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Nokia Wins Preliminary Ruling in Patent Fight With HTC

Nokia Wins Initial Round in Smartphone Patent Fight With HTC
A U.S. International Trade Commission judge found that HTC Corp. violated Nokia Oyj’s patents for a way to remove errors in radio signals and another for a process to deal with different radio frequencies. Photographer: Kiyoshi Ota/Bloomberg

Sept. 23 (Bloomberg) -- Nokia Oyj, the Finnish company selling its handset business to Microsoft Corp., won the first round of its U.S. patent-infringement fight against Taiwanese phonemaker HTC Corp.

HTC violated two Nokia patent rights, while no infringement was found on another patent, U.S. International Trade Commission Judge Thomas Pender said in a notice posted today on the Washington agency’s website. The judge’s findings are subject to a review by the six-member commission, which has the power to block imports of products that infringe U.S. patents and is scheduled to make a final decision by Jan. 23.

The judge found that HTC violated Nokia’s patents for a way to remove errors in radio signals and another for a process to deal with different radio frequencies. No violation was found on a third Nokia patent for a way to transmit data from a computer to a mobile phone, which Google Inc. helped Taoyuan, Taiwan-based HTC challenge. It was directed at phones running on Google’s Android operating system.

Nokia was the world’s biggest maker of mobile phones before losing its 14-year title to Samsung Electronics Co. in 2011. It has sought to use patent licensing to recoup some of the money it spent on phone innovations. Those patents will stay with Nokia after it sells its handset business and licenses its technology to Microsoft Corp. for $7.2 billion.

Espoo, Finland-based Nokia had accused HTC of infringing nine patents related to mobile phones when it filed the complaint in May 2012.

Same Technology

One of the patents found to be infringed covers the same technology that Nokia has asserted against HTC in courts in London; Dusseldorf, Germany; and Rome, said Mark Durrant, a spokesman for Nokia.

He said the company was pleased with the two infringement findings and “we will reserve further comment until we have had the chance to study the judgment in detail.”

HTC General Counsel Grace Lei said in an e-mail the handset maker was pleased with the part of the judge’s findings it won.

“We look forward to a final determination by the commission in favor of HTC on this matter,” Lei said. “In the meantime, HTC will keep its alternative plans ready to ensure no business disruption.”

HTC’s Struggles

The case targets HTC phones including the Amaze 4G, One S, Rhyme and Vivid, as well as the Flyer and Jetstream tablet computers. Nokia has a second trade case, filed in May, that targets the HTC One and Droid Incredible. The companies also are fighting in Germany.

HTC, Taiwan’s biggest maker of smartphones, has struggled to increase its presence in the U.S. and elsewhere by revamping its marketing strategy and shuffling executives. The company’s share price peaked in 2011, and has plunged 89 percent since then as Samsung and Apple Inc. became the dominate players in the $280 billion smartphone market.

HTC had about 2.8 percent of the global smartphone market in the second quarter, compared with Nokia’s 3.1 percent, data compiled by Bloomberg show.

The case is In the Matter of Certain Electronic Devices, Including Mobile Phones and Tablet Computers, 337-847, U.S. International Trade Commission (Washington).

To contact the reporter on this story: Susan Decker in Washington at sdecker1@bloomberg.net

To contact the editor responsible for this story: Bernard Kohn at bkohn2@bloomberg.net

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