Ericsson sues Apple back

After Apple filed the first legal salvo against Ericsson, the Swedish firm has now retaliated with its own lawsuit against the Cupertino-based tech giant.(Supplied)

After Apple filed the first legal salvo against Ericsson in a bid to lower what it said were excessive royalties for patents, the Swedish firm has now retaliated with its own lawsuit against the Cupertino-based tech giant.

On Monday, January 12, 2015, Apple Inc. sued Ericsson alleging that the Swedish company’s LTE wireless technology patents are not essential to industry cellular standards and that it is demanding excessive royalties for these patents.

Read: Are iPhone prices set to drop as a result of this lawsuit?

In response, Ericsson said in a media statement on Wednesday that it has filed a complaint in the United States District Court for the Eastern District of Texas requesting the court to determine if its global licensing offer for Ericsson’s standard essential patent portfolios to Apple is fair, reasonable, and non-discriminatory (FRAND).

“Global sharing of technology has created the success of the mobile industry and allowed new entrants to quickly build successful businesses. We believe it is reasonable to get fair compensation from companies benefitting from the development we have made over the course of the last 30 years,” said Kasim Alfalahi, Chief Intellectual Property Officer at Ericsson.
“During the past two years of negotiations, the companies have not been able to reach an agreement on licensing of Ericsson’s patents that enable Apple’s mobile devices to connect with the world and power many of their applications. Ericsson filed the suit in order to receive an independent assessment on whether Ericsson’s global licensing offer complies with Ericsson’s FRAND commitment,” the Swedish firm noted in the statement.

“Our goal is to reach a mutually beneficial resolution with Apple,” added Alfalahi.

Ericsson notes that “every Apple smartphone and tablet with cellular capability uses technology from Ericsson,” and maintains that since the expiry of the licence agreement between the two, Apple has been using its technology without a licence.

“Apple has declined to take a new licence on offered FRAND terms,” it said, and adds that its Q4 2014 IPR revenue will include payment from Apple under previous agreement.

“Ericsson invests more than $5 billion in research and development per year, resulting in one of the industry's most comprehensive patent portfolios,” Ericsson said.

On the other hand, Apple has made it clear that it is not keen on paying the billed amount. “We’ve always been willing to pay a fair price to secure the rights to standards essential patents covering technology in our products. Unfortunately, we have not been able to agree with Ericsson on a fair rate for their patents so, as a last resort, we are asking the courts for help,” Apple spokeswoman Kristin Huguet has been quoted as saying.

Apple insists the royalties should be based on the value of the processor chip that includes the technology, and not be calculated as a percentage of the price of the entire smartphone or tablet, which is what Ericsson wants as part of the revised terms.

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