Chinese company Yuan Gongyi filed a lawsuit against Xiaomi earlier this month, alleging the Beijing-based consumer electronics manufacturer infringed on a 3GPP technology with several devices. The patent in question describes a “Common Packet Channel” intended to be used in conjunction with HSPA, WCDMA, TD-SCDMA, and 4G LTE networks. The Mi Max 2, Mi Note 3, and Mi 5X are all said to be utilizing such a telecommunications solution despite the fact Xiaomi never licensed the technology, according to the plaintiff. The system first envisioned by New Jersey-based Jinqiao Technology Co. Ltd was transferred to Yuan Gongyi in late 2016.
The litigation is seeking the equivalent of $7.5 million in damages and also wants to stop the sales of the current versions of the Mi Max 2, Mi 5X, and the Mi Note 3. The chances of an injunction being granted while the case goes to trial remain unclear but without such a court order, the prolonged nature of patent infringement cases will likely see Xiaomi stop selling the three devices on its own long before the dispute is settled. The lawsuit names Xiaomi Technology and Xiaomi Communication as the defendants. Neither branch of one of the world’s most valuable startups has yet commented on the matter in any capacity, though it’s likely to fight it in the court of law.
Besides immediate IPO plans, Xiaomi is presently also working on launching large-scale operations in the United States, though potential design patent disputes with the likes of Apple and other phone makers with any presence in the country may inhibit its ambitions to enter the world’s largest market for high-end handsets, according to some industry watchers. While the U.S. and China are presently on the brink of a full-blown trade war, Xiaomi remains unconcerned about such issues, having recently stated its strong relations with technology giants such as Qualcomm and Google should be conducive to its stateside plans. The company also lacks close ties to Beijing that previously created issues for Huawei and ZTE.