Week 13 - Post 2: Court Determines FRAND Rate for Google Patents

       For my next post, the United States District Court for the Western District of Washington published a FRAND rate determination for the royalties that Google's Motorola Mobility could charge Microsoft for its use of Google's SEP's- specifically regarding a video codec and a WiFi standard.   This was the first time in history that a U.S. court made a FRAND royalty determination on behalf of the implementer of a standard (Google in this case).  Previous similar cases have only been regarding damages that were awarded for past infringement.  The significance of this case is quite staggering, as it seems more and more FRAND rate determinations will be set by the courts in future, as opposed to the standard model of suing for post-violation damages.  Regardless, Google took a major hit with the ruling of Judge James Robart, who decided that regarding the video codec standard, Microsoft would only have to pay Motorola about half a cent (.555 of a cent) per unit produced, as Motorola apparently did provide a significant value add to Microsoft's technology through this specific SEP.  Regarding the WiFi standard, Motorola is only to be awarded 3.471 cents per Xbox unit, and .8 cents per unit of all other Microsoft products produced.  What is the significance of all of this for Motorola and Google?

        Motorola initially went into the case demanding that the FRAND rate be a $4 billion annual payment by Microsoft, however now it is estimated that with Microsoft's current sales Motorola can only expect a payment of around $1.8 million per year.  This amount is 50% higher than what Microsoft claimed they were willing to pay - $1.2 million a year - however this is "less than a twentieth of a percent of Motorola's initial demand".  Motorola will not even be able to cover their legal fees with this award amount, and it is clear that this determination was a major loss for both Motorola and Google.  Moreover, this ruling is only further compounding Google's continued losses against Microsoft (see my previous article), as Google has failed to achieve significant returns of any kind from its purchase of Motorola Mobility.  Google paid $12.5 billion to acquire Motorola, with an eye towards bolstering their patent portfolio, but they have seen limited returns (only in the millions of dollars) on the leveraging of Motorola's patent portfolio.  It seems Google was fooled into purchasing Motorola due to the sheer number of patents that they possessed  they did not examine the relevancy and value of each individual patent.  For the time being then, it seems as if Microsoft is dominating Google, and I look forward to seeing how Google fights back.

Link: http://www.fosspatents.com/2013/04/court-determined-frand-rate-for.html

Week 13 - Post 1: Android Continues to Require Patent Licenses from Microsoft

        For this post I've decided to focus on another FOSS article, about how ZTE, one of the world's largest smartphone companies, has decided to enter into a licensing agreement with Microsoft.  This event is significant because it marks the 20th mobile device maker to have received a license from Microsoft so as to avoid infringement through the use of the Android OS.  Major companies such as HTC, Samsung, LG, and Nikon have each entered into similar licensing agreements that grant them access to Microsoft's global portfolio of patents, which Microsoft states on its website is the way things should be, "to recognize the value of others' creations in a way that is fair".  Microsoft's Corporate Vice President estimated that approximately 80 percent of Android smartphones sold in the U.S. and a majority of those sold worldwide are now covered by licensing agreements.  The real question now is, to those companies who have yet to sign with Microsoft, how long will they be able to survive and stave off Microsoft in court?
        Google and their owned subsidiary Motorola have essentially refused to acknowledge the need to enter into a licensing agreement with Microsoft, and they have encouraged all of the mobile device producers not to do so either, yet twenty of them already have.  What does this mean for Microsoft and for Motorola?  Twenty companies believed they would be exposed to litigation by Microsoft if they did not do the licensing deal; this indicates to me that if Microsoft were to sue Motorola today over Android related patents, Microsoft would likely win.  Historically, companies like HTC and Samsung have already engaged in several patent battles over mobile devices, yet we find them waving a white flag in the face of Microsoft - clearly indicating they believe a battle in court with Microsoft would be unprofitable.  It must be obvious to the legal teams of these twenty companies that a licensing deal would be less troublesome than going to court.  So why hasn't Motorola done a similar deal yet?

        Motorola is clearly exposed to litigation that other companies have sought to avoid by entering into a protective licensing agreement, and Motorola is in no more of a position to defend itself than is HTC, Samsung, or any other company.  Microsoft may even have the potential to win a U.S. import ban on Motorola's devices, and then what would happen to Motorola's profits?  It seems at this point, Motorola is simply being stubborn; Motorola is attempting to avoid stating the obvious - that most if not all Android using companies should enter into a licensing contract with Microsoft to avoid litigation.  If Motorola were to admit that they needed a licensing contract, then their past claims that the contract was unnecessary would clearly be nullified, and Motorola would appear disorganized and even untrustworthy.  Regarding the promotion of the Android OS, it must be to Motorola's advantage to pretend the licensing agreement is unneeded, to continue to encourage companies to use the OS in hopes that they will not have to pay for a licensing agreement.

