Apple Sued Over Issues With Ericsson's 5G Patent Tariff

JAKARTA - Apple has been sued by Ericsson in Texas federal court, where the telecommunications company is seeking concrete evidence that the rates Apple is offering to license its 5G wireless patents are fair and reasonable.

Ericsson accuses Apple of using inappropriate tactics to lower the royalty rate it pays and refusing to license in the Standard Essential Patent (SEP), in addition to the terms proposed in a lawsuit filed Monday in Marshall, Texas.

Under international agreements, SEP is an innovation that has contributed to industry standards, such as 5G, and can be used by anyone as long as they pay a fair price for the privilege. These rates are known as fair, reasonable and non-discriminatory terms (FRAND).

This means that anyone who uses SEP in their product must pay royalties to the patent owner. Some companies with large SEP portfolios often introduce royalty limits in an effort to prevent possible legal disputes, which are not uncommon among large vendors

In Ericsson's lawsuit it says they started negotiating a new license with Apple at the end of 2020, and Apple remains on its position that Ericsson's rates are not FRAND and the only way to make it FRAND is to adhere to Apple's self-declared standards of methodology.

In addition, Apple is also demanding that owners of standard essential patents allow it to examine, assess, and license each individual patent in its portfolio at its sole discretion. Ericsson said Apple required them to prove to the company that any patents were important, valid and had been infringed.

Further, the lawsuit comes as the company, which settled a previous licensing dispute in 2015 amid a California court battle, is deadlocked in negotiations for a new license.

"Technology leaders like Ericsson, who make large initial investments in R&D, must be fairly compensated through licensing important patents, to ensure new investments in innovation and continued success of open collaborative standardization," said Ericsson spokesperson Mikaela Idermark Stern. as quoted by Reuters, Friday, October 8.

Ericsson said it began licensing its wireless patents to Apple when it first released the iPhone in 2008. Apple sued Ericsson in California in 2015 during negotiations for a new license, in a case that was settled later that year with a second deal. According to Apple in the 2015 case, Ericsson's patent in question was not important, even Apple did not infringe it, and called Ericsson's royalty demands very excessive.