Nokia 2014 Annual Report Download - page 173

171
Financial statements
NOKIA IN 2014
Irish Broadband
In 2010, the Imagine group (IBB Internet Services & Irish Broadband Internet Services trading as Imagine Networks) (“IBB”) served a claim
in the commercial court of Ireland for breach of contract and tort against Motorola Limited. The claim was later amended to add Imagine
Communications Group as an additional plainti. In 2011, Nokia Siemens Networks acquired certain assets and liabilities including this matter
from Motorola Solutions Inc. (“Motorola”). Among other things, IBB claims that WiMax network equipment purchased from Motorola failed
to perform as promised. The Group disputes these allegations. The case is still in the discovery phase and no date for trial has been set.
Vertu
Vertu was a United Kingdom-based business division of the Group that specialized in the provision of luxury mobile phones. The Group divested
the Vertu business to Crown Bidco Ltd in 2013. In April 2014, Crown Bidco Ltd served a claim in the commercial court in London alleging breach
of contract in relation to the transfer of IT assets and breach of warranties under the sale agreement. The Group disputes these allegations.
The time set for the trial is January 2016.
Pars Iratel
In March 2005, Pars Iratel was contracted as a general contractor to the Mobile Communications Company of Iran (“MCCI”) to deliver and
implement part of a network expansion in Iran. The Group provided equipment and certain services to Pars Iratel. Pars Iratel became liable
for damages to MCCI and suered other losses. Pars Iratel owes the Group for some of the equipment and services provided and has made
claims against the Group for losses it claims to have suered. On November 18, 2010 Nokia Siemens Tietoliikenne Oy (“NSTL”) commenced
ICC arbitration against Pars Iratel. The matter was heard in Zurich in August 2013. The parties are awaiting the award of the Arbitrator.
Intellectual property rights litigation
HTC
In 2012, the Group commenced patent infringement proceedings against HTC in relation to 21 non-essential patents in Germany in the district
courts of Mannheim, Munich and Düsseldorf, in relation to nine non-essential patents in the ITC in Washington DC, and 18 non-essential patents
in the United States district court for the district of Delaware. In response, HTC led nullity actions with the Federal Patent Court in Munich,
commenced revocation proceedings against 18 of the Group’s non-essential patents in the United Kingdom High Court, and led an action
for patent infringement in respect of one non-essential patent against Nokia GmbH in the district court of Mannheim and against Nokia Oyj in
the district court of Munich. S3 Graphics Co. Ltd, a subsidiary of HTC, also led actions for patent infringement in respect of one non-essential
patent against Nokia GmbH in the district court of Mannheim and Nokia Oyj in the district court of Düsseldorf. HTC commenced, then later
withdrew, an arbitration in the UK claiming that some of the patents asserted by the Group against HTC were licensed under an essential
patent license.
Subsequently, the Group led further counter-infringement actions in relation to HTC’s UK revocation actions, brought further infringement
proceedings against HTC in relation to eight non-essential patents in the district courts of Mannheim, Munich and Düsseldorf, three
non-essential patents in the court of Paris, France, two non-essential patents in the regional court of the Hague, the Netherlands, two
non-essential patents in the court of Rome, Italy, and four non-essential patents in the Tokyo district court, in Japan. The Group also
commenced patent infringement proceedings against HTC in respect of seven non-essential patents in the ITC in Washington DC, the
United States and ten non-essential patents in the United States district court for the southern district of California.
The Group was awarded injunctions against HTC in respect of a power control patent and patent enabling modern mobile devices to work in
older networks by the district court of Mannheim, a USB functionality patent and a patent enabling the transfer of network resource information
between mobile devices by the district court of Munich. The United Kingdom high court found that the Group’s patent relating to a modulator
structure was valid and infringed by HTC in October 2013 and awarded an injunction. In its initial determination in September 2013, the ITC
found that HTC had violated two patents which cover improvements to radio receivers and transmitters. The Tokyo district court gave a
judgment in default against HTC in respect of a calendar display patent. The rst two of S3’ and HTC’s actions were dismissed by the district
court of Mannheim. On February 7, 2014 the parties settled all pending patent litigation between them and entered into a patent and
technology collaboration agreement. HTC will make payments to the Group and the collaboration will involve HTC’s LTE patent portfolio.
The full terms of the agreement are condential.
Samsung
In 2013, the Group and Samsung agreed to extend their existing patent license agreement for ve years from December 31, 2013. According to
the agreement, Samsung will pay additional compensation to the Group from January 1, 2014. The amount of this compensation will be nally
settled in a binding arbitration.
29. Accrued expenses, deferred revenue and other liabilities
Non-current liabilities
EURm 2014 2013
Continuing operations
Deferred IPR revenue(1) 1 573 332
Dened benet pension obligation (Note 8) 530 237
Other 94 61
Total 2 197 630
(1) In 2014, includes a prepayment of EUR 1 390 million relating to a ten-year mutual patent license agreement with Microsoft. Refer to Note 3, Disposals treated as discontinued operations.