UK High Court Sets $392 Million FRAND Lump Sum in Samsung v. ZTE Global SEP Dispute

Mr Justice Meade of the UK High Court (Patents Court) handed down judgment on 1 May 2026 in Samsung Electronics Co, Ltd v ZTE Corporation [2026] EWHC 999 (Pat), determining that a lump sum balancing payment of US$392 million by Samsung to ZTE constitutes fair, reasonable, and non-discriminatory (FRAND) terms for a global standard-essential patent (SEP) cross-licence. The decision marks a significant development in international SEP licensing and FRAND rate-setting jurisprudence.

Background

Samsung and ZTE had maintained a bilateral Patent Licence Agreement (PLA) since 2021 covering each other’s SEP portfolios. When the agreement expired and renewal negotiations broke down in 2024, the dispute was not about whether a licence should exist, but about its price. Samsung filed proceedings in the London Patents Court in December 2024, seeking a court-determined FRAND rate. ZTE simultaneously pursued parallel litigation in Brazil, China, and Germany, maintaining pressure across multiple jurisdictions.

The Court’s Determination

Meade J settled on a FRAND lump sum of $392 million, positioning the award between Samsung’s maximum position of $200 million and ZTE’s demand of $731 million. Samsung is the net payer under the cross-licence structure, reflecting the court’s assessment that ZTE’s SEP portfolio carries greater net value in the arrangement.

On the question of comparable licences, the court declined to treat the existing agreements of Ericsson, Nokia, and InterDigital (the ENI licensors) as reliable benchmarks. Meade J found that the ENI portfolios differed materially from ZTE’s in composition and geographic scope. More significantly, the court reasoned that the ENI licensors’ well-established willingness and ability to obtain injunctions — particularly in Germany — meant their agreements almost certainly incorporated a substantial premium above true FRAND rates, rendering those figures unsuitable as comparables.

On non-royalty terms, the court found in Samsung’s favour. Meade J characterised ZTE’s withdrawal from negotiation over non-royalty terms as tactical rather than principled, and held that only the contractual structure Samsung proposed was properly within FRAND parameters.

Sanctions and Non-FRAND Factors

A notable aspect of the judgment is its treatment of US export-control sanctions imposed on ZTE. The court examined whether, and to what extent, these sanctions constituted a “non-FRAND factor” affecting ZTE’s bargaining position and the appropriate rate. The analysis of how sanctions-related commercial constraints interact with FRAND obligations is likely to be cited in future SEP disputes involving entities subject to trade controls.

Significance for Global SEP Practice

Since the UK Supreme Court’s 2020 decision establishing jurisdiction to set global FRAND terms, the English courts have become a key venue for SEP licensing disputes. The ability of English courts to bind parties to worldwide licence rates — absent a genuine challenge to jurisdiction — makes London an attractive forum for both implementers and patent holders seeking certainty. The Samsung v ZTE judgment adds to a growing body of UK FRAND case law and will serve as a reference point for practitioners negotiating or litigating 5G, LTE, and other standard-essential licences.

Outlook

Both Samsung and ZTE declined to comment on the ruling, and both retain the right to appeal. Questions remain as to how the UK judgment will interact with proceedings in Brazil, China, and Germany, and whether the courts in those jurisdictions will apply consistent or divergent approaches to the underlying portfolio valuation. The judgment’s treatment of comparable licences and non-FRAND factors is expected to inform future FRAND litigation strategy across multiple jurisdictions.