Escalation of Negotiation by Litigation: QUALCOMM v. Nokia, Nokia v. QUALCOMM
Pretty soon Robin Hood and his Merry Band of Benevolent R&D and Patent Aggregators will have to whittle some new sticks or dig up some new carrots.
There is no mention in QUALCOMM's latest 10K (or the prior one) of QUALCOMM v. Kyocera brought in late 2004 in U.S. District Court, Ninth Circuit (Civil Action No. 04-CV-1605 S.D. Cal. 2004) in which ...
... Qualcomm alleges that Nokia breached the parties' BREW License Agreement ("BLA") by filing three patent-infringement actions against Kyocera Corp. and certain of its subsidiaries (collectively "Kyocera") in Texas and filing patent infringement counterclaims in an action Kyocera brought before this court. In particular, Qualcomm alleges that the BLA's Section 12.1 Covenant Not to Assert barred Nokia's patent-infrigement suits against Kyocera.
... but Steve Altman, the COO of QUALCOMM's patent factory stated this week at the London Analyst Day that the action which essentially seeks to limit Nokia's right to assert its CDMA patents against QUALCOMM's licensees has not yet been resolved although Kyocera is now a royalty paying licensee of QUALCOMM.
One year after QUALCOMM initiated the action referenced above Nokia became one of the 6 complainants in an action against QUALCOMM filed with the EC Competition Commission in Brussels and subsequently QUALCOMM has filed 2 additional actions against Nokia in the US and four in Europe.
The following is excerpted from QUALCOMM's 10K SEC Filing for the fiscal year ended September 24, 2006 ...
tinyurl.com
Three new European actions against Nokia that have not been celebrated in Press Releases but which were alluded to by Steve Altman earlier this week are noted. QUALCOMM appears to have confidence that at least 2 of the 15 allegedly 'essential' GSM patents asserted against Nokia can stand close scrutiny.
In the 10K Qualcomm states (although bracketed and bulleted text are my insertions) ...
[ Negotiation ]
>> [Page 29] We have a license agreement with Nokia Corp., which in part expires on April 9, 2007. While the parties have been in discussions to conclude an extension or a new license agreement beyond that time period, there is no certainty as to when we will be able to conclude an agreement or the terms of any such agreement. There is also a possibility that the parties will not be able to conclude a new or extended agreement by April 2007. In that event after April 9, 2007, unless and until the existing agreement is extended or a new agreement is concluded, Nokia's right to sell subscriber products under most of our patents (including many that we have declared as essential to the CDMA, WCDMA and other standards) and therefore Nokia's obligation to pay royalties to us will both cease under the terms of the current agreement, and our rights to sell integrated circuits under Nokia's patents will likewise cease under the terms of the current agreement. ... <snip> ...
[Page 59] We will continue to devote resources to working with and educating all participants in the wireless value chain as to the benefits of our business model in promoting a highly competitive and innovative wireless market.
However, we expect that certain companies may continue to be dissatisfied with the need to pay fair royalties for the use of our technology and not welcome the success of our business model in enabling new, highly cost-effective competitors to their products. We expect that such companies will continue their attacks on our business model in various forums throughout the world.
In addition, our license agreement with Nokia Corp. expires in part on April 9, 2007. If we cannot conclude an extension or a new license agreement beyond that time period, Nokia's rights to sell subscriber products under most of our patents will expire, as will our rights to sell integrated circuits under Nokia's patents. While we continue to work with Nokia to see if we can reach an agreement, there is no guarantee that we will be able to successfully resolve this matter before April 9, 2007, and little progress has been made to date. If we are unable to reach agreement, we will aggressively pursue all our legal and business remedies and assume that Nokia will do likewise. Nokia has stated publicly that it does not intend to pay us for its use of our patents prior to the resolution of the dispute. As a result, under generally accepted accounting principles, we will be unable to record royalty revenue attributable to Nokia's sales until a court awards damages or agreement is reached, potentially resulting in a negative impact on future royalty revenues reported by our QTL segment. ... <snip> ...
[ QUALCOMM v. Nokia in the USA ]
• US District Court for the Southern District of California [November 2004]
[Page 50] On November 4, 2005, we, along with our wholly-owned subsidiary, SnapTrack,, filed an action in the United States District Court for the Southern District of California against Nokia alleging infringement of eleven of our patents and one SnapTrack patent relating to GSM/GPRS/EDGE and position location and seeking monetary damages and injunctive relief. The case is currently stayed pending a decision by the Federal Circuit regarding Nokia's arbitration demand.
• ITC [June 2006]
On June 9, 2006, we filed a complaint with the ITC against Nokia alleging importation of products that infringe six of our patents relating to power control, video encoding and
decoding, and power conservation mode technologies and seeking an exclusionary order and a cease and desist order. On July 7, 2006, the ITC commenced an investigation.
[ QUALCOMM v. Nokia in Europe ]
• Chancery Division of the High Court of Justice for England and Wales (May 2006)
On May 24, 2006, we filed an action in the Chancery Division of the High Court of Justice for England and Wales against Nokia alleging infringement of two of our patents relating to GSM/GPRS/EDGE technology seeking monetary damages and injunctive relief.
• District Court of Dusseldorf, Federal Republic of Germany [August 2006]
On August 9, 2006, we filed an action in the District Court of Dusseldorf, Federal Republic of Germany, against Nokia alleging infringement of two of our patents relating to GSM/GPRS/EDGE technology seeking monetary damages and injunctive relief.
• High Court of Paris, France [October 2006]
On October 9, 2006, we filed an action in the High Court of Paris, France against Nokia alleging infringement of two patents relating to GSM/GPRS/EDGE technology seeking monetary damages and injunctive relief.
• Milan Court, Italy [October 9, 2006]
On October 9, 2006, we filed an action in the Milan Court, Italy against Nokia alleging infringement of two patents relating to GSM/GPRS/EDGE technology seeking monetary damages and injunctive relief.
[ Nokia v. QUALCOMM in the USA ]
• Delaware Chancery Court [August 2006]
Nokia Corporation and Nokia Inc. v. QUALCOMM Incorporated: On August 9, 2006, Nokia Corporation and Nokia, Inc. filed a complaint in Delaware Chancery Court seeking declaratory and injunctive relief relating to alleged commitments made by us to wireless industry standards setting organizations. We have moved to dismiss the complaint. ###
- Eric - |