Link: http://www.fosspatents.com/2013/04/just-like-one-week-ago-when-foxconn.html

Week 12 - Post 2: ITC Throws Out Motorola Patent Suit

        Today I read another interesting article about a lawsuit of Motorola vs. Apple that I had written about several weeks ago.  Essentially, "the U.S. International Trade Commission on Monday ended a two-and-a-half year patent suit leveraged by Motorola against Apple, throwing out the the case as the last of six patents-in-suit was found to be invalid."  In other words, Apple is finally off the hook from a suit that took over two years to come to a close - indicating just how much time (and presumably money) can be wasted through the process of litigation, especially for trivial mobile device patents.  The patent itself was for a "sensor controlled user interface for portable communication devices," which referred to technology allowing a touch screen to ignore accidental screen touches while making a phone call.
        I remember that Apple had at one point been behind Motorola regarding the final patent in dispute, as the presiding Judge Thomas Pender had ruled that Apple had actually infringed upon the patent.  However upon examining prior art from an earlier-filed Motorola patent, Pender ruled that this more recent patent was invalid for lack of novelty in comparison to the earlier-filed patent.  The ITC Commission itself even found the Motorola patent to be obvious considering their earlier-filed patent, along with common knowledge from another patent.  Google now has the opportunity to pursue an appeal through the U.S. Court of Appeals through the Federal Circuit.

        The most interesting part of this entire fiasco was that Motorola would likely have won their suit against Apple if they had not filed the earlier-patent related to the screen technology that they did.  It is ironic that the prior art used to find Motorola's patent invalid was their own earlier patent.  Had the prior art not existed, Pender would have ruled in Motorola's favor and Apple would be facing an injunction in the United States that would be extremely detrimental to them.  I wonder then if there was a possibility for Motorola to have asserted the earlier patent that was used as prior art?  If the newer patent was deemed obvious in comparison to the older patent, I would think Motorola would have been able to find a way to prove Apple infringed on their older prior art patent.   I am curious to hear everyone else's opinions on this.

Link: http://appleinsider.com/articles/13/04/22/itc-throws-out-motorola-patent-suit-against-apple

Week 12 - Post 1: Amazon Patents Remote Display

        The most recent article I read was about Jeff Bezos, the CEO of Amazon.com, who was one of two inventors to have recently filed a patent for:  "A remote display system including a portable display that wirelessly receives data and power from a primary station."  Essentially, this display system would reduce the modern day tablet to a mere lightweight screen, without all of the data processing equipment and batteries, drastically reducing the potential size of such a device.  Specifically, "the primary station, which is remote from and without a tangible connection with the portable display, includes a data transmitting element and a power transmitting element." The display would be able to receive both power and data from the primary station, effectively allowing the tablet to have a substantially longer or even permanent battery life.  Clearly this technology has the opportunity to be a real game-changer, and the potential uses for such a technology seem limitless, and it will be up to Amazon to decide how it intends to pursue the many business opportunities such a device would allow.

        Most interestingly, listed in the patent Bezos filed, potential applications for such a device included perhaps having several primary stations on a college campus and then issuing or renting the mobile screens to students for however long they needed.  The primary station would handle data and Wi-Fi processing so that the device would be able to perform all the functions of a standard tablet - but with greatly enhanced mobility, battery life, and even performance.  It was also stated that there may be potential applications for digital reading, hinting that this may be the future of the Amazon Kindle.  The patent stated the device could even be used as an attachment to a car windshield, to glasses, or to an earpiece.  The opportunities seem limitless for Amazon with this type of technology,and we can likely expect more patents to follow as Amazon further explores the potential of this technology.

Link: http://www.geekwire.com/2013/future-kindle-amazons-bezos-eyes-wireless-power-remote-processing-device-displays/

Week 11 - Post 2: Apple Defeats Samsung in Claim Construction

     

        The second article that I read today was about how last Wednesday in a case of Apple vs. Samsung in California,  a claim construction order was issued by judge Lucy Koh that puts Apple in a position to defeat Samsung at trial next year.  It is rare for one party to have an edge to such a complete extent as does Apple at this point, and considering the state of affairs, it is highly unlikely Samsung will be able to effectively fight back the lawsuit.  Specifically, Apple "prevailed on each and every disputed term in its own patents..." in such a way that the court adopted Apple's claim construction without any modification.  Samsung's efforts to both narrow and broaden certain elements of the construction were all tossed out because they weren't supported by "patent specifications, prosecution history, or extrinsic evidence."  Samsung only succeeded with one patent, a "method and apparatus for performing non-scheduled transmission in a mobile communication system for supporting an enhanced uplink data channel."  Finally Samsung has two non-SEP's that it will struggle to prove Apple infringed upon.
        Not only will Samsung struggle to prove non-infringement on Apple's four patents, but their only success with the SEP patent will likely cause Apple little harm, as Samsung has a FRAND-licensing obligation that will limit the damages Apple has to pay, and there would be no injunction.  Also, Samsung has a terrible track-record when it comes to proving non-SEP's in court, and Apple successfully added several limitations to the interpretation of these two patents.  Thus it would seem that Apple is on track to come out ahead of Samsung at this point, and I would be surprised if Samsung continued to pursue this engagement with Apple.  I predict Samsung will settle with Apple because at this point the possibility of facing serious damages is very high for Samsung, and they themselves have little to win against Apple.

