Nokia 2011 Annual Report Download - page 42

An unfavorable outcome of litigation could have a material adverse effect on our business,
results of operations, financial condition and reputation.
We are a party to lawsuits in the normal course of our business. Litigation can be expensive, lengthy
and disruptive to normal business operations and divert the efforts of our management. Moreover, the
results of complex legal proceedings are difficult to predict. An unfavorable resolution of a particular
lawsuit could have a material adverse effect on our business, results of operations, financial condition
and reputation.
We record provisions for pending litigation when we determine that an unfavorable outcome is
probable and the amount of loss can be reasonably estimated. Due to the inherent uncertain nature of
litigation, the ultimate outcome or actual cost of settlement may vary materially from estimates. We
believe that our provisions for pending litigation are appropriate. The ultimate outcome, however, may
differ from the provided level which could have a positive or negative impact on our results of
operations and financial condition.
See Item 8A7. “Litigation” for a more detailed discussion about litigation that we are party to.
Allegations of possible health risks from the electromagnetic fields generated by base stations
and mobile devices, and the lawsuits and publicity relating to this matter, regardless of merit,
could have a material adverse effect on our sales, results of operations, share price, reputation
and brand value by leading consumers to reduce their use of mobile devices, by increasing
difficulty in obtaining sites for base stations, by leading regulatory bodies to set arbitrary use
restrictions and exposure limits, or by causing us to allocate additional monetary and
personnel resources to these issues.
There has been public speculation about possible health risks to individuals from exposure to
electromagnetic fields from base stations and from the use of mobile devices. A substantial amount of
scientific research conducted to date by various independent research bodies has indicated that these
radio signals, at levels within the limits prescribed by safety standards set by, and recommendations of,
public health authorities, present no adverse effect on human health. We cannot, however, be certain
that future studies, irrespective of their scientific basis, will not suggest a link between electromagnetic
fields and adverse health effects that could have a material adverse effect on our sales, results of
operations, share price, reputation and brand value. Research into these issues is ongoing by
government agencies, international health organizations and other scientific bodies in order to develop
a better scientific and public understanding of these issues.
Over the past eleven years we have been involved in several class action matters alleging that Nokia
and other manufacturers and cellular service providers failed to properly warn consumers of alleged
potential adverse health effects and failed to include headsets with every handset to reduce the
potential for alleged adverse health effects. All of those cases have been withdrawn or dismissed in
relation to Nokia. In addition, Nokia and several other mobile device manufacturers and network
operators were named in nine lawsuits by individual plaintiffs who allege that radio emissions from
mobile devices caused or contributed to each plaintiff’s brain tumor. A hearing on the admissibility of
the plaintiffs’ proffered general causation evidence will likely occur in the third quarter of 2013.
Although Nokia products are designed to meet all relevant safety standards and recommendations
globally, we cannot guarantee we will not become subject to product liability claims or be held liable for
such claims or be required to comply with future regulatory changes in this area that could have a
material adverse effect on our business. Even a perceived risk of adverse health effects of mobile
devices or base stations could have a material adverse effect on us through a reduction in sales of
mobile devices or increased difficulty in obtaining sites for base stations, and could have a material
adverse effect on our sales, results of operations, share price, reputation and brand value.
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