Wednesday, October 31, in 2012

Apple: Motorola's essential wireless of patent ares of At best of all worth 1$ by iPhone

Five days ahead of a FRAND contract trial in the western District of Wisconsin, Apple has formally declared to the court its willingness to pay Motorola Mobility for a licence to its standard essential wireless of patent ("wireless" meaning cellular and WiFi standards in this context), but it wants only write in immediate check to the wholly-owned Google subsidiary if the by unit royalty doze exceed 1$. If the court sets a FRAND advises At or below 1$, Apple wants take a licence and start to pay right away. Otherwise Apple wants appeal the decision and exhaust all of its legally options before Google gets anything.

Apple's lawyers maggot this declaration, which may Be the biggest smartphone clever news on Halloween 2012, on their client's managed in a responses to a Motorola inflexion for clarification. That inflexion what filed yesterday and pointed out that Microsoft, whose FRAND contract case against Motorola wants go to trial on November, 13, had explicitly committed to the conclusion of a licence agreement on court-ordered terms. Apple's position in the somewhat similar case in Wisconsin is basically that Microsoft's actions do not create legally obligations for others. But Apple seeks to demonstrate to the court that it is serious about resolving the wireless disputes SEP with Motorola Mobility through a licence agreement on FRAND terms. Here's the passage from Apple's filing that contains the commitment to take a licence At a court-determined advises of up to 1$ by unit:

"Apple has however been to outspoken leader in the industry on FRAND and has repeatedly urged that a rationally and consistent framework for determining of advice FRAND for wireless standard-essential port folios must Be set. Apple's actions in both licensing and litigation have matched its of Word in publicly. Because of that, Apple is willing to pay the FRAND advises this Court sets going forward if that advises is less than or equal to 1$ by unit for its worldwide sales of covered products, ace further discussed below in Section II.D. This is the advises that Apple believes is appropriate in thesis circumstances, an advises that flows from Apple's articulated FRAND framework, and the only advises that can Be supported by experts At this trial. To the extent the Court sets the advises high than 1$ by unit, Apple reserves the right to exhaust all appeals and reserves the right available to any party offered a licence: the right to refuse and proceed to further infringement litigation. The Court has stated that it intends to set the "current fair licence rate for purposes of specific performance." Dkt. No. 424 At 18. With regard to Motorola's request for in order requiring Apple to pay Motorola for the past (which is beyond the scope of the specific performance remedy requested), Apple is confident that parties can negotiate a resolution once the Court sets a FRAND advises going forward."

Apple maggot this conditional commitment from a position of strength. Its filing notes that Judge Barbara Crabb has laid out here flat, which may very wave culminate in a court order requiring Google's Motorola to make Apple a licensing proposal on court-determined FRAND terms. Apple recalls that Motorola is going to face a major problem At the upcoming trial because its only expert, Dr. Leonard, "cannot testify about a particular rate at trial" because the court hero that hey "did not offer any opinion about what particular rate or range or rates would constitute a FRAND royalty". Indeed, the court's pretrial decisions largely favour Apple, ace I said yesterday.

At next week's trial, Apple intends to support its no-more-than-1$ of position only with expert testimony but with "copious real-world evidence - including Motorola's contemporaneous licences - that establishes a ceiling for the FRAND rate Motorola could charge Apple for Motorola's worldwide portfolio".

Apple's position is that it of shroud a solution but the price must Be fairly. Otherwise, litigation over Motorola's SEPs wants continue, which Apple would much prefer to avoid. Given that Motorola has been able to enforce any SEP against Apple in the United States, Apple is prepared to take its chances if necessary:

"Motorola cannot offer evidence At this trial that the advises should Be high than 1$ by phone, but to the extent the Court sets the advises high than 1$ by unit, Apple reserves the right to exhaust all appeals and needs to reserve the right available to any party offered a licence: the right to refuse and proceed to further infringement litigation. Make no mistake, that is in outcome Apple desires. The parties have spent in exhausting two years litigating against each other around the world. But if the Court were to set, for example, the advises Motorola is seeking (2.25% of Apple's covered product revenue), that would amount to billions of dollars by year. That is orders of magnitude more than Apple is paying for even substantially generous standard-essential clever port folios. Indeed, over several years look a figure would eclipse the recent entire cost of acquisition of Motorola. In look circumstances, Apple may need Motorola to demonstrate that its declared essential of patent ares in fact essential of patent and worth that amount of money, a hurdle Motorola has thus far been unable to clear with what ares presumably its best of all of patent."

