The Delhi High Court ordered Xiaomi to furnish a pro tem security deposit in an intellectual property dispute concerning cellular standard essential patents, according to filings from IAM. The February 2026 ruling (CS(COMM) 734/2025 [2026:DHC:3671]) addresses a lawsuit brought by Malikie Innovations, which asserted a portfolio of 3G, 4G, and 5G cellular SEPs originally acquired from BlackBerry.
Licensing Negotiations and Hold-Out Allegations
Malikie approached Xiaomi in October 2023 to negotiate a license on fair, reasonable, and non-discriminatory (FRAND) terms, according to court documents cited by IAM. Over nearly two years of discussions, the parties executed non-disclosure agreements, held technical talks, and exchanged multiple offers and counteroffers. Malikie argued that Xiaomi’s conduct demonstrated classic “hold-out” behavior by continuing to sell 4G and 5G-compliant devices without concluding an agreement or paying royalties, while never denying the need for a license.
Legal Arguments on Maintainability and Validity
Xiaomi resisted the application for pro tem security on both procedural and substantive grounds, as reported by IAM. The manufacturer argued that the suit was defective for non-joinder of BlackBerry under Section 109 of the Patents Act, contending that BlackBerry continued to own at least part of the portfolio. Xiaomi also submitted that Malikie failed to establish its royalty demands were FRAND because no comparable third-party licenses or objective valuation materials were produced, and noted that no court had yet held the patents valid, essential, or infringed. Furthermore, Xiaomi maintained that a separate FRAND rate-setting action it filed before the Shenzhen Intermediate People’s Court in China related exclusively to Chinese patents and sales, rather than serving as an admission regarding the Indian patents.
Court Findings on Interim Arrangements
The Delhi High Court reaffirmed its power to put in place temporary pro tem arrangements in standard essential patent disputes to balance equities pending final adjudication, noting that such measures do not require a detailed examination of merits. According to IAM, the court emphasized that the SEP framework imposes reciprocal obligations, meaning implementers cannot commercially exploit SEP technology without making interim arrangements while negotiations proceed. The court rejected Xiaomi’s argument that comparable license agreements were indispensable at the pro tem stage, clarifying that the non-production of comparable licenses was not fatal to interim relief because the court was not finally determining FRAND royalty rates.
