Upping its battle with Nokia, Qualcomm said yesterday that it had filed suit in Britain, claiming that the Finnish mobile phone maker had infringed on two patents.
Qualcomm said the suit was a geographic extension of litigation it started in the United States in November. In that case, Qualcomm said Nokia had infringed on 11 of its patents.
With the new suit, filed in the High Court of England and Wales, Qualcomm said it was seeking damages and an injunction to prevent Nokia from selling phones using the patents.
In a twist, Qualcomm's claims relate to patents of next-generation versions of the wireless standard GSM, short for global system for mobile communication.
Qualcomm is considered the champion and chief architect of the alternate wireless technology called CDMA, or code division multiple access, and has never been much of a player in the GSM industry.
Qualcomm and Nokia long have had a contentious relationship, warring over technology standards and business practices. Last year, Nokia along with five other companies complained to European regulators that Qualcomm was thwarting competition by overcharging for its technology.
Bill Plummer, spokesman for Nokia Americas, said the company learned about the suit from Qualcomm's press release and hadn't reviewed it. Nonetheless, he called the suit “disappointing but not surprising.”
“We are again disappointed that again Qualcomm has decided to litigate,” he said.
But Christine Trimble, Qualcomm's spokeswoman, said that Nokia's current stance left it no choice but to file suit.
“As of last November, Qualcomm had been discussing these patent issues with Nokia,” Trimble said. “Nokia had led Qualcomm to believe that these issues could be resolved cooperatively but when it appeared that that resolution was not likely, Qualcomm proceeded with litigation in the U.S. and now in the U.K.”
Analysts called Qualcomm's latest legal salvo a ploy to improve its position as the two wireless titans hammer out a new licensing agreement.
“Most of this back and forth in the legal system is just negotiating and posturing that these two giants feel is necessary,” said Albert Lin, an analyst with American Technology Research.
Qualcomm and Nokia have a licensing deal that is set to expire in April 2007. In the wireless industry, companies craft deals in which they agree to use each other's technology under certain conditions and prices.
Qualcomm, which holds many of the key patents for CDMA, makes about half of its money from companies who pay to use its patents. It also sells wireless chips to mobile phone makers.
In a research note, Merrill Lynch recounted that Qualcomm told analysts at a recent meeting that it might try to “pressure Nokia by leveraging certain GSM-related patents that have so far not been enforced,” adding that Qualcomm said it was willing to drop the enforcement of the patents altogether should Nokia extend its royalty agreement.
But Trimble said the current licensing agreement did not cover next-generation GSM patents in question and that it was not relevant to either of the suits.
Nokia is confident in its patent position in GSM as well as its next-generation versions, Plummer said, adding that the company owned key CDMA patents as well.
“There is a popular misconception that any one party dominates a certain standard,” he said. “No single partner dominates either standard.”
Analysts, saying both sides had too much to lose for them not to reach a new licensing deal, predicted that the lawsuits would be settled.
“I don't think that Qualcomm and Nokia want so much of their business to be determined by the court system,” Lin said.
Jennifer Davies: (619) 293-1373; jennifer.davies@uniontrib.com
