Nokia's Fully Paid Up License for Early QUALCOMM CDMA Patents
JG,
<< Essentially, Nokia is arguing they have paid enough and don't want to pay in the future for older patents regardless of their continuing essential nature to wcdma. I seriously doubt that there is anything in the licensing agreement that says the patents are "paid up" in full. >>
I have exactly the opposite view. I "seriously" suspect that (have very little doubt that) the CDMA licensing agreement announced by QUALCOMM and Nokia on April 14 1992 when Nokia became QUALCOMM's 5th licensee (the license that was subsequently expanded to include WCDMA SE and Infra but rather obviously not extended in July 2001) had a 15 year term, and specifically granted Nokia a fully paid up license to QUALCOMM's early CDMA patents including those now applicable to WCDMA upon its expiration.
That suspicion (lack of doubt) is reinforced by the 'partial expiration' language employed in QUALCOMM's SEC filings from July 19 2006 ff ("We have a license agreement with Nokia Corp., which in part expires on April 9, 2007"), Steve Altman's statement at the November 13, 2006 London Analyst Day ("... early patents remain licensed") when responding to a question on what 'partial expiration' meant, and extremely specific Nokia statements that have followed and which were filed in their US SEC 6-Ks, since, and which will likely be mirrored in their 2007 SEC 20-F, due any day ...
From April 9, 2007, Nokia contractually has a fully paid up license covering Qualcomm's early patents and thus those patents are licensed to Nokia royalty free for its handsets going forward in perpetuity. Therefore Nokia's licensing agreements with Qualcomm for the future will focus only on the terms for Qualcomm's newer patents.
Nokia's 1st public mention that upon the pending expiration of the license that "Qualcomm early patents will be paid up" came two weeks after Altman opened the door, in a webcasted breakout session opening day 2 (29 November 2006) of Nokia Capital Market Days in Barcelona. The presentation on "Technology Advantage & IPR" was made by Tero Ojanperä, Nokia EVP and CTO, in the presence of Nokia's CEO, CFO, CLO, and Director of IPR and principle IPR strategist and is still available on the Nokia website.
In his presentation and while dealing with the subject of the paid up license Tero Ojanperä did not make reference to specific patents that were paid up, but instead offered "general technology areas from the late 80's - early 90's" that should give us all a big hint as to what QUALCOMM "fundamental" patents in what patent families, in fact, are fully paid up ...
• Rake receiver
• Soft handover
• Spread/scramble
• Orthogonal spreading code
• Softer handover
• Closed loop power control
Alternatively and in conjunction with that listing, we can look at a whitepaper that while burred on the QUALCOMM "Legal News" website, is still accessible there along with much other recently buried material.
<< Sounds to me just as more PR from the House of Hagfish. >>
Nokia said in a public version of a court filing in Delaware that the patents are now paid up and royalty-free, according to the terms of 1992 and 2001 agreements with Qualcomm.
- Reuters -
A Chancery Court pleading is not PR, and far from it. Neither are US SEC filings even if they contain press releases.
Since the PR issue is on the table, I should point out that in the game of Press Release B-I-N-G-O that QUALCOMM frequently indulges, that while QUALCOMM has frequently attempted to rebut Nokia statements, or spin them differently, they have never attempted to rebut Nokia's statements that they have a fully-paid up license to QUALCOMM's early CDMA patents even when Nokia's statements were made in a press release where they attempted to counter other Nokia statements (e.g. "Nokia today confirmed that until 2007 it has paid less than 3 per cent aggregate license fees on WCDMA handset sales under all its patent license agreements. This number represents Nokia's aggregate gross royalty payments made under all the numerous patent license agreements applicable to its WCDMA handsets. It excludes infrastructure related royalties and all royalty income collected by Nokia. The above WCDMA handset related royalty payments made by Nokia include all WCDMA handset royalty payments made to Qualcomm."
<< In my opinion, Nokia's "paid up" argument is a slight of hand based on the upfront license fee and another example of Nokia trying to make the agreements say something they don't. >>
VC Strine will decide that, not thee, me, he, she, or the garden variety headbanger, and VC Strine will have an advantage that thee and me do not have ... i.e. access to the original 1992 licence and the expanded 2001 license. I am of the opinion that he won't have too much problem in doing so. He may, however, have a more challenging task in determining whether or not Nokia extended the contract or breached it as QUALCOMM contends.
Cheers,
- Eric - |
