The Strategist

Nokia and Apple settle the patent lawsuit

05/23/2017 - 14:22

Finnish telecommunications equipment manufacturer Nokia and American corporation Apple have settled their dispute over the issue of patent law in the court, reports the Financial Times. Nokia accused Apple that the company used patented Finnish software technology and user interface, but did not license them. The American corporation, in turn, stated that the Finnish company violated 13 of its patents.

Jamie McCall via flickr
Jamie McCall via flickr
Both companies came to an agreement on multi-year patent licensing. "We are happy that we were able to agree and look forward to the opportunity to support Apple", said Basil Alwan, President of the Nokia IP and Optical Networks division. Apple also said they were satisfied with the agreement reached with Nokia. According to him, Nokia will provide Apple with certain products and services on the network infrastructure. Also, the Finnish company will receive an advance payment for its products from Apple. The American corporation, in turn, will again sell Nokia products in its branded stores.

In December last year, Nokia appealed to the regional courts of Dusseldorf, Mannheim and Munich in Germany and the US District Court of the Eastern District of Texas. According to Nokia, 32 patents have been violated, including patents for display technology, technology for developing a user interface and software.

"Since the signing of the licensing agreement in 2011, which covers some of Nokia Technologies’ patents, Apple has rejected Nokia’s successive offers to license other patented developments used in many products of the company", Nokia stated.

Nokia owns tens of thousands of patents in the field of technology used in smartphones, tablets, computers and other devices. Over the past 20 years, Nokia has invested more than € 115 billion in research, and also owns three portfolios of intellectual property patents after purchasing NSN in 2013 and Alcatel-Lucent in 2016.

Apple’s representative said that the company is always ready to honestly pay for patents for technology used in Apple’s products, reports WSJ. "Unfortunately, Nokia does not license patents on a reasonable basis, but resorts to the "patent troll" tactics in an attempt to get money out of Apple," he added. 

In 2009, Nokia received, according to some estimates, about $ 720 million from Apple for copyright infringement as a result of a two-year lawsuit. In addition, Nokia has got an eternal right for $ 13 royalties from each iPhone sold by the company. Similarly, in 1999 Nokia received a patent for a touch screen, which Apple uses in its products, and now the latter is for life forced to pay a portion of the revenue to the patent’s owner.

Nokia, the formerly well-known mobile phone manufacturer, abandoned its core business in 2014, and then sold the division for € 5.44 billion ($ 5.86 billion) to Microsoft Corp., focusing on telecom equipment instead. Yet, Nokia’s patents still cover technologies used in many modern tablets and smartphones. Sales of the network equipment are not going well, so Nokia is extremely dependent on the profitable patent business: last year, revenue of Nokia Technologies’ related division was € 1,02 billion, or 8% of the total number of sales.