Huawei and Verizon have agreed to settle their patent dispute. The two companies were embroiled in a couple of lawsuits alleging patent infringement since early last year. However, they no longer want to fight in the court and have filed joint motions to dismiss both cases on Sunday, Reuters reports.
The origin of the dispute dates back to 2019. Huawei had approached Verizon asking for more than $1 billion in patent licensing fees for technologies that the latter used in its networking equipment. The Chinese conglomerate said the American wireless carrier used more than 230 Huawei patents.
Of course, Verizon doesn’t use Huawei equipment in its network infrastructure. However, the carrier did use technologies covered by Huawei patents. As such, the Chinese company wanted it to pay licensing fees. Huawei said it was “simply asking that Verizon respect Huawei’s investment in research and development by either paying for the use of our patents or refraining from using them.”
The talks though failed and the company took the court way. It filed lawsuits accusing Verizon of using patents without authorization in two US courts in Texas in February 2020. The lawsuits claimed that the American carrier used a dozen Huawei patents in areas such as “computer networking, download security, and video communications” without proper authorization. They sought an unspecified amount of compensation and royalty payments.
Verizon counterclaimed but has now reached a settlement with Huawei
Verizon expectedly dismissed Huawei’s allegations saying it was a “PR stunt” from the Chinese conglomerate. The company also filed counterclaims alleging it of violating Verizon patents. The trial of one of the two lawsuits began last week. But days into it, the two companies have settled the dispute. It is a confidential agreement, so neither party disclosed the terms of the settlement.
Verizon is “happy with the settlement reached with Huawei involving patent lawsuits,” the company said in a statement. “Our team did an outstanding job bringing this protracted matter to a close.” Huawei also echoed the sentiment saying it’s pleased to reach an agreement “that ends the companies’ patent litigation.”
Huawei reportedly holds more than 100,000 active patents worldwide. Around 10,000 of those are in the US. However, the growing tensions between the US and China have hit the Chinese conglomerate hard. The US government has put it on an economic blacklist, cutting off its access to American technologies. As such, it is struggling to keep its smartphone business afloat. The company might now be looking to make money on licensing fees of patents. Whether Huawei manages to make a successful return to the global smartphone market, only time will tell.