HTC 2012 Annual Report Download - page 60

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On March 08, 2013, the District Court of Mannheim dismissed Nokia's infringement complaint against HTC,
alleging that HTC infringed the German part of its EP0812120 (the `120 patent) and EP 1312974 (the `974
patent), the Company also believes that both `120 and `947 patents are invalid, and will continue with invalidity
actions pending before the English Patents Court and German Federal Patents Court. The Company fully
expects the patents to be revoked before any Nokia appeal proceedings take place.
On March 18, 2013, the District Court of Mannheim handed down a judgment that the Company had infringed
the German part of its EP 0673175 (the `175 patent) entitled "Reduction of Power Consumption in a Mobile
Station". However, the judgment only covers three handsets that the Company no longer imports into Germany
(the Wildfire S, Desire S and Rhyme). HTC will be appealing the present decision but also believes that this
patent is invalid and so will be continuing with the invalidity actions pending before the German Federal Patents
Court and the English Patents Court. The Company's German business will not be affected by it.
On April 23, 2013, the District Court of Mannheim dismissed a complaint by Nokia that HTC had infringed
the German part of patent EP 1 581 016 (the `016 patent) entitled "A Communication Network Terminal for
Accessing Internet", and awarded the Company its legal costs. The Company believes that this patent is
invalid and will be continuing with the invalidity actions pending before the German Federal Patents Court and
the English Patents Court.
5. On the basis of its past experience and consultations with its legal counsel, the Company has evaluated the
possible effects of the contingent lawsuits on its business and financial condition..
(13) Other important risks and mitigating measures being or to be taken
None.
(14)
Risk Management Organization Structure
Responsible/Implementation Unit Control Item Implementation Tasks
Legal Department Contractual and Legal Risk Manage overall corporate contractual risk
Finance and Accounting Division Business Strategy and Financial Risks
Responsible for capital allocation and management,
investment planning, customer credit control,
operational analysis, and cost analysis
Internal Audit Internal Control Risk Assess comprehensiveness and effectiveness of
internal control systems
Global Product Division Product Trend Risk Identify future product development trends and
customer demands
Design Quality & Engineering
Service Division Product Design and Quality Risks Ensure design quality of HTC products with regard
to hardware, software and product safety
Manufacturing Operation Center Production Quality Risk Enhance production quality
Customer Service and Quality
Assurance Division Product Quality Risk Provide after-sales service and enhance the quality
of such
7. OTHER IMPORTANT MATTERS
1. Certification Details of Employees Whose Jobs are Related to the Release of the
Company's Financial Information
Number of Employees
Certification Finance and Accounting Division Internet Audit
Certified Public Accountants (CPA) 8 2
Internal Auditor 1 2
US Certified Public Accountants (US CPA) 3 1
Certified Internal Auditor (CIA) - 2
Chartered Financial Analyst (CFA) 2 -
Financial Risk Manager (FRM) 1 -
1
1
6
6
FINANCIAL STATUS, OPERATING
RESULTS AND RISK MANAGEMENT
1
1
7
6
FINANCIAL STATUS, OPERATING
RESULTS AND RISK MANAGEMENT