Apple Agrees to Pay Nokia in Patent Fight -- WSJ

By Dominic Chopping and Sam Schechner 

Apple Inc. and Nokia Corp. settled dueling lawsuits over what Apple should pay for intellectual property used in its iPhone, a surprisingly quick end to what analysts had said could have been years of litigation.

The companies didn't disclose financial terms, but said Tuesday that Apple has agreed to make an upfront cash payment to Nokia, with additional payments over the term of the "multiyear" deal. The companies also said that Apple will resume selling Nokia's digital health products -- which include Withings-branded connected objects -- in Apple retail and online stores. Nokia has said it is devoting considerable investment in that product line.

The quick resolution to the deal surprised patent experts who had been expecting a drawn-out fight over multiple countries. The deal could also help cash flow and product sales for Nokia, whose stock rose more than 6% in early afternoon trading.

Analysts said the agreement frees up legal resources for Apple, which is locked in an intensifying patent fight with Qualcomm Inc. over how much Apple should pay for intellectual property used in Apple products.

"It sounds like business considerations other than patents played a role here," said Florian Mueller, an independent intellectual property analyst. He said: "This deal should allow Apple to focus on the dispute with Qualcomm, which is economically and strategically much bigger."

At the end of last year, Nokia confirmed it had filed actions against Apple in 11 countries in total, saying the U.S. company violated 40 of its patents covering technologies such as display, user interface, software, antenna, chipsets and video coding.

At the same time, Apple filed a suit in the U.S. District Court for the Northern District of California, arguing that Nokia excluded some patents from a 2011 agreement and transferred them to third-party companies "to be used for extorting excessive royalties" from Apple. It asked the court to award damages and rule that Nokia breached its contract.

Write to Dominic Chopping at [e-mail] and Sam Schechner at [e-mail]

(END) Dow Jones Newswires

May 24, 2017 02:48 ET (06:48 GMT)

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