An Indian court has ordered Chinese smartphone vendor Xiaomi to suspend sales in the country until February as it hears a patent-infringement lawsuit filed by Swedish equipment maker Ericsson.
The patent dispute threatens to derail the Chinese firm’s international expansion, the Financial Times reported.
Xiaomi, whose valuation has topped US$40 billion following its latest fundraising in November, plans to expand to as many as 10 emerging markets.
But the case before the Delhi High Court suggests its overseas plans may open it to more patent disputes, with companies demanding it pay royalties, the newspaper said.
Wednesday’s ruling said Xiaomi was “restrained from manufacturing, assembling, importing, selling or advertising” its products in India pending a further hearing, while local customs authorities were “directed not to allow the import” of mobile phones and other products that may infringe Ericsson’s patents.
Xiaomi has its own patents, but the phone maker could see its costs swell by 5-20 percent due to licensing fees, according to some experts. The firm acquired 1,141 patents last year, but that’s not too impressive by tech industry standards.
The court ruling is likely to raise concerns that similar intellectual property challenges could be thrown to other Chinese smartphone makers, including Huawei, ZTE and Lenovo, the report said, citing analysts.
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