Xiaomi fans in India will no doubt celebrate the fact that Xiaomi can continue to sell. However, this order leaves open some questions. For if Xiaomi has to purchase from Qualcomm (a licensee authorised by Ericcson), wouldn’t the doctrine of patent exhaustion apply? As I noted in an earlier post here, once the patent rights in the chipset are exhausted, then Ericsson cannot demand any more royalties from a party that merely inserts the chipset into a phone. In which case, why pay at all? Or have I missed something here?
And even assuming the payment is for other patents that may be outside the Qualcomm chipsets and could be independently infringed by Xiaomi, how did the court arrive at a figure of Rs 100 per phone? This appears far higher than the per phone rate that the Micromax order of .8% royalty works out to effectively (should approximate around Rs 30 or so per phone, as I’m given to believe).
Lastly, we are given to believe that the counsel for Ericsson complained to the Delhi High Court that a certain “blog” had reported the earlier order against Xiaomi and frustrated the impact of the order. Apparently, the court responded, stating that they couldn’t stop publication of proceedings in an open court. Well done Delhi High Court! A thumbs up to more transparency.