Qualcomm Rejects Nokia Licensing Payment

Qualcomm and Nokia's battle over patent royalty payments intensified Thursday, with Qualcomm rejecting Nokia's $20 million USD payment for licensing WCDMA-based technologies for the second quarter of 2007.

The payment is said to be a fraction of the agreed-upon licensing fees in the 2001 agreement, and Qualcomm continues to assert that it amounts to an extension of previous agreements. It also noted the amount was far less than what Nokia is asking in return for licensing its own patents.

Qualcomm is also once again threatening legal action against Nokia, saying its claims of paying less than 3 percent licensing fees amounted to a breach of the previous contract, and that it will address the admission "through legal and contractual channels."

Based on its payment, Qualcomm is also asking an arbitrator to rule that Nokia is extending the terms of the licensing agreement and will be required to continue to pay the licensing rate as agreed to in the 2001 agreement.

"Qualcomm's agreement with Nokia requires that disputes relating to the agreement must be resolved through binding arbitration in Los Angeles," it noted in a statement.

Nokia was not available to respond to Qualcomm's claims as of press time.

Indications that Qualcomm was going to reject the royalty payment first surfaced last week shortly after Nokia publicly announced the move. At the time, the company equated the apparent underpayment to shoplifting.

"Nokia has no more right to unilaterally set a price than the average consumer has a right to walk into a store, take a product off the shelf, and walk out with it after leaving only a fraction of the established price on the counter," Qualcomm said at the time. "Leaving some money on the counter does not make the act any less unlawful."