Nokia wants to block sales of BlackBerry phones in a number of key countries, including the UK, if Research In Motion does not agree to a deal to pay new patent royalties.
Nokia said in a statement that a Swedish tribunal "found that RIM was in breach of contract and is not entitled to manufacture or sell WLAN products" without first agreeing to royalty terms with Nokia. As a result, Nokia said it is seeking court action to block the sale of RIM devices with Wi-Fi capabilities in the United States, the UK and Canada. (Wireless local access network technology, or WLAN, is usually marketed as Wi-Fi.)
Analysts have warned of dire consequences for RIM: "This could have a significant financial impact to RIM, as all BlackBerry devices support WLAN," IDC analyst Francisco Jeronimo told Reuters.
Canalys analyst Pete Cunningham added: "If a sales ban was imposed it would be a massive blow for RIM as it manages its transition to the new BlackBerry 10 software platform."
However, the view by many is that embattled RIM is much more likely to now reach a royalty agreement with Nokia to avert a sales ban, according to Reuters.
Nokia said more than 40 companies license its handset patents, but RIM had argued that an earlier licensing deal with Nokia meant it should not have to pay a separate fee for Wi-Fi technology. However, the Swedish tribunal disagreed, according to BBC News.
Nokia confirmed to BBC News that it had taken action "with the aim of ending RIM's breach of contract," adding it would also continue to pursue a separate case against RIM in Germany involving antenna, email and navigation technologies.
Peter Misek, an analyst at the New York-based investment bank Jefferies, said Nokia's filings mean that RIM likely will end up paying royalties of $2 to $5 per phone, according to Newser.
Nokia received a $565 million royalty payment from Apple to settle long-standing patent disputes, and has recently filed claims in the U.S. and Germany alleging that products from HTC, RIM and Viewsonic infringe on a number of its patents.
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