INSUBCONTINENT EXCLUSIVE:
David Kline
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David Kline is a journalist, author and intellectual property
strategist.
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Although top senators, including Democrat Chuck Schumer and Republican Marco Rubio, are urging the
administration not to bend on ZTE, President Trump is planning to ease penalties on the Chinese telecommunications giant for violating
sanctions against Iran and North Korea.
But what Mr
Trump may not realize is that ZTE is also one of the world most notorious intellectual property thieves — perhaps eventhemost notorious of
And since stopping Chinese theft of U.S intellectual property is supposed to be one of the President top trade objectives, he should not
ease up on ZTE until it stops its high-tech banditry and starts playing by the rules in intellectual property (IP) matters.
To get a sense
of just how egregious ZTE behavior truly is, we need only to consultPACER,the national index of federal court cases
A search of PACER reveals that in the U.S
alone, ZTE has been sued for patent infringement an astonishing 126 times just in the last five years
This number is even more shocking when you consider that only a subset of companies who believe their IP rights have been violated by ZTE
has the means or the will to spend the millions of dollars needed to wage a multi-year lawsuit in federal courts.
But ZTE IP thievery is not
confined just to the United States
According toone Chinese tech publication,ZTE has also been sued for patent infringement an additional 100 times in China, Germany, Norway,
the Netherlands, India, France, the United Kingdom, Canada, Australia, and other countries
As an intellectual property renegade, ZTE certainly gets around.
Even when it not being sued, ZTE thumbs its nose at the traditional rules
of fair play in intellectual proper matters, commonly engaging in delay, misrepresentation, and hold out when dealing with patent owners
While ZTE is more than happy to accept royalty payments for the use of its own intellectual property, it rarely if ever pays for the use of
others& IP.
Consider ZTE treatment of San Francisco-based Via Licensing Corp, a Swiss-neutral operator of patent pools covering wireless,
digital audio, and other building-block components of complex products
Patent pools offer one-stop shopping for product makers to acquire licenses to patents from multiple innovative companies at once
Pools are generally a more efficient, and less litigious, way for product makers to acquire the IP rights they need at reasonable prices.
In
2012, ZTE joined Via LTE wireless patent pool, whose members also include Google, ATT, Verizon, Siemens, China Mobile, and another Chinese
tech powerhouse, Lenovo, maker of Motorola-branded smartphones
It helped set the royalty pricing of the pool aggregated patent rights, and even received payments from other product makers for their use
of ZTE own patents within the pool.
But in 2017, precisely when it was ZTE turn to pay for its use of other members& patents in Via LTE
pool, it suddenly and without ceremony quit the patent pool
Via and its member companies are still trying to get ZTE to pay for its use of their intellectual property — and to abide by the very
rules it helped establish in the first place.
Even among much-criticized Chinese companies, ZTE behavior is completely outside the norm
Despite what you may hear, some Chinese companies are actually good IP citizens — Lenovo for one
In fact, Via various patent pools include more than two dozen Chinese companies who play by the rules.
But ZTE is not one of them
It is a blatant serial IP violator who gives other Chinese companies a bad name
And our government should not reward such behavior.
Ease sanctions on ZTE only when it finally starts respecting intellectual property
