Nokia Corp. v. Qualcomm Inc., in the Chancery Court of Delaware ...
... which Nokia originally filed in August 2006 is now moving to trial in July of this year in the Chancery Court of Delaware (Wilmington. DE), a court of equity, not law, that sits without a jury and whose cases it choose to hear are presided over by its Chancellor or one of four Vice Chancellors — in this case Vice Chancellor Leo E. Strine, Jr.
Vice Chancellor Strine has served Chancery Court for 10 years and is an Adjunct Professor of Law at Penn Law where he received his J.D. with summa cum laude honors in 1988 before becoming a corporate litigator, a law clerk for a judge of the U.S. Court of Appeals, a clerk for the Chief Judge of the U.S. District Court of New Jersey, then counsel to Delaware's Governor. Sis opinions in the area of corporation law include IBP, Inc. v. Tyson Foods Inc., Del. Ch., 2001 WL 675330 (Del. Ch. Jun. 18, 2001); In re Pennaco Energy, Inc. Shareholders Litig., Del. Ch., 2001 WL 115341 (Del. Ch. Feb. 5, 2001); Chesapeake Corp. v. Shore, 771 A.2d 293 (Del. Ch. 2000); In re Gaylord Container Corp. Shareholders Litig., 753 A.2d 462 (Del. Ch. 2000); Ace, Ltd. v. Capital Re Corp., 747 A.2d 95 (Del. Ch. 1999).
This is an important milestone that hopefully will move matters along towatds an eventual negotiated settlement and new or renewed license agreement(s) but it will not consolidate the numerous pending suits between the parties ...
"Nokia believes that any issues related to Qualcomm patents, and their valuation, will be resolved in each individual country, ... The Delaware case is one step which could help the companies reach common ground. ... However, it is unlikely the case will resolve the overall licensing negotiations." - Laurie Armstrong, Nokia spokeswoman -
Both QUALCOMM and Nokia Inc. (Nokia USA) are incorporated in Delaware and one of several reasons that over 50% of US publicly-traded corporations and 58% of the Fortune 500 companies as well as numerous subsidiaries of multinationals headquartered elsewhere are incorporated in Delaware is the availability to them of the prestigious Chancery Court and Delaware's exceptionally well-developed body of corporate case law (and abundance of highly competent corporate attorneys congregated on 'lawyers row' on N. King Street above the courthouse).
The Delaware Court of Chancery established in 1792 is widely recognized as the nation's preeminent forum for the determination of disputes involving the internal affairs of the thousands upon thousands of Delaware corporations and other business entities through which a vast amount of the world's commercial affairs is conducted. Its unique competence in and exposure to issues of business law are unmatched.
• This is Nokia's original August 9, 2006 filing in Delaware Chancery Court ...
qualcomm.com
• This is from QUALCOMM's latest Quarterly SEC 10-Q Filing ...
>> 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 the Company to wireless industry standards setting organizations. The Company has moved to dismiss the complaint. On April 12, 2007 and June 5, 2007, the Company filed counterclaims seeking declarations that, among other things, the Company’s 2001 license agreement with Nokia fulfilled and/or superseded any ostensible obligations to offer or grant patent licenses to Nokia allegedly arising from the Company’s participation in certain standards setting organizations. Both parties have moved to dismiss the other’s complaints, but the parties have also discussed and are negotiating, at the Court’s suggestion, an agreement in which the arbitration filed by the Company would be consolidated into the Delaware case discussed above. ###
• Previous posts here on this subject (chronological) ...
Message 22701745
Message 23060842
The 1st article below is from our local Sunday newspaper delivered to my office's stoop earlier this morning, and was buried in §C (Business) page 4, although the headline occupying 3 of 4 columns was large enough for my wife to easily spot while I was reading the Sports section. The author is a Bloomberg court reporter and stringer who is resident in Wilmington, 14 miles north of here, and he is a principle source of news on matters being adjudicated in Chancery between large corporations although he unfortunately he seldom reports in depth.
>> Nokia's Qualcomm Challenge Trial Set For July
Phone maker's lawsuit revolves around patent-licensing fees
Phil Milford
Bloomberg News
The News Journal (Wilmington, DE)
February 17, 2008
tinyurl.com
Nokia, the world's biggest maker of mobile phones, will go to trial July 21 in Delaware to challenge U.S. microchip producer Qualcomm Inc. over patent-licensing fees, a state judge decided.
Nokia will file an amended complaint this month and Qualcomm will submit amended counterclaims to further define issues involved, lawyers for the companies told Chancery Judge Leo Strine Jr. at a hearing last week in Wilmington.
