BMW’s Fight Over US Patents in Germany Previews Battles to Come

International patent law has long operated on a simple, geographic truce: US courts evaluate and enforce US patents, and foreign national courts evaluate and enforce their patents.

But the Court of Justice of the European Union’s landmark 2025 ruling in BSH Hausgeräte GmbH v. Electrolux AB may have dismantled those longstanding territorial limits of patent adjudication.

A year later, a dispute between Onesta IP, a non-practicing entity, and luxury car maker BMW has put the decision’s real-world consequences in the spotlight, prompting a Texas federal judge to take the extraordinary step of enjoining a German court from deciding the fate of a US patent.

‘Third State’ Loophole

The BSH case that upended the territorial understanding didn’t involve US patents, but rather a dispute between global appliance companies in a Swedish court regarding a Turkish patent.

Under EU regulations, courts of an EU member state have exclusive jurisdiction over the validity of their own patents. This rule has historically prevented cross-border patent battles (for example, a German court invalidating a French patent).

In BSH, however, the CJEU identified a gap in these regulations: Protection applies only to patents granted by EU member states, not to those from so-called third states such as Turkey. On that basis, the CJEU approved the Swedish court’s adjudication of the Turkish patent.

The takeaway is significant: Where a defendant is domiciled in the EU, a local court may now assert jurisdiction over, and effectively arbitrate, patent rights issued outside of the European Union.

The Munich Maneuver

Concerns that the CJEU’s decision could extend adjudication to US patents were well-founded.

Onesta IP sued BMW for infringement in Munich instead of litigating its US patents (Nos. 8,854,381 and 8,443,209) in a slow-moving US venue where injective relief is difficult to obtain. Under the standard established in eBay Inc. v. MercExchange LLC, courts weigh equitable factors before granting an injunction—a test that non-practicing entities rarely satisfy.

The complaint was based on allegations tied to BMW vehicles equipped with Qualcomm Snapdragon chips in the vehicle’s infotainment systems.

The action would force the Munich court to apply US patent law to determine infringement and validity without the procedural safeguards available in US courts, such as Markman hearings, depositions, robust discovery, or a jury.

BMW now faces the prospect of having its rights to conduct business in the US defined by a German court operating largely under European procedures.

Texas Standoff

BMW responded by seeking an anti-suit injunction, a tool of cross-border litigation well known in the context of standard essential patents and fair, reasonable, and non-discriminatory licensing.

On Feb. 13, Judge Alan Albright of the US District Court of the Western District of Texas condemned the logic of the Munich maneuver, finding that allowing the proceedings to continue in Germany would “eviscerate” the US statutory scheme and deprive BMW of constitutional rights available only in the US—specifically, a jury trial. By firmly rejecting the “vexatious or oppressive” conduct of litigating US rights abroad, Albright’s order reinforces the same principle—reciprocal restraint: We don’t touch your patents, and you don’t touch ours.

Briefing before the Federal Circuit remains ongoing and we expect the US Court of Appeals for the Federal Circuit to agree with Judge Albright as it has in similar cases, such as Voda v. Cordis (refusing to adjudicate foreign patents to avoid international friction).

The injunction coincides with the US Patent and Trademark Office’s recent formation of a SEP working group to reinforce domestic enforcement of US patent rights. Together, Albright’s injunction and the PTO’s move indicate that US intellectual property policy will be set and enforced at home.

Harmonization Through Conflict

A non-practicing entity seeking leverage—or a multinational defending its supply chain—no longer needs to litigate where infringement happened or where a patent issues. With no global treaty to address this, companies must at least consider a potential new reality.

For implementers (the preemptive shield): Entities with European domiciles no longer can assume that infringement claims concerning US patents will be litigated in the US. This may not be altogether bad. Damages awarded in a European court are likely to be a fraction of those awarded by a US jury.

Litigation costs in Europe likewise may be orders of magnitude lower. The intrusive discovery common in US courts is reduced. Proving invalidity to a US jury under heightened burdens of proof is more daunting.

The greater availability of injunctive relief in Europe, combined with trends toward bifurcating proceedings, delayed invalidity defenses, and faster case resolution, can undermine an accused infringer’s perceived advantages of adjudicating there.

Multinationals domiciled in Europe that favor the US judicial system no longer can assume their disputes will end up in US courts.

Where defendants once raced to favorable venues through declaratory judgment to avoid unfavorable US courts, such actions may now be essential to prevent extra-territorial adjudication.

For patent owners (global drafting): The BSH ruling offers an international one-stop shop. Faster proceedings, broader access to injunctive relief, and streamlined costs in Europe may enhance settlement leverage.

For practicing entities, minimal discovery helps avoid disclosing potentially sensitive information, while European courts may also expand claim constructions. Some patent owners may conclude that these advantages outweigh the loss of a jury on damages and invalidity.

Claims that might be patent-eligible in the US may face challenges when viewed through a European lens. To survive a Section 101 patent validity challenge in the US, claims must be more than an abstract idea, while European courts require a technical contribution. These standards don’t always overlap.

Coupled with inconsistent Section 101 applications by US courts and the US Patent Office, claims found eligible in the US may be ineligible in Europe, and vice-versa. Patent owners with domiciles in Europe should to avoid broad functional language and instead tie software or business logic to specific hardware improvements or technical solutions to meet both standards.

For now, the era of siloed litigation is over. Pending further developments, every cross-border patent dispute may carry global consequences.

The case is Bayerische Motoren Werke Aktiengesellschaft v. Onesta IP LLC, W.D. Tex., No. 6:25-cv-00581, injunction granted 2/13/26.

This article does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., the publisher of Bloomberg Law, Bloomberg Tax, and Bloomberg Government, or its owners.

Author Information

Ryan Schermerhorn, a partner at Marshall Gerstein and registered patent attorney with the firm’s industrial and mechanical technologies practice group.

Matt Nealon is an associate with Marshall Gerstein’s electrical and computer technologies group.

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