Patent Ruling Could Ban New Phones

Got your eye on one of the upcoming handsets from Motorola or Samsung? Then you might have to wait for a while.

 

A patent row could cause the U.S. International Trade Commission to ban the import of phones made using Qualcomm semiconductors. The Commission ruled yesterday that Qualcomm had violated a patent held by Broadcom, another semiconductor company.

 

The ruling is also likely to affect providers like Verizon and Sprint, among others, who rely on the handsets.

 

The dispute involves a patent used in the chip design of third-generation, or 3G, phones, which the industry is relying on to drive sales.

 

“We believe the commission has overstepped its statutory boundaries and has not afforded due process to manufacturers and operators,” said Qualcomm chief executive Paul Jacobs.

 

The company plans to immediately appeal the ruling in federal court, asking that it be blocked. Additionally, Qualcomm plans a direct appeal to President Bush, in the hope that his trade representative, Susan C. Schwab, will veto the ruling.

 

Qualcomm can continue to ship models that already are on the market as of June 7, regardless of whether they use the patented technology. The company has told investors that it’s in negotiation with Broadcom to establish royalty rates for the technology, but the current rates are prohibitive. Industry analysts expect that the companies will achieve a breakthrough on talks or Qualcomm will find a technological fix to the problem.

 

Last week Broadcom won a court case against Qualcomm over other patent infringements, and had also sued over the patent involved in the I.T.C. ruling, although the case had been delayed pending the ruling.