Link: http://www.fosspatents.com/2013/04/apple-defeats-samsung-in-california.html

Week 11 - Post 1: Nokia Streamlines Patents Against HTC

        The first article that I read today was about how Nokia streamlined several of their patent assertions against HTC with the ITC last Friday.  Nokia filed a motion for partial termination that saw three of its patent complaints dropped of an original nine patent assertions.  However Nokia only has four patents remaining in the lawsuit due to the withdrawal of an assertion back in October of 2012 and the reference of a patent claim to arbitration by the ITC; Nokia also dropped several claims from one patent.  Thus Nokia will now focus on four patents at their upcoming evidentiary trial to begin on May 31st.          Apparently this is the standard number of patents to actually make it through to this point from the original patent suit itself (for a case involving nine or ten original patent assertions).  The patents that were dropped were a light guide patent and two patents related to database synchronization.  This was likely because Nokia lost an earlier claim construction battle that would make it much harder for them to assert their patents against HTC.
        Regardless, Nokia has already obtained one German injunction against HTC at this point, although HTC claimed "its business would not be affected".  Nokia has filed forty patents in total against HTC in both Germany and the United States, so dropping three patent complaints may not seem to be too large of a hindrance for Nokia.  However HTC is countersuing Nokia in Germany with assertions on a power saving patent in both Munich and Mannheim.  HTC's subsidiary S3 Graphics is also suing Nokia over a video patent supposedly infringed upon by Qualcomm's Snapdragon chip.  Thus it seems that the Nokia HTC patent battle is in full swing, and it will be interesting to follow the battle to see who comes out ahead - if anyone actually does come out ahead.

Link: http://www.fosspatents.com/2013/04/nokia-streamlines-itc-case-against-htc.html

Week 10 - Post 2: Android Text Selection to Infringe

        The second article that I read this week was about Administrative Law Judge Thomas Pender's preliminary ruling on remand issues regarding Apple and Samsung.  Pender had remanded a case of Apple against Samsung, allowing Apple to "broaden its win" against Samsung with respect to two patents.  However this is also an opportunity for Samsung to overturn the original ruling or to narrow Apple's claim for later.  Apple was able to successfully broaden its win regarding one of the two more important patents against Samsung.  Specifically Apple is asserting multiple claims against Samsung regarding a " method and apparatus for providing translucent images on a computer display", and Samsung was found to have infringed on all of these - notably through their text selection feature in the Android browser and  the the translucent buttons of the Android photo gallery.

The offending translucent text on an Android phone.

        Apple's claims were all deemed valid, however for the ITC to give an exclusion order on the corresponding Samsung devices, Apple must demonstrate that the act of importation itself constitues a patent infringement.  Interestingly enough, the remand of the trial issued by Pender was as a result of a minor oversight on his part, and the remand gave him the opportunity to fix his mistake, which was regarding one of Apple's claims.  Regardless, now what remains to be seen is whether Samsung's offending devices are taken off the market due to an import ban on behalf of the ITC.  Samsung will have to disprove Apple's claim, although the odds do not seem in their favor at this point.  I would be curious to hear what everyone else things about this whole situation.

Link: http://www.fosspatents.com/2013/04/corrected-itc-ruling-finds-androids.html

Week 10 - Post 1: Apple Patent Invalidated

        The first article I read for this week detailed the ongoing patent war regarding Apple and their "slide-to-unlock" patent.  Essentially, Samsung and Motorola Mobility saw a win in Germany's federal patent court yesterday after the court deemed all claims on Apple's "slide-to-unlock" patent are invalid, and none of the 14 amendments that Apple proposed could restore the patent either.  While Apple intends to appeal this decision it seems that they will likely meet with limited success , because Apple's "slide-to-unlock" does not cover all slide-to-unlock mechanisms, and many mobile device companies have found their way around Apple's design.  Apparently, software like Apple's is not a patentable object if it does not solve, "a technical problem by technical means."   However, Apple's "slide-to-unlock" may have more ground in the U.S. as the courts here are not as strict as in Europe.
     

        Interestingly, the Munich I Regional Court granted Apple a permanent but appealable injunction against Samsung on two of its slide-to-unlock mechanisms.  What does this say about the court system in Germany?  The federal court was against appealing one of Apple's claims yet a regional court upheld what appear to be the same claims in a different suit.  While I appreciate the fact that Europe does not seem to grant patent assertions as easily as is done in the United States, if a court found Apple to have won their case in a regional court, it seems unreasonable that the federal court should go against the same ruling.  It's not that Apple needs to win more patent assertions, but the discrepancy in rulings in Germany, and even throughout the world regarding mobile device patents seems to be too convoluted and highly complex.  However one good thing I can say about the federal court's ruling was that three of the five judges ruling had engineering backgrounds, so perhaps the Munich court was incorrect in their ruling.  Regardless, Germany and the rest of the world still need - as we have seen time and time again - a more efficient system for patent filing.

Link: http://www.fosspatents.com/2013/04/apples-slide-to-unlock-patent.html