The decision of a Delaware court is awaited on whether Nokia will be ordered to pay billions of dollars to Qualcomm for using its technology.

The dispute relates to a 1992 licensing agreement which allowed Nokia to incorporate its phones with patented Qualcomm technology. Nokia is now being scrutinized for extending the usage of Qualcomm’s technology in its phones, beyond the expiry of the licence on April 9, 2007. Nokia claimed it a false allegation, saying that the contract could be extended only through a written agreement, and that it had paid in full for the licence.

Bill Davidson, Qualcomm Vice President, said that Qualcomm could file a patent infringement case even if Nokia managed to prove that it has not extended the use of technology beyond the terms of the licence. Qualcomm owns patents on CDMA and WCDMA technology, and Nokia requires its WCDMA technology to make 3G phones.

Whereas other cell phone makers are willing to pay 5% of the cost of their cell phones to use Qualcomm’s technology, Nokia has refused to continue paying 5% royalties. It stated that Qualcomm’s technology only covers a small portion of a modern phone, featuring Bluetooth wireless networking, GPS receivers, cameras and music players.

But Qualcomm maintains that WCDMA is at the heart of 3G phones. And Nokia pointed that Qualcomm’s technology was supposed to be licensed fairly and reasonably as it was made a part of industry standard for 3G phones in Europe, by the European Telecommunications Standards Institute. Laurie Armstrong, Nokia spokeswoman said, ‘We believe this means you should not be entitled to seek court injunctions for essential patents.’ X

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