At the end of an eventful week for Nokia, the Mannheim Regional Court announced its decision this morning to reject an HTC v. Nokia patent infringement complaint over EP2073096 on "Power management systems and methods for electronic devices". I discovered in early February that HTC was asserting this patent against Nokia.
Nokia welcomes today's ruling:
"Nokia is pleased by the court's decision in this case, which confirms that Nokia's products do not infringe HTC's patents."
The trial was held on May 31. I didn't attend that one due to a scheduling conflict, but I did attend two hearings (the second one of which was tantamount to a trial) held by the Munich I Regional Court over the same patent. HTC is suing Nokia Oyj (the Finnish parent company) in Munich and Nokia's German subsidiary in Mannheim. The first Munich hearing took place in mid-February. At the second hearing (i.e., trial) in late June it became known that HTC had in the meantime amended its complaints (in Mannheim as well as Munich) so as to accuse newer (Windows Phone 8-based) Lumia devices of infringement (the infringement allegations don't relate to Windows Phone per se, but to Qualcomm and Broadcom chips incorporated into the accused devices). Those additional infringement contentions were severed (a related hearing in Munich was scheduled for October 31, 2013. Today's ruling relates only to the originally-accused devices. The Munich court will rule on those older devices next week, and based on how it managed the case, I got the impression at the June trial that a dismissal is the most likely outcome there, too.
Bird & Bird is defending Nokia against HTC and is representing it in many of its offensive cases. Preu Bohlig is HTC's counsel in its offensive power management cases against Nokia. While it looks like HTC won't win those, Preu Bohlig did a great job defending HTC against Apple in several German actions (none of which was adjudged prior to last year's settlement, but HTC was in better shape than Google's Motorola with respect to the same patents).
Nokia succeeded with its own power management patent lawsuit against HTC: it won a Mannheim injunction earlier this year.
Nokia is asserting approximately 50 patents against HTC worldwide. In addition to the power management-related lawsuits, HTC also has a countersuit going against Nokia over a video codec patent. Wholly-owned HTC subsidiary S3 Graphics is suing Nokia, in Mannheim, over the alleged infringement of EP0797181 on "hardware assist for YUV data format conversion to software MPEG decoder" by the Qualcomm Snapdragon chip. A decision (which may or may not be a final ruling) was scheduled for September 20 (i.e., two weeks from today). I think HTC's S3G has a decent chance of winning something, but the impact of the injunction it might obtain will depend on the specific infringement theory on which the ruling will be based. The injunction could be easy to work around if a hardware feature that the software doesn't use merely has to be thrown out.
The Microsoft-Nokia M&A deal announced earlier this week may actually render HTC's countersuits against Nokia irrelevant from a practical point of view. In a matter of months, the Lumia devices will be Microsoft products. Microsoft and HTC entered into a patent license agreement in the spring of 2010 (the first of 20 Android-related patent license deals Microsoft has announced so far). I don't know the terms of that agreement but strongly doubt that HTC would sue Microsoft, let alone enforce an injunction against Microsoft, after the closing of the deal. In a strategic rationale document published this week, Microsoft discussed the cost-effective ways in which it can combine its own patent cross-license agreements with the benefits Nokia will assign to Microsoft under dozens of other agreements. HTC wasn't mentioned, but I'd be surprised if HTC had more favorable terms than the likes of Samsung and LG. I could imagine (and this is now somewhat speculative, but not without a logical basis) two reasons for which HTC wasn't mentioned: its ongoing litigation with Nokia and the fact that it doesn't play in the same patent league as the companies mentioned in Microsoft's slide.
Theoretically, if HTC obtained an injunction in the very near term against Nokia and enforced it, it could hope that this would make Nokia back down, but patent monetization is going to be so key to Nokia in 2014 and beyond that I believe it would take a strategic, long-term perspective on this. Also, Nokia could even take some risks with its workarounds: if those raised questions of fact that a German court would have to address, a contempt proceeding would likely take longer than the merger process, after which the whole issue would presumably go away at any rate.
HTC is defending itself extremely well against Nokia so far, but it will end up sending royalty checks to Finland, I'm sure.
If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or follow me on Twitter @FOSSpatents and Google+.
Share with other professionals via LinkedIn: