ZTE, Ericsson agree to drop patent lawsuits

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ZTE, China’s number two telecommunications equipment manufacturer, and Swedish rival Ericsson may be close to a cross-licensing deal after agreeing a settlement of their 10-month intellectual property dispute.

ZTE, Ericsson agree to drop patent lawsuits

In a filing with the Shenzhen Stock Exchange on 20 January, Shenzhen-based ZTE said that “the two parties have mutually agreed to withdraw all patent infringement litigation against each other”, including the lawsuits filed by the Swedish company in April last year against ZTE subsidiaries in the UK, Germany and Italy, and a separate legal action initiated by ZTE against Ericsson (China) Communications, Ericsson’s PRC subsidiary.

ZTE, which is also listed in Hong Kong, said the two parties were waiting for the courts to grant their applications for the withdrawal of the lawsuits.

In its case against Ericsson, ZTE claimed the company had violated domestic patent laws related to a range of ZTE patents in so-called core telecommunications networks, GSM cellular systems, and in 4G wireless infrastructure. Ericsson’s lawsuits alleged that ZTE had infringed several of the Stockholm-based company’s patents related to GSM and 3G WCDMA cellular technologies found on various ZTE handset models.

ZTE chairman Hou Weigui denied reports that ZTE had lost to Ericsson in their dispute, saying the two sides “have conducted extensive discussion and consultation in respect of the patent matters involved” in their litigation.

However, Bernstein Research senior analyst Pierre Ferragu said: “This means ZTE eventually agreed to pay Ericsson royalties, mostly on their terminal device.”