Nokia Files Lawsuit Against RIM

Nokia is launching a legal attack on Research In Motion (RIM), claiming that a contract linked to technology used for the wireless local access network (WLAN) has been breached.

The lawsuit has been filed in the U.S., U.K. and Canada; Nokia claims that a cross-licensing agreement which was signed with RIM in 2003 gave RIM access to use Nokia's standard-essential cellular patents in its Blackberry handsets. However, arbitration was sought by RIM with the Stockholm Chamber of Commerce, stating that Nokia's WLAN patents need to become a part of the licensing agreement.

However, a Swedish tribunal rejected RIM's request for arbitration, and according to Nokia, its WLAN technologies continue to be used by RIM's Blackberrys.

In a statement, Nokia said: "In 2011, RIM sought arbitration, arguing that the license extended beyond cellular essentials. In November 2012, the arbitration tribunal ruled against RIM. It found that RIM was in breach of contract and is not entitled to manufacture or sell WLAN products without first agreeing royalties with Nokia."

RIM stated that it will make no comments on any ongoing legal litigations as per company policy.

RIM has recently struggled to successfully compete in the smartphone market against incumbent companies like Apple and Google, and the claims which Nokia is currently making against it pose an even greater threat to the company.

Kevin Restivo, an IDC analyst, said that it may be most beneficial to RIM if they simply submit to Nokia's requests and sign a new licensing deal for WLAN patents.

According to Restivo: "RIM could, for example, try to develop some sort of workaround to avoid the need for a deal with Nokia which theoretically gets it out of the company's cross hairs... This option isn't likely given the complexity and time taken to develop wireless technology communication patents and equipment. It's far more efficient to pay the patent holder, in this case Nokia... There's no sign an injunction of any sort is imminent so RIM could still pursue other legal avenues as it sees fit."

RIM is also only two months from launching its new next-generation mobile operating system, Blackberry 10, and some say this is the company's final chance to prove themselves in the market. Nokia's lawsuit thus comes at an important time for RIM. (CY) Link