BYD is a leading EV manufacturer, based in China, the world’s largest electric vehicle market and producer. China exported more than 1.2 million EVs, mainly to Europe, Southeast Asia, and South America in 2023. Avanci is a US patent licensing platform focusing on standard essential patents (SEPs) in the field of Internet of Things standards (IoT) and connected Vehicles. On 7 February 2025, Sol IP, LLC (“Sol IP”), one of Avanci’s licensors, filed a patent lawsuit against BYD at the Munich I Regional Court in Germany. Sol IP filed two patent infringement complaints No. 7 O 1597/25 and No. 7 O 1583/25 against BYD Europe B.V. of Hoofddorp in the Netherlands (“BYD”). The European patents involved are the patent of a carrier aggregation in wireless communication system No. EP2575281 and the patent of a method and apparatus for transmitting ACK/NACK No. EP2624516. Both of them are SEPs in the field of wireless communications, involving 4G/LTE technology. Sol IP sues BYD for allegedly using its 4G SEPs without a proper license and currently focuses on a finding of infringement from BYD and a declaration that it is entitled to damages.
Avanci collects SEPs in the field of communications from multiple licensors, including Sol IP, to provide a “one-stop” patent licensing solution for IoT devices (especially EVs). The solution, adopting a “charge per vehicle” model (US$20 per vehicle for 4G and higher for 5G), simplifies the process for companies to obtain communication technology patents (such as 2G, 3G, 4G, 5G, Wi-Fi, etc.) and reduces licensing complexity and legal risks. Avanci’s 4G licensing agreement covers 175 million vehicles from over 100 vehicle brands worldwide, but Chinese automakers, including BYD, have not yet joined.
Chinese automakers believe that Avanti's rates are too high, and may advocate using the T-Box (on-board communication module) rather than the entire vehicle as the basis for billing. On 20 December 2024, China Automotive Information Technology Co., Ltd., a subsidiary of China Automotive Technology Research Center Co., Ltd., released a Research Report on License Fees for Essential Patents for Cellular Communication Standards in the Automotive Industry, which analyzed Avanci’s charging model. According to the report, the licensing model of the automotive industry should comply with the principles of fairness, reasonableness, and non-discrimination (FRAND); in terms of 4G multi-mode vehicles, the reasonable cumulative licensing fee for automotive industry cellular communication SEPs in the Chinese market should be RMB 7.125-16.362 per vehicle. In response to the report, Avanci stressed that “joining Avanci is only an option”, and automakers can also choose to negotiate bilateral licensing agreements with each patent owner individually.
Back to the case between Sol IP and BYD, the protagonists are Avanci and BYD. The strategic considerations for Avanci are likely to pressure BYD into a settlement or licensing agreement. Otherwise, an EU-wide sales ban on BYD vehicles may be issued if an injunction is granted. It is well-known that the German courts are willing to grant injunctions if infringement is proven. In August 2020, Avanci forced Daimler to accept the license through its other licensor Nokia. This time, by litigating BYD by Sol IP, Avanci may further reinforce its position as a “market maker” for IoT/automotive SEP licensing.
The potential outcomes of the case include a settlement before trial, injunctions, BYD or a ruling that Sol IP’s patents are invalid, non-essential, or that licensing terms were not FRAND.
Avanci collects SEPs in the field of communications from multiple licensors, including Sol IP, to provide a “one-stop” patent licensing solution for IoT devices (especially EVs). The solution, adopting a “charge per vehicle” model (US$20 per vehicle for 4G and higher for 5G), simplifies the process for companies to obtain communication technology patents (such as 2G, 3G, 4G, 5G, Wi-Fi, etc.) and reduces licensing complexity and legal risks. Avanci’s 4G licensing agreement covers 175 million vehicles from over 100 vehicle brands worldwide, but Chinese automakers, including BYD, have not yet joined.
Chinese automakers believe that Avanti's rates are too high, and may advocate using the T-Box (on-board communication module) rather than the entire vehicle as the basis for billing. On 20 December 2024, China Automotive Information Technology Co., Ltd., a subsidiary of China Automotive Technology Research Center Co., Ltd., released a Research Report on License Fees for Essential Patents for Cellular Communication Standards in the Automotive Industry, which analyzed Avanci’s charging model. According to the report, the licensing model of the automotive industry should comply with the principles of fairness, reasonableness, and non-discrimination (FRAND); in terms of 4G multi-mode vehicles, the reasonable cumulative licensing fee for automotive industry cellular communication SEPs in the Chinese market should be RMB 7.125-16.362 per vehicle. In response to the report, Avanci stressed that “joining Avanci is only an option”, and automakers can also choose to negotiate bilateral licensing agreements with each patent owner individually.
Back to the case between Sol IP and BYD, the protagonists are Avanci and BYD. The strategic considerations for Avanci are likely to pressure BYD into a settlement or licensing agreement. Otherwise, an EU-wide sales ban on BYD vehicles may be issued if an injunction is granted. It is well-known that the German courts are willing to grant injunctions if infringement is proven. In August 2020, Avanci forced Daimler to accept the license through its other licensor Nokia. This time, by litigating BYD by Sol IP, Avanci may further reinforce its position as a “market maker” for IoT/automotive SEP licensing.
The potential outcomes of the case include a settlement before trial, injunctions, BYD or a ruling that Sol IP’s patents are invalid, non-essential, or that licensing terms were not FRAND.