Infringements of Ericssons patents by Xiaomi Inc.

mobiles
ASSIGNMENT: 1

Submitted by:
Umesh Kumar
(14A1HP049)
Section - A

Company Background:
Xiamoi inc.Is a privately owned Chinese electronics company headquartered in Beijing, China.
Its products include mobile phone, smartphones, mobile apps, and consumer electronics.
Xiaomi Technology India Pvt. Ltd. is engaged in the manufacturing of communications
equipment in India. The company was found in 2014 and is based in Bangalore, Karnataka.
Patent infringement law in India(The patents Act,1970):
A patent confers the exclusive right on the patentee to make, distribute or sell the
invention in India. An infringement would be when any of three rights is violated. A patentee
may assign license all or some of these rights. The exercise of the rights so transferred in favor of
the assignee or the licensee by the assignor or the licensor would not amount to infringement of
the patents.
In case of a product patents rights of the patentee are infringed by anyone who makes or supplies
that substance commercially. In case of a process patent, the use of such a method or process in
India by anyone other than the patentee amounts to infringement.
What can amount to infringement
(1) The colorable imitation of an invention. (2)Immaterial variation in the invention.
(3) Mechanical equivalents. (4) Taking essential features of the invention.
Who is entitled to sue
Only the person who has a right in the patent can institute a suit for infringement. The
following persons are entitled to sue:(1) The patentee.(2) The exclusive licensee if the license is registered.
(3) A compulsory licensee when the patentee refuses or neglects to institute proceedings.
(4) A licensee other than the above two licensees can bring an action for infringement upon the
terms of the contract between the licensor and licensee.
(5) Assignee, he can sue only after the application for registration of the assignment in his favour
has been filed. If a patent is assigned after the commencement of action, the assignee is to be
joined as a co-plaintiff. An assignee cannot sue for infringement which occurred prior to
assignment.
The Issue:
On 8 December,2014, an order was passed in a patent infringement suit filed by Ericsson
claiming infringement of its 2G and 3G technologies against Xiaomi. The courts order had also
extended to e-commerce website Flipkart.com that had an exclusive arrangement with Xiaomi
for flash sales of its handsets in India.
Initially a ruling came against Chinese handset maker an order restraining Xiaomi from
manufacturing, assembling, importing, selling, offering for sale or advertising including through
their and third-party websites, products (telephone instruments, mobile handsets, tablets, handheld devices, dongles, etc.) and any future or other devices or models that include the AMR

(adaptive multi rate), 3G and EDGE technology/devices/apparatus that infringed any of

Swedish telecommunication giant Telefonaktiebolaget LM Ericssons eight patents.
Xiaomi needs a license from Ericsson for all of their phones imported to India, which will be
clarified in the upcoming hearing.
Ericsson claimed that despite specific requests to Xiaomi to obtain a license with respect to
Ericssons standard essential patents (SEPs), it had launched its infringing devices in India in
July 2014, without taking any such license. An SEP is a patent that protects technology that is
essential to a standard, without which it would be impossible to manufacture that particular
technology while complying with the set industry standard. Since any product that meets the
standard will necessarily have to use the patented technology, globally these patents are licensed
by the patent holder to prospective users on fair, reasonable and non-discriminatory terms.
The Hearing:
The Delhi high court on 16 December 2014, allowed Xiaomi Technology India Pvt. Ltd to
import and sell communication devices such as mobile phones and tablets in India, subject to
some conditions.
=>Xiaomi can only sell devices that use chipsets that have been imported from Qualcomm Inc., a
licensee of Ericsson.
=>Xiaomi was also told to deposit Rs.100 for every device it has sold in India or sells till 3
February.
Claiming that the 8 December order brought Xiaomis business in India to a grinding halt, senior
appearing for the company argued that Ericsson had suppressed important information before the
single judge that Xiaomi had been sourcing the chipsets from Qualcomm, which was authorized
to sell them to Xiaomi according to terms of an agreement it has with Ericsson. The court, in its
earlier order, had also directed the Central Board of Excise and Customs not to allow the import
of mobiles, handsets, devices, tablets of the allegedly infringing devices and to intimate
Ericsson about any consignments imported by Xiaomi. It had directed Xiaomi to file an affidavit
disclosing the quantum of AMR, EDGE and 3G devices sold by it in India and the revenue
earned from their sale. This order was passed ex-parte, that is, without giving Xiaomi an
opportunity to appear before the court and defend its stand.
Citing the closure of Xiaomis business due to the sweeping order passed by the single judge
as the reason for the temporary relief being granted to Xiaomi, the court clarified that it was not
expressing any opinion on the merits of the case. This is a temporary decision until the court in
the first instance can look into the matter more closely.