US technology company InterDigital has initiated global litigation proceedings against entertainment giant Walt Disney Company for allegedly infringing its video encoding standard essential patents (SEPs).

InterDigital is suing Disney and its subsidiaries Disney+, Hulu and ESPN+ in the Central District of California, in Brazil, in Germany, and in the local divisions of Mannheim and Düsseldorf of the Unified Patent Court, over what it says is Disney’s “ongoing infringement” of its patents through its hugely popular video streaming services. 

In a press statement, Josh Schmidt, the chief legal officer of Interdigital, said: “Our video technologies enable Disney to efficiently stream content and enhance the user experience.”

He added: “We always prefer to sign licence agreements through amicable negotiation, but we are committed to receiving fair compensation for our groundbreaking research, which allows us to continue to invest in the next generation of technology.”

According to the US complaint filed in California on 2 February, the Delaware-headquartered company initially reached out to Disney in July 2022 to request licensing of the patents, but licensing talks failed and Disney is still “not authorised to use InterDigital’s patents”.

InterDigital, represented by McKool Smith in the US proceedings, is suing for the alleged infringement of five video encoding patents: US patent numbers 8,406,301, 10,805,610, 11,381,818, 9,185,268 and 8,085,297. It is seeking a permanent injunction, damages and a jury trial. 

Video coding technology refers to encoding video into a compressed form and decoding video so that it can be displayed and viewed by a user. This technology allows efficient transmission of video while at the same time maximising quality.

Discussing the legal action on its website, InterDigital said that its foundational research in video and other related technologies “underpins the viability of the entire streaming industry, which is forecast by third parties to generate more than $400bn in revenue in 2025 across subscription and advertising supported platforms, and on social media”.

Disney has more than 250 million paying subscribers across brands like Disney+, ESPN+ and Hulu. 

“With the help of our innovation”, said InterDigital, Disney has created a “profitable business spread across its multiple platforms and, in its most recent financial results, reported annual revenue of around $25bn from its streaming businesses”.

InterDigital reiterates that “amicable negotiation” is always the preferred path to signing new licensing agreements but from “time to time enforcement is required to ensure we receive fair compensation for our groundbreaking research”.

The US action is being led by McKool Smith principal Alan P Block, who is based in Los Angeles. InterDigital is being represented by German boutique IP firm Arnold Ruess in Munich and the UPC and by litigation law firm Licks Attorneys in Brazil.

Video streaming technology has been the source of numerous recent disputes. Amazon has been involved in multiple patent lawsuits, most notably with Nokia, over its video streaming services and devices.

A number of patent pools for licensing video technology have been launched. In 2023, the patent platform Avanci launched Avanci Video aimed at being a one-stop platform for licensing video technologies. Licensing company Access Advance launched its video distribution patent pool in January.