Huawei is suing InterDigital, a mobile technology research and development company based in Delaware, for allegedly violating an obligation to license patents, according to Reuters. The companies were previously operating under a patent licensing agreement that expired at the end of 2018.
The Chinese tech giant filed a lawsuit against the U.S. company in Shenzhen Intermediate People’s Court and asked the court to determine a royalty rate for its wireless products that would carry through 2023. The patents under dispute are reportedly essential to 3G, 4G and 5G technology standards. Huawei accuses InterDigital of failing to reach a patent licensing agreement on fair, reasonable and nondiscriminatory terms.
InterDigital filed notice of the lawsuit yesterday in an 8-K filing with the Securities and Exchange Commission. “We believe we have the most competitive rates in the industry in relation to wireless standards contributions, and when we cannot reach agreement with a customer we always offer to have an arbitration panel determine the rates," InterDigital President and CEO Bill Merritt said in a prepared statement provided to FierceWireless. "As a result, our rates and licensing practices have never been successfully challenged. Nevertheless, we’ll continue our discussions with the goal of a comprehensive agreement.”
The legal dispute comes as tensions between the U.S. and China appear to be worsening and Huawei finds itself in the crosshairs. President Donald Trump is reportedly considering an executive order that would bar U.S. companies from using equipment made by Huawei and ZTE.
Strain between the U.S. and Huawei is at an all-time high and was further heightened last month when Huawei CFO Meng Wanzhou was arrested in Canada due to requests from U.S. officials who accuse Huawei of evading U.S. sanctions against Iran.
Editor's Note - Jan. 8, 2018: This article has been updated to include comments from InterDigital.