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Apple maintains Ericsson’s patented technology no longer ‘essential’; Ericsson sues

Swedish banknote

Swedish Krona banknote via Flickr © Handolio (CC BY-SA 2.0)

The gloves are off in the Apple v. Ericsson patent dispute. The Swedish mobile  specialist is suing Apple for patent infringement after its attempts to get the smartphone vendor  into court to settle upon fair licensing terms apparently failed.

Ericsson, while no longer in the handset business, holds a mass of patents covering 2G to LTE  - aging patents, according to Apple, which declined to sign up with Ericsson to extend its existing FRAND technology license, claiming the patents were no longer that essential and that, therefore, Ericsson was charging too much for them.

So earlier this year the Swedish company applied some screws and filed for an exclusion order against Apple’s products with the US International Trade Commission (ITC).  It then filed a second ITC complaint including damages. Apple filed back, and here we are with a full-blown scuffle (see TelecomTV - FRAND or foe? Ericsson and Apple tussle over the meaning of ‘fair’ )

According to Kasim Alfalahi, Chief Intellectual Property Officer at Ericsson, "Apple's products benefit from the technology invented and patented by Ericsson's engineers. Features that consumers now take for granted - like being able to live stream television shows or access their favorite apps from their phone - rely on the technology we have developed. We are committed to sharing our innovations and have acted in good faith to find a fair solution. Apple currently uses our technology without a license and therefore we are seeking help from the court and the ITC."

One reason there aren’t more of these disputes is that a balance of terror usually exists between the big handset parties so that they can injunct each other in a tat-for-tat exchange before settling down to a cease-fire and a technology agreement - since both sides tend to lose out in full-on warfare there is an incentive to come to terms. Now that Ericsson is no longer in the handset business but keen to get payback for its patent stash, that situation no longer applies: there’s no tit for Apple’s tat, you might say.

So fending off a nagging litigant and perhaps losing an injunction or two, might be deemed too high a price for Apple to pay. According to Reuters, quoting “analysts”,  if Apple loses it would have to pay Ericsson somewhere between  US$250-750 million annually. Or, to put it another way, a tiny little fraction of its existing money mountain.

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