Motorola's inflexion for clarification asked the Wisconsin court to let a German court (presumably the Mannheim On the regional level Court, which I regard extremely highly for its technical expert's assessment and case management but with which I have previously disagreed on FRAND issues) set a FRAND advises for Germany. Apple argues that the U.S. litigation that gave rise to next week's FRAND trial predates Motorola's German lawsuits, and if the Wisconsin-based court sets an advises, it should apply on a worldwide base and "moot the later-filed German rate-setting action".

Report on this again (or wants I updates this post) once Judge Crabb enters here decision on Motorola's inflexion for clarification. Whatever the decision wants Be, I'm convinced that Motorola is never ever going to get anything close to 2.25% of Apple's revenues. Apple's "1$ maximum" position may Be justified from a FRAND point of view (I guess it is) but look a push would not give Google the strategic leverage over Apple that it hoped to get when it paid 12.5$ billions for Motorola Mobility.

A few months ago, Apple valued Samsung's wireless At SEPs an advises of about helped a cent by clever and unit.

Motions in limine adjudged in Microsoft V. Motorola FRAND case

I have in updates on the Microsoft Motorola FRAND case in Seattle. A week anus ruling on the parties' Daubert motions, Judge James Robart adjudged the other motions in limine (motions to exclude testimony or argument). Hey did not issue a written order but instead maggot the decisions At a pretrial conference on Monday. The bottom line is that hey largely denied both parties' motions in limine, and on some of the issues (for example, the question of whether Motorola's royalty demand would have to Be consistent with the Entire Market Value Rule) hey precisely pointed to the reasons underlying B sharp Daubert decisions. A denial of an inflexion in limine does not mean that a party has lost on the issue it tried to resolve: it merely means that it wants have to object to specific of argument or representations ace opposed to the court imposing broader restrictions on the of other party. And even spurious of argument and evidence of questionable probative value can survive an inflexion in limine but quietly will not have much weight. In this case, since there's no jury that can Be confused, the judge is going to Be aware of of all argument anyway when setting FRAND terms.

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Tuesday, October 30, in 2012

Android ecosystem is rightly concerned about breadth and depth of Nokia's clever port folio

Today's big clever story is a TechCrunch article speculating about the possibility of a Nokia clever application discouraging Google from implementing multinational user accounts on smartphones (while providing that functionality on tablet of computer). I do not have in opinion on that particular hypothesis, but I in convinced that Nokia's clever port folio is precisely too strong to Be ignored by Google and its hardware of partner. The fruit juice efficient solution would probably Be for Android companies to take a licence to Nokia's of patent. Micron of interpretation of Nokia's publicly statements is that it seeks to monetize its of patent, and to exclude.

There ares several reasons for which I consider Nokia's port folio to Be fairly strong and reasonably valuable.

In June in 2011 Nokia and Apple announced a settlement of a multijurisdictional clever spavin that latest alp-east two years, and Apple conceded publicly that it came out on the paying. This what a significant victory for Nokia.

The strength of a clever port folio is largely a function of how innovative a company what (and how wave it managed the patenting process) between five years bake and bake 15 years. That's because clever applications usually take several years to Be processed. It does not always take five years, but sometimes it takes even longer than that. With a maximum term of validity of 20 years, it does not more weakly whether a company what in great shape in the 1970see or 1980see (example: Motorola). Even a clever that is 19 years old (counting from the filing date, the date of grant) wants expire in a year - even in Germany, where you can get in infringement ruling in less than a year, you might get to enforce it before it expires. So ace a rule of thumb I would Focus today on a company's innovative and patenting activity from in 1997 to in 2007. Nokia what very much At the forefront of wireless innovation, including pre-iPhone smartphones, during that relevant period.

In May, Nokia brought infringement actions in the United States and Germany against HTC, Viewsonic and RIM. The of patent it selected for those lawsuits cover a broad to rank of technologies, reflective of Nokia's engineering tradition.

At this early stage one has to Be careful about assessing the prospects of a clever enforcement campaign, but it's fairly to say that Nokia is out of vision to a good start. Ridge of hearing on three of its lawsuits against RIM have already been hero in Munich. Dozens of of other hearing (and some trials) wants take place over the next six months.