Nokia sued San Diego-based Qualcomm in Chancery Court in 2006, claiming it's entitled to use the chip technology on "fair, reasonable and non-discriminatory terms." Qualcomm collected $3.1 billion, about a third of its revenue for the year ended Sept. 30, from licensing.
"We're going to move forward one way or the other," Strine told Nokia attorney Kathleen Sullivan and Qualcomm attorney Roger Brooks, who have been unable to agree on putting patent-related lawsuits worldwide on hold as the Delaware action proceeds.
Nokia and Qualcomm are involved in patent litigation in courts in California, Wisconsin, Texas, the U.K., Germany, the Netherlands, France, Italy and China, according to court papers.
Strine said the trial, dealing in part with contract issues, will take at least a week, and maybe more, with "a lot at stake for customers and employees."
"Qualcomm is pleased that the issues with Nokia are moving toward a prompt resolution," spokeswoman Christine Trimble said in an e-mailed statement.
"Nokia believes that any issues related to Qualcomm patents, and their valuation, will be resolved in each individual country," said Nokia spokeswoman Laurie Armstrong in an e-mailed statement.
"The Delaware case is one step which could help the companies reach common ground," Armstrong said. "However, it is unlikely the case will resolve the overall licensing negotiations."
Nokia, based in Espoo, Finland, reported $69.8 billion in 2007 sales and had 112,000 employees on Dec. 31, according to data compiled by Bloomberg News.
Qualcomm, the largest maker of chips that power mobile phones, reported $8.87 billion in fiscal 2007 sales and has about 12,800 employees.
The case is Nokia Corp. v. Qualcomm Inc., CA2330, Delaware Chancery Court (Wilmington). ###
>> Patent Rivals Near Terms
Don Clark
The Wall Street Journal (Page B4)
February 15, 2008
tinyurl.com
Qualcomm Inc. and Nokia Corp. are close to an agreement on procedural issues relating to a court case between them, the two companies said.
The cellphone technology giants have been waging legal battles over issues related to a 2001 patent-licensing agreement, which expired in April 2007. Qualcomm charges patent royalties to makers of cellular handsets, which Nokia and some other companies contend are excessive.
The case in Delaware Chancery Court, filed by Nokia, focuses on whether Qualcomm abided by patent-licensing rules set by an industry group that defined technology standards in so-called third-generation cellular networks. The companies have also been preparing to fight a separate arbitration proceeding, sought by Qualcomm, that stems from the breakup of their licensing relationship.
At the court's suggestion, the companies have been negotiating an agreement in which the arbitration would be consolidated into the Delaware case.
Nokia said lawyers for the companies discussed ways to resolve certain issues common to all potential cases between them. Nokia said the issues relate to interpretation of the 2001 cross-license agreement and certain parts of standardization rules.
Qualcomm issued its own statement. "Qualcomm is pleased that the issues with Nokia are moving toward a prompt resolution," it said.
If the procedural agreement is reached, a trial in the Delaware case is expected in July. ###
>> Nokia, Qualcomm Seek Common Ground in Legal Fights
Tarmo Virki
Reuters (Barcelona)
February 14, 2008
Nokia (NOK1V.HE) and Qualcomm (QCOMM.O) agreed to look for ways in which a U.S. court in Delaware could solve some wider, international issues in the major legal battle between the two technology heavyweights.
"The parties are now working on the precise details, including the timeline, so that the proceedings can move forward," said Nokia spokeswoman Anne Eckert.
Eckert said the common issues could include interpretation of their 2001 technology licensing agreement, and certain parts of standardization rules.
"The intention is that the same interpretation applies to Qualcomm products using Nokia patents and to Nokia products if they are deemed to use Qualcomm patents," Eckert said.
Qualcomm said it was pleased there was positive news in the long-winding legal battle.
"Qualcomm is pleased that the issues with Nokia are moving toward a prompt resolution," said Christine Trimble, senior director of corporate communications for Qualcomm.
Nokia, the world's largest cellphone maker, and San Diego-based chip firm Qualcomm have about a dozen legal fights pending on three continents. The two firms' expensive legal battle is worrying investors and the industry on both sides of the Atlantic.
The companies have been at legal loggerheads since they failed to renew a part of a key technology licensing pact that expired last April. Analysts have estimated Nokia pays around $500 million to Qualcomm annually for patents and wants to cut the sum.
Qualcomm's head of European operations, Andrew Gilbert, told Reuters in an interview conducted before the Delaware court hearing, that cutting the sum was not on the agenda.
"We want them to pay what they should be paying ... as soon as possible," Gilbert said in an interview at Mobile World Congress trade show.
