Nokia Corp. requested international arbitration in a licensing disagreement with wireless technology company InterDigital Communications Corp., news that sent InterDigital’s stock down almost 25 percent after the news.
The company’s stock was back up slightly to $18.35 in trading the following day.
Nokia’s request for arbitration was filed in the International Court of Arbitration of the International Chamber of Commerce. The dispute centers on InterDigital’s GSM and GPRS patents.
Nokia argues it has no royalty obligations to InterDigital based on InterDigital’s agreement with L.M. Ericsson and Sony Ericsson Mobile Communications. InterDigital reached a licensing deal with Ericsson and Sony Ericsson earlier this year following a long-standing patent dispute. Under the deal, Ericsson must pay InterDigital an annual fee of $6 million for sales of infrastructure equipment, and Sony Ericsson will pay a royalty on each licensed product sold.
InterDigital’s dispute with Nokia includes several complicated facets. Nokia is seeking an order requiring InterDigital to provide Nokia with access to various documents related to previous litigations, negotiations and arbitrations with other parties. Pending access to the requested documents, Nokia is also seeking to prevent arbitration proceedings that would determine royalty amounts it potentially owes to InterDigital.
Nokia declined to comment on the issue.
InterDigital said it will file a counterclaim asking the court to determine and award royalties it believes Nokia owes.
“Resolving royalty issues with Nokia remains a top priority,” said William Merritt, InterDigital’s executive vice president, general patent counsel and president. “We believe that we have fully satisfied our contractual obligations and remain confident in our position, including our prior projections as to the amount of royalties owed and to be paid. We are fully prepared to move forward to arbitration.”