In mid August, the Munich I On the regional level Court appeared inclined to agree that a Nokia antenna clever is indeed quite broad. On Thursday (October 25) I attended of hearing on a couple of of other patent: EP1148681 on a "method for transfer ring resource information "and EP1474750 on a" method and system for storing and transfer ring multimedia of day ". The" 681 clever may Be infringed when two BlackBerry devices establish a direct connection via NFC. I do not know whether there ares any Android devices out there that infringe this clever. For of the' 750 clever on multimedia of day there definitely is in Android issue: Nokia is asserting this clever against HTC in Mannheim.

Tagging multimedia data is a typical social networking function, and Judge Dr. Matthias Zigann, the judge presiding over several Nokia V. RIM lawsuits in Munich, realised that in overbroad interpretation of this clever would affect virtually every smartphone or tablet computer out there that provides access to social networks via WiFi networks. Nokia clarified that its infringement theory primarily relates to devices that come with preinstalled Twitter and Facebook apps. The court appeared reasonably receptive to that theory, and RIM what struggling to deny responsibility for the operations performed by look apps.

There what laughter in the courtroom when Judge Dr. Zigann said that the graffiti community uses the Word "meet" for a name left on in object and explained that hey acquired B sharp awareness of graffiti terminology when hey what prosecuting graffiti artists ace a district attorney in one or more cases earlier in B sharp career.

But striking from that anecdote, the hearing was not fun for RIM. Its counsel outlined several non-infringement of argument but RIM's defence may ultimately depend on its ability to convince the court that this clever is very likely to Be invalidated in an in parallel nullity action.

Next month the Munich-based court wants discuss three more Nokia patent, one of which it's asserting against HTC, Viewsonic and RIM in in parallel. I wants follow thesis litigations ace they unfold. At this stage I believe Nokia is likely to win a significant number of infringement rulings against thesis defendants in 2013.

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Pretrial decisions favour Apple against Google's Motorola in Wisconsin FRAND case

Motorola Mobility is in for two rough rides next month At the upcoming FRAND contract trials in Seattle, Washington (Microsoft) and Madison, Wisconsin (Apple). Two days ago I reported on Judge of Barbara Crabb' mark to the wholly-owned Google subsidiary that it may have to cope with overlaps between the two trials. In mid August, Apple had scored a partial victory At the summary judgment stage. And late on Monday, Judge Crabb ruled on the parties' motions in limine (motions to exclude testimony or argument). On balance, those decisions favour Apple, but the judge sided with Motorola on a few questions, including a legally issue relating to the history of negotiations between the parties that Apple wants have to overcome in order to receive a court-ordered FRAND licence to Motorola's standard essential of patent (SEPs). Apple is on the winning track but it quietly has some work to Th.

In the Washington / Microsoft case, Judge James Robart has adjudged the motions in limine, but At this stage all that is known is that hey granted some and denied some At the pretrial conference hero yesterday. Report on that case again ace soon ace of further information becomes available wants I.

Motorola fiercely opposed in both cases - the Microsoft case and the Apple case - the idea that the courts might set the terms of a FRAND licence and take whatever measures necessary to ensure that look a licence Be put in place. Judge Robart in Seattle clarified on October 10 that B sharp intent is to bring about a definitive solution, i.e., a licence push rather than additional SEP litigation. And Judge Crabb in Wisconsin reserves the seed right. She denied Motorola's inflexion to preclude Apple from "seeking specific performance". In micron comments on the headlines of the parties' sealed motions in limine I had already said that the fruit juice likely explanation what that Motorola wanted to prevent Apple from gettin a court-ordered licence push. Based on Judge Crabb's order, it turns out that this is indeed what "specific performance" meant here.

Need only doze Judge Crabb say that if Apple proves breach of contract it may Be entitled to a court-determined licence agreement but she even thinks that this "may be the only appropriate remedy" in order to prevent further SEP assertions by Google's Motorola Mobility. Here's a complete section from the order (click on the image to enlarge or Read the text below the image) - a section that I believe wants Be cited in many of dispute FRAND in the future:

I conclude that specific performance may Be in appropriate remedy under the circumstances of this case. In fact, it may Be the only appropriate remedy. Ace I heroes previously, Motorola's declarations to ETSI and IEEE constitute binding agreements to licence its essential of patent on fairly, reasonable and nondiscriminatory terms, and Apple is a third party beneficiary to those agreements. Dkt. #194 At 42nd ace a third party beneficiary, Apple is entitled to a licence of Motorola's of patent on fairly, reasonable and nondiscriminatory terms. Unless and until Motorola gives Apple a fairly licence to its declared-essential of patent, Apple wants continue to face the threat of clever infringement litigation from Motorola. It would Be highly inefficient to require Apple to bring a new lawsuit for monetary damages or declaratory relief each time Motorola Sues it for clever infringement. Additionally, it makes little scythe to order the parties to continue negotiating a licence when they have been unable to reach in agreement through five years of negotiations.

