Friday, February 7, 2014

HTC pays up for license to Nokia patents -- U.S. import ban could have been ordered on Monday

Nokia and HTC just announced the settlement of their patent infringement dispute spanning seven countries on three continents. HTC already had a license to Nokia's standard-essential patents (SEP) and "will [now] make payments to Nokia" for the use of its non-SEPs as well. Furthermore, it appears that Nokia will help HTC monetize its 4G (LTE) patents ("the collaboration will involve HTC's LTE patent portfolio, further strengthening Nokia's licensing offering).

All pending litigations around the globe are now dismissed immediately. On this coming Monday (February 10), the ITC was scheduled to rule on Nokia's first of two ITC complaints against HTC. The U.S. trade agency was reviewing a preliminary ruling that found HTC to infringe two Nokia patents. Affirmance of the preliminary ruling with respect to one or both patents would normally have led to a U.S. import ban.

A week ago, Nokia won its fourth German patent injunction against HTC in less than a year, and its third in only two months. Nokia's German litigations undoubtedly contributed to this resolution of the dispute.

I had blogged about this litigation on many occasions and, besides the parties and their counsel, attended more Nokia v. HTC patent hearings and trials than anyone else. Time and time again I predicted that HTC was ultimately going to take a royalty-bearing license. This is an important proof of concept for Nokia's patent monetization efforts.

HTC was countersuing Nokia over a couple of patents in Germany. The dismissal of all lawsuits between these companies also simplifies things with a view to the formal closing of Microsoft's acquisition of Nokia's wireless devices business. Microsoft and HTC entered into a patent cross-license agreement almost four years ago.

In late April/early May 2012, Nokia filed patent infringement lawsuits in the U.S. and Germany against HTC (only non-SEPs) and ViewSonic (SEPs and non-SEPs) as well as RIM/BlackBerry (only Germany, and only non-SEPs). RIM/BlackBerry was the first defendant to settle (in December 2012). In June 2013, Nokia reached a partial settlement with ViewSonic, which is now licensed to Nokia's SEPs but still defend itself against various Nokia non-SEPs in the U.S. and Germany (in some of those litigations, Google is an intervenor, as it was in some Nokia v. HTC cases).

In November 2013, without any prior litigation, Nokia announced the extension of a license agreement with Samsung. The scope of that deal was not specified. It may or may not involve Nokia's non-SEPs; it undoubtedly relates at least to its SEPs.

Not all but various of Nokia's patent assertions involve Android, Google's mobile operating system. Google is certainly going to continue to intervene in certain Nokia v. ViewSonic cases until that dispute is settled as well (which may happen rather soon now). Google may continue to pursue certain nullity (invalidation) actions against some of Nokia's patents-in-suit, while HTC will certainly withdraw those challenges now under the settlement agreement. The Federal Patent Court of Germany had scheduled its first two hearings in nullity actions targeting Nokia patents for next month. Google is presumably concerned about Nokia's claims that certain key Google services such as Google Maps and Navigation, as well as the VP8 video codec, infringe on some of its patents.

Apple settled a patent dispute with Nokia in June 2011 and later referred to that contract as a "provisional" standstill agreement for a limited period of time. According to a recent Samsung filing with a U.S. court, the Apple-Nokia deal is potentially in force until December 31, 2016, but Samsung may have focused on the maximum term without highlighting certain scenarios under which the parties might have to renegotiate sooner (possibly much sooner) than that.

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