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Technology Stocks : Qualcomm Moderated Thread - please read rules before posting

QCOM 136.33

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3:59 PM EST

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From: JGoren	4/5/2007 2:50:08 PM
	Read Replies (2) of 197606

I can't remember; has Qcom ever used the terms "paid up" to describe the license on the cdma early patents? I have always interpreted NOK's use of those words as: "we don't owe any quarterly royalty from April 9, 2007 through December 31, 2008" so they are effectively paid up, but we have the right to continue to use those patents." I always thought that if the original patents haven't expired by "end of 2008", NOK has to re-up somehow at that time. The arbitration request addresses the issue of what the option means and what the parties contemplated when it was signed. Also, is there one license agreement or more than one? If there is only one with separate provisions about various patents and what they can be used for, Qcom may be on firm ground that NOK cannot separate and pay separately for some and not all. One other problem with NOK's tender of payment is that licenses have lots of other terms in them than the royalty rate. For example, in order to prevent exhaustion there are restrictions on how the can be used and reservations of rights. According to the research a couple of weeks ago, such restrictions must be in writing and clear. NOK is taking the position, it can just pay something. The problem is NOK is in an (insolvable?) dilemma. If it says it does not have to abide by the restrictions in the existing license, it infringes and is subject to an injunction, because otherwise Qcom's patents theoretically could be exhausted or Qcom's righs otherwise lost by NOK's use. If nok says it will abide by those restrictions even though there is no written agreement, then Qcom could be on firm ground that NOK has effectively extended the license. This, I think, is the crux of Qcom's argument. NOK's dilemma is that FRAND does not say what all those other reasonable and fair terms are; those terms go well beyond the royalty rate.

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