January 25, 2010 / 9:07 PM / 9 years ago

UPDATE 2-U.S. trade body starts to probe Apple on patents

   * ITC starts Apple investigation based on Nokia request
* Yet to decide on Nokia probe based on Apple request
* Nokia requested investigation on Dec 29  (Adds analyst comment, other details)
 By Tarmo Virki, European technology correspondent
 HELSINKI, Jan 25 (Reuters) - The United States trade body started an investigation on Monday into whether Apple Inc (AAPL.O) infringes on Nokia’s NOK1V.HE patents, the latest twist in a legal battle between the two technology giants.
 The companies have been in a legal dispute since last October when Nokia charged Apple was using its patented technologies without paying for them.
 “It’s a clear tactical win for Nokia,” said CCS Insight analyst John Jackson.
 “Given the complex, drawn-out nature of these cases, it’s difficult to gauge the magnitude of the ITC’s decision. Still, the stakes are a notch higher than they were yesterday,” he said.
 Nokia filed a claim with the International Trade Commission in late December, alleging Apple infringed seven of its patents — which allow greater ease of use, lower manufacturing costs, smaller size and longer battery life — in “virtually all of its iPhones, iPod music players and computers.”
 “We are pleased that the ITC has moved quickly to begin investigation,” said a Nokia spokeswoman.
 Both companies have sued each other in the United States, and both have turned to the ITC. The trade body has yet to decide if it will launch an investigation based on Apple’s request.
 The ITC can ban selling products in the United States — a crucial market for Apple, but Nokia makes only a fraction of its sales there.
 Analysts have said the ITC could ease the path toward agreement between the two firms. The dispute is expected to last for more than a year, with Nokia seeking payment of up to 1 billion euros ($1.415 billion).
 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.
 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 last year as the cellphone maker generating the highest total operating profit.  $1 = 0.7068 euros  (Reporting by Tarmo Virki; additional reporting by Karey Wutkowski in Washington; editing by Gerald E. McCormick, Andre Grenon and Matthew Lewis)       

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