"By the end of this year, actually their right to re-sign under the same terms expires and then we might have a more meaningful discussion about what the rate should be. When it comes to the end of this year maybe we do need to sit down and renegotiate but I don't see that going for less," he said.
Nokia has repeatedly said it was looking for a timely solution to the battle, but not at any cost.
Qualcomm's Gilbert said the company's legal bill this year would be on par with last year's, at "a little over $200 million," with most of the money used in battles with Nokia and Broadcom. ###
>> TIMELINE: Qualcomm, Nokia Patents Battle
Tarmo Virki and Sami Torma
Reuters
February 14, 2008
tinyurl.com
Nokia (NOK1V.HE) and Qualcomm (QCOMM.O) agreed to look for ways in which a U.S. court in Delaware could solve some wider, international issues in the major legal battle between the two technology heavyweights.
Here is a chronology of the dispute: [my edits in italics — E.L.]
• October 28, 2005 -- Nokia and five other firms — Broadcom, Ericsson, Matsushita (Panasonic), NEC, and Texas Instruments — file complaints with the European Commission alleging anti-competitive conduct by Qualcomm, including high royalty rates. In Oct 2007 EU opened antitrust proceedings in the case.
• November 4, 2005 -- Qualcomm files a suit seeking an injunction against the sale of infringing single mode GSM products and monetary damages against Nokia in a federal court in San Diego for infringement of eleven of Qualcomm's patents and one patent owned by SnapTrack alleged to be essential for the manufacture or use of single mode GSM equipment that complies with the GSM, GPRS and EDGE cellular standards./I> The case is on hold and reportrdly is being consolidated in San Diego with other suits and countersuits filed subsequently.
• May 2006 -- Qualcomm files a lawsuit against Nokia in Britain over two GSM-related patents. A ruling is seen this month.
• June 2006 -- Qualcomm files a complaint against Nokia with the ITC regarding GSM patents, seeking a bar on imports of Nokia GSM handsets into the United States. In December 2007 administrative law judge found no infringement or violation by Nokia of the three asserted Qualcomm patents. In addition, it was determined that patent '473 was found to be invalid.
• August 2006 -- Qualcomm files a patent infringement lawsuit against Nokia in Germany.
• August 2006 -- Nokia files the case in Delaware saying Qualcomm had breached its contract to license patents on fair and reasonable terms.
• October 2006 -- Qualcomm files infringement lawsuits against Nokia in France and Italy regarding GSM technologies and GSM patents alleged to be 'essential' to the 3GPP GERAN standard.
• February 2007 -- Qualcomm files three complaints in China regarding GSM patents alleged to be 'essential' to the 3GPP GERAN standard.
• March, 2007 -- Nokia files patent exhaustion complaints against Qualcomm patents in Germany and the Netherlands. Both courts dropped the cases last year and Nokia appealed the decision in Germany in November.
• April 2, 2007 -- Qualcomm files two cases against Nokia in the United States over Nokia GSM cellular phones (implementation patents not essential patents). Nokia filed a counter-suit in Wisconsin in May and in Texas in June alleging infringement of implementation patents for various technologies. Reportedly [in QUALCOMM SEC filings] these suits are all being consolidated in San Diego with the original November 5 suit.
• April 5, 2007 -- Qualcomm asks American Arbitration Association (AAA) to rule that Nokia's use of its patents after April 9 would mean Nokia extended a key cross-license agreement at old royalty rates. Arbitrators have been chosen. [It has already been ruled that the arbitration clause in the 2001 cross-license which specifies AAA as the arbitrator) does not address QUALCOMM's GSM patents used in single mode GSM patents which usaage is the subject of most of the suits between the parties].
• April 9, 2007 -- The cross-license agreement expires in part (according to Nokia contractually they now have "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"). The firms say they continued to negotiate on a new deal.
• May, 2007 -- Nokia says it filed in a Wisconsin court its first counter-suit against Qualcomm relating to six Nokia implementation patents. The case is on hold (see above re consolidation).
• June, 2007 -- Nokia filed a similar case in Texas. The case is on hold. (see above re consolidation).
• [QUALCOMM reported that] On July 9, 2007, the Company filed an amended demand for arbitration, alleging that Nokia’s institution of certain patent infringement proceedings against the Company was a material breach of the license agreement between the parties. An arbitration panel has been selected by the parties, and the arbitrators have issued an order scheduling the first phase of the arbitration for July 2008.
• Aug 16, 2007 -- Nokia asks the ITC to bar the import of some Qualcomm's chips, and phones using those chips, to the United States as they infringe five Nokia patents. The case was terminated in November 2007.
Sources: Nokia, Qualcomm Web sites ###
- Eric - |
