Chinese smartphone maker Xiaomi has been in rapid expansion mode for some time now, and the company has been made growth in India one of its highest priorities. Unfortunately, Xiaomi hit a bump in the road on Thursday when the Delhi High Court granted an injunction that prohibits the sale, advertising, manufacturing and import of Xiaomi devices that infringe upon the IP of Swedish firm Ericsson.
Xiaomi Corp. usually sells between 65,000 to 100,000 units per week, with special events causing sales to spike up to 175,000 phones a week. Of note, the privately held smartphone maker is reportedly also exploring options with Foxconn to manufacture its line of devices in India or Indonesia.
Statement from Xiaomi India Head
According to a statement from Manu Jain, the chief of Xiaomi’s India operations, the company has not yet received an official notice from the Delhi High Court, and that Xiaomi India is currently evaluating the situation. “India is a very important market for Xiaomi and we will respond promptly as needed and in full compliance with Indian laws. Moreover, we are open to working with Ericsson to resolve this matter amicably,” he continued.
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Details on the Delhi High Court decision
A report from SpicyIP notes that apparently one of the main reasons the Delhi High Court granted the injunction was because Xiaomi had not responded to Ericsson (ADR) (NASDAQ:ERIC)’s at least six requests for communications since July of 2014. Of interest, the report closes by somewhat ambiguously saying that the injunction granted by the Delhi High Courts “is not in conformance with either international practice or domestic local law”.
Assuming that the matter is resolved expeditiously, the injunction should just be a blip on the radar for Xiaomi and their big plans for India. If, however, the dispute between the two companies drags on for some time, the Chinese firm risks losing the strong sales momentum they’ve already generated in the country.