All eyes on legal case over essential patents relating to smart autos

Global tech companies and the auto industry are fighting a lawsuit involving standards-essential patents of telecommunications technologies used in intelligent vehicles, which the domestic industry should pay attention to, intelligent property experts said.

Standards-essential patents are the ones a company must use when using standardized technologies in the industry, giving them a key value among all patents.

Last year, German carmaker Daimler and other companies complained to the European Union’s antitrust regulator about the fees charged for technology patents by Finnish telecoms equipment maker Nokia.

Daimler, German electronics company Bury Technologies, German car parts maker Continental, France’s Valeo and chipmaker Gemalto have filed a complaint with the European Commission about the fees demanded by Nokia for patents that are essential to car communications.

“We want clarification on how essential patents for telecommunications standards are to be licensed in the automotive industry. Nokia has so far refused to comprehensively and directly license our suppliers,” Daimler said.

“Fair and non-discriminatory access to these standards for all users of the essential patents for telecommunications standards is a key prerequisite for the development of new products and services for connected driving.”

Nokia said in a statement that it continues to work toward resolving commercial disputes related to licensing its standardized cellular technologies.

In December, Nokia, Daimler and several car parts suppliers agreed to independent mediation to resolve their technology licensing dispute.

“We expect the mediation to take place soon and look forward to a constructive dialogue with all parties with the aim of reaching an amicable and definitive resolution,” Nokia said in a statement. No specific proposal has been revealed so far.

He Xuwen, deputy secretary-general of the Patent Protection Association of China, said there is no doubt that enterprises should be charged when using others’ patents.

“China’s auto companies should attach importance to technological innovation and IP protection,” he said. “Carmakers should pay attention to patent infringement from design to manufacturing processes. When it comes to infringement, they need to avoid the unauthorized use or ask for permission and

for the patents,” he added.

Cong Fang, director of the Intellectual Property Research Institute of the China Anti-Infringement and Anti-Counterfeit Innovation Strategic Alliance, suggested companies use cross-licensing patents as an approach to settling patent lawsuits they are involved in.

“Enterprises should learn about the industrial layout and make full use of their technologies, which are a bargaining chip in trade talks,” Cong said. She noted that patents are not only a legal matter, but a complex business issue.

Deng Wei, co-partner of Beijing Merits and Tree Law Offices, said whether companies choose to sue depends on their business modes.

Selling patents may become one of Nokia’s revenue streams, after it stopped selling cellphones. All patents are valid for 20 years, Deng said.

While Chinese telecommunication company Huawei has different business models, it has taken a leading IP role, owning 15 percent of all the 5G standards-essential patents in the world, according to German patent data company IPlyticsIn.

Huawei entered the connected vehicle market in 2013 and has developed its own intelligent system, which means the company has more choices with these patents.

Deng added that the final negotiated patent-licensing fee in the dispute between Nokia and Daimler would be an important reference for China’s enterprises, which have applied the most 5G standards-essential patents.

Chinese companies are the world’s No 1 filer of 5G standardsessential patents in the communications sector by the end of last April, accounting for 34 percent of the global total.

Three industrial leaders from China were included in the top 10 list of 5G standards essential patents owners. In addition to Huawei, ZTE Corp and the China Academy of Telecommunications Technology ranked fifth and ninth respectively.

Enterprises should learn about the industrial layout and make full use of their technologies, which are a bargaining chip in trade talks.”

Cong Fang, director of the Intellectual Property Research Institute of the China Anti-Infringement and Anti-Counterfeit Innovation Strategic Alliance