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Nokia v InterDigital (Round 2)

Posted On: Wed, 04/01/2006 - 04:05 by Alex

Three days after christmas, the US District Court for the Southern District of New York decided that InterDigital was due a ~ US $250 million for patent licences.

The most comprehensive coverage seems to be the press release issued by InterDigital - sources such as CNN and The Register have the news, but are light on content. The essentials (apparently undisputed, according to this judgment (PDF) by the US Court of Appeals for the Federal Circuit on a related matter)... (more)

Three days after christmas, the US District Court for the Southern District of New York decided that InterDigital was due a ~ US $250 million for patent licences.

The most comprehensive coverage seems to be the press release issued by InterDigital - sources such as CNN and The Register have the news, but are light on content. The essentials (apparently undisputed, according to this judgment (PDF) by the US Court of Appeals for the Federal Circuit on a related matter) -

In 1999, Nokia entered into agreements with InterDigital involving technology development and patent licensing. Nokia paid $31.5 million to cover royalties through the end of 2001, and the agreement stated that royalties owed after 2001 would be determined either by (1) negotiation, or (2) by reference to the terms of patent license agreements signed with designated Nokia competitors.

In March 2003 InterDigital entered into a patent licensing agreement with Sony Ericsson, as part of a trial settlement, which InterDigital claims established the framework for Nokia's royalty obligations for 2G and 2.5G handset and infrastructure sales, according to (2). InterDigital notified Nokia of its royalty payment obligations, but Nokia disagreed.To settle the dispute, the parties elected for arbitration, and the result of that was a Award which estimated that the total amount of royalty payments due to InterDigital from 2002 to the end of 2006 was $250 million and required Nokia to pay the same to InterDigital.

The recent ruling from the US Distrcit Court was in support of that Arbitrial Award. We don't really have an opinion on the decision, as the full text of the judgment was not available (yet?), and because the exact phraseology of (2) is unknown to us, but on the basis that two independent third parties have decided in favour of InterDigital, it seems to be that at the very least some amount will be payable to InterDigital by Nokia.

However, do note that Nokia is likely to be able to appeal - either to the US Court of Appeals for the Second Circuit or for the Federal Circuit. After this, it is conceivable that a further appeal may be entered into which will bring the case before the Supreme Court of the United States.

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