Daimler and Nokia settle long-running patent spat over cellular tech Nokia and Daimler have resolved a long-running patent dispute, with both sides halting any pending litigation across the world and the German carmaker agreeing to pay licence fees. Neither parties disclosed the terms of the agreement, or whether it pertained to any specific patents. Last August, a Mannheim court ruled Daimler …
Surely Daimler are not manufacturing these chips?
The chips surely must be being built under licence buy some other company who are paying royalties to Nokia. Daimler will just be buying pre-built units or modules. Or have Daimler been knowingly buying shonky, unlicensed rip-offs from a white-box builder in China who are too difficult to take to court?
Clearly, I don't understand this patent malarky!
I agree, the modules will be an off the shelf module (or close to being), the problem is how would you enforce this. If the ruling had gone to Nokia then they could have stopped any new cars being fitted with the modules. But would they then be forcing all the existing cars must have the module disabled.
The reason the FRAND rules exist Is that the standards need to be available to everyone. Yes the companies need to be able to recover the costs in developing the technology but if you start to block people adopting it will at a reasonable cost then the development cost won’t be recovered.
The best conclusion would be a negotiation on a suitable licence fee (although surely it should be designer selling the board) for anything going forward and then a one off charge to cover all the devices already shipped.
But then I am probably being far too sensible to be a parent lawyer….
Unfortunately, it doesn't work like that.
I am not a patent lawyer, but this gets reported often enough, so I'll give it a try.
The chip manufacturer pays his license fee in order to sell the chips... If he sells them to an end user, or builds them into a finished product themselves, that is the end of the story.
The problem is, Daimler isn't an end user. They buy those components and attach them to their car control systems and entertainment system, thus making an end-product that has technology that uses those patents, so those have to be licensed as well.
Nokia is legally obliged to provide Daimler access to use the patents at FRAND rates (i.e. if everybody else is paying 5c per chip, they can't turn to Daimler and say, "we don't like you, we want 1,000€ per chip.") and Daimler is legally obliged to license those patents for its finished products.
It is a bit of double-dipping, IMHO, but that seems to be the way the law works, from what I've seen reported here and elsewhere.
It is all fiendishly complex and that is the best I can do to approximate my understanding of how the situation works. But I might also have the wrong end of the stick...
IANAPL, also, but that seems bent even if probably true. Probably akin to buying a DVD and selling it on to someone selling tickets to see the film in private screenings.
IIRC, FRAND rates sometimes came in "x% of finished product sale price". Might have been an interesting discussion at that time...
There is another possibility: that whoever made the chips isn't in a country governed by the European Patent. A patent is a monopoly granted on the invention which allows the patent holder to stop others using it. The invention can't be made, sold, imported or used without the patent-holder's permission. If the chips are made outside the EU, and even integrated into a larger component for Daimler outside the EU, then Daimler are on the hook when they import it.
If the chips are made in China or Taiwan, then Nokia would need a Chinese or Taiwanese patent on the same invention to enforce it at source. Even if they have one, then Nokia may have chosen to go through a German court instead. As the patent holder, they can choose where to enforce it, and also choose who they want to enforce it against.
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