The industry of mobile phone handsets is quite a complicated industry, with contracts and agreements left and right that should be up to date and existing. The competition is fierce and two companies are already feeling its wrath: Motorola Inc. and Research in Motion Ltd as they face individual suits filed against each other due to a cross licensing agreement.

Based on the reports by the media, it seems to be that Motorola Inc and Research In Motion Ltd had a cross licensing agreement in 2003 that expired four years after. Negotiations have taken place and yet nothing has been made to renew this agreement.

Both companies were unable to give their comment on this issue at the moment.

A suit was filed by Motorola against RIM at the Delaware District Court at the Texas Eastern District. A countersuit was made by RIM at the Texas Northern District.

The stocks of both companies fluctuated for several points because of this issue and yet the day ended with an increase of around one percent its opening value in spite of the non resolution of the issue.

According to the suit filed by Motorola, they did not infringe five patents of RIM, even if two of which appear to be related to the mobile device Moto Q. They also mention that the Curve mobile phone and the Pearl mobile phone of RIM have violated seven of the patents of Motorola. This includes software for linking corporate servers and devices.

On the other hand, RIM claims that Motorola is infringing on nine of their patents as well as requiring too high royalty fees for their patents.

This disagreement points out an aspect in the industry of mobile telecommunications. Business for mobile phones requires a need for several agreements and cross licensing between companies. Companies allow each other, competitor or otherwise to exchange the use of technology with technology. If a company holds a patent hand that is more valuable that what is exchanged, then a cash payment may be required to act as a balance to the cross licensing agreement. These payments may run even to millions of dollars in payments.

These agreements are usually based on a mutual sense of value between the two parties. Unfortunately, when the mutuality disappears, lawsuits appear since the negotiations cannot be resolved anymore.

Frequently, settlement is made before a formal hearing occurs which is for the best interest of the parties. The competition is usually too intense that a resolution will definitely be forced to put an end to the quarrel.

This pattern was seen in the case between Nokia and Qualcomm. Lawsuits have been thrown back and forth between the two companies over the issue of expected revenue. Their share prices have been dampened because of this dispute wherein no expected revenue was being paid by each. Although it may be best that they settle this quarrel, only little progress has happened in a year’s time.

Similar to the case of RIM and Motorola, their interests are at stake as they are battle it out through lawsuits.

Motorola has experienced a change in management and are presently re-evaluating business matters for their shareholders annual meeting and having the activist Carl Icahn wanting several seats on the board. Motorola CEO Greg Brown mentioned that although he plans to lead the business on mobile devices, he is also wondering on having it as a standalone company. There has been talk on a joint venture between Motorola and Nortel Networks although there is nothing concrete done about it yet.

The share of Motorola on the global market of mobile phones has gone down and its place in the US market is continually being threatened. On the other hand, RIM has gotten almost half of the US market’s share on smart phones because of the interest gained by the consumers.

RIM has witnessed an increase in the number in subscribers and sales of their devices especially of the email service provided for the Blackberry handset as their expansion to the international market is on its way. And since its performance has continually grown, competition also grows to be fierce especially between the great contenders for mobile phones on the market such as Microsoft, Nokia, Apple, and Hewlett-Packard.

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