Apple Sues Ericsson to Reduce Patent Royalty Rates Related to LTE Connectivity
Apple has filed a lawsuit against Ericsson alleging that the Swedish networking giant is demanding excessive royalty rates on certain wireless Long Term Evolution (LTE) technology.
In a complaint lodged with the U.S. District Court for the Northern District of California, Apple argued that Ericsson’s LTE wireless technology patents are not essential to industry cellular standards and that it is seeking royalties for the technology calculated as a percentage of the price of every cellular-connected iPhone or iPad sold.
The complaint, as reported by Bloomberg, reads:
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.
The iPhone maker asserts the royalties should be based on the value of the processor chip that includes the technology, which would come out to a fraction of what Ericsson is asking.
Further, Apple has requested the court assign a reasonable royalty rate if Ericsson’s patents are deemed essential and Apple is found to infringe on Ericsson’s IP.
“We’ve always been willing to pay a fair price to secure the rights to standards essential patents covering technology in our products,” said Apple spokeswoman Kristin Huguet. “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.”
Ericsson has been aggressively defending a batch of its patents to milk royalties from major phone makers, including Samsung and Xiaomi, which use the IP across a range of devices.
Apple currently licenses a number of Ericsson’s allegedly standard-essential patents, according to the agreement which was signed back in 2008 soon after Apple launched the iPhone.
The complaint did not reveal how much Ericsson is demanding, neither the representatives at Ericsson have said a word on the suit yet. We’ll update you as the story develops.