The Delhi high court issued an ex parte injunction against Chinese smartphone maker, Xiaomi, which prevents it from selling its phones in India. This happened after the Swedish telecom giant, Ericsson, filed a case against Xiaomi for Ericsson has accused Xiaomi of violating eight mobile phone patents relating to the technology standards 3G, EDGE and AMR (a technology that improves voice quality).
The injunction also prevents Xiaomi from advertising, manufacturing and importing devices that infringe upon the patents in question. Flipkart, Xiaomi's exclusive e-commerce partner in India, has been ordered to stop selling the handsets as well.
WHAT'S AN EX PARTE INJUNCTION?
An ex parte injunction is an order passed by a court after hearing only one of the parties involved in a case. This is typically done when the implementation of the order is urgent.
SO...WHY WAS IT SO URGENT IN THIS CASE?
Legal and economic analyst Shamnad Basheer argues on SpicyIP.com that it wasn't. Chances are that these patents are the same ones that Ericsson had mentioned when it filed a lawsuit against Indian phone maker Micromax last year.
Ericsson has also sued other smartphones makers like Gionee, Intex, Samsung and Acer over patents in the past. And yet, these brands continue to sell their devices around the world.
WHY IS THIS IMPORTANT?
Xiaomi is the world's third-largest smartphone maker. It entered the Indian market in July 2014 and is famous for its high-end devices at dirt-cheap prices that have left incumbents like Samsung shaking in their boots. The company says it sold about half a million handsets in India,
Xiaomi is extremely serious about the Indian market and is keen on investing in Indian startups in addition to selling its devices.
WHAT DOES THIS MEAN FOR ME?
It's not clear if this affects every Xiaomi device being sold in the country or only specific handsets. At the time of this writing, we were still able to buy Xiaomi's popular handset, the Redmi 1S on Flipkart. And the website still said that we could register to buy a Redmi Note on December 16. It's likely that Xiaomi will appeal in this case and eventually come to a settlement with Ericsson, so you should still be able to snag that Redmi Note you've been eyeing.
WHY DOES ERICSSON HAVE TO BE SUCH A BULLY?
Ericsson, which was one of the leading mobile handset makers in the world at some point, holds over 35,000 standard-essential mobile communication patents, including those that cover 2G, 3G and 4G technologies. Every time someone uses these or any one of the 35,000 technologies that Ericsson's patent portfolio covers, the company gets a licensing royalty. If you want make a mobile handset, chances are high that you'll be paying Ericsson some money to license patents for some crucial features (like data transfer over 3G). Yep, it’s got some serious bullying rights.
WHAT ARE STANDARD-ESSENTIAL PATENTS ANYWAY?
This is a complex topic, but here's a simplistic explanation: a patent is deemed "standard-essential" if an independent evaluator determines that a particular patent is essential to establish a technical standard. Think widely-used file formats like GIFs and JPGs. And cellphone standards like 3G, 4G and LTE.
WHAT'S GOING TO HAPPEN NEXT?
Since this injunction was ex parte, Xiaomi now has a chance to file an appeal in the Delhi High Court, which gives it a chance to negotiate with Ericsson. In a statement to Hindustan Times, Manu Jain, Xiaomi's India head said that the company hadn't even received an official notice from the Delhi High Court yet, but the company was "open to working with Ericsson to resolve this matter amicably."