Nokia learned that Qualcomm has filed a complaint with the United States International Trade Commission (ITC) asking the commission to open an investigation into the alleged infringement by Nokia of six GSM standard related Qualcomm patents. Nokia is currently evaluating the filing and will respond as necessary.
As disclosed by both parties, Nokia's obligations to pay royalties to Qualcomm under the current license agreement will expire on April 9, 2007. Nokia and Qualcomm are in active negotiations to extend, or replace, the current agreements.
The ITC request is the third legal action taken by Qualcomm against Nokia in the past eight months. While we are still evaluating Qualcomm's latest action it appears that most of the patents which are the subject matter of Qualcomm letter to the ITC are believed by Nokia to be covered by Qualcomm's prior agreements to license on fair and reasonable terms and are thus not properly subject to a request by Qualcomm to the ITC.
These repetitive legal actions, over GSM technologies that have been in the market for many years, reflect Qualcomm's concern over the current 3G UMTS patent negotiations. These actions demonstrate that the conditions applicable to ongoing negotiations between Nokia and Qualcomm have substantially changed since the early 1990's. At that time Qualcomm held a dominant patent position in IS-95 standard and was able to impose that position on the industry.
Since the early 1990's Nokia has built a leading wireless intellectual property portfolio by investing over EUR 25 billion in research and development. Today Nokia's intellectual property portfolio consists of over 10,500 patent families. As a world leader in the development of wireless communications technologies, with over 220 essential patents in GSM alone and far more essential patents than Qualcomm in 3G UMTS standard, Nokia holds a very strong patent position.