Huawei Sues Samsung Alleging Patent Infringement -- Update
May 25 2016 - 12:46AM
Dow Jones News
By Juro Osawa in Tokyo and Jonathan Cheng in Seoul
Chinese telecommunications-equipment maker Huawei Technologies
Co. said Wednesday it has filed a lawsuit in the U.S. against
Samsung Electronics Co., alleging that the South Korean electronics
maker infringed a number of patents covering mobile devices and
cellular-communications technology.
The lawsuit marks the first major legal challenge by a Chinese
smartphone maker against Samsung, which has dominated world-wide
sales over the past several years. Chinese companies have growing
ambitions in the smartphone world, where major players like Huawei
are investing billions of dollars to beef up patent portfolios that
enable them to compete with Samsung and Apple Inc. in overseas
markets.
Huawei said it is seeking compensation for Samsung's alleged
infringement of 12 of its patents--four related to smartphones and
eight related to cellular networks. The lawsuit covers Samsung's
use of cellular network protocol that Huawei says helps ensure
uninterrupted phone service on 4G LTE networks. Huawei alleges that
Samsung has used this technology on its flagship products, dating
back to the Galaxy S II handset that it released five years
ago.
"Samsung and its affiliates have earned billions of dollars by
selling...products that use Huawei's technology," Huawei says in
the lawsuit, which was filed in the U.S. District Court for the
Northern District of California.
"We hope Samsung will respect Huawei's R&D investment and
patents, stop infringing our patents and get the necessary license
from Huawei, and work together with Huawei to jointly drive the
industry forward," Ding Jianxing, Huawei's president of
intellectual property rights, said in a statement.
A spokeswoman for Samsung said the company "will thoroughly
review the complaint and take appropriate action to defend
Samsung's business interests."
Shenzhen-based Huawei also filed a lawsuit against Samsung in
China, in the Shenzhen Intermediate People's Court. Huawei filed
the suits in the U.S. and China because those are two of
Samsung's--and the world's--largest markets for smartphones.
Huawei is the world's third-largest smartphone maker by sales,
with a 8.3% market share in the first quarter, up from 5.4% a year
earlier, according to data provider Gartner. Samsung had a 23%
market share, followed by Apple with a 15% share. The next biggest
players, Oppo Mobile Telecommunications Corp. and Xiaomi Corp., are
also Chinese.
Samsung and Huawei both make handsets that run Android, the
dominant mobile-operating system controlled by Alphabet Inc.'s
Google unit. Last year, Huawei spent $9.2 billion in research and
development, while Samsung devoted about $12.5 billion.
Both companies have signed a number of patent agreements with
other industry players, limiting friction between companies that
manufacture smartphones that rely on hundreds of patents to work
well. Earlier this year, Huawei reached a patent-licensing
agreement with Apple, and the U.S. company pays royalties for
Huawei's patents, according to a person with knowledge of the
matter.
Samsung has had to spend heavily to defend itself from
patent-infringement claims. A long-running patent dispute with
Apple is set to come before the U.S. Supreme Court in its next
term, which begins in October.
Write to Juro Osawa at juro.osawa@wsj.com and Jonathan Cheng at
jonathan.cheng@wsj.com
(END) Dow Jones Newswires
May 25, 2016 00:31 ET (04:31 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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