The ruling goes to the heart of how technology must be licensed for mobile-telecommunication systems that are standard features in most modern cars.
“We cannot understand the verdict of the Mannheim court and will appeal,” Daimler said in an emailed statement.
Carmakers in Europe are dependent on the technology to enable their autos for e-connectivity. Nokia seeks to charge fees per car instead of granting auto-parts makers licenses for the components they produce. As a result some suppliers, including Continental and Robert Bosch, are supporting Daimler in the litigation.
The case is being closely watched beyond the car industry as it may have repercussions for the internet of things as mobile connectivity gets more important in almost all products and industries.
In a rare move that shows how high the stakes are, Germany’s Federal Cartel Office in June asked the Mannheim judges to seek the guidance of the European Court of Justice before deciding the dispute. The Mannheim judges on Tuesday rebuffed the request.
Nokia has sued Daimler in three German courts over the portfolio of mobile technology patents. The Mannheim court in February dismissed a similar suit by Nokia and has stayed two other cases to wait for a ruling on their validity.
More suits are pending in Munich and Dusseldorf. Daimler has also filed a suit to annul Nokia’s patents in a separate court.
The Finnish company wants Daimler to pay royalties based on each car sold, but Daimler argues that the fees would be too high. It wants Nokia to license the technology to the suppliers of the equipment used to integrate mobile devices in its vehicles, which would then charge the German carmaker.
Daimler and some of its suppliers, including Continental, have asked the European Commission to go after Nokia, claiming the Finnish company missuses its market power. Auto-parts makers also see their business model at stake so they joined the suit to defend Daimler against Nokia.
Nokia has said its license model has been accepted by other carmakers, including BMW and Volkswagen Group.