Wednesday, March 1, 2023

Huawei asks China's patent office to confirm Xiaomi infringes patents, but administrative process is more similar to mediation than to litigation

There are reports from China that the country's State Intellectual Property Office (SIPO) has accepted Huawei's requests to determine that Xiaomi infringes four select patents. Two of them are 4G/LTE standard-essential patents (SEPs) while the other two are non-SEPs on panoramic images (a camera feature) and screen locking.

Apparently those petitions were filed on January 17, 2023.

The same reports quote Xiaomi as saying that the two parties are "actively negotiating" a patent license agreement, and that both Huawei and Xiaomi believe in IP and licensing. Xiaomi describes this proceeding as an alternative dispute resolution mechanism: it's an administrative proceeding that may help the parties reach an agreement.

In other words, they're not embroiled in litigation. This is not a case of Huawei seeking an injunction against Xiaomi. There always is a risk that if negotiations fail, enforcement actions will begin. For now, the most likely outcome is that they will reach an agreement on the terms of a patent license agreement, also considering that another major Chinese smartphone maker--OPPO--worked out a deal with Huawei last year (an agreement that apparently also involved an exclusive license to certain patents, three of which OPPO is now asserting against Nokia in its latest German countersuits).

Huawei's patent licensing program is wildly successful. Without ever having defined IP licensing as a strategic business area, Huawei has become a net licensor. Xiaomi must be the biggest unlicensed user of Huawei's patents at this stage. Several other major smartphone makers are known to have a license.