Apple turns up heat in Nokia battle with ITC filing

HELSINKI Sat Jan 16, 2010 6:06pm EST

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HELSINKI (Reuters) - Nokia said it would defend itself vigorously against Apple's new complaint to the United States International Trade Commission.

The two phone giants are in the midst of a major legal battle, which started last October when Nokia charged Apple for using its patented technologies without paying for them.

Apple filed the new ITC complaint on Friday.

"Nokia will study the complaint when it is received and continue to defend itself vigorously," said a company spokesman.

"However, this does not alter the fact that Apple has failed to agree appropriate terms for using Nokia technology and has been seeking a free ride on Nokia's innovation since it shipped the first iPhone in 2007," he said.

In late December Nokia also filed a claim with the ITC, alleging Apple infringed seven of its patents in "virtually all of its mobile phones, portable music players, and computers" sold.

"The fact that two such prominent companies have now filed complaints will likely mean the ITC will seek to deal with this as a matter of urgency," said Ben Wood, head of research at British consultancy CCS Insight.

"That said, a lengthy legal battle is almost inevitable irrespective of a decision from the trade commission," he said.

The ITC can ban selling products in the United States -- a market crucial for Apple, but Nokia makes only a fraction of its sales there.

Analysts say it could take years to solve the legal battle.

"This dispute is still in its infancy. I don't think Nokia is finished with evaluating the infringements by Apple, it might be just the surface," said Steven Nathasingh, chief executive of U.S. research firm Vaxa Inc.

Nokia, along with Ericsson and Qualcomm, holds many key patents for making mobile phones.

Nokia has stumbled badly in the fast-growing smartphone sector and relative newcomer Apple has gained ground against the market leader thanks to the iPhone, but still trails Nokia in smartphones sales.

The legal dispute, potentially involving hundreds of millions of dollars in annual royalties, reflects the shifting balance of power in the mobile industry as cellphones morph into handheld computers that can play video games and surf the Web.

Apple, which entered the industry in mid-2007, overtook Nokia in the September quarter as the cellphone maker generating the highest total operating profit.

(editing by Dominic Evans)

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