Nokia declares first victory in Qualcomm phone wars

ITC judge says Nokia not infringing on Qualcomm 2G patents; Qualcomm to appeal

Qualcomm’s attempt to get Nokia GSM phones banned in the U.S. was halted today as an administrative law judge with the U.S. International Trade Commission ruled that Nokia violated none of Qualcomm's patents. The fight isn’t over yet, though. The ruling is only an initial determination, which Qualcomm plans to appeal, leaving the full commission to issue a final ruling in April.

The judge found that Nokia did not infringe upon three of Qualcomm’s patents related to power consumption in GSM, GPRS and Edge phones. Though not final, Nokia declared the ruling a victory. Nokia chief financial officer Rick Simonson said the case was the first of numerous regulatory and court cases to reach a verdict and was therefore a critical test of the merits of Qualcomm’s patent portfolio. Nokia’s initial victory shows that its rock solid foundation of intellectual property isn’t as stable as Qualcomm claims, Simonson said.

Simonson said Qualcomm is trying to extend the strong royalty business in CDMA to the GSM world, where GSM’s 3G radio interface Wideband CDMA draws from upon Qualcomm technology. W-CDMA, however, was developed by multiple vendors who have agreed to cross license their technology giving Qualcomm a far weaker case for its royalty rates than in the CDMA world, Simonson said. “Qualcomm seems a bit stuck in the past,” Simonson said.

The initial ITC decision, however, applies to patents related to GSM technology, which is outside of Qualcomm’s traditional area of expertise. Qualcomm’s case was based on the power-saving techniques that could be applied across technologies, not to the core W-CDMA radio technology the technology the vendor was instrumental in developing, as Qualcomm was quick to point out after the ruling. “The action does not address Nokia's WCDMA or "3G" products and the ID therefore has no bearing on such products,” Qualcomm said in a statement.

Qualcomm has yet to challenge Nokia for infringements on its 3G patents, despite the fact that the two let their cross-licensing agreement expire last spring. At issue is hundreds of millions dollars of royalty payments Qualcomm is demanding payment on, but Nokia is refusing to fork over. Qualcomm, however, is seeking to settle the dispute through arbitration rather than take Nokia to the courts. Instead it has challenged Nokia on other technologies in cases all around the world, which has led Nokia to accuse Qualcomm of trying to gain leverage in licensing negotiations through litigation.

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