By a judgment of 27 July 2026, the UK Supreme Court reinstated Tesla's claims against InterDigital and Avanci (Tesla v InterDigital, [2026] UKSC 27). The case raises a question the automotive licensing market could no longer avoid: what becomes of the FRAND license undertaking when the patentee chooses to license its patents through a patent pool ?
The Court's answer fits in one formula: the platform is a mode of performance of the undertaking, not a discharge. Joining a pool such as Avanci does not extinguish the obligation given toETSI ; it merely relocates the place where it is performed.
Behind the technicalities of strike-out and jurisdictional gateways, the judgment engages the very characterisation of the FRAND undertaking, that prior question of standard essential patents which governs everything else: contractual source, determinable content, effect towards third parties.
What the Court did not decide
Caution comes first. The Supreme Court did not hold that the rate of the Avanci 5G platform is not FRAND, nor that Avanci owes an independent FRAND obligation. The proceedings concerned jurisdiction and strike-out, at the undemanding threshold of a real, rather than fanciful, prospect of success. Evidence, valuation, procedural fairness and the form of relief all remain for trial.
The procedural background clarifies the scope of the reversal: Tesla had challenged the platform rate before any product launch and sought declarations; Fancourt J had struck out the claims and the Court of Appeal had upheld that decision by a majority, over the dissent of Arnold LJ. It is that strike-out which the Supreme Court has now overturned.
The undertaking does not stop at the agent's door
The ETSI Intellectual Property Rights Policy is a contractual instrument governed by French law: the clause 6.1 declaration creates a contract for the benefit of third parties, with implementers as beneficiaries. The Supreme Court draws the logical consequence: nothing allows the obligation to lapse when several patentees choose to license jointly through an intermediary. The anti-hold-up rationale applies with at least equal force where a substantial share of the stack of standard essential patents is aggregated into a single offer.
The Court of Appeal had treated the platform offer as a distinct commercial arrangement, unconnected to the undertaking. That error is corrected: Tesla was not seeking to extend InterDigital's undertaking, it was asking that the undertaking continue to bite through the licensing channel the patentee had itself chosen.
Commercial reality specifies performance, it does not create the obligation
The Court rejected Tesla's broadest submission, under which every licence offer would have to be FRAND. A patentee remains free to negotiate a separate arrangement on non-FRAND terms, provided FRAND terms remain genuinely available. But it accepted the narrower argument: for a patentee licensing through the Avanci platform, the only commercially real FRAND licence may be the platform licence, at a rate which is itself FRAND.
The formula is worth retaining: commercial reality specifies what faithful performance requires; it does not create the obligation, which flows from the ETSI declaration. Avanci had itself pleaded the practical impossibility of negotiating thousands of bilateral licences; once that premise is accepted, it becomes difficult to argue that the substitute mechanism escapes all FRAND scrutiny.
Determination is not formation
The judgment fits within a civilian framework that French law supplies with precision. The stipulation pour autrui (Article 1206 of the Civil Code) gives the beneficiary a direct right to the promised performance, without turning the undertaking into an already executed licence. Article 1163 disposes of the converse objection: the absence of pre-fixed monetary terms does not render the obligation void, so long as the performance is determinable. Article 1221, finally, recalls that specific performance is the remedy for an existing obligation and cannot enlarge its object.
Three operations must therefore remain distinct: identifying the content of the undertaking, drawing the consequences of non-performance, and forming the downstream licence. A court may order the patentee to perform, in particular by presenting a compliant offer and refraining from coercive conduct; it does not thereby manufacture a contract against the parties' will.
An obligation that travels with the patent
On jurisdiction, the Court treated the FRAND obligation and the underlying UK patent as inseparable features of the standard essential patent. It relied on clause 6.1bis of the ETSI Intellectual Property Rights Policy, which directs that FRAND undertakings be interpreted as encumbrances binding successors in interest. The structure is hybrid: the source is personal and contractual, the intended effect attaches to the asset. A patentee cannot shed the undertaking through a mere change of negotiator.
The same logic settled the forum non conveniens issue: the Delaware Court of Chancery was not an available alternative forum, the evidence indicating that US courts would set FRAND terms for US patents, not UK ones. As for the forum shopping charge, the Court answers it lucidly: competition between national forums is the inherent consequence of the absence of an international FRAND tribunal; the answer is institutional, not jurisprudential.
What follows
Tesla's appeal having been allowed, the claims are reinstated and the case returns for trial on the merits before the High Court, according to the information published by the UK Supreme Court. The trial will have to decide what the judgment left open: the genuine availability of bilateral licensing, the FRAND character of the Avanci terms, the fairness of a determination in the absence of certain licensors, and the effects of any declarations granted.
The practical lessons are already here. For implementers, a credible English route now exists to test a platform rate before launch and before any infringement suit. For platform operators, the paradox is real: the more the platform succeeds, the stronger the argument that its offer is the only commercially real FRAND mode. For patentees, the line is clear: joining a pool does not privatise the rate, and each remains answerable for the compatibility of its licensing channel with the undertaking given. The question will sooner or later reach the UPC, which delivered its first FRAND decision in Panasonic v Oppo and will likewise have to interpret clause 6.1 under French law.
Key takeaways
- Tesla v InterDigital ([2026] UKSC 27, 27 July 2026) reinstates Tesla's claims: they had a real prospect of success and fell within English jurisdiction.
- The licensing platform is a mode of performance of the FRAND undertaking, not a discharge: joining Avanci does not extinguish the ETSI obligation.
- Commercial reality specifies performance without creating the obligation, which flows from the declaration governed by French law (stipulation pour autrui).
- A declaration may be sought against the agent (Avanci) without a free-standing cause of action, where a genuine controversy and practical utility exist.
- Through clause 6.1bis, the FRAND obligation travels with the patent as an encumbrance binding successors in interest.
- The case returns for trial: rate, bilateral availability and procedural fairness remain to be decided.
Frequently asked questions
Did the Supreme Court hold that the Avanci rate is not FRAND?
No. It held only that Tesla's claims raised serious issues warranting a trial. Whether the 5G platform rate is FRAND will be examined on the merits by the High Court.
Does a patent pool owe a FRAND obligation of its own?
In principle, no. Avanci owns no standard essential patents and has made no ETSI declaration. But the undertaking of the participating patentees continues to produce effect through the platform, which organises its performance.
Why is French law central to a British case?
Because the ETSI Intellectual Property Rights Policy is governed by French law: the FRAND declaration is analysed as a stipulation pour autrui, and its determinable content is assessed under Articles 1163, 1206 and 1221 of the Civil Code.
What can an implementer do when it considers a platform rate excessive?
It can now, in circumstances comparable to Tesla's, seise the English court before launch to have FRAND terms determined, or negotiate on the strength of the participating patentees' contractual obligation, without waiting to be sued for infringement.
The firm advises patentees, implementers and prospective licensees on FRAND undertaking disputes and on strategies towards pools, in litigation as in negotiation, through its practice asFRAND and standard essential patents counsel. Talk to us.
This article is an original and substantially updated adaptation of an analysis by Matthieu Dhenne first published on Kluwer Patent Blog on July 28, 2026: A Mode of Performance, Not a Discharge: Tesla v. InterDigital and the FRAND Undertaking Inside the Pool.