Samsung Electronics Co., Ltd. (LON:BC94) (KRX:005930) and InterDigital, Inc. (NASDAQ:IDCC) have signed a patent license agreement Tuesday, and the deal includes dropping all active and pending litigation against each other.
The terms of the deal were not disclosed. The royalty-bearing license agreement sets forth terms covering the sale by Samsung Electronics Co., Ltd. (LON:BC94) (KRX:005930) of 3G, 4G and certain future generation wireless products.
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InterDigital’s suit against Samsung
It may be recalled, in January 2013, InterDigital, Inc. announced that a complaint has been filed with the U.S. International Trade Commission citing infringement against seven of its patents. Well-known for having a large number of patents on wireless products, the Philadelphia-based company called for a sales ban against Samsung Electronics Co., Ltd. (LON:BC94) (KRX:005930), Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V), ZTE Corporation (SHE:000063), and Huawei Technology Co Ltd for reportedly engaging in illegal trade practices by selling certain 3G and 4G wireless devices that infringed on seven of the company’s patents.
In a statement issued Tuesday, InterDigital, Inc. (NASDAQ:IDCC) said the license agreement covers the sale of 3G, 4G and “certain future generation wireless products” by Samsung Electronics Co., Ltd. (LON:BC94) (KRX:005930) and ends all litigation between the companies until the end of 2017.
Samsung licensed InterDigital, Inc. (NASDAQ:IDCC)’s patents from 2002 to 2012, but when the licensing period ended, InterDigital immediately filed a complaint with the ITC.
According to Patrick Van De Wille, InterDigital’s vice president of communications: “As we do with all our licensees we began discussions at that point, but because we don’t want discussions to take 12 years, we also filed an ITC action”.
According to Van de Wille, InterDigital, Inc. (NASDAQ:IDCC) requested that the ITC ban Nokia’s Lumia 920, Huawei’s MediaPad S7 Pro, the ZTE Avail as well as a host of other phones from being imported into the U.S. Huawei agreed to arbitration late last year and the case continues against Nokia and ZTE.
Upped revenue guidance
Following the latest deal announcement, InterDigital, Inc. (NASDAQ:IDCC) said it now anticipates total revenue for the second quarter to be between $172 million and $210 million, compared to prior outlook of $65 million and $72 million.
The wireless research and development company’s shares gapped open sharply higher Tuesday and rose steadily during the first 45 minutes of trade before settling into a range. The stock closed up by $7.74 at $45.15 on the highest volume of the year. That price for InterDigital, Inc. (NASDAQ:IDCC) shares represents an 11-month high.