Nokia (NYSE:NOK) won a Swedish patent arbitration ruling against Research In Motion (NASDAQ:RIMM), and is seeking to block the sale of Blackberry devices with Wi-Fi until the companies can agree to new patent licensing terms.
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 United Kingdom and Canada. (Wireless local access network technology, or WLAN, is usually marketed as Wi-Fi.)
In a statement Nokia said that it and RIM had agreed to cross-licensing terms for standards essential cellular patents in 2003, and terms that were amended in 2008. According to Nokia, in 2011, RIM sought arbitration, arguing that the license extended beyond cellular essentials. RIM argues that its patent-licensing deal with Nokia covers the disputed Wi-Fi technology, but Nokia argues it does not. The arbitration between the companies took place in September at the Stockholm Chamber of Commerce in Sweden, which acts as a neutral arbiter in commercial disputes, according to IDG News Service.
RIM declined to comment, according to multiple reports.
"This could have a significant financial impact to RIM, as all BlackBerry devices support WLAN," IDC analyst Francisco Jeronimo told Reuters.
The dispute is another that revolves around standards-essential patents, which are supposed to be licensed on "fair, reasonable and nondiscriminatory terms," or FRAND. 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.
Analysts think that in this latest dispute, RIM will most likely ink a royalty agreement with Nokia to avoid a sales ban of any kind.
This is not the first time Nokia and RIM have tussled over patents. In May Nokia filed lawsuits in the United States and Germany, arguing that HTC, RIM and ViewSonic were infringing on a number of its patents.
- see this Reuters article
- see this WSJ article (sub. req.)
- see this IDG News Service article
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