December 19, 2014 by ...
In part 1 I explained that Ericsson sought injunctive relief against Xiaomi in India. An injunction is a court order mandating that a specific behavior continue or cease. In this case, Ericsson convinced the Indian High Court to prohibit Xiaomi from selling phones there. Ericsson said that Xiaomi was using their tech without paying for it. The court agreed an ordered an injunction against all Xiaomi phones, suppliers and prohibited Xiaomi from advertising.
An injunction seemingly flies in the face of the notion of innocent until proven guilty. For example, in this case, Ericsson claimed that Xiaomi had done something wrong. Xiaomi refuted this. The courts usually hold off on taking action against the accused until guilt is proven. In cases such as this, however, the potential loss is too great so an injunction is ordered.
It would seem that Ericsson had an airtight case. According to them, Xiaomi had used their tech for three years without paying. They had told Xiaomi to rectify this long ago. According to them Xiaomi failed to comply and thus had in effect ‘stolen’ money from Ericsson. We now find out, however, that the ban has been partially lifted. Xiaomi can sell some of its kit in India.
But why is this true?
So what is the current status?
The ban has been lifted on the MI3 and Redmi due to the fact that they sport Qualcomm chipsets. Qualcomm has an agreement with buyers which forces them to forgo license fees if they run Qualcomm gear. Xiaomi argues that this exempts them from paying fees on the phones mentioned. Two Indian judges agreed and have lifted the ban on those phones.
The findings are inconclusive, however, and we will have to wait and see how this all shakes out. Xiaomi’s argument seems strong on the face of it, but little has been said of Ericsson’s rejoinder. It would seem that if Xiaomi had a case for immunity they would have made it much earlier. They have not, which makes their argument seem suspect.
The bottom line is that as of now, Xiaomi can still sell selected phones until the Indian High Court rules on the case.