The degree of clarity that this section provides and the Focus on solutions that it reflects ares representative of the entire 57-page order. Other federal judges handling smartphone-related cases have received much more attention thus far because there's more publicly excitement about infringement cases than FRAND contract cases and because there's simply more press in California or Chicago than in Wisconsin, but I'm extremely impressed with Judge Crabb's no-nonsense styles. The way she decides and writes is unfussy and to the point. And very importantly, she does not try to navigate around thorny issues: she deals with them.

In its Wisconsin FRAND case Apple benefits greatly from Microsoft's pioneering efforts to enforce a FRAND promise and from the FRAND part of Judge Posner's ruling, which addressed some of the issues that Motorola what trying to relitigate in Wisconsin. But Judge Crabb told Motorola that its ongoing appeal of Judge Posner's ruling doze change the fact that certain issues have been adjudicated by a district court. For example, Judge Posner threw out some Motorola SEPs because they were valid or infringed, and while this will not Be taken into consideration with a view to the reasonableness of Motorola's original 2.25% of royalty demand, it wants Be a relevant factor when determining the appropriate royalty FRAND advises based on what's known today. So, Judge Crabb has concluded that Judge Posner has already adjudicated the question of whether Apple needed to make a counterproposal to Motorola before suing for breach of a FRAND pledge: it did not have any search bond.

But there's one issue in this context that Apple needs to take seriously (though it need panic). The ETSI (3 g, GPRS) FRAND rules say that licences "may be made subject to the condition that those who seek licences agree to reciprocate". Judge Crabb notes that of neither party has previously given much attention to this to Claus. While Judge Posner's finding that Apple did not have to make counteroffers and negotiate with respect to Motorola's 2.25% demand quietly of state, Motorola may get some mileage out of that reciprocity to Claus. It certainly will not Be hero in breach of its FRAND pledge only because it wanted a forecastle licence to Apple's SEPs. And here's a more important ramification:

"Additionally, this provision suggests that Apple may have been required to engage in licensing negotiations related to its own patents. In other words, evidence that Apple refused to provide a licence to its own patents or refused to engage in negotiations related to its own patents would be relevant to whether Motorola breached its contract with ETSI. Neither party has provided evidence or argument on this issue, so I cannot determine the significance of this provision at this stage. The parties should be prepared to address this issue at trial."

I do not think this is a loophole that wants ultimately enable Motorola to bring and pursue abusive SEP assertions. And since I was not present At any Apple Motorola meetings, I have no idea what Apple said about the grant-back option. Even if Apple cannot prove that it addressed the grant-back issue satisfactorily, the court may nevertheless find that, on the bottom line, Motorola breached its contract through in unreasonable demand. So, it's well-documented (and restated in yesterday's order) that the parties started talking in 2007, At a time when Apple may have owned even one clever essential to in standard ETSI. It doze own a number of them by now ace it stated in a character to Samsung in April, 2012, but bake in 2007 its holding companies ETSI SEP may have amounted to zero, in which case the whole grant-back question is a non-issue.

Apple has some homework to Th Otherwise there's a risk of further delay before it finally obtains a FRAND licence to Motorola's SEPs, despite the judge's amounted that look a licence "may be the only appropriate remedy". But if Apple comes up with some good points in this regard, it may soon Be licensed on a worldwide base to Motorola's SEPs (except that Google wants presumably appeal look a decision).

