Apple and Nokia Bury the Patent Hatchet
Ping!
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Posted on 07/28/2017 5:39:26 PM PDT by Swordmaker
In today’s financial results, Nokia mentioned that it had increased cash inflow thanks to an “up-front cash payment of approximately EUR 1.7 billion, part of which was recognized in the second quarter 2017 results.” When Nokia announced back in May that it settled all litigation with Apple, they also said that they will update its capital structure optimization program, as one reader pointed out, which means Apple agreed to pay a big one-time amount.
We contacted Nokia to confirm if the “up-front cash payment of €1.7 billion ($2 billion) (of which a part was recognized in Q2 results)” is from Apple, and Nokia’s PR team confirmed that and invited us to join the investor webcast at 2pm CEST here for more details.
We can conclude that Nokia scored a good deal with Apple. Apple agreed to pay up-front 2 billion dollars, of which some were paid in Q2. Apple will continue to pay royalties, along with the rest of this up-front payment. Details about the Nokia-Apple deal can be found here.
Update: Seeking Alpha has a full transcript of the webcast and the Apple part goes:
Second, we got a substantial upfront cash payment of €1.7 billion from Apple, strengthening further our cash position. As said earlier, our plans is to provide more details on the intended use of cash in conjunction with our Q3 earnings.
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Smart move by Apple, now hey might be able tgo get some of that money back!
Well, anyone can access the ip once the patents expire. So non-expiring access to the patents can be a bit misleading.
True, but patents can be renewed, and or added to. This apparently, I gather, includes that kind of license.
Generally speaking, in the US a utility patent is good for 20 years (time can be added if the patent office drags its feet, and in some cases can be as short as 17 years.) A design patent is good for 15 years (used to be 14). If you file a new patent covering the same ground, you have to disclaim (terminal disclaimer, as I recall) the portion that would extend past the original patent date, or you can lose your patent for deceptive intent. You can’t extend a patent past its expiration date. You can, however, expand the scope of the original patent. (Caveat on the length - you do have to keep regularly paying fees to the USPTO to keep your patent alive. For details as to timing and amount, talk to a patent lawyer.
Laws may vary in other countries.
Like immigration law, I don’t do patent law, but I’ve interacted with both patent lawyers and immigration lawyers over the years and some of it has rubbed off.
These are generally utility patents, and cover patent award dates beginning in the late 1990s through just recently or even pending. Some patents can be based on an earlier patent, but the new patent starts over again if it is sufficiently different, although derivative from the older patent but superseding the older patent in the Standard Essential Patents framework and can be subsumed under this license. THESE patents are what are important to nail down under a FRAND contract of some kind. Nokia probably has the largest portfolio of such patents. SEP and licensing contracts can tie up patents far beyond patent expiration dates, or even a court ruling that a patent is invalid. That has happened before but the license is unaffected for those who signed the contracts before the courts ruled on the validity of the patent perhaps in another case. Those with prior licenses have to go back to court to get their contracts set aside. . . if the courts with jurisdiction is at all even amendable to breaking a contract.
There are no design patents in any FRAND patent consortium as far as I know, as designs are not essential to the operation of cellular standards or other standard by definition.
Incidentally, the vast majority of these patents were awarded in the EU, not in the USA. I would imagine that the EU laws about terms and SEPs would apply. It know the EU’s laws on SEPS are stricter than are those in the US. Samsung just missed getting fined it’s entire company’s yearly REVENUE for attempting to abuse the European FRAND rules about SEPs, by doing “patent hold-up,” a four years ago in the European courts. They worked out an out-of-court settlement for considerably less, but still for a few Billion Euros.
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