Proceedings were filed against Ericsson Australia Pty Ltd and Ericsson's Swedish parent company (Telefonaktiebolaget LM Ericsson).
QPSX is seeking damages for breaches of the licence agreement, misleading and deceptive conduct in contravention of the Trade Practices Act 1974 (Cth), and breach of warranty of authority.
The Federal Court will also be asked for a declaration on whether or not the licence agreement applies to Ericsson's global ATM product portfolio. The licence agreement last November 2003 granted Ericsson non-exclusive licence to QPSX's patented Segmentation and Reassembly (-SAR") technology, which is used in Asynchronous Transfer Mode (-ATM") networks.
The licence agreement provides for payment of royalties at a rate of 5 percent on sales value for the first year from 1 July 2003 and 3 percent for subsequent years.
Ericsson previously told ZDNet Australia that it does not dispute the validity of the existing agreement. However, its interpretation of the contract is different from that of QPSX. Ericsson interprets the agreement as not applying to its entire global ATM Product portfolio.