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Nokia files patent countersuit against Qualcomm

posted on May 24, 2007 12:36PM
Nokia files patent countersuit against Qualcomm

Reuters
EE Times
(05/24/2007 11:49 AM EDT)

HELSINKI, Finland — Nokia, the world's top mobile phone maker, said Thursday (May 24) it has filed its first patent counter-suit against Qualcomm, seeking damages and an injunction against the U.S. company's chips.

A legal dispute between the two has continued since part of a major cross-licensing agreement over technology patents expired last month, and their battle is worrying investors and the industry on both sides of the Atlantic.

Shares of Qualcomm, which is also awaiting decisions on two U.S. legal battles with rival Broadcom Corp., fell as much as 3 percent in morning trade on Nasdaq.

Nokia, which makes more than one in three of the cell phones sold globally, said it had filed patent countersuits against Qualcomm in a Wisconsin court, alleging the U.S. chip maker had infringed its six implementation patents in its GSM/WCDMA and CDMA2000 chips.

No one at Qualcomm was immediately available to comment.

Over the past 19 months, Qualcomm has filed 11 patent suits against Nokia seeking damages and injunctions, Nokia said.

"First and foremost, this is a counteraction. Since they are seeking injunction against us, we are doing this reciprocally," Rick Simonson, Nokia chief financial officer, told Reuters.

"We believe very strongly Qualcomm has copied our implementation patents," he said in an interview.

Nokia said the technologies in question have had a significant role in the success of its devices, allowing seamless and transparent roaming, and reducing handset and chipset size, cost and power consumption.

"We are doing this in the interest of Nokia and also in the interest of the whole industry," Simonson said.

The legal dispute centers on Nokia's use of Qualcomm patents for 3G, a high-speed wireless technology. But it also has a bearing on Qualcomm's chips business, which Nokia says uses many Nokia-patented technologies.

Analysts estimate Nokia has paid Qualcomm around $500 million per year and now aims to get a better deal. Nokia says its patent portfolio is much stronger now than years ago when the original cross-licensing deal was signed.

The world's top wireless network maker, Ericsson , said last month it hopes to see a quick resolution of the dispute before it hurts the whole industry.

"We do not think the issue is causing any slowdown in the industry or in the development of the 3G technology," Simonson said.

Nokia said it also responded to a lawsuit filed by Qualcomm in Wisconsin on April 2, and it remains confident that its products do not infringe either of two Qualcomm patents and that both patents are invalid.

Aside from the Nokia case, Qualcomm also faces patent suit brought against it by Broadcom. The U.S. International Trade Commission is due to make a decision on the Qualcomm-Broadcom case on May 25.

Jurors were expected to start deliberating on Thursday on Broadcom's infringement suit against Qualcomm in a Santa Ana, California, court.

Qualcomm shares were down $1.03, or more than 2 percent, at $43.81 on Nasdaq in midday trading.

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