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Tuesday October 20, 3:03 pm Eastern Time
Company Press Release
SOURCE: QUALCOMM Incorporated
Ericsson Drops Three 'Essential' Patents from Lawsuit
Against QUALCOMM and Surrenders Two Others
- Ericsson's Actions Further Undercut Ericsson's Claim to Hold Essential Patents for CDMA
Standards -
SAN DIEGO, Oct. 20 /PRNewswire/ -- QUALCOMM Incorporated (Nasdaq: QCOM - news) today announced that
Ericsson, Inc. and its Swedish parent Telefonaktiebolaget LM Ericsson have dismissed with prejudice all claims under three of
the patents asserted against QUALCOMM in the litigation brought by Ericsson in Marshall, Texas. In a further development,
Ericsson, in papers filed with the United States Patent and Trademark Office, also admitted the invalidity of the claims of two
other patents asserted against QUALCOMM in the lawsuit, and surrendered those patents. All five patents are among the eight
patents that, beginning in December 1995, Ericsson repeatedly told the telecommunications industry were ''blocking'' patents
or were ''essential'' to make or use cellular products compliant with IS-95 and other cdmaOne(TM) standards.
In December 1995, Ericsson represented to the Telecommunications Industry Association and others that it held eight allegedly
essential patents for IS-95. QUALCOMM challenged Ericsson's representation, and Ericsson filed a patent infringement
lawsuit against QUALCOMM in Marshall, Texas in September 1996, eventually bringing a total of 11 patents into the case.
QUALCOMM counterclaimed against Ericsson for unfair competition, stating in court filings that ''Ericsson has knowingly
made false and unfounded claims, including the assertion that it owns or controls patents that are 'essential' to the manufacture,
use or sale of products that implement the IS-95 standard'' with the ''inten[t] that its false claims ... would have an
anticompetitive effect and injure QUALCOMM's business.'' Ericsson's dismissal or surrender of the majority of the supposedly
essential patents substantiates QUALCOMM's charge that Ericsson deliberately misled the industry.
''The IS-95 standard has not changed and Ericsson's patents have not changed since Ericsson first publicly contended that
these five patents were essential to IS-95. In light of those facts, Ericsson's recent actions and admissions can only confirm
QUALCOMM's complaint that Ericsson wrongfully and falsely claimed essential patents,'' said Louis Lupin, QUALCOMM's
senior vice president and proprietary rights counsel. ''That Ericsson waited more than two years to dismiss these meritless
claims sheds light on its motives. These events show that Ericsson's statements to the industry with respect to its CDMA patent
position are not believable.''
Unlike QUALCOMM, whose CDMA patent position has been accepted by more than 55 major telecommunications
companies that have entered into royalty-bearing licenses with QUALCOMM, Ericsson has yet to announce a single
royalty-bearing license under any of Ericsson's alleged CDMA patents for any CDMA standard. Moreover, Ericsson has not
identified any essential patents it claims to hold with respect to any proposed third generation CDMA standard, including the
W-CDMA proposal it has promoted in Europe, Japan and elsewhere, despite specific requests to do so from
standards-setting bodies. Consequently, it is not surprising that notwithstanding Ericsson's threatened and actual litigation
against CDMA equipment manufacturers, Ericsson's claims to hold essential CDMA patents have not been accepted.
Ericsson had been contending in the Texas lawsuit that the three dismissed patents, U.S. Pat. Nos. 5,148,485, 5,239,557, and
5,430,760, covered certain features of IS-95 compatible products sold by QUALCOMM, and that the two surrendered
patents, U.S. Pat. Nos. 5,109,528 and 5,327,577, covered ''soft handoff'' in accordance with IS-95. Ericsson dropped the
three patents from the lawsuit shortly before Ericsson was due to disclose in court proceedings its interpretation of the meaning
and scope of the allegedly infringed claims and several months before the scheduled trial date in February 1999. Ericsson's
surrender of the other two patents and admissions of invalidity were made during reissue proceedings before the United States
Patent Office in which Ericsson is applying for new claims which it argues avoid the invalidity problems of the surrendered
claims. To date, Ericsson has not dismissed its claims against QUALCOMM under the surrendered patents in the Texas
litigation.
Headquartered in San Diego, Calif., QUALCOMM develops, manufactures, markets, licenses and operates advanced
communications systems and products based on its proprietary digital wireless technologies. The Company's primary product
areas are the OmniTRACS(R) system (a geostationary satellite-based, mobile communications system providing two-way data
and position reporting services), CDMA wireless communications systems and products and, in conjunction with others, the
development of the Globalstar(TM) low-earth-orbit (LEO) satellite communications system. Other Company products include
the Eudora Pro(R) electronic mail software, ASIC products, and communications equipment and systems for government and
commercial customers worldwide. For more information on QUALCOMM products and technologies, please visit the
Company's web site at <http://www.qualcomm.com/>.
Except for the historical information contained herein, this news release contains forward-looking statements that are subject to
risks and uncertainties, including timely product development, the Company's ability to successfully manufacture significant
quantities of CDMA or other equipment on a timely and profitable basis and those related to performance guarantees, change
in economic conditions of the various markets the Company serves, as well as the other risks detailed from time to time in the
Company's SEC reports, including the report on Form 10-K for the year ended September 28, 1997 and most recent Form
10-Q.
QUALCOMM, OmniTRACS and Eudora Pro are registered trademarks of QUALCOMM Incorporated. Globalstar is a
trademark of Loral QUALCOMM Satellite Services, Incorporated.
SOURCE: QUALCOMM Incorporated
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