Ipcom demands that German retailers halt HTC sales

PATENT COMPANY Ipcom has written to retailers in Germany to demand they stop sales of HTC 3G handsets in Germany.

Ipcom said that HTC has not responded to its request to stop "the illegal use of IPCom's patents", so it is seeking fines from HTC as well as targeting retailers with further patent lawsuits.

Ipcom has also asked the Mannheim District Court to initiate penalty proceedings for contempt of court against HTC. It said that under these proceedings the court can impose fines of up to €250,000 per violation.

On 25 November, HTC dropped its appeal against an injunction granted by the District Court of Mannheim, which ruled that HTC was infringing one of IPCom's core patents.

Ipcom said, "HTC however refuses to respect the final German court decision, leaving Ipcom no choice but to execute the injunction."

Ipcom last week asked HTC to stop selling all 3G devices in Germany and disclose its current German sales figures in order to allow a proper assessment of HTC's alleged "illegal use" of Ipcom's intellectual property.

IPCom said, "HTC has not stopped selling its 3G handsets in Germany - even though the decision of the District Court Mannheim addresses all 3G mobile phones - it has not disclosed its current relevant sales figures, nor has it approached IPCom with an offer to license the patents under fair monetary conditions."

Last week, HTC responded to the demand by Ipcom to stop selling its 3G products in Germany, claiming that the disputed patent is invalid and that it has "legally outmanoeuvred" Ipcom.

HTC said that it decided to drop its appeal because it believes that the Karlsruhe Court of Appeal would not reinstate an injunction against its products, since the Federal Patents Court (FPC) ruled that the patent in question was invalid.

The company said that this FPC ruling renders the 2009 verdict, upon which Ipcom rests the majority of its case, inconsequential, and that it expects the German Supreme Court to agree with it on this matter.

It also said that even if the patent was valid, HTC has implemented a design workaround that puts its products outside the remit of that patent.

"IPCom has given HTC every chance to take a fair license for the Bosch inventions, or to comply with the judgment handed down by the court, but HTC has not contacted us, let alone made any attempt to come to a fair licensing agreement with us. Instead, they continue to infringe our patents every day, without paying a cent for the use of technology they did not create, but rather Bosch, and from which the Taiwanese company benefits so enormously," said Bernhard Frohwitter, MD of IPCom. "That is intolerable, it disregards our legal system and invites everybody to copy and exploit technology abroad created here by German companies."

IPcom said it has therefore "been left with no choice", and is "now forced to take specific measures to protect its intellectual property from illegal copying".

The firm said the patents describe an algorithm that allows mobile telephony networks to assign priorities to mobile phones on the basis of a pre-defined hierarchy, providing for the smooth functioning of the system in emergencies and overload situations.

IPCom is also seeking similar injunctions against Nokia.

Update
HTC has sent us a statement, which said, "On Tuesday, HTC was informed that IPCom had written to German retailers and wholesalers requesting them to cease sales of HTC 3G handsets. Once again, HTC would like to set the record straight.

"The letter to German retailers alleges that a number of HTC’s handsets infringe the so-called #100a patent. In fact, the patent from which HTC withdrew its appeal last week was the #100 patent.

"Whilst the #100a patent is a related patent to #100a, IPCom does not have a finding of infringement of the #100a patent against HTC, no injunction has been handed down and, to HTC's knowledge, IPCom has not initiated new infringement proceedings against HTC.

"Patent #100a is currently in opposition proceedings before the European Patent Office and the current indications are that it will be revoked at the 24th April 2012 hearing.

"We reiterate our position that the original injunction in the #100 case relates to only one, now-obsolete, handset, which is no longer being sold in Germany. This position is supported by earlier rulings of the Court of Appeal in Karlsruhe in other related IPCom cases. As a precaution, we have an alternative implementation of the standard in place, which does not infringe the interpretation given to the #100 patent by the Mannheim Court or any possible interpretation of the #100a patent. HTC remains respectful of the intellectual property rights of others and has concluded licences with many essential patent owners.

"It is regrettable that IPCom has demonstrated that it is prepared to go to any lengths, including contacting our customers, to advance what we consider to be disproportionate and unjustifiable claims. We will continue to fiercely defend our business interests and those of our customers and partners." µ