Ericsson sues Samsung over patent dispute

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Ericsson (NASDAQ:ERIC) sued Samsung Electronics in federal court for patent infringement after the two companies reached an impasse over how much Samsung would pay Ericsson to license Ericsson's wireless standards patents.

Samsung previously licensed Ericsson's patents in 2001 and renewed the licenses in 2007, but its license has now expired. Ericsson said Samsung refused to renew its license to Ericsson's patent portfolio on the same FRAND terms that its competitors have previously accepted. FRAND is shorthand for Fair, Reasonable and Non-Discriminatory terms.

"We are renowned in the industry of being very reasonable. I think if you ask a lot of the players they will say that," Kasim Alfalahi, Ericsson's chief intellectual property officer, told FierceWireless. "The main competitors to Samsung are licensed. We have more than 100 agreements signed and in place. We have extended an offer to Samsung to license at a level which is similar to their competitors."

Samsung said it disagrees with that characterization of the negotiations. In a statement Samsung said it will "take all necessary legal measures to protect against Ericsson's excessive claims."

"Samsung has faithfully committed itself to conducting fair and reasonable negotiations with Ericsson over the past two years, but Ericsson has demanded prohibitively higher royalty rates to renew the same patent portfolio," Samsung said.

Alfalahi said that Ericsson has "hundreds" of patents covering GSM, GPRS, WCDMA, LTE and Wi-Fi technologies, which Samsung has licensed in the past for use in its mobile devices, including smartphone and tablets. "It's a large portfolio and it's a very broad patent portfolio that covers many Samsung products," he said.

This is not the first time Ericsson has sued Samsung over patents. Ericsson pursued a similar strategy in 2006. In 2007 the companies agreed on new licensing terms.

Patent battles that have engulfed the wireless industry during the past two years, with many lawyers and industry observers arguing that FRAND has been distorted and that companies are using standards-essential patents as weapons in their legal battles.

Samsung's dispute with Ericsson is separate from the ongoing one between Samsung and Apple (NASDAQ:AAPL) over smartphones and tablets. Samsung has asserted its own wireless standards patents against Apple, accusing the iPhone maker of violating them.

For more:
- see this release
- see this WSJ article (sub. req.)
- see this Reuters article

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