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Samsung refuses to negotiate with Apple on IPR

Head of Korean firm's mobile business said there are no plans to enter talks despite Apple's licensing truce with HTC


Published: 15 November, 2012

READ MORE: Samsung | Patents/IPR | Android

Apple's truce with HTC in the patent wars created speculation that the deal would be a 'blueprint' for similar agreements with Samsung and Motorola Mobility. But Samsung, which is in the most powerful commercial position against Apple, says it is not ready to negotiate.

The firm's mobile chief, JK Shi, told the Korean Yonhap news agency that Samsung wants a legal resolution rather than an out-of-court compromise. He told reporters that there were no plans to negotiate at all with Apple, suggesting that the rivals are poles apart in their legal positions.

Samsung was the loser in the highest profile judgement so far, when a federal court in San Jose awarded a $1.2bn verdict against the Korean giant, but it has been the winner in some other cases, notably in Europe, and recently saw some of the patents at issue in the Silicon Valley case provisionally overturned by the US Patents and Trademarks Office. Some key cases loom, notably at the US International Trade Commission, whose outcome could shift the position of the firm that loses.

HTC, the first company which Apple sued when it unleashed its "thermonuclear" attack on Android, has been estimated by analysts to be liable for up to $280m a year over the length of its 10-year deal with Apple, as a result of the recently announced cross-licensing deal which ended their legal battles. But HTC president Jason MacKenzie told CNet that the settlement would not materially affect the company's financial results.

In another high profile patents war, Microsoft alleges that Motorola Mobility is adopting a "hold-up strategy" when negotiating licensing deals for its patents. The accusation was made as a case in Seattle opened - a hearing which will be influential across the handset IPR world because it revolves around the thorny issue of how standards-essential patents are licensed.

Such IPR is governed by 'Frand' (fair reasonable and non-discriminatory) terms, but both Microsoft and Apple are accusing Google's Motorola unit of violating those guidelines. The issue is also critical to an Apple case against Samsung in Europe. While Apple is weak in terms of patents which underpin wireless technologies, both its main Android rivals have powerful holdings in 3GPP standards.

Microsoft's lawyers told US District Judge James Robart that Motorola has priced its patents "to hold up Microsoft and its customers". The case is the biggest of seven that the companies have filed against one another, and refers to a 2010 negotiation in which Microsoft alleges the Google subsidiary tried to levy an unreasonable fee for patents which are included in video streaming and Wi-Fi standards.

Motorola insists it offered Microsoft the same terms as other players. The two firms disagree on how standards-essential patents should be licensed, with the Windows giant favouring the pool approach and Motorola clinging to the mobile industry's traditional bilateral (and secret) deals. Both firms argued that some of their evidence documents, containing detailed descriptions of patent pricing and negotiating practices, should be sealed by the court, and the judge agreed in at least some cases. The trial is expected to last for a week with a ruling to come in late December.

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