Nokia Corporation (ADR)(NYSE:NOK) shares surged on Monday after an analyst predicted that the phone company would benefit from a jury verdict against Samsung Electronics in a patents dispute with Apple.
On Aug. 24, a federal court in San Jose had ruled that Samsung infringed on Apple's patents and copied the designs of its iPhones and iPads. It rejected Samsung’s counterclaims of having its wireless technologies patents being infringed on by Apple and awarded the latter more than a billion dollars in damages by the Korean handset electronics giant.
The verdict will have significant effect for Samsung, which now has to go back to the drawing board for a re-look at the designs of its Galaxy range of devices, which were at the core of the dispute.
This could give Nokia some breathing space in which to gain some headway with its Windows-based smartphones it plans to launch in the first week of September.
Nokia's position as the world's number one seller of mobile phones was taken over by Samsung in the first quarter of 2012, when Samsung overtook it with its smartphone range.
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The Finnish handset maker has been fighting competition not only from Samsung but also from Apple, which with its superior quality designs and innovative features has set new benchmarks in the market.
After junking its in-house Symbian operating software, Nokia has decided to partner with Microsoft. However sales of the Windows-based phones have been slower off the mark than anticipated.
The new range of Lumia, expected to be unveiled on September 5, will be running on the new Windows 8 operating software and the companies - Nokia and Microsoft - have big expectations from this launch.
In a research note published on Monday, Wunderlich Securities' analyst Matthew Robison said that the $1 billion verdict and possible punitive damages could slow or postpone Android innovation. Any damage to Android favors Nokia's smartphone business, he wrote.
Robison also assumes that smartphone features that were central in Apple's successful patent claims against Samsung will not be contested by Apple on Windows Phone products, noting that Apple and Microsoft have reached agreements on some patents.
"We believe this implies a significant positive shift in application developer sentiment toward Windows Phone," Robison wrote.
Shares of NOK ended higher by 5.52% to $3.25 on Monday.