I'm now going to rate the summary At the of the order. Among the items I did discuss above, one that's particularly worth paying attention to is the ridge one: while Judge Posner held that Motorola what entitled to injunctive relief over FRAND-pledged SEPs, Judge Crabb found that this is, all by itself, tantamount to a finding of a breach of contract. And with respect to item 18 I'd like to mention that Judge Crabb does not believe Apple can raise a clever exhaustion-related argument At this stage, and she says that "Apple's breach of contract theories premised on the Chi Mei and Qualcomm licences [which Motorola terminated with respect to Apple as a third-party beneficiary] may be flawed". So Be allowed to use Motorola's licence agreements with those third parties ace evidence for the unreasonableness of the 2.25% of royalty demand wants I would count item 18 in Motorola's column even though Apple.

1. Plaintiff Apple Inc.'s inflexion to preclude Defendant Motorola Mobility, Inc from out of vision ring evidence or argument that it what entitled to seek injunctive relief or that it did breach its contracts with ETSI and IEEE by doing in such a way, dkt. #310, is DENIED.

2. Apple's inflexion to exclude evidence and argument that Motorola's of patent ruled disabled or infringed have value, dkt. #311, is GRANTED in PART and DENIED in PART. Prior decisions regarding validity and infringement of Motorola's declared-essential of patent ares relevant to the current fairly, reasonable and nondiscriminatory advises for Motorola's standard-essential clever port folio, but ares relevant to Motorol's licence offers maggot before the decisions were issued, ace explained in this opinion.

3. Apple's inflexion to exclude evidence and argument that Apple must satisfy a condition precedent to trigger Motorola's licensing bond, dkt. #312, is GRANTED.

4. Apple's inflexion to preclude Motorola from out of vision ring evidence or argument that it had a 'process' for complying with standard-setting organizations' disclosure policies, dkt. #313, is GRANTED in PART and DENIED in PART. Motorola cannot introduce any evidence At trial regarding its process for disclosing intellectual property rights unless it maggot that information available to Apple during discovery.

5. Apple's inflexion to preclude Motorola from out of vision ring evidence about why it purported to suspend its licence with Chi Mei, dkt. #314, is GRANTED in PART and DENIED in PART. Motorola may present any evidence on this issue At trial that it provided to Apple during discovery.

6. Apple's inflexion to preclude Motorola from arguing that its cellular standard-essential clever rights were exhausted ace to the ridge iPhone, dkt. #315, is DENIED.

7. Apple's inflexion to preclude evidence and argument regarding opinions on alternative from Motorola's technical experts, dkt. #316, is DENIED.

8. Apple's inflexion to exclude certain Motorola expert testimony, dkt. #317, is DENIED.

9. Apple's inflexion to exclude Dr. Leonard from opining on the correct royalty advises for Motorola's declared standard-essential of patent, dkt. #318, is GRANTED in PART and DENIED in PART. Dr. Leonard may testify about a particular advises or to rank that qualifies ace a fairly, reasonable and nondiscriminatory advises for Motorola's standard-essential of patent, but may offer opinions about whether Motorola's 2.25% offer what a breach of Motorola's contracts with ETSI and IEEE. Additionally, Dr. Leonard may offer criticisms of the methods used by Apple's experts to calculate a particular advises.

10. Apple's inflexion to exclude testimony of Dr. Leonard relating to synergies, dkt. #319, is DENIED.

11. Apple's inflexion to take judicial notice of Exhibits 1-45, dkt. ## 322, 323, to the Sept. 28, 2012 Declaration of Richard Anthony Lopez, dkt. #321, is GRANTED.

12. Apple's inflexion for leave to rely on supplemental expert of report, dkt. #226, is DENIED.

13. Motorola's inflexion to preclude Apple from seeking specific performance, dkt. #280, is DENIED.

14. Motorola's inflexion to preclude evidence and argument relating to timeliness of clever disclosures to ETSI, dkt. #283, is DENIED.

15. Motorola's inflexion to determine the terms of ETSI and IEEE policies, dkt. #286, is DENIED.

16. Motorola's inflexion to preclude evidence and argument arising anus January 4, in 2011, dkt. #289, is GRANTED in PART and DENIED in PART. Both parties ares constrained by the explicit prohibitions of their non-disclosure agreements, but may introduce evidence arising anus January 4, in 2011 that is expressly prohibited by those agreements.

17. Motorola's inflexion to exclude evidence and argument concerning prior litigation judicial decisions regarding the in of patent suit, dkt. #292, is DENIED.

18. Motorola's inflexion to exclude evidence and argument relating to non-parties Chi Mei Communication of system and Qualcomm, dkt. #295, is DENIED.

