QUALCOMM, NOKIA TAKE IT TO COURT
SAN DIEGO - 11/10/05 - California headquartered Qualcomm Inc. is suing global cellphone giant Nokia Corp. for alleged patent infringement.
The suit - the latest in a flurry of lawsuits being flung about the global telecommunications industry - was filed just one week after Nokia and five other companies filed an antitrust complaint against Qualcomm with the European Commission (EC) in Brussels.
The Qualcomm suit - filed in a US federal court in San Diego - charges that cell phones sold by Nokia in the US infringe on 11 patents for improving wireless Internet access and data transmission on the dominant GSM, or Global System for Mobile, cellular standard.
Qualcomm, which developed a rival standard known as CDMA - or code-division multiple access - alleges that next-generation versions of GSM have adopted its innovations to boost connection speeds, increase network efficiency and capacity, and facilitate multimedia services.
The legal acrimony surrounding Qualcomm has been building since earlier this year, with a growing number of wireless equipment makers chafing at the market power and royalties that come with Qualcomm's near-monopoly grip over CDMA.
The California-based company collects a fee for almost every CDMA-based phone sold and a growing number of GSM-based handsets.
In May, wireless chipmaker Broadcom Corp. sued Qualcomm for infringement of patents for audio, video and data services and filed a complaint with the International Trade Commission alleging unfair trade practices.
Two months later, Qualcomm returned the favor, filing its own suit against Broadcom charging that the Irvine-headquartered company infringed on Qualcomm's patents relating to semiconductors for cell phones.
The dispute widened dramatically in late October when Nokia, LM Ericsson, Broadcom, NEC Corp., Texas Instruments Inc., and the Panasonic unit of Matsushita Electric Industrial Co. Ltd. asked the EC to investigate and halt Qualcomm's alleged abuse of EU competition rules.
According to industry press reports, the six companies charged that Qualcomm was making it harder for rival producers of computer chips for cell phones to compete because it was refusing to license essential CDMA patents on reasonable terms and offered lower royalty rates to handset makers that only buy Qualcomm semiconductors.
Qualcomm appeared to point to that complaint in announcing the suit against Nokia.
Finland-based Nokia, the world's biggest producer of cell phones, said in a statement it had not yet seen a copy of the suit, but denied Qualcomm's allegations.
The company "is disappointed Qualcomm has taken this step given they have yet to engage in any licensing negotiations concerning these matters," according to a statement issued by Nokia's top management.
"Qualcomm has a duty to license those patents on fair, reasonable and non-discriminatory terms," it said, adding that "Qualcomm has not provided Nokia with any proposed terms for a license in compliance with its obligations."
More than two thirds of the world's roughly 2 billion cell phones are based on GSM, which dominates Europe and most other regions other than the US, and Korea, where CDMA has prospered.
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