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On Thursday, January 11th, reports indicated that China’s Shenzhen Intermediate Court had entered a ruling in favor of Chinese smartphone maker Huawei in a patent infringement case that company had filed against Korean electronics conglomerate Samsung. The Chinese court ordered Samsung to stop manufacturing and sales of its infringing products and found that the Korean firm “maliciously delayed negotiations” between the two companies, which began back in July 2011. Reports indicate the court did not specify the specific Samsung phone models infringing the Huawei patents.
This is only the latest action to play out in the infringement case between Huawei and Samsung in Chinese courts. In April 2017, Huawei scored its first patent infringement win in Chinese courts when it was awarded 80 million yuan ($11.6 million USD) in damages from Samsung. The previous July, Samsung had filed its own patent infringement case against Huawei, seeking 161 million yuan ($24.14 million USD) in from against Huawei. As of last September, Samsung and Huawei were respectively first- and second-place among smartphone companies in terms of unit sales.
It’s obvious why Huawei would decide to file its patent infringement suit against Samsung in China but the Chinese court’s decision in the case highlights the friendly attitude which Chinese courts and the nation’s federal government have been showing to patent owners. Having been embattled in multiple jurisdictions by Apple on legal matters involving global patent licensing, American semiconductor giant Qualcomm chose to sue Apple in Chinese courts to force a ban of iPhones in that country. Such an injunction seems like it would be the kind of “heavy price” paid for infringement which was contemplated last July by Chinese President Xi Jinping at a Chinese national economic forum. Through July 2016, foreign patent owners suing as plaintiffs in infringement cases taking place in China’s IP courts were a perfect 65-0 in cases they brought to court.
This second successful finding of patent infringement against Samsung is also further proof of how Huawei’s commitment to possessing a strong IP portfolio will ultimately allow the company to remain very successful. Research published last year on patent license royalties paid in the mobile phone space indicated that Huawei is earning 30 percent of total patent revenues which are being earned by all Chinese companies combined. Combine those strong patent licensing activities with a federal government which is stepping up its rhetoric against infringement and relaxing barriers to patentability in valuable sectors like software and business methods and you have the recipe for developing an incredibly valuable domestic tech company. If only the majority of our own country’s leadership in Washington, D.C., could understand the same.