Ericsson Sues Samsung Over Mobile Patents

Ericsson has sued Samsung after the latter refused to renew a patent-licensing agreement. Samsung calls Ericsson's new terms "excessive."

Ericsson, the latest company to join the patent finger-pointing fracas that's become the norm in the fast-growing smartphone industry, filed a patent-infringement lawsuit against Samsung in a U.S. District Court in Texas.

Samsung signed licensing agreements for the use of Ericsson patents in 2001 and 2007, but the latter has expired, and after two years of negotiations between the "most senior management of both companies," Ericsson officials said in a Nov. 27 statement, Samsung has yet to renew the agreement. A Sweden-based communications technology vendor, Ericsson has U.S. headquarters in Texas.

"The dispute concerns both Ericsson's patented technology that is essential to several telecommunications and networking standards used by Samsung's products as well as other of Ericsson's patented inventions that are frequently implemented in wireless and consumer electronics products," Ericsson officials said in their statement. It concluded that it "has no option other than legal action."

Ericsson also accused Samsung of refusing to take a license on fair, reasonable and non-discriminatory terms, known industry-wide as FRAND. FRAND licensing is essential to encouraging new players to enter the market, said Ericsson, as it strikes a balance between incentivizing them to contribute technology and keeping royalty rates reasonable.

"By the end of 2012 there will be approximately 6.6 billion mobile subscribers in the world. The sharing of technology in the telecom industry is one of the main drivers behind this development," Kasim Alfalahi, Ericsson's chief intellectual property officer, said in a statement. "The telecom ecosystem builds on fair and reasonable terms that have created an attractive global mass market for mobility and broadband with Ericsson as a main contributor."

Ericsson holds more than 30,000 patents and said that hundreds "are essential to the standards that drive global communications, such as GSM, GPRS, EDGE, WCDMA, LTE and 802.11," among others.

Samsung officials defended their actions, calling Ericsson's changed terms unreasonable.

"Samsung has faithfully committed itself to conducting fair and reasonable negotiations with Ericsson over the past two years, but Ericsson has demanded prohibitively higher royalty rates to renew the same patent portfolio," the officials said in a statement. "As we cannot accept such extreme demands, we will take all necessary legal measures to protect against Ericsson's excessive claims."

Apple and HTC, which together in 2010 kicked off a wave of patent disputes in the industry, announced Nov. 10 that they'd finally shaken hands over a 10-year licensing agreement.

Less than two weeks later, Apple escalated its patent-infringement suit against Samsung by growing its list of offending devices by six. It asked the court to add the Galaxy S III, the Galaxy Note II, the Galaxy Tab 8.9 WiFi, the Galaxy Tab 2 10.1, the Rugby Pro and the Galaxy III Mini to its ongoing complaint, so as not to have to initiate a separate suit against them.

In separate news, David Kappos, the director of the U.S. Patent and Trademark Office, will be stepping down from his position in January 2013, The Wall Street Journal reported Nov. 27.

Kappos, who joined the agency in 2009, is credited with helping reduce the agency's backlog of patents, making the agency more efficient and ushering through Congress the America Invents Act of 2011. The Act, which brings the U.S. up-to-date to European and Asian countries, according to The Journal, awards patents on a "first to file" basis, which has helped eliminate legal disputes over who invented something.