Micromax-Ericsson patent feud: Top ten facts

Micromax's Funbook Talk tablet, which is part of the current patent lawsuit.
Micromax’s Funbook Talk tablet, which is part of the current patent lawsuit.

Chances are that you would have heard about Ericsson’s INR 100cr lawsuit against Micromax for allegedly infringing upon the Swedish company’s GSM, EDGE and 3G patents also known as standard essential patents (SEP). The matter is currently sub-judice and Delhi High Court recently ordered Micromax to pay Ericsson royalties on every phone/ tablet shipment that infringes on Ericsson’s patents until both the company work out a suitable agreement.

The case being one of the first smartphone patent lawsuits is likely to become a trend-setter and will have huge implications on other home-grown manufacturers, who are also most likely infringing on such patents but were being ignored by the patent holders because of their meagre device shipments. However, after the recent smartphone revolution in the country, and the increasing popularity of local manufacturers, the situation is changing and companies like Micromax, Karbonn, Lava are now shipping smartphones more than ever.

Everyone in the Indian smartphone industry including us will be keeping a keen eye on the result of Micromax-Ericsson lawsuit and to give you all the existing facts in a gist; we have compiled this list of top ten facts.

  • According to Ericsson, it decided to sue Micromax after the failure of three-year long negotiations
  • The current lawsuit includes Micromax’s Ninja handset series, the Canvas 2 handset series and its Android tablet Funbook Talk.
  • The interim royalties’ agreement is only valid until 09th April, 2013, by which time Ericsson and Micromax have agreed to negotiate a FRAND License Agreement.
  • In the case that both parties are unable to arrive at FRAND terms that could opt for mediation under a court-appointed advocate.
  • The interim agreement terms will have no effect on the possible settlement or court verdict.
  • Until April 9, Micromax has agreed to pay 1.25% of sale price of GSM mobile device shipments, 1.75% of sale price of phones/devices capable of GPRS + GSM, 2% of sale price of phones/devices capable of EDGE + GPRS + GSM, WCDMA/HSPA phones/devices, calling tablets and a fixed $2.50 for Dongles, data cards shipments.
  • Micromax will intimate Ericsson whenever a new device consignment arrives at the Customs within 24 hours, to allow them to inspect the consignment for possible infringing devices.
  • Micromax will have to make a deposit of interim payments in Court within five working days of the intimation by Customs of the arrival of the device consignment.
  • Royalties for the past period for the past period will be negotiated as part of the final FRAND agreement.
  • Micromax has said that is committed to negotiating a FRAND license with Ericsson as Ericsson has undertaken to provide a Fair Reasonable and Non-Discriminatory (FRAND) license to Micromax.

Full court order available here.

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