Nokia Sues Qualcomm on Patents Infringement Claims From Rivals Abound

Jun 12, 07:57 AM

Current Headlines: By Kevin J. O'Brien

Nokia, fighting a nearly two-year-old royalty dispute with Qualcomm, said Monday it had filed a second lawsuit in the United States accusing Qualcomm of patent infringement.

In the suit, which Nokia said it had filed Friday in U.S. District Court in Beaumont, Texas, Nokia accused Qualcomm of illegally copying six of its patents for mobile downloading of software applications and for mobile television broadcasts.

"This lawsuit shows we are talking about a company that has begun using technology without paying for it," Tero Ojanpera, Nokia's chief technology officer, said during an interview. "Everybody recognizes they have a lot of technology. But they are also big users of our technology."

The Nokia lawsuit comes as Qualcomm, based in San Diego and an early innovator of digital mobile technology, tries to maintain the value of patents that now generate a third of its total revenue, as well as defend itself against charges by rivals of patent infringement.

On May 29, a U.S. jury in Santa Ana, California, ruled that Qualcomm had violated three patents of a rival, Broadcom. On June 7, the U.S. International Trade Commission barred imports of newly designed mobile phones using the disputed technology.

Nikolas von Stackelberg, an analyst in Frankfurt at the private bank Sal. Oppenheim, said Qualcomm, in both the Broadcom and Nokia cases, appeared on the defensive, fighting to protect patents that were largely linked to an earlier generation of digital mobile telephony.

"I think the pressure is mounting on Qualcomm," von Stackelberg said. "I think not only Nokia but a number of other companies are taking offense at Qualcomm's royalty demands."

Andrew Gilbert, the president of Qualcomm Europe, called Nokia's latest U.S. lawsuit a "typical legal tit for tat" that was designed to affect the ongoing royalty negotiations.

"They are trying to reduce the costs to their own bottom line," Gilbert said during an interview. "Unfortunately, things have a value. We have negotiated 145 different license agreements with other companies."

Nokia, based in Espoo, Finland, filed its first patent infringement lawsuit against Qualcomm on April 3 in Wisconsin. The two companies have been fighting in U.S., European and Asian courts since late 2005 over Qualcomm's demands for royalties for technology used in one of the first digital mobile phone standards, code division multiple access, or CDMA, and a high-speed successor, Wideband CDMA.

A 15-year agreement between Nokia and Qualcomm - under which Nokia paid Qualcomm $450 million last year, according to an estimate by Enskilda Bank in Stockholm - expired on April 9. Nokia claims Qualcomm's contribution to the WCDMA standard is much less than it was to CDMA and has cut its royalty payments to Qualcomm to $80 million a year.

Nokia and Qualcomm officials both said the two companies were continuing to negotiate a new cross-licensing agreement in good faith, but both also declined to say whether representatives of the two companies were actually continuing to meet.

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