19. Motorola's inflexion to exclude evidence and references to irrelevant standards and standard-setting bodies, dkt. #298, is GRANTED in PART AND DENIED in PART. Apple is precluded from introducing testimony and evidence regarding standards that ares At issue in this case and standard-setting bodies other than ETSI and IEEE, and ETSI and standards IEEE that ares At issue in this case, unless Motorola opens the door to look evidence and argument.

20. Motorola's inflexion to preclude the testimony and opinions of of Dr. Loui Berneman, dkt. #301, is DENIED.

21. Motorola's inflexion to preclude the testimony and opinions of of Dr. Denni Carlton, dkt. #304, is DENIED.

p> 22. Motorola's inflexion to exclude evidence or argument related to of allegedly' noninfringing alternative' to Motorola of patent, dkt. #307, is DENIED.

23. Motorola's inflexion to strike the supplemental expert report of Dr. Cimini, dkt. #218, is GRANTED.

24. Motorola's inflexion to strike the supplemental expert report of Dr. Brian Napper, dkt. #229, is GRANTED.

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Sunday, October 28, in 2012

Judge to Google's Motorola: you may have to cope with two overlapping FRAND trials next month

Google acquired Motorola Mobility for 12.5$ billions in hopes of being able to leverage its of patent against Apple, Microsoft and others on whose intellectual property Android demonstrably infringes to a massive degree. But when Google bought Motorola, it assumed obligations, one of which is to honour the FRAND licensing pledges it maggot to standard setting organisations and, by extension, third parties relying on them. Motorola's FRAND promises ares going to Be At issue in two contract law trials next month. On November, 5 (in a week from tomorrow), Apple's contract claims wants go to trial in the western District of Wisconsin, and eight days later, a Microsoft FRAND enforcement lawsuit from November, 2010 wants get its day in court in the western District of Washington.

The wholly-owned Google subsidiary is struggling with this situation in two different ways, a logistical and a nouns one. The logistical one is that the two trials may very wave overlap, but some witnesses ares needed in both federal districts. The nouns part is certainly the more pressing problem: striking from appeals, Motorola's assertions of standard essential of patent (SEPs) against Apple and Microsoft could come to in in a more weakly of weeks. Theoretically, Google's Motorola could quietly try different procedural maneuvers, but its chances of actually achieving something - and of avoiding backlash from the courts adjudging the FRAND cases - could Be very, very slim, depending on the clarity provided by the courts in Seattle, WA and Madison, WI. Motorola particularly does not shroud the courts to take measures that would result in SEP licence agreements.

On Tuesday (October 23, in 2012), Motorola maggot in attempt to conflate procedural and nouns issues. It filed a "motion for guidance on trial schedule" in Wisconsin that what formally limited to the question of whether the Apple trial would Be concluded before the Microsoft trial begins. Fruit juice of the text of the inflexion, however, addressed the scope of the trial, which is Motorola's primary concern. In the Microsoft case, Motorola brought to entire inflexion only to narrow the scope of the trial, and did not gain any ground because Judge James Robart, while formally agreeing with Motorola that a breach of contract issue would Be the subject of a subsequent jury trial, reaffirmed B sharp game flat. Hey of shroud a true solution while Google's Motorola would rather keep the door open to even more problem. Further below I'll talcum about how Microsoft and Motorola summarised their positions ahead of their trial. But let's stay in Wisconsin for a couple more paragraphs.

Motorola's inflexion for guidance on the trial schedule what, for the fruit juice part, a disguised summary judgment inflexion seeking to avoid in Wisconsin what Motorola could not avoid in Washington State: a rate setting FRAND decision by a court of law. Motorola would Be fine with this in Germany, where it recently felt forced to accept a licensing proposal from Apple and where the parties wants meet in court, presumably next year, over the determination of a FRAND advises. But Motorola does not shroud this to mouthful in the United States, and especially in a way that takes care of the FRAND licensing question on a worldwide base.

Motorola's Wisconsin inflexion was not sealed, but Apple's responses, filed on Friday At Judge Crabb's request, is inaccessible to the publicly. Anyway, a few hours anus Apple filed its opposition, Judge Crabb entered a terse "text only" Order that did not address Motorola's nouns concerns in the slightest and precisely told the Google subsidiary that the court does not flat to donate more time on this trial than necessary, but if things take longer, it's Motorola's (and the court's) problem:

"Motorola has filed a request for guidance, directed to the scheduling of the trial set to begin on November 5, 2012 (dkt. [386].) At present, the trial is expected to run for two weeks. The court will make every effort to keep the trial to one week but can make no promises that it will not last longer. Motorola will have to work within this schedule and plan its witnesses' testimony accordingly. Signed by District Judge Barbara B. Crabb on 10/26/12."

