HTC Corporation and Nokia, two struggling mobile phone companies, have brought their patent fight to an end by signing a patent sharing agreement. Although details of the agreement were not disclosed, the settlement is considered to be a positive development for both firms.
In a recent Wall Street Journal article the chief intellectual property officer at Nokia, Paul Melin commented on the deal. “We are very pleased to have reached a settlement and collaboration agreement with HTC,” he said. He further remarked that the agreement will validate the company’s patent portfolio and also makes further licensing opportunities a viable source of revenues. The General Counsel of HTC, Grace Lei, added that the company, an industry pioneer, is pleased to have come to an agreement with Nokia.
HTC will be obligated to pay royalties to Nokia as a condition of ending the dispute, although it was not revealed whether this will take the form of percentage royalties for flat fees. Each company will be entitled to make use of the other company’s technology patents and the possibility of collaboration on future technology developments was also mentioned in reports. The resolution covers over 60 litigation cases in countries around the world.
This announcement came after HTC Corporation lost a significant battle against Nokia in Germany earlier this month. The case may have been the catalyst which finally brought the two companies to end their fight and negotiate a patent agreement.
A court in Mannheim, Germany found HTC guilty of infringing a Nokia patent concerning how newer devices access older networks. As a result, the court granted an injunction preventing all HTC devices infringing the patent to be imported or sold in Germany.
This was the third injunction Nokia has won against HTC in Germany within just a few months. HTC, the largest smartphone maker in Taiwan, was found to have infringed on patents concerning USB connections to computers and devices using Bluetooth or near field communication.
HTC Corporation was also running the risk of being prevented from importing phones into the US. An International Trade Commission judge in September found that HTC infringed two Nokia patents in the US and the commission was scheduled to announce a possible injunction last week. HTC is betting its new One 2 smartphone will help rejuvenate the company after two straight years of revenue declines.
Finland based Nokia has not been without its difficulties as its business has been dramatically eroded over the last few years due to consumers opting for offerings by Samsung or Apple. They agreed in September to sell their mobile phone division to Microsoft Corp. However, analysts believe that Nokia’s strong patent portfolio and aggressive protection of their intellectual property will keep the company on its feet.
Patent litigation is often described by tech industry pundits as a drain on the creative potential of innovative companies, as a financial end rather than a means to innovation, but with this agreement between HTC Corporation and Nokia it is plain that sometimes the companies are simply fighting for survival.
By Brian Ryer