Unlike the Nokia Arbitral Award which established RATES for Nokia..IDCC was Awarded a specific MONETARY AWARD of $134 Million, plus interest for their sales through 2005. Some should consult with an Attorney to establish the distinction..
InterDigital Receives Final Award in Arbitration Proceeding with Nokia Corporation
KING OF PRUSSIA, Pa.--(BUSINESS WIRE)--July 1, 2005--InterDigital Communications Corporation (Nasdaq:IDCC), a leading designer, developer and provider of wireless technology and product platforms, today announced that the Arbitral Tribunal operating under the auspices of the International Court of Arbitration of the International Chamber of Commerce (ICC) has delivered its Final Award in the arbitration proceeding between InterDigital Communications Corporation, InterDigital Technology Corporation (ITC), one of the company's wholly-owned subsidiaries, and Nokia Corporation (Nokia). The Tribunal has established royalty rates which are applicable to Nokia's sales of covered products for the period beginning January 1, 2002 through December 31, 2006 and reflect Nokia's leading market position. Based on the royalty rates established by the Tribunal, InterDigital estimates that Nokia's royalty obligations for covered infrastructure and handset sales from January 1, 2002 through December 31, 2003 will be approximately $112 million. In addition, InterDigital estimates that royalty obligations for covered infrastructure and handset sales for the period January 1, 2004 through December 31, 2006 will be in the range of $120 million to $140 million depending upon whether Nokia avails itself of a prepayment option for the eighteen month period from July 1, 2005 through December 31, 2006. The above amounts are exclusive of awarded interest, net of any applicable contractual discount and based on Nokia achieving sales volume that entitles Nokia to obtain the lowest applicable royalty rate. Estimates of post-2003 royalty obligations are based on third party and InterDigital's estimates of Nokia's sales of covered products for the applicable periods and InterDigital's assumptions as to market forecasts and Nokia's sales mix, selling prices and market share.
The Final Award relates to Nokia's royalty obligations on its worldwide sales of 2G GSM/TDMA and 2.5G GSM/GPRS/EDGE products under its existing patent license agreement with ITC. The company expects to recognize revenue associated with the Final Award after all criteria for revenue recognition have been met.
"We are pleased with the Tribunal's decision," said Harry G. Campagna, InterDigital's Chairman of the Board. "I would like to thank the many talented people both inside InterDigital and outside the company who remained steadfast in their resolve and tireless in their support of this effort."
William J. Merritt, InterDigital's President and Chief Executive Officer, added, "While Nokia maintained a very aggressive position in this matter, we are hopeful that Nokia will comply with its contractual requirements and pay past and future amounts owed. Nonetheless, to enforce the ICC's decision, today we filed an action against Nokia in the U.S. District Court for the Southern District of New York."
InterDigital continues to be a party to an arbitration proceeding with Samsung Electronics Co., Ltd. (Samsung) with the evidentiary hearing scheduled to commence in October 2005. In 2002, Samsung exercised its most favored licensee rights under its patent license agreement with InterDigital and elected to have its royalty obligations be defined by the terms of the Nokia Patent License Agreement. The company is currently reviewing the impact of the Final Award on the Samsung patent license agreement, but believes that it should have a significant impact on Samsung's royalty obligations.
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