Nokia disallowed from calling truce in InterDigital dispute

In the latest turn of events in a patent infringement case characterized by strange turns of events, a move by plaintiff Nokia to force defendant InterDigital to settle their unique dispute through arbitration backfired, when a judge said they can't. Last Thursday, as first detected by The Wall Street Journal's Julia Angwin, New York District Judge Deborah Batts ruled that Nokia waived its right to arbitration by essentially making this dispute the court's business in the first place.

It is the weirdest dispute one can possibly imagine, which boils down to this: Nokia claims it bargained for and received VIP status with regard to licensing fees for InterDigital's patents. But Nokia's complaint is that when InterDigital settled with Ericsson on another matter related to the same patents, the amount of the settlement gave Ericsson the better deal. After what appeared to be an initial settlement, suddenly InterDigital complained that Nokia was using its patents without license during the settlement period itself.

Fast-forward to this year, when both Nokia and InterDigital are claiming at some level that, if it hadn't been for the court itself, things wouldn't have had...to go to court. Last November, it looked like these two sides were willing to settle. A lower court ruled Nokia had that right, but a higher court review triggered by the lower court ruling overturned that decision. Essentially, you can't arbitrate a dispute that's already been hashed out in court for this long. Besides, Nokia fought for and won the right to intervene in what had been the already settled InterDigital v. Ericsson case, so why would it seek to reverse that victory?

"While certain non-final decisions of an appellate court may not qualify as law of the case, the Court has no doubt," Judge Batts ruled last week, citing prior case law, "that 'the litigation of [this] particular issue has reached such a stage that [the] court sees no really good reason for permitting it to be litigated again." In other words, arbitration at this point may mean starting over the argument from square one, effectively undoing what this and other courts have already decided.

With that, the judge granted InterDigital's request to dismiss Nokia's motion for summary judgment. As a result, the possibility that the US International Trade Commission could impose an injunction against the import of certain Nokia phones, has just been revived.