WSJ: HTC facing sales ban in Germany over smartphone patent dispute, adding to company’s problems

A German court recently granted an injunction against HTC, and could lead to the Taiwanese manufacturer’s smartphones being taken off shelves in Germany. It’s not exactly the good news HTC was hoping for following a troubled year of slipping market share, dropping revenue and the lukewarm market response to its devices.

Wall Street Journal reports that a patent licensing firm named Acacia Research Group LLC won a lawsuit on November 27 which granted it an injunction against HTC smartphone sales through the country’s biggest telecommunications provider. HTC smartphones sold by Deutsche Telekom are expected to be pulled by the end of this month, although the manufacturer will be appealing to try to overturn the decision. HTC is understandably disappointed by the ruling, and is working with DT to ‘minimize disruption’ to its customers …

The particular patent in question relates to a voice coding technology owned by Acacia Research Group. It’s a standard-essential patent, meaning it’s part of a standard technology used widely across a number of devices. It also means there are special limits on how it’s used to make money, and in most cases, the owner has to agree FRAND (Fair Reasonable and Non-Discriminatory) terms for licensing the technology to hardware makers. In this specific case, Acacia Research Group has successfully agreed licensing terms with Apple, Samsung, Amazon, Huawei and others, but not with HTC.

It’s too early to tell how this will end. HTC won’t go down without a fight and there are still other options even if the appeal is rejected by German courts. The company could, for instance, agree a licensing deal with the patent owner, or agree a settlement fee. If it really wants to avoid having its products banned, it’s definitely not the end of the road, presuming Acacia Research Group is in a mood to discuss terms.