ZTE's intellectual property defences strengthened by US ITC ruling in TPL case

ZTE Corporation ("ZTE") (H share stock code: 0763.HK / A share stock code: 000063.SZ), a publicly-listed global provider of telecommunications equipment, network solutions and mobile devices, welcomes the final determination of the United States International Trade Commission rejecting the claims of Technology Properties (TPL), which strengthened ZTE's defences against other intellectual property-related complaints.

The ITC terminated an investigation into TPL's complaints alleging violations of Section 337 of the Tariff Act of 1930, after rejecting TPL's claims of patent infringement. TPL initially filed the complaints in July 2012 against more than 10 respondents, including ZTE, Samsung, HTC, LG and Huawei. The decision in the TPL case followed the ITC's decision in December 2013 to reject the patent claims made by InterDigital against ZTE and other respondents.

"We are pleased by the ITC's decision, as ZTE has refuted claims by the complainants for more than a year," said Shen Jianfeng, Chief Intellectual Property Officer of ZTE. "We face an increasingly complex market environment, prompted by rapid changes in the global telecommunications industry and the intellectual property landscape. ZTE is committed to our principles of openness and mutual benefit as we continue to work with all stakeholders to promote benign competition and development of a healthy industry ecosystem."

In recent years, some patent holders have been demanding unreasonable licensing fees, and have used litigations as negotiating tactics. Investigations related to Section 337 of the Tariff Act of 1930 are protracted, and may result in export exclusion orders and cease and desist orders that will prevent the shipments of affected products to the US market.

ZTE's multibillion-dollar investment in research and development has resulted in an industry-leading pool of intellectual property assets. ZTE has filed applications for more than 50 000 patents globally, with more than 14 000 granted. ZTE is a global leader in holdings of essential patents related to 4G LTE.

ZTE ranked number one globally in international patent applications in 2011 and 2012, according to the World Intellectual Property Organization. ZTE will continue to strengthen its portfolio of patents to attain globally leading positions in core areas such as smart terminals, optical networking, cloud computing, big data and 4G LTE, and invest in next-generation technologies such as 5G. Such investments will be key to enhance ZTE's competitiveness and intellectual property capabilities to help the company cope with changes in the technology landscape and market environment.