Apple sued by a firm in a patent deal with Microsoft

Category: WTO Sub-category: Intellectual Property
Document type: news

12-Mar-2012 | 12:50 IST | Edited by: Sharmila Maitra

A subsidiary of a company that shares patent-licensing revenue with Microsoft Corp. has sued Apple Inc. for infringement.

Core Wireless Licensing SARL claims in a lawsuit filed last week in Eastern Texas District Court that Apple infringed on eight patents related to 2G, 3G, and 4G communication protocols used in the company's iPhone, iPad and iPad 2 devices. The corporation seeks unspecified damages and future royalty payments for each and every product sold by Apple in the future that is found to infringe.

This particular lawsuit puts Microsoft and Apple in an awkward position, as the two recently partnered in a consortium that purchased Nortel Networks' remaining portfolio of 6,000 patents and patent applications for $4.5 billion. Other companies involved in the deal, which won regulatory approval include Research In Motion, Sony, and Ericcson.

However, it might be interesting to note that last September, Canada's Mosaid Technologies Inc. said it had purchased Core Wireless and its roughly 2,000 patents and patent applications for wireless technology originally filed by Nokia Corp. It had declared that Core Wireless shall retain approximately one-third of gross royalties from future licensing and enforcement of the patents and will bear all of the costs associated with their administration, licensing, enforcement and monetization. Core Wireless' ongoing ownership of the portfolio is subject to minimum future royalty milestones. Microsoft then licensed those patents.

A Microsoft spokesman said in a statement that as part of that transaction, they had also received a passive financial interest in future revenue generated by Mosaid from the licensing of those patents to others. Microsoft has, however, declined to comment on the terms of agreement or the number of patents involved.

A Nokia spokesman said the company has divested itself of the patents involved in the litigation and declined further comment.

Apple, in January, had sold more than 37 million iPhones and more than 15 million iPads in the quarter that ended in December.

According to the statistics, Apple held nearly 24% share of the worldwide smartphone software market in the fiscal 2011 fourth quarter, compared to 1.9% held by Microsoft.

Microsoft, Apple, Nokia and others including Google Inc. have been engaged in a simmering legal battle over intellectual property rights as they jockey for position in the mobile phone market.

External links:
Core Wireless Licensing S.a.r.l. owns patents and patent applications that are used in mobile communications devices and services. The company is based in Luxembourg. As of September 1, 2011, Core Wireless Licensing S.a.r.l. operates as a subsidiary of MOSAID Technologies Inc.