More cellphone firms are suing each other

Berlin: The change in the dynamics of the mobile phone business and the increase in the number of patents sought by makers of mobile phones in their quest for the cutting edge, has resulted in a rise in the spate of lawsuits by cellphone companies against one another.

When Nokia, the world's largest maker of mobile phones sued Apple, Samsung, LG and eight other competitors within six weeks beginning in October, it said that it was conducting a routine defense of its intellectual property, reports New York Times. But for cellphone makers and suppliers accustomed to swapping valuable technologies, the lawsuits filed by Nokia were far from standard.

According to Bill Tai, a Partner at Charles River Ventures, a technology investment firm, the new legal aggressiveness was 'a natural evolution' similar to what took place in the semiconductor and desktop computer businesses during difficult or competitive times. "As competition has intensified and margins have deteriorated, companies are trying to put up barriers to protect their positions," said Tai.

In 2008, Nokia settled a lawsuit with Qualcomm, a U.S. maker of mobile phone chips, and agreed to pay an estimated $400 million a year for Qualcomm patents over 15 years. According to recent financial reports, nearly all cell phone makers are suing or are being sued.

According to New York Times, Research In Motion, the maker of the BlackBerry, is suing Motorola, accusing it of using 20 of its patents, while Motorola has countersued. Palm is being sued by Saxon Innovations, a patent licensing company in Tyler, Texas, over a third-party application processor. In March, Apple won a ruling in Japan against Shigeru Saito Architecture Institute, which had sued over touch-screen patents.

"Nokia has been very active of late, and in general, there has been an increase in litigation in the industry," said Clive D. Thorne, an intellectual property Lawyer at Arnold and Porter in London. "There is an attempt to gain technical advantage. Mobile technology is fast-moving. The commercial life of products is limited. There is urgency in ensuring that IP rights are protected."

Louise Pentland, Nokia's Chief Legal Officer, said that the company's legal strategy had not changed. Instead, according to her, the dynamics of the mobile phone business has been changing: increasing boundary testing by industry newcomers and suppliers, in addition to convergence of mobile Internet, information technology and other industries. "The litigation is not the driver," Pentland said in an interview. "It is the business environment that has changed."