Nokia Corporation has sued Research In Motion Limited (TSE:RIM) (NASDAQ:RIMM) for breach of contract in the U.K, U.S, and Canada. This lawsuit could halt the sale of BlackBerry phones if Research In Motion does not pay Royalties to the Finnish mobile phone maker. The suit could extend to 2013, thereby impacting RIM's launch of BB10. According to a Nokia spokesman, the two companies agreed on a cross license for standards-essential cellular patents in 2003, a deal that was amended in 2008.
However, Nokia Corporation (ADR) (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) reported that, Research in Motion filed a request for arbitration with the Stockholm Chamber of Commerce, claiming that the license extended beyond cellular essentials. It is reported that the tribunal established that Research in Motion was in no position to manufacture or sell devices that use Nokia Corporation (ADR) (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V)'s WLAN without agreeing on a royalty rates, with the Finnish based company.
Research In Motion Limited (TSE:RIM) (NASDAQ:RIMM) uses WLAN (Wireless Local Access Network) technology, which is marketed under the WiFi brand, across all its BlackBerry devices. Nokia is trying to boost its royalty income following the downward trend in its phones business. Nokia is yet to report a single profitable quarter in 2012, and the same case applies to RIM. Both companies are struggling for survival in the smartphones business, but Nokia holds a great deal in patents.
Research in Motion does not rely on a third party for its OS, contrary to Nokia, which ditched its own Symbian OS in favor of Microsoft Corporation (NASDAQ:MSFT)'s Windows Phone.
It seems as though patent wars in the smartphones industry will remain to be a part and parcel of every innovative idea as competitors seek to gain from their rivals.
In other patent related news, Immersion Corporation (NASDAQ:IMMR) just reached a settlement and license agreement with Google Inc (NASDAQ:GOOG) and Motorola Mobility LLC that resolves a patent-infringement lawsuit it brought against Motorola. Immersion will receive compensation for all Motorola devices shipped that use its haptic technology. It will be interesting to see what comes out of the Nokia and RIM case as the Holiday season reaches climax.
At the time of this writing, Nokia Corporation (ADR) (NYSE:NOK) shares were up 3.47 percent, or $0.11 to trade at $3.28 per share. Research In Motion Limited (TSE:RIM) (NASDAQ:RIMM) shares are up 3.9 percent.