InterDigital vs Samsung arbitration awards
InterDigital vs Samsung arbitration awards
Wireless technology company InterDigital Communications Corp. announced it has been awarded $134 million by an arbitrator in a decade-long royalty dispute with South Korean-based Samsung Electronics Co. Ltd.
The arbitration award for InterDigital (King of Prussia, Pa.) covers past royalties plus interest on Samsung’s sale of single mode 2G GSM/TDMA and 2.5G GSM/GPRS/EDGE terminal units through 2005. The arbitrator said Samsung would have to pay InterDigital $17 to $21 million to cover royalties for the first half of 2006.
In a separate matter, the arbitrator determined that Samsung has not obtained the broader CDMA and 3G patent license rights in the Nokia agreement with InterDigital.
In Feb. 1996, Samsung entered agreements with InterDigital which covered both technology development and patent licenses. As part of the agreements, Samsung paid approximately $35 million up front to InterDigital.
As part of an arbitration proceeding concluded in 2002, Samsung elected, pursuant to its most favored licensee clause, to base its royalty payments commencing Jan. 1, 2002 for TDMA-based wireless communication products on the terms of InterDigital’s patent license agreement with Nokia.
Subsequently, InterDigital and Ericsson and Sony Ericsson established the framework for Nokia’s royalty obligations for 2G GSM/TDMA and 2.5G GSM/GPRS/EDGE handset and infrastructure sales in March 2003.
Samsung disagreed with InterDigital’s interpretation of the impact of these patent licensing agreements and requested binding arbitration in Nov. 2003 to resolve the dispute.
Earlier this year, InterDigital agreed on a license deal with South Korea-based LG Electronics. Under that agreement, LG would pay InterDigital $285 million over a three-year period to use its 2G and 3G technologies. The amount includes royalties for technologies LG had used in the past.
