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InterDigital Seeks Payments from Nokia

Tue, 02/27/2007 - 3:27pm
Monica Alleven

InterDigital Communications Corporation plans to continue fighting for technology licensing payments it says Nokia owes the company.

InterDigital contends a federal court confirmed an arbitral award against Nokia, but Nokia is appealing it. In December, the federal district judge presiding over the enforcement proceeding between InterDigital and Nokia confirmed a final award that was issued in June by the Arbitral Tribunal. Nokia filed notice of appeal.

"I am disappointed that Nokia has elected to pursue yet another legal challenge to its royalty obligations to InterDigital in spite of an unambiguous confirmation of the Final Award by the federal court," InterDigital President and CEO William Merritt said via a press release. "We will continue to pursue all legal remedies to secure payment, and we remain confident that Nokia will pay the amounts due, either of its own accord or by court order."

A Nokia spokesperson was unavailable to comment before press time.

The dispute between the companies dates back to patent licensing agreements signed in March 2003 between InterDigital, Ericsson and Sony Ericsson that established the framework for Nokia's royalty obligations for 2G and 2.5G handset and infrastructure sales, according to InterDigital. After those patent licensing agreements were signed, InterDigital notified Nokia of its royalty payment obligations. Nokia disagreed with InterDigital's interpretation of the impact of the licensing agreements.

Earlier this week, InterDigital shares set a new 52-week high after the company announced a 5-year patent license agreement with LG Electronics. Under the deal, LG will pay InterDigital three equal installments of $95 million in the first quarters of 2006, 2007 and 2008. At the end of the five years, LG will receive a paid-up license to sell single-mode GSM/GPRS/EDGE terminal units.

Shares in InterDigital were down slightly at mid-day Eastern time today, trading at $24.17.

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