Qualcomm sues Nokia over mobile phone patents

Sinead Carew and Rex Merrifield

NEW YORK/HELSINKI: Wireless technology company Qualcomm Inc. said on Monday it filed a patent infringement lawsuit against Nokia, less than two weeks after Nokia and five other companies complained about Qualcomm's competitive practices to the European Commission.

Qualcomm said it wanted Finland's Nokia, the world's No. 1 mobile phone maker, to stop selling certain mobile phone products in the United States, and demanded unspecified monetary damages from Nokia.

The latest suit appeared to be a retaliation by Qualcomm for complaints to the European Commission, made on Oct. 28 by Ericsson, Texas Instruments Inc., Broadcom Corp. and others. It could be the start of a flurry of additional lawsuits from Qualcomm, analysts said.

"What Nokia did the week before last makes it slightly easier for Qualcomm to be more enforcement-prone," said Harris Nesbitt analyst John Bucher, referring to enforcement actions to protect patents for mobile phone technologies.

"Maybe this is just the beginning of it," Bucher added.

Nokia said in a statement that it had yet to receive a copy of the complaint, which was filed in U.S. District Court in San Diego on Nov. 4, but it plans to defend itself.

Qualcomm dominates the market for technology and chips for CDMA, the main U.S. mobile phone standard.

It also sells licenses and chips for Wideband-CDMA (W-CDMA), a high-speed wireless technology that is being adopted in Europe as an upgrade for slower networks based on GSM, short for Global System for Mobile communications.

LEGAL DISPUTE

Qualcomm said Monday that Nokia has used some of its CDMA technology to improve networks based on GSM, so that they too could achieve faster speeds for data services, such as video calls and Internet downloads.

Qualcomm's rivals have accused it of stifling competition in the W-CDMA mobile phone chip market by giving preferential pricing to technology license holders who also buy its chips. Qualcomm has rejected the claims.

Qualcomm said the Nokia lawsuit involves 11 Qualcomm patents and one belonging to its subsidiary, SnapTrack Inc.

"Until recently, we had been led to believe that these issues might be resolved cooperatively and amicably," Qualcomm Senior Vice President Louis M. Lupin said in a statement.

Nokia said that Qualcomm had filed the suit without first negotiating or proposing any license terms to Nokia.

All mobile phone chip and handset makers need Qualcomm's CDMA technology for Wideband-CDMA (W-CDMA).

Nokia, Ericsson and others say they have contributed significantly to the W-CDMA standard and also expect royalties. That might be hard if Qualcomm stuck to its licensing terms, which Nokia said are "not fair and reasonable."

Nokia has a rocky relationship with Qualcomm. It has struggled for years to get a share in the CDMA mobile market equal to its chunk of GSM sales by using its own CDMA-designed chips rather than Qualcomm's, but so far has failed.

Virtually all its rivals use Qualcomm's CDMA chips.

(Additional reporting by Lucas van Grinsven in Amsterdam, Joseph Giannone in New York)