnish an unconditional bank guarantee for the same amount, failing which Malikie would be entitled to seek interim injunctive relief.

Conclusion

The ruling is significant because it further strengthens the Delhi High Court’s emerging approach of treating SEP disputes as a specialised category of commercial litigation requiring flexible interim remedies distinct from conventional patent disputes. The judgment establishes the principle that courts may intervene at an early stage to preserve commercial balance where negotiations over FRAND licensing continue alongside active market exploitation of standardised technology. At the same time, the decision reflects the increasing globalisation of SEP litigation, where conduct before foreign courts, parallel FRAND proceedings, and international licensing strategy are becoming deeply interconnected with domestic patent enforcement. By directing pro tem security while leaving final FRAND determination open for adjudication, the Delhi High Court has continued its effort to develop a commercially responsive and institutionally mature SEP framework capable of addressing the complexities of modern telecommunications litigation.

Citations

1. An SEP implementer is a manufacturer using standard-essential technology in standard-compliant products ↩︎
2. Malikie Innovations Ltd. v. Xiaomi Corporation & Ors., 2026:DHC:3671 ↩︎
3. Section 109 of the Patents Act, 1970 ↩︎
4. Xiaomi Technology v. Telefonaktiebolaget LM Ericsson, 2016 SCC OnLine Del 2404 ↩︎
5. Intex Technologies (India) Ltd. v. Telefonaktiebolaget LM Ericsson (PUBL),2023:DHC:2243-DB ↩︎
6. Nokia Technologies OY v. Guangdong OPPO Mobile Telecommunications Corp. Ltd. & Ors., 2022/DHC/004935 ↩︎

Expositor(s): Adv. Aparna Shukla,