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Smart phone international trade exports encounter a patent war, and cautious response is the key

2022-10-24

The global patent war between the smartphone manufacturer and mobile Internet service provider OPPO and Nokia has lasted for a year. When people were still wondering whether OPPO would stop selling products in Germany, the dispute had new news.

It is revealed that OPPO has amended several German patent infringement counterclaims against Nokia and started to seek injunctive relief in addition to claiming compensation. In addition, OPPO obtained new favorable results in the German lawsuit. The court in Munich, Germany, recently agreed to suspend the infringement proceedings of two other Nokia patents. In German proceedings, suspension generally means the victory of the defendant, unless the patent involved can be confirmed to be valid in parallel invalid proceedings, but it generally takes 1 to 2 years to confirm whether it is valid.

At the same time, the Intellectual Property Court of the Supreme People's Court also made a final ruling on the jurisdiction of OPPO v. Nokia on the global licensing fee dispute, and rejected Nokia's appeal. The Intellectual Property Tribunal of the Supreme People's Court determined that China is one of the main places for licensing the standard essential patents involved in the case, negotiating the licensing agreement, performing the reasonably foreseeable post contract, and implementing the main licensing. It has a fairly close geographical connection with the case dispute, and has made it clear that the Chinese court has jurisdiction in OPPO v. Nokia.

At present, OPPO has obtained 4 prohibitions in Germany (OPPO is still in the process of appeal), and in turn, 4 patents of Nokia have been successfully suspended by OPPO in Germany, and the patent war between the two sides is still in a white hot state.

"The reason why Nokia sued OPPO for infringement is not to investigate its infringement, but to hope to achieve cooperation and gain benefits." Liu Yi, a risk compliance expert of Dow Jones, told reporters that currently, taking patents to negotiate with emerging technology companies has become the main way for Nokia to survive. With Nokia's complete withdrawal from the mobile phone market, its patent licensing revenue has become the most important source of revenue for the company. Since 2017, Nokia's annual revenue from patent licensing has been more than 1.5 billion euros, accounting for more than 85% of the company's net revenue. During this period, there have been patent lawsuits with several major mobile phone companies, such as Apple and Vivo, due to patent fees.

In recent years, OPPO has continuously expanded its patent layout during the process of going to sea, making Nokia smell a crisis. Public data shows that OPPO has applied for more than 80000 patents worldwide and granted more than 40000 patents worldwide, among which the number of invention patent applications accounts for 90% of all patent applications. According to the ranking list of international patent treaty applications in 2021 released by the World Intellectual Property Organization, OPPO ranks sixth in the world; In the report on the number of necessary patents claimed for the global 5G standard issued by IPlytics, a leading German research institution, in June 2022, OPPO ranked among the top eight in the world.

"Nokia may feel threatened by OPPO's achievements in patents." Liu Yi said that many foreign established enterprises put forward unreasonable high patent charges to Chinese enterprises entering the international market, and threatened to sue if they were unwilling to cooperate. If Chinese enterprises blindly choose to accept their rules, they will inevitably reduce profits. It is difficult to achieve scientific and technological innovation, and they can only move forward passively. If OPPO fails in the patent war with Nokia, the price of local mobile phones will inevitably rise, which is also a big loss for consumers.

Liu Chunquan, a partner of Duan He Duan Law Firm in Shanghai, believes that as Chinese international trade enterprises continue to expand their influence overseas, it is only a matter of time before they encounter the challenge of patent litigation. From another perspective, enterprises can realize the importance of patent protection. Patent litigation is unavoidable. Enterprises going abroad need to know more about foreign markets and legal rules. They should not only be calm, but also attach great importance to it and deal with it seriously.

"If the cooperation cannot be reached, the hooligan who initiates patent litigation aims at money. If it cannot be taken arbitrarily, it can only be lured by profit. Some enterprises that are confident in the development of overseas business can actively negotiate with patent hooligans who often initiate litigation at the initial stage of overseas expansion and when the scale of overseas business is small, which may solve future risks at a very low cost." Yan Xin, head of Huawei's intellectual property department in Beijing, said.

"It is not entirely a bad thing for Chinese international trade enterprises to deal with overseas patent litigation - on the one hand, when fighting back, it can urge enterprises to reflect on whether their own patent quality is excellent, which is helpful to improve the patent quality and layout of international trade enterprises; on the other hand, enterprises can understand and be familiar with local legal rules and judicial procedures in practice, improve the experience and ability of the team, and improve the legal aspects of international trade enterprises " Yan Xin said.


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