ZTE accuses Huawei of copying camera tech as China patent battles heat up

HONG KONG, April 23 (Reuters) - Chinese telecom gear manufacturer ZTE Corp has published a letter accusing Huawei Technologies Co Ltd of copying its camera technology and threatened legal action, a sign that smartphone patent battles have begun in earnest in China.

ZTE’s lawyers at Guangdong Guanghe Law Firm said in a letter dated April 21 that Huawei’s recently released Honor X2 and high-end P8 smartphones violated ZTE’s camera-focusing patents.

ZTE published the letter on the Weibo microblog of its Nubia smartphone brand a day later, adding that “given Huawei’s large-scale copying, we feel it’s time to come out and use legal means to protect orderly and fair market competition.”

Huawei denied the allegations in a statement on Thursday.

“Huawei has never used the patent mentioned in our competitor’s lawyers’ letter and therefore we contest the allegations made against us. We stringently respect others’ IPR (intellectual property rights) and protect our own IPR,” the statement said.

Patent battles among Chinese smartphone manufacturers are expected to rise in the wake of Qualcomm Inc’s record settlement with Chinese antitrust regulators.

The settlement dissolved the cross-licensing agreements that had given Qualcomm customers such as ZTE and Huawei free access to each others’ patent portfolios and kept them away from litigation.

ZTE, anticipating the dissolution of the Qualcomm-enforced patent truce, has been quietly seeking patent royalties from its Chinese rivals over the past year, people with knowledge of the situation have previously told Reuters.

Although most industry experts expected the likes of ZTE and Huawei - two leaders in the number of patent filings internationally - to seek royalties from smaller firms, few had anticipated the two Shenzhen-based rivals to go head to head.

Both ZTE and Huawei have been stockpiling patents in the past several years. Huawei was the world’s No. 1 applicant for international patents in 2014, according to a United Nations patent agency, while ZTE took third place. (Reporting by Gerry Shih; Editing by Edwina Gibbs)