Huawei files antitrust complaint with EC against InterDigital

Huawei alleges that InterDigital has breached guidelines on FRAND licensing

Chinese communications equipment company Huawei Technologies has filed an antitrust complaint with the European Commission against patent company InterDigital, claiming it is abusing its patents allegedly essential to the 3G (UMTS) standard, it said Thursday.

Describing InterDigital as a non-practicing entity, Huawei said in a statement that the U.S. company is seeking to leverage its declared 3G standards essential patents to force Huawei into a "discriminatory, unfair, and exploitative" license.

Huawei alleged that InterDigital's demand breaches the policies of the European Telecommunications Standards Institute calling for fair, reasonable, and non-discriminatory (FRAND) licensing practices by technology patent holders, and Article 102 of the Treaty on the Functioning of the European Union. The company has asked for the EC's intervention.

FRAND licenses allow companies to develop open standards by sharing information and technology. Article 102 of the Treaty on the Functioning of the European Union deals with the abuse by one or more undertakings of a dominant position within the internal market, including directly or indirectly imposing unfair purchase or selling prices or other unfair trading conditions.

Huawei said it has been negotiating to reach an agreement with InterDigital on licensing fees for mobile devices, but decided to file the complaint as it sees "no foreseeable resolution".

InterDigital has asserted eight patents that it alleges are essential to standards, and is seeking an exclusionary order at the US International Trade Commission on this basis, said Huawei spokesman Roland Sladek in an email on Friday. "Our aim is to reach a fair, reasonable and non-discriminatory agreement with InterDigital, based on the European Commission's guidelines," he added.

InterDigital, which describes itself as a developer of fundamental wireless technologies, said in a statement that it has not seen the complaint that was filed, so it cannot offer a specific response to whatever issues might be raised in it.

Over the past three decades, InterDigital's research and development team has developed fundamental wireless technologies that have shaped the cellular industry, and has built a portfolio of over 19,500 patents and patent applications as of Dec. 31, the company added.

InterDigital of King of Prussia, Pennsylvania said in January that it had decided to include patent sales and licensing partnerships in its business plan after its review of strategic alternatives failed to get an offer for the whole company. It said it had received nearly US$3 billion in royalties from 2G and 3G licenses through Dec. 31, and saw great potential for the company's licensing program for LTE.

Huawei said it had filed 57,972 patent applications by December, of which 23,522 had been granted. A number of patent related disputes turn on companies' differing views of what constitutes FRAND licensing terms for patents.

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John Ribeiro

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