Chinese cellphone manufacturer Xiaomi got partial relief from the Delhi High Court on Tuesday, with a Division Bench allowing Xiaomi to sell it cellphones, based on chips sourced from Qualcomm Incorporated. The court has also directed Xiaomi to submit payment for all phones imported so far in India, which will be deposited before the High Court and kept in fixed deposit for three months while the case is being heard.
Last week, a single judge bench of the court had restrained all sales of Xiaomi phones in India, on a complaint by technology giant Ericsson Telefonaktibolaget, which had said the Chinese startup had violated its patent by not paying to get a license to use its technology.
During a hearing before the court of Justice Pradeep Nandrajog and Justice R K Gauba on Tuesday, Xiaomi, represented by Senior Advocate Kapil Sibal, said it had purchased telephone chipsets from Qualcomm, which holds the patent license for the eight patents for 3G technology that are under consideration in this case.
According Xiaomi, under the terms of the agreement between Xiaomi and Qualcomm, the chipsets installed in the Xiaomi Mi3, Xiaomi Redmi1S and Redmi Note 4G were “licensed” as they were based on Qualcomm technology. The company also submitted copies of communication with Qualcomm to support their argument that they had not infringed the patent. The Redmi Note 3G and other models however are based on the chipsets sourced from Mediatek, which does not have such license to sell as a licensee of Ericsson.
The High Court has now issued pro tem orders allowing Xiaomi to import and sell Qualcomm based phones in India till the next date of hearing before the single bench in February.
The court has also directed Xiaomi to submit the details of invoices of the purchase of chipsets from Qualcomm and details of sale of Qualcomm based phones in India. Further, the bench has directed Xiaomi to deposit Rs 100 for every device imported to India by it since its launch and to also disclose the number of phones imported to India in January 2015 and deposit the money per phone imported in January by the next date of hearing on February 5.
Xiaomi in their plea before the division bench had claimed that Ericsson had got the ex parte injunction order from the single bench by “suppressing facts” about the license agreement between Ericsson and Qualcomm. The Bench has now asked the single judge to consider the plea filed by Xiaomi to vacate the injunction and consider the allegation raised by the Chinese company regarding suppression of facts by Ericsson.
Following the court order, Xiaomi vice president Hugo Barra, in a Facebook post, said, “We are happy to announce that the Delhi High Court today (Tuesday) issued a ruling in our favour … the good news is that Redmi 1S is coming back next week and we’ll be having our next sale on Tuesday, December 23. We will also be resuming sales of Redmi Note shortly, with the 4G model this time.”