Strategic CIO // IT Strategy
03:57 PM

Samsung, InterDigital Settle Cell Phone Patent Suit

The multimillion-dollar arbitration involves Samsung's sale of 2G products and 3G patent licensing.

InterDigital and Samsung Electronics have settled longstanding patent-infringement litigation over cell phone broadband technology.

According to a release by InterDigital, the arbitration issues involving Samsung's sale of 2G products and 3G patent licensing disputes calls for InterDigital to grant Samsung "a royalty-bearing license covering Samsung's sale of all 3G products (including products built under both the WCDMA and cdma2000 standards and their related extensions) through 2012." The deal also covers certain payment disputes on Samsung's 2G products.

Signaling that Nokia is next in line to face similar litigation, an InterDigital spokesman said the case with Nokia is "very similar" to the Samsung litigation and is situated in the "same courts." Both cases have been before the U.S. International Trade Commission.

A dollar figure hasn't been released for the Samsung-InterDigital case, but telecom analyst Tom Carpenter of Hilliard Lyons told The Wall Street Journal that he estimates the value of the settlement for InterDigital to be between $400 million and $500 million over the next five years. Carpenter owns InterDigital shares, the newspaper said.

InterDigital said its agreement with Samsung calls for Samsung to choose a payment option in 45 days.

Nokia, which has been shipping up to four times as many cell phones as Samsung, is scheduled to present evidence in its InterDigital proceeding before the ITC next year, with a full ruling expected to be reached by before the end of next year. Nokia reached a patent agreement last July with Qualcomm after a lengthy and bruising battle.

Previously, InterDigital has had 3G licensing agreements with Apple, LG Electronics, and Research In Motion.

This article was edited on 11/26 to clarify InterDigital's relationship with Apple, LG, and RIM.

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