Innovation in business processes is every bit as important as in product design. Improving how things are done, not just what things are done, is a fundamental tool of such companies as Procter & Gamble.

But who thinks of law as a place for innovation? The structure and framework are based on precedent and predictability. Yet, using the law in an innovative way is what Nokia has just done: gaining a newly negotiated partnership with Apple, as reported this morning by the Wall Street Journal.

You remember Nokia. Used to be the top of the mobile phone industry? Got into legal fights with Apple? Failed to innovate at the rate of the industry? Sold the mobile device business to Microsoft and was left with the mobile network infrastructure lines?

Nokia went plummeting because it steadfastly refused to consider the pace of innovation it needed. So there's a wry apparent contradiction in using a lawsuit in what seems to be a novel way. But it's important to remember that most lawsuits are settled outside of court, not during a trial. And negotiation can bring amazing things to pass.

Nokia and Apple had previous squared off in competing patent suits for years. In 2011, they settled, with Nokia getting a one-time payment and royalties. The deal ran out in 2016 and the lawsuits started again last December.

It does seem like a crazy way of doing business -- fighting it out, agreeing to royalties, then starting all over again after the first deal ran out. This time, at least, things came together in a matter of a few months. Part of the deal is a "collaboration agreement" in which Nokia sells network infrastructure equipment to Apple. According to the Journal, the expectation is that Nokia will introduce cloud computing products in the near future and that Apple may be getting advanced access. Also, Nokia had bought a Fitbit competitor, Wirthings. The products, under the Nokia name, will sell in Apple stores. Another speculation is that Nokia may have dropped royalty rates to achieve the deal.

In any case, it is a strange and, ultimately, expensive way of getting to a working agreement, as lawsuits at this level are anything but cheap. Maybe next time the two companies can try a different type of innovative tactic: negotiating a deal without letting slip the lawyers of war.

Published on: May 23, 2017
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