Delhi High Court Orders Lava To Pay Rs.244 Crore Damages To Ericsson For Patent Infringement

Delhi High Court Orders Lava To Pay Rs.244 Crore Damages To Ericsson For Patent Infringement

Stresses the importance of respecting intellectual property rights

The Delhi High Court has issued a judgment against domestic smartphone manufacturer Lava, ordering it to pay damages worth Rs.244 crores to the Swedish multinational giant Ericsson.

The bench of Justice Amit Bansal slapped the penalty as Lava infringed on Ericsson's 2G and 3G patents.

The judge stated that seven of the eight Standard Essential Patents, asserted by Ericsson, were valid. The patents comprised critical technologies including Adaptive Multi-Rate (AMR) speech codec, Enhanced Data Rates for GSM Evolution (EDGE), and various features within the 3G technology.

The order stressed the importance of respecting intellectual property rights and the repercussions of patent infringement within the tech industry.

Lava has been directed to compensate Ericsson by paying Rs.244 crores, along with a five percent annual interest until the realization of the amount. The domestic mobile handset company was also instructed to cover the additional court fees and release the deposited amount in Ericsson's favor.

On Ericsson's request, the bench further granted taxed costs and partially revoked Lava's patented suit. It dismissed Lava's objections on the validity and indispensability of Ericsson's patents. The judge labeled Lava as an ‘unwilling licensee’ due to its failure to engage in negotiations on licensing agreements.

The court highlighted the significance of fair, reasonable, and non-discriminatory (FRAND) licensing terms, affirming Ericsson's entitlement to damages reflecting lost royalty fees.

The bench rejected Lava's proposal to compute royalties grounded on chipset value. It pointed out that within the telecommunications sector royalties aligned better with industry norms.

The court’s ruling underscored the necessity of licensing complete portfolios of Standard Essential Patents (SEPs) to guarantee interoperability and technological advancement. It conceded the comparable licensing approach as the favored mechanism for establishing FRAND royalty rates.