Apple Settles Patent Lawsuit With Nokia For A Whopping US $2 Billion

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Apple Settles Patent Lawsuit With Nokia For A Whopping US $2 Billion

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Apple seems to be in a mood for catching a break from the “Smartphone Patent Wars”. After battling the patent violation lawsuit with Samsung, Apple seems to have decided on settling the patent infringement dispute with Nokia back in May. Apple seemed eager to avoid the legal battle like the one with Samsung and both the companies agreed on moving from adverseries to business partners.

The details of settlement were initialy announced without disclosing the terms and the value of the settlement. According to the recent reports, Nokia announced that it has received a US $2 billion upfront cash payment from Apple (€1.7 billion) to settle the case. The terms of the new licensing deal are yet to be disclosed, including, whether Nokia would receive a US $2 billion quarterly payment or whether this was non-recurring catch-up settlement. Though the possibility of Apple paying US $2 billion quarterly to Nokia seems highly unlikely.

The original lawsuit began in December with Nokia accusing Apple of patent infringement in multiple countries. Apple was also accused of infringing patents from Nokia subsideries – NSN and Alcatel-Lucent.

At the center of the dispute were 32 patents involving the iPhone 3GS and subsequently launched iPhones (along with other Apple products) which Apple claimed Nokia intentionally left out of a 2011 licensing agreement. The lawsuit allegedly covered many elements of smartphone handset design and functionality, with Nokia’s patent portfolio spanning display technology, antennas, chipset, user interface and more.

Apple responded to the lawsuit with its own and removed Withings’ products (a division of Nokia) from its online store and worldwide Apple stores. Both companies, soon after resolved the issues as Apple started restocking Withings products, with new licensing terms and agreeing to a joint effort to explore “future collaboration in digital health initiatives.”

After the settlement, Apple and Nokia decided to take the usual patent licensing deal a step further by collaborating on technology along with research and development. The collaboration indicates that Apple might be paying Nokia to help explore the technologies related to digital health, optical network and IP routing.

No information has been received about how Nokia plans to invest the upfront cash payment received from Apple. Whereas for Apple, it may not be a major financial setback, as according to reports, the company has more than a 750 billion dollars in cash and investments.

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Anshika Jain