In court proceedings last week Nokia Oyj of Finland insisted that it is not infringing patent rights of Qualcomm Inc. Qualcomm is suing Nokia in Germany and in the U.S. for allegedly infringing some of its patents for GSM technology. 

Nokia and Qualcomm’s legal wrangling has escalated since their licensing deal over technology patents expired on April 9, 2007. Their increasing rancor has concerned both investors and the mobile phone industry and technology industries since both parties are major players in these industries.

Nokia is basing its legal stance of non-infringement on the fact that the chipsets ultimately used in Nokia cell phones are, in fact, originally manufactured by Texas Instruments Inc., and that use of any Qualcomm patents for those chipsets is already covered and paid for by TI under TI’s existing technology licensing agreement with Qualcomm. 

Nokia’s lawyer issued a statement that Qualcomm was abusing its market position by demanding payments from both chipset manufacturers and from their clients; while Qualcomm’s lawyer countered that Qualcomm is justified in seeking payments from clients of TI (including Nokia) because the TI patent rights had not been “exhausted” when Nokia used the TI chipsets in its cell phones.

Analysts reportedly estimate that Nokia had been paying Qualcomm about $500 million per year before the parties’ technology licensing patent agreement expired in April. Nokia has filed two separate lawsuits against Qualcomm in The Hague, Netherlands on the basis that the chipsets used in Nokia cell phones initially are shipped to The Netherlands before they are sent to Nokia plants located in Germany, Hungary and Finland and over the origin of the Nokia chipsets from TI in the United States.