Daily Management Review

Nokia sues Apple over patent infringement


12/22/2016


Finnish company Nokia has filed several petitions against American Apple to the European and US courts for patent infringement. For several years, the company has been trying to resolve the conflict through negotiations, but the process resulted in nothing.



Nokia appealed to the regional courts of Düsseldorf, Mannheim and Munich in Germany and in the US District Court for the Eastern District of Texas. According to Nokia opinion, Apple has infringed 32 patents, including patents for display production technology, and technology for development of user interface and software.

"Since signing of the licensing agreement in 2011, which covers some of the Nokia Technologies' patents, Apple has been rejecting successive Nokia’s proposals to license other patented design, used in many products of the company", - stated the Finnish company.

Nokia owns tens of thousands of patents on technology used in smartphones, tablets, computers and other devices, the company said in a statement. Over the past 20 years, Nokia has invested more than € 115 billion in research, and holds three portfolios of intellectual property patents after purchase NSN in 2013 and Alcatel-Lucent in 2016.

"After several years of negotiations, during which we have tried to reach an agreement with Apple for use of our patents, we have decided to take action to protect our rights" - the company says.

Apple’s spokesman said the company is always ready to honestly pay for patents on technology used in its products, according to the WSJ. "Unfortunately, Nokia does not license patents on a reasonable basis, but instead resorts to tactic of a "patent troll" in an attempt to knock money out from Apple", he added. 

In 2009, Nokia win $ 720 million by court action for copyright infringement as a result of two years of litigation. In addition, Nokia received an eternal right on 13 dollars of royalties from each iPhone sold. In 1999, Nokia received a patent for a touch screen, also used in Apple’s products. The latter now has to pay the money to the patent owner for the life term.

Nokia in 2014 gave up on its main business and then sold the unit for € 5.44 billion ($ 5.86 billion) to Microsoft Corp. to further focus on telecom equipment. However, Nokia’s patents cover technologies still used in many modern tablets and smartphones. Sales of telecom equipment are stumbling, so Nokia is extremely dependent on the lucrative patent business. Last year, revenue of Nokia Technologies' core business units amounted to € 1.02 billion, or 8% of total sales.

Therefore, aggressive tactics of the Finnish vendor in relation to intellectual property is not surprising. Earlier this year, the company announced completion of a patent dispute with South Korea's Samsung Electronics. This proceeding was finished in International Court of Arbitration on February 1. The judge determined the amount of additional compensation for Nokia to receive from Samsung for renewal of a license agreement since January 1, 2014 for a period of five years.

The size of compensation is not disclosed, but Reuters said the Finnish vendor’s revenues from sales of rights to its intellectual property will increase by hundreds of millions of euro. Nokia’s representatives have noted that Nokia Technologies' revenues in 2015 could have exceeded € 1 billion thanks to the agreement with Samsung, and was higher than total income of the previous two years. In 2014, patent department of the Finnish manufacturer has received 578 million euros in revenue.

According to forecasts of the European company’s management, Nokia will receive at least € 1.3 billion from the arbitration agreements in the period from 2016 to 2018, similar to that signed with Samsung.

source: reuters.com






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