Nokia and Apple trade accusations in patent lawsuits

The companies are at odds over fair licensing of the H.264 video codec and other technologies

An international patent dispute has broken out between Apple and Nokia over the Finnish mobile network vendor's licensing terms for the widely used H.264 video codec and other technologies.

Nokia on Wednesday filed lawsuits against Apple in Germany and in the U.S., alleging that the smartphone giant has infringed 32 of its patents.

Nokia's five lawsuits follow an Apple lawsuit filed in California Tuesday. The U.S. company accused Nokia of working with patent assertion firms Acacia Research and Conversant Intellectual Property Management to "extract and extort exorbitant revenues unfairly and anticompetitively" from Apple and other smartphone makers. Nokia was not named as one of eight defendants in the Apple lawsuit.

Nokia's patent infringement lawsuits, filed with the Regional Courts in Dusseldorf, Mannheim and Munich in Germany and the U.S. District Court for the Eastern District of Texas, cover patents related to displays, user interfaces, software, antennas, chipsets, and video coding, Nokia said Wednesday.

Nokia is planning to file more lawsuits in other jurisdictions, the company said in a press release.

The eight patents covered in one of Nokia's Texas lawsuits, filed Wednesday, are related to the H.264 Advanced Video Coding standard approved by the International Telecommunication Union, according to Nokia's complaint. A second Texas lawsuit covers 10 patents for a range of other technologies.

Apple products using the H.264 video codec include the iPhone, iPad, iPod, Apple Watch, Macs, and Apple TV, Nokia said in its complaint.

"Despite all the advantages that have been enjoyed by Apple, Apple has steadfastly refused to agree to license Nokia's H.264 patents on reasonable terms," Nokia's lawyers wrote. "Dozens of companies have licensed Nokia’s patents for use in their products ... Apple, however, refuses to pay Nokia's established royalty rates."

Apple did not immediately respond to a request for a comment on the lawsuits.

As part of the ITU standards process, Nokia agreed to grant licenses for the H.264 decoder on reasonable and nondiscriminatory, or RAND, terms, the company said. However, the ITU standard covers only the decoder, and not the encoder, the complaint said.

Nokia has offered Apple a license for the encoder technology on RAND terms, but Apple has refused to pay, the company asserted.

"Nokia has negotiated in good faith and made substantial efforts to enter into a license agreement with Apple on reasonable and non-discriminatory terms," its lawyers wrote.

Nokia research has contributed to "fundamental technologies" used in Apple products, Ilkka Rahnasto, head of Patent Business at Nokia, said in a press release. "After several years of negotiations trying to reach agreement to cover Apple's use of these patents, we are now taking action to defend our rights."

Apple's lawsuit, meanwhile, alleges that Nokia is working with outside patent assertion firms to skirt its RAND patent commitments to standards bodies.

Nokia promised it would "license its patents fairly," Apple's lawyers wrote. Nokia is working with the patent lawsuit filers on a "scheme to diffuse and abuse" the company's patents by extracting "exorbitant" royalties, they alleged in their complaint.

Nokia's aggressive patent licensing efforts came after the company largely exited the smartphone-making business, Apple's lawyers wrote.

"Unable to compete with innovative companies such as Apple -- which had developed a revolutionary hardware and software platform -- Nokia quickly transformed itself," Apple's lawyers wrote. "It changed from a company focused on supplying cell phones and other consumer products to a company bent on exploiting the patents that remain from its years as a successful cell phone supplier."

Acacia and Conversant didn't immediately respond to requests for comments on the Apple lawsuit.

The Apple lawsuit is "unrelated to our own complaints" against the company, a Nokia spokesman said by email. "By failing to agree to terms, Apple is seeking an unfair advantage over our other licensees and we are taking steps to protect our inventions and defend our rights," he added.

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