China's largest telecommunication equipment supplier, Huawei Technologies, has won a preliminary injunction prohibiting its hometown rival ZTE from using a Huawei trademark on USB broadband modems sold in Germany. The injunction is part of a larger legal battle over trademark and patent infringements the two companies are fighting in several countries.
Huawei said on Thursday it had been granted the injunction in a German court. Two weeks ago, the company filed lawsuits in Germany, France and Hungary, alleging that ZTE had infringed on a series of Huawei patents involving mobile broadband modems and higher-speed fourth generation technology known as LTE (Long Term Evolution). The lawsuits also accuse ZTE of illegally using Huawei's trademarks on some of its modem products.
A copy of the German court document said that ZTE is temporarily prohibited from using a Huawei trademark on its USB broadband modems in the country.
"The court's decision will protect our intellectual property and we look forward to ZTE ensuring that Huawei's innovations and technologies are used in a lawful manner," Huawei spokesman Ross Gan said via e-mail.
ZTE, however, contends that Huawei's lawsuit is without merit and suggests the case is being used as a tactic to interfere with the company's business in Europe.
The preliminary injunction centers on an environmental certification used in Europe indicating compliance with the Restriction of Hazardous Substances (RoHS) Directive. Huawei had designed a trademark reflecting the certification, which the company now alleges ZTE has illegally used on its own modem products.
ZTE claims it stopped using the trademark in July 2009, months before Huawei applied for it as its own with the European Union. Furthermore, ZTE argues Huawei's RoHS designed logo shouldn't even be considered a legitimate trademark.
"This is like having a little bit of graphic design around the words 'energy saving', and use it as a trademark of household appliances," ZTE said in a statement. "There is a clear lack of legitimacy."
ZTE added that it believed the trademark case goes "beyond normal technology, marketing and legal litigation."
"ZTE's determination to explore the European market will not be impeded by this or any such action. The preliminary injunction will not impact on ZTE's business," the company said in a statement.
Shortly after Huawei filed its lawsuits in Europe, ZTE fired back with its own patent infringement cases against its rival, filing them in China. ZTE has also applied with the E.U. to revoke Huawei's RoHS trademark.
Both Huawei and ZTE are based in the Chinese city of Shenzhen, but their market reach has grown to expand outside of China. A majority of their revenues come from foreign countries -- about 54 percent for ZTE, and two-thirds for Huawei. Both mobile broadband modems and higher-speed LTE networks represent major product markets the companies compete in.