Verizon, Huawei settle patent dispute

Verizon and Huawei said they inked a settlement in their long-running legal battle over patents, but neither side offered any details about the parameters of their new agreement.

"Verizon is happy with the settlement reached with Huawei involving patent lawsuits. While terms of the settlement are not being disclosed, our team did an outstanding job bringing this protracted matter to a close," Verizon spokesperson Rich Young said in a statement.

According to Reuters, Huawei said in a statement it was "pleased that Verizon and Huawei reached an agreement that ends the companies' patent litigation. The terms of the agreement are confidential."

The settlement occurred just as the two companies were scheduled to start a trial in a Texas courtroom over the matter.

Huawei kicked off the dispute in 2019 when it presented Verizon with a bill of over $1 billion for licenses to more than 230 of its patents. The company followed up in 2020 with a patent-infringement lawsuit, alleging Verizon used a dozen Huawei patents without authorization in areas such as computer networking, download security and video communications. Huawei said at the time it was "simply asking that Verizon respect Huawei's investment in research and development by either paying for the use of our patents, or refraining from using them."

Verizon, for its part, called the lawsuit "nothing more than a PR stunt" and "a sneak attack on our company and the entire tech ecosystem." The company also filed a counterclaim.

In the big picture

In the multi-billion dollar global telecom industry, patent-infringement lawsuits are a way of life. Such disagreements often stem from the research and development expenses that go into developing communications technologies, and companies' desire to obtain revenues from licensing those technologies to rivals. When those licensing negotiations break down, companies often seek legal recourse.

However, the details of any technology-licensing agreement in the telecom industry are often a closely guarded secret.

The US government views Huawei's networking equipment as a vehicle for Chinese espionage, and has therefore moved against the company both domestically and internationally. Huawei, for its part, continues to dispute that allegation and maintains that it operates independently from China's government.

Verizon at one point was a Huawei customer, albeit a very small one. Last year, as part of an FCC investigation into US companies that purchased Huawei equipment, Verizon acknowledged it operated a "relatively small number" of Huawei devices called VoiceLink. The gadgets were used by an unspecified number of Verizon customers.

"There are no data services associated with these devices," Verizon wrote last year in response to questions from Light Reading, noting the carrier expected to retire all Voicelink by the end of 2020.

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— Mike Dano, Editorial Director, 5G & Mobile Strategies, Light Reading | @mikeddano