Friday, 22 March 2013

Nokia and HTC in Germany: a clarification

In the light of recent press coverage of the German litigation between Nokia and HTC (eg here, here, here and here), PatLit has received the following clarificatory statement from Laura Whiting (Hogan Lovells, who acted for HTC).
You may have seen recent reports of the judgment of the Mannheim District Court in case 2 O 119/12, one of a number of cases between Nokia and HTC that have been heard or will be heard this year. There appears to have been some confusion in the press reporting of the case in relation to the scope of the action and therefore of any injunction, should Nokia choose to enforce the ruling. It might be helpful to clear this up. To be clear, any injunction will apply only to three old HTC phone models – it will not affect any other HTC phones.

The judgment in German shows that the dispute revolved round the infringement of EP 0 673 175 – a patent concerning a niche piece of code for power reduction when the phone is in the GSM idle mode. HTC has implemented a workaround.

The case (and therefore any injunction) concerns only three phone models: the HTC Rhyme, Wildfire S and Desire S, all of which are all superseded models. 
In their post hearing brief dated 26 February 2013, Nokia made the following statements:
4. We furthermore note that the specified profits in the amount of Euro ● million [actual sum redacted] according to Defendants' submission should relate to the sale of all HTC devices in Germany. However, the present complaint challenges only three different embodiments. [ie. the Rhyme, Desire S and Wildfire S] The profits generated from the sale of all devices, thus also cannot serve as the basis for the provision of a security bond in the present proceedings. It is not known, what portion of the alleged profits should relate to the infringing embodiments. The affidavit thus is in any case not suitable to demonstrate any losses resulting from enforcement with regard to the infringing embodiments.

5. … We have to assume that the Defendants could easily avoid the patented technical teaching, not using the advantages of the patent. As has been explained in detail, with the patent, the infringing embodiments could only use two or three of the four BCCH/PCH messages transmitted by default. However, they also could be easily modified so that all four messages would always be used. This would only result in increased power consumption and a shorter standby period. It is, however, not apparent, how this should result in Defendants losing significant market shares...
2. In the judgment itself, the subject-matter of the dispute (and therefore the scope of the injunction) is defined as follows:
This action is brought against the following mobile devices, so-called smartphones (accused devices):

a) product designation: Wildfire S, equipped with a chipset of the company Qualcomm with a baseband processor MSM 7227 and sender-receiver RTR 6285 GSMW-CDMA,

b) product designation: Desire S, equipped with a chipset of the company Qualcomm with a baseband processor MSM 8255 and sender-receiver QTR 8200 GSM/W-DDMA,

c) product designation: Rhyme, equipped with a chipset of the company Qualcomm with a baseband processor MSM 8255 and sender-receiver QTR 8615 GSM/W-DDMA.
The chipset-supplier of the Defendant, the company Qualcomm, has its registered offices in the United States of America.

3. In Germany, a bank guarantee must be provided before an injunction can be enforced (this is referred to as a bond). The value of the bond to be deposited against enforcement is set according to the scope of the injunction. In this case, the amount of the bond Nokia must pay to enforce the injunction was set with reference to the three phone models named in the suit only rather than HTC's whole product range (in which case the bond amount would be much larger). Any injunction is therefore also limited to these three phones.
In proceedings earlier this month, as reported by FOSS Patents here, the District Court of Mannheim dismissed an infringement complaint brought by Nokia against HTC, alleging that HTC infringed the German part of its EP0812120 patent for a “method for using services offered by a telecommunications network, a telecommunications system, and a terminal for it.” The court also awarded HTC its legal costs.

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