The much awaited Yutopia was initially said to be launched on December 7. According to internal sources, Rahul Sharma, Yu CEO postponed the event to December 17 due to a bailable arrest warrant issued against him and two of his colleagues Sumeet Kumar and Vikas Jain by a Delhi court on December 2.
The case is related to a contempt of court relating to payment of royalty to Ericsson from the sale proceeds of the handsets.
Justice Najmi Waziri has issued order which prohibits Yu Televentures from importing and selling smartphones and other related devices that infringe Ericsson’s registered patents.
Yu Televentures has to pay the same royalties that are paid by Micromax to Ericsson. The court has posted the case for further hearing on December 15 where three promoters should be present in the court.
Yu has used few trademarks and patents owned by Ericsson but failed to pay royalties. Micromax contested that Yu is a separate entity and are not liable to pay any royalties. However, the court rejected the weak arguments put before the court and issued bailable arrest warrants.
.@YUplaygod Hold your excitement, as we plan to announce something special with YUTOPIA. The most powerful phone now launches on 17th Dec
— Rahul Sharma (@rahulsharma) December 2, 2015
This is the second time Ericsson has approached the court stating that Micromax owns 99.98% stake in Yu. Yutopia launch delayed due to bailable warrant issued against Yu CEO Rahul Sharma and are liable to pay royalties for 3G, EDGE and GSM patents originally owned by them.
The court has ordered Micromax to pay 1% royalty of the selling price to Ericsson in November 2015 since it was prima facie found guilty of using patents originally developed by Ericsson. However, Ericsson reportedly approached the court since Yu, the subsidiary company of Micromax was not paying any royalties.
The above tussle between Micromax and Ericsson is not new to smartphone industry. Samsung also previously paid millions in the form of royalties to Apple. Redmond based software giant Microsoft also faced similar issues related to Internet Explorer browser few years ago.
We have contacted Yu spokesperson for comment. We will update this story as soon as we hear back from them.