Sun, Feb 09, 2014 - Page 13 News List

HTC reaches settlement with Nokia over patents

Bloomberg

HTC Corp (宏達電) and Nokia Oyj have agreed to collaborate after ending a patent-infringement dispute that could have resulted in the devices of Taiwan’s largest smartphone maker being kept out of the US market.

HTC will pay royalties to Nokia to end the dispute, they said yesterday in a statement, without disclosing the financial terms of the settlement. Each company will gain access to the other’s patented technology and will explore “future technology collaboration opportunities,” they said.

The US’ International Trade Commission (ITC) in Washington was scheduled to announce tomorrow whether it would issue an import ban on HTC devices.

Patents will be one area of focus for Nokia after the former mobile-phone market leader agreed in September to sell its handset division to Microsoft Corp.

“The win could be a useful benchmark” for Nokia, Credit Suisse Group AG analyst Kulbinder Garcha wrote in a note to clients on Friday. “The win positions Nokia well in the ongoing arbitration with Samsung to monetize IP beyond standard essential patents and implementation patents.”

The settlement and the patent agreement with Nokia has no material adverse impact on HTC’s finances, the Taoyuan-based company said in a filing to the Taiwan Stock Exchange yesterday. The two companies said they have settled all pending patent litigation between them.

“The pact reduces one uncertainty for HTC,” Jih Sun Securities (日盛證券) analyst Chen Fu-li (陳富立) said. “The deal was expected and may not have a big impact on HTC’s finances.”

Nokia is selling its phone business to Microsoft, a deal that is expected to close this quarter, to focus on networking equipment. It has retained patents on fundamental phone technology as part of a program to try and recoup the billions of dollars it spent on research.

“This agreement validates Nokia’s implementation patents and enables us to focus on further licensing opportunities,” Nokia chief intellectual property officer Paul Melin said in the statement.

An ITC judge in September found that HTC infringed two Nokia patents for a way to remove errors in radio signals and a process to deal with different radio frequencies. No infringement was found of a third Nokia patent for a way to transmit data from a computer to a mobile phone, which Google Inc helped HTC challenge. It was directed at phones running on Google’s Android operating system.

“Nokia has one of the most preeminent patent portfolios in the industry,” HTC general counsel Grace Lei (雷憶瑜) said in the statement. “As an industry pioneer in smartphones with a strong patent portfolio, HTC is pleased to come to this agreement, which will enable us to stay focused on innovation for consumers.”

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