Nokia vs. Qualcomm

Distric Court of The Hague, 14th november 2007, Nokia vs. Qualcomm, Case number: 287058/HA ZA 07-1470

Patent case. No exhaustion of rights. Nokia demands a declaration in law. The court only has jurisdiction for as far as the claims relating to the Dutch claims.

Nokia and Qualcomm signed a licensing agreement (the SULA) in which Qualcomm gave Nokia a licence relating to patents owned by Qualcomm for the use of WCDMA-technology. After the SULA expired Nokia continued use of the rights pertained in the SULA without remunerating Qualcomm. Qualcomm also has an agreement with Texas Instruments in which it is stipulated that parties won’t litigate against each other on matters concerning the production and sale of chips and chipsets. The grounds for this agreement lie in their patent rights. Nokia and Qualcomm also have disputes in Germany and Italy.

In short Nokia claims a statement to declare it to be law that all Qualcomm’s patent rights relating to chips and chipsets have been exhausted for the Dutch market. Furthermore it claims that because of the exhaustion in the Netherlands the patents should also be considered  exhausted in the EU and the whole EEC. The foundation for this claim is that the chips or chipsets bought by Nokia from Texas Instruments with Qualcomm’s permission have been put onto the European market. Qualcomm replied to this with motivation and invokes that the court has no jurisdiction regarding Nokia’s claims.

First of all Qualcomm invokes invalidity the of the writ of summons because it views it to be unclear and too unspecific. The invalidity defence does not succeed. The court considers:

“4.2 This plea does not succeed. Even though Qualcomm is correct that the writ of summons has a quite broad tenor, the claim and the grounds have been included sufficiently clear. Therefore, the writ of summons meets the requirements of article 111 paragraph 2 of Dutch Civil Code of Civil Procedure. Qualcomm unsuccessfully pleaded that it was not able to put up a decent defence and therefore is harmed in its interest. As appears from its defence in the Statement of Defence and during the hearing, Qualcomm on the contrary has understood the essence of the plea of Nokia apparently very well. The (possibly) broad tenor of the claim of Nokia is a question which should be answered within the framework of the discussion of the awardness of the claims, which is dealt with hereinafter.”

As regard to the jurisdiction of the court the court rules firstly that Nokia’s claims are a request based on article 53 ROW 1995 (Dutch patent law of 1995):

“4.5 () This declaration is, against the background of Nokia’s statements, substantively equivalent to and can be put into line with a declaration that certain acts, namely selling mobile phones containing TI chips, are not infringing Qualcomm’s patents rights valid in the Netherlands.”

Furthermore the court rules that a request for a declaration for it to be law of non-infringement is not the same as an injunction request (see consideration 4.5)

The court rules that it only has international jurisdiction for so far as the request is relevant for the Netherlands and this jurisdiction is not international by nature. Nokia’s claim taht exhaustion in the Netherlands causes exhaustion in the EU and EEC is not followed by the court:

“4.10 ()From the provisions of the EC Treaty or Article 94 of the Constitution no international (cross-border) jurisdiction can be derived. As considered in the above, the jurisdiction of the Dutch court is restricted to an assessment of whether Nokia’s acts are infringing the Dutch patents or the Dutch parts of the European patents from Qualcomm.  The assessment as to whether other than the aforementioned patent rights are exhausted must – in the absence of other reference points  – take place by the

court of the country of the foreign patent right (where the damage occurs). The Dutch court has in this respect no jurisdiction.”

Qualcomm’s second jurisdiction defence based on article 27 EEX-Vo also fails as the foreign procedures (in Germany and Italy) are based on different patents or on different claims or causes.

The court rules that the request for a declaration of exhaustion for the Netherlands is too broad and not specified sufficiently:

“4.15 ()the claim, has been formulated too broad and insufficiently specific. From the used formulation (“patents of Qualcomm that are realised through this chip”, see ground 3.2 under d of this decision) it cannot be determined whether the exhaustion has taken place.”

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okia has refrained form specifying the patents of Qualcomm and the relevant claims thereof. Nokia has solely submitted one example, which furthermore solely regards an application (EP 1 239 465 A2). In addition it has not specified which specific products would be brought within the free movement of goods and what the exact configuration of these products would be, nor where it regards the chips of Texas Instruments, nor where it would regard Nokia’s own mobile phones.

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Nokia has refrained form specifying the patents of Qualcomm and the relevant claims thereof. Nokia has solely submitted one example, which furthermore solely regards an application (EP 1 239 465 A2). In addition it has not specified which specific products would be brought within the free movement of goods and what the exact configuration of these products would be, nor where it regards the chips of Texas Instruments, nor where it would regard Nokia’s own mobile phones.

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Nokia has also not specified which features of which patent(s)(claims) would read on which parts of the chips of the mobile phones. In view of the different types of possible claims – Nokia itself mentions apparative claims, process claims and system claims -  it is thinkable that there are many permutations. In view of the foregoing it is

unclear which type of claims in relation to which products may possibly be exhausted. Another thing is that it also depends on the type of claim whether or not (implicit) consent has been given by the patentee for the placing of the products within the free movement of goods, for so far the TI patent portfolio agreement would contain such consent, that which Qualcomm has contested. Therefore, the by Nokia chosen general formulation of the claims are not allowable.”

Finally, the matter of compensation of procedural costs. Even though Nokia is ordered to pay the costs of the procedure as the losing party, cost are calculated at the standard rate, as Qualcomm did not fully justify its claimed costs. Qualcomm did not provide a specified account of its incurred costs.

Read the entire judgement here.