Nokia And Apple Patents Licensing Tussle Gets Over: A New Collaboration Begins

Introduction

After a patents row that escalated between Nokia and Apple in December last year and was settled in May. Nokia sues Apple for the infringement of several patents claiming that Apple has been using Nokia technologies without the proper licenses. Nokia says that the two companies have been able to reach an agreement over several patents in 2011. But Apple allegedly rejected subsequent negotiations with Nokia to license other patented inventions used in numerous Apple’s products.  The lawsuits includes dispute over a broad range of technologies such as display, antenna, video coding Antenna, software chipsets and user interface.

Nokia Corporation is a multinational company and a global leader in innovation, leading in telecommunications, information technology, and consumer electronics industry. Headquartered in Espoo, Finland Nokia reported annual revenues of around €23 billion in 2017. It is a public limited company listed on the New York Stock Exchange and Helsinki Stock Exchange.

Apple Inc. is an US multinational Technology Company headquartered in Cupertino, California with annual revenue of $265 billion in 2018, which designs, develops, and sells consumer electronics, computer software, and online services. Apple was incorporated in 1977 and is the world largest company in Information Technology by revenue.

 Dispute

Nokia says it’s a very old infringement as Apple have allegedly been using several of Nokia’s mobile patents since the 3Gs, turning it into a bitter public fight.

The lawsuit started late last year. Nokia first blamed Apple of infringing some of Nokia’s patents as well as patents from the two companies it owned, NSN and Alcatel Lucent.

This time Apple is filing an antitrust lawsuit, against PAE’s (Patent Assertion Entities) acting on Nokia’s behalf. Apple argues that Nokia already has a reasonable agreement for these patents through FRAND. But Nokia is transferring these patents to PAEs in order to get more revenue through its intellectual property from Apple and other Smartphone makers.

Patent Assertion Entities is any entity/businesses that acquire patents from third parties and get revenue by asserting them against infringement. They do not actually produce or invent any goods or services for public consumption, their sole purpose is to profit by identify infringers and sue them.

FRAND (Fair, Reasonable and Non-Discriminatory) is a voluntary licensing commitment taken from the owner of an intellectual property (usually a patent) that may become essential to practice a technical standard. This means that companies can take advantage of these patents and without paying outrageous licensing fees as they are essential to most products.

In response to this lawsuit, Nokia is striking back by suing Apple directly.

This week Nokia technology announced that it had sued Apple over 32 new Smartphone tech patents in the United States and Europe.

In a company statement Nokia adds that Apple did start by paying for the other patents by 2011, still the other 32 patents in the lawsuit have been refused for extension. It has not been able to reach an agreement to pay for those additional ones mentioned in the lawsuit with the tech giant.

Conclusion

Nokia and Apple have announced to settle their patent disputes and have agreed to have a multiyear patent license deal.  Nokia will receive upfront cash payment from this quarter itself and additional licensing revenue for the duration of the agreement.

Apple has settled a patent dispute with Nokia and agreed to buy more of its network products and services.

This means that Nokia will now get bigger royalties from using its mobile phone patents, as it’s tapping more into its patent portfolios. Nokia will also supply mobile network infrastructure products of Apple. In turn Apple will resume sales of Nokia digital health products and retail it online stores and look at further collaboration in this venture. Withings (Nokia) Digital Health products making a comeback to Apple retail and online Stores. Nokia has recently been focusing on developing on digital health as one of their new business ventures, since its doom as a world’s largest phone maker.

Withings is a French consumer Electronics Company headquartered in Issy-les-Moulineaux, France, distributing products worldwide. It was purchased by Finnish company Nokia on 26 April 2016. The deal closed on 31 May, with Withings having been absorbed into Nokia’s new Digital Health unit led by the former Withings CEO; the division became known as Nokia Health. In May 2018, Withings became an independent company again.

Author: Ms. Tanuja Prasad, Associate at Khurana & Khurana, Advocates and IP Attorneys. In case of any queries please contact/write back to us at pratistha@khuranaandkhurana.com.

References:

[1]https://gadgets.ndtv.com/mobiles/news/apple-nokia-patent-dispute-settled-licence-agreement-business-collaboration-1697124

[2]https://nokiapoweruser.com/nokia-inks-patent-licensing-business-collaboration-agreement-applenokia-inks-patent-licensing-and-business-collaboration-agreement-with-apple-settles-all-litigations/

[3]https://www.digit.in/general/nokia-and-apple-settle-patent-dispute-agree-to-a-new-business-collaboration-35264.html

[4]https://www.apple.com/newsroom/2017/05/nokia-and-apple-sign-agreement-settle-all-litigation/

[5]https://www.theverge.com/2017/5/23/15679612/apple-nokia-settle-patent-dispute-withings

[6] https://en.wikipedia.org/wiki/Patent_troll

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