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Apple and Ericsson sue each other over unfair patent royalties

Apple and Ericsson are suing each other over a dispute regarding patent royalty payments.

The iPhone manufacturer claims that the prices being quoted for the latter’s wireless technology patents are excessive and has asked US courts to intervene. Ericsson has filed a similar complaint to a district court in Texas, seeking clarification on its rates.

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Although Ericsson sold its mobile phone business to Sony back in 2012, the Swedish firm was an early leader in the market and has recently become very protective of its long-held patents. In 2012, it sued Samsung after claiming that the South Korean technology giant had failed to extend its licensing deal and last year, smartphone firm Xiaomi faced a lawsuit over 2G, 3G and 4G wireless technology patents.

“Ericsson seeks to exploit its patents to take the value of these cutting-edge Apple innovations, which resulted from years of hard work by Apple engineers and designers and billions of dollars of Apple research and development -- and which have nothing to do with Ericsson’s patents,” Apple argued in its complaint.

According to Business Week, Ericsson’s chief intellectual property officer Kasim Alfalahi has defended his company’s patent policy.

“It’s important for us that more devices are out in the market and available to consumers,” he said. “Our approach is on fair and reasonable terms. That’s always been our approach.

"We believe it is reasonable to get fair compensation from companies benefitting from the development we have made over the course of the last 30 years."

However, Apple claims that by asking it to pay royalties based on a percentage of the price of the entire device, Ericsson is setting its rates unreasonably high.

Kristin Huguet, an Apple spokeswoman, explained that despite her company’s best efforts it would now be up to the courts to decide on a fair royalty price.

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“We’ve always been willing to pay a fair price to secure the rights to standards essential patents covering technology in our products,” she said. “Unfortunately, we have not been able to agree with Ericsson on a fair rate for their patents so, as a last resort, we are asking the courts for help.”