Patent dispute threatens Xiaomi's India future

Patent disputes between Xiaomi, an emerging smartphone maker in China, and Swedish telecom company Ericsson continue after Ericsson claimed Xiaomi violated an order from Delhi High Court on Feb 5.

In December the Indian court banned Xiaomi from selling phones in India as it found the company did not pay royalties to Ericsson, which owns patents for technology used in Xiaomi phones.

At the court hearing on Feb 5, Ericsson claimed that Xiaomi continued to sell phones that used its patented technology in India through a website called xiaomishop.com.

Xiaomi denied the accusation and said it did not authorize the website to sell its products. The phone maker said it had nothing to do with the e-commerce website, which it alleged infringed Xiaomi's brand rights and was ordered to stop selling Xiaomi products.

In December, Ericsson sued Xiaomi in India, claiming it violated its patent rights. Delhi High Court ordered Xiaomi and its local e-commerce partner Flipkart to stop selling handsets in India until Feb 5, when the court was due to hear Ericsson's patent-infringement case, Indian media reported.

The court gave an interim order to Xiaomi on Dec 16 to permit sales of only its Qualcomm chip-based handsets, with the condition the company deposited 100 rupees ($1.6) to the court for each phone sold.

Wang Yanhui, a mobile phone industry insider, suggested the interim ruling could have been made because Qualcomm and Ericsson have patent authorization from each other and Xiaomi may have paid royalties to Qualcomm but not Ericsson.

In a public statement Ericsson said that it asked the Indian court to appoint a local commissioner to examine all Xiaomi phones imported to India and the court agreed.

Xiaomi said the interim order was valid until March 18, when the court will hold another hearing for the dispute, which also involves Xiaomi's authorized dealer in India－Flipkart.

Xiaomi said it planned to resort to legal action to protect itself from xiaomishop.com.

Ericsson said in December it tried to talk to Xiaomi about royalties for the past three years but Xiaomi did not respond.

Sales of Xiaomi handsets reached 1 million units in India in six months after it entered the market in July 2014, Manu Kumar Jain, Indian head of the company, said on Twitter in December.