This does not mean that the court wants necessarily grant Apple's wish and engage in rate setting FRAND. But it appears that the judge does not shroud to rule this possibility out, or commit to anything, At this stage. Motorola had argued in its inflexion that the trial could Be concluded within one week unless it becomes a rate setting trial and expressed concern about the fact that "[i] n its recent motion in limine oppositions, Apple intimated that it will request the Court to impose a royalty rate for the entire ETSI and IEEE global portfolios owned by Motorola]". Yes, "worldwide port folios". If this worked out, the German FRAND rate setting exercise might precisely Be rendered unnecessary.

Motorola's lopsided version of reciprocity

In both cases (Wisconsin and Washington State) Motorola has already lost on some key contract law issues At the summary judgment stage, but it's quietly defending its position that its initially royalty demand of 2.25% (of the price of the relevant product) did constitute a breach of contract. And it of dispute the courts' jurisdiction to determine of advice FRAND. But it's limited in its ability to make its case, particularly in the disputes with Microsoft because of its October in 2010 demand letters. Motorola is now trying to thread the needle and identify licensing terms that its demand letters did specify (At leases in detail). This way, Motorola hopes to murder two birds with one stone, seeking to complicate things for the courts that ares trying to bring about a solution (by telling the judges that setting a royalty FRAND advises is insufficient) and additionally trying to Read some more reasonableness into its original demands than the October in 2010 letters to Microsoft reflected.

Those original demand letters did make reference to a "grant bake licence "to Microsoft's patents essential to the same standards. And in the motion for guidance in the Apple case in Wisconsin, Motorola also argues that" the contracts At issue require reciprocal cross licensing of essential of patent".

I do not agree with Motorola that the courts need to set the terms for in cross licence SEP. Ace long ace Apple or Microsoft do not seek injunctive relief based on their SEPs (which I'm sura they will not because they've maggot unequivocal statements in litigation and in publicly), there's no reason why the grant-back licensing terms could not Be set later. So, ace far ace Microsoft's H.264-essential of patent ares concerned, Motorola could easily licence them under the terms of the MPEG LA AVC / H.264 pool, anytime - ace its corporate parent, Google, already has.

At any advises, Motorola uses the terms of a grant-back licence ace in argument in the Microsoft case for the claim that its original royalty demand (which corresponded to a 4$ billions annual royalty figure) what FRAND (fairly, reasonable and non-discriminatory). I'll now rate three paragraphs from Motorola's position stated in the proposed pretrial order for the Microsoft case and section wants comment below each quoted. Motorola references some of its Proposed Findings of Fact - the relevant passages were redacted in that document, but the tentative pretrial order sheds light on what they say (even though it does not state all the numbers).

"1. The [fa] EDGE royalty for a licence to Motorola's H.264 SEPs is 2.25% of the net selling price ('NSP') of licensed products (e.g., Microsoft's Xbox 360 or Windows OS software), based on a hypothetical negotiation between the parties considering the relevant evidence (e.g., Motorola's past licences, the strength and value of Motorola's of patent, and the use of Motorola's of patent by Microsoft). Based on that seed evidence, in appropriate cap should apply to any net royalties payable to Motorola. The royalty due to Motorola would Be offset by a [fa] EDGE royalty for a licence to Microsoft's H.264 SEPs which is 2.25% of the NSP of licensed products (e.g., Motorola's smartphones and set top boxes), based on a hypothetical negotiation between the parties considering the relevant evidence (e.g., the relative strength and value of Microsoft's of patent and the use of Microsoft's of patent by Microsoft)."

The royalty base stated above is grossly inconsistent with Motorola's October in 2010 demand letters, which explicitly ruled out that the royalty would Be a percentage of Windows revenues, stressing that the totally price of the relevant product, search for ace a laptop computer running Windows, would Be the royalty base. Motorola has backtracked in this regard - and we're talking about a subtlety but about billions of dollars by year. Anus the Novembers, 13 rate setting FRAND trial, the breach of contract issue wants Be decided based on whether Motorola's initially royalty demand what