In a significant legal development, the Delhi High Court has ordered prominent Chinese smartphone manufacturers Oppo, Vivo, and Realme to settle all outstanding royalties owed to InterDigital for leveraging its patented technologies. The court has set a three-month deadline for these payments to be made to its registrar general.
A Firm Stance on Patent Rights
The directive follows two lawsuits filed by InterDigital, a U.S.-based technology research and development firm, demanding enforcement of its patent rights. These rights pertain to five standard essential patents (SEPs) related to wireless communication technologies, which the companies are accused of using without proper licensing.
Balancing Interests Amid Financial Scrutiny
Justice Pratibha Singh, presiding over the case, highlighted the necessity of balancing the interests of both parties while considering the financial dynamics of the involved smartphone giants. The court has thus directed Oppo, Vivo, and Realme to furnish a payment reflecting their global sales proportion attributable to India, covering all past sales from 2021 to 2024.
Additional Court Directives
Justice Singh also ordered the establishment of a confidentiality club to enable secure exchange of sensitive information between the disputing entities. Moreover, due to the delays and conduct of the Chinese firms, the court imposed a penalty of INR 5 lakh against them.
Ongoing Sales Amidst Legal Tussles
Despite ongoing legal battles and claims of incurring losses in India, the companies have continued their sales operations, generating significant revenue, which has led to investigations by various authorities. The court expressed perplexity over the inability of both parties to reach a settlement, especially in light of a recent ruling by the Munich Regional Court I in Germany, which found the defendants guilty of infringement.
InterDigital's Position and Defendants' Counter
InterDigital, recognized as one of the leading innovators in wireless SEP, holds numerous patents essential for 3G, 4G, and 5G technology implementation. The defendants, however, argued against a prima facie deposit mandate, suggesting that bank guarantees should suffice as security.
The Broader Impact on BBK Group's Operations in India
This ruling comes at a crucial time when BBK Group, the parent company of Oppo, Vivo, and Realme, continues to lead the Indian smartphone market, having reported substantial revenue in the last fiscal year. The group's strategic partnerships with Indian manufacturers underline its significant market presence and the critical nature of adhering to licensing agreements for patented technologies.
