Huawei Technologies is suing Taiwanese mobile chip developer MediaTek for alleged infringement of its intellectual property patents, the latest example of the Chinese company’s efforts to increase licensing fees and royalties.
Huawei, which owns patents for numerous key mobile technologies, filed the lawsuit in a Chinese district court. MediaTek, the world’s leading developer of chips used in smartphones and other mobile devices, confirmed the case in a filing with the Taiwan Stock Exchange on Friday, stating that it would have no significant impact on the chipmaker but declining to comment further.
The lawsuit’s details, including the damages Huawei may seek, have not been made public.
MediaTek’s clients include many of the world’s leading smartphone and tablet manufacturers, including Samsung, Amazon, Oppo, Sony, Vivo, and Xiaomi. Prior to the United States imposing stricter export controls in 2020, the company was also a key supplier to Huawei’s smartphone business.
According to Counterpoint Research, MediaTek held the largest global market share for smartphone processors, accounting for approximately 40% of shipments in the first quarter of 2024. It was followed by Qualcomm and Apple.
According to a source familiar with the case, Huawei is suing MediaTek for patent infringement in order to collect royalty fees that will allow it to continue investing in research and development. The move also allows Huawei to demonstrate the strength of its technological capabilities to the rest of the world, according to the person.
According to another source familiar with the situation, Huawei has filed patent lawsuits against a number of companies, primarily to diversify its revenue streams after its smartphone business, which was once the world’s second-largest, was hit by US export controls.
Huawei owns a significant portion of so-called standard-essential patents (SEP), which are critical to wireless communication standards. It owns approximately 20% of the world’s patents related to 5G, for example.
Enterprise Patent Observation, a Chinese media outlet, first reported on the lawsuit against MediaTek.
Huawei has increased its efforts to collect royalties since 2021, shortly after Washington tightened its grip on the company. Its licensing and cross-licensing partners include European automakers like Volkswagen, Mercedes-Benz, Audi, BMW, and Porsche. It signed cross-licensing agreements for 5G technologies with Oppo and Samsung last year.
Last year, Huawei attempted to collect licensing fees from 30 small and midsize Japanese companies that it claimed were using the Chinese company’s patented technologies.
According to Huawei’s most recent disclosure, patent royalties will generate $560 million in revenue in 2022. Nikkei Asia has learned that approximately 200 companies are currently paying royalties to Huawei.
