Huawei vs. ZTE: China IP Road Trip

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When last we left telecom giant Huawei, it was basking in the victory/settlement it achieved against/with Motorola in a trade secrets case.

Huawei’s actions received quite a lot of attention over here because it had successfully persuaded a federal judge in the US to grant it a preliminary injunction against Motorola. This type of action was hailed as the dawning of a new age, characterized by more aggressive Chinese multinationals enforcing their IP rights as opposed to infringing upon those of others. Huawei went abroad and utilized all the tricks of the trade to pursue its business interests against its US rival.

I generally agree with that sentiment. Huawei acted in that instance just like any other multinational telecom company. It just so happened that their opponent in that case was Motorola and they were in the US. Could have been any competitor in any jurisdiction — Huawei is a true multinational corporation.

So the latest round of overseas IP wrangling doesn’t surprise me in the least, although it might trouble some of my nationalist friends who may not care to see two huge Chinese companies duking it out in foreign courts in a most non-harmonious fashion.

This dispute between Huawei and ZTE is already turning into a brawl. Here’s what happened yesterday:

On Thursday, Huawei said it filed lawsuits against ZTE in Germany, France†and Hungary for patent and trademark infringement.

Huawei said ZTE had infringed on a series of its patents relating to data card and LTE technologies and illegally used a Huawei-registered trademark on some of its data card products.

Sounds like some basic unfair competition going on there. Should we expect ZTE to take all these accusations lying down? Of course not! The other shoe dropped today (note that we have the May 1 holiday coming up beginning tomorrow):

ZTE Corp , China’s No.2 telecommunications equipment maker, has filed a lawsuit against larger Chinese rival Huawei Technologies Co Ltd in China, it said on Friday, a day after it was sued by the latter in Europe.

ZTE is suing Huawei, the world’s No.2 telecoms equipment maker, for patent infringement over its fourth-generation LTE (long term evolution) technology, it said in a statement.

“ZTE will continue to use legal means to protect our intellectual property rights worldwide too ensure our legal rights are not infringed upon,” ZTE said. “However, we feel that patent competition shouldn’t become the main means of competing in the industry.”

That sounds like a statement that you make when your patent portfolio is second rate.

So we have a good old fashioned ‘tit-for-tat’ multi-jurisdictional patent case on our hands here. The odds, as always, favor a settlement, but we might get lucky and see some nasty public bickering before all the dust settles. Gotta love that. A lot of patent lawyers will do well off this dispute, God love ’em.

I’m hoping that the same folks who thought that Huawei’s dispute with Motorola was indicative of the growing maturity of Chinese multinationals will remain consistent and put this dispute in the same column. In each case, Huawei has availed itself of the legal system in foreign jurisdictions to enforce its IP rights.

This is good news for Chinese industry, right?

3 responses on “Huawei vs. ZTE: China IP Road Trip

      1. Stan Post author

        Chinese patent lawyers have a shrine to Huawei in their homes that they pray to every night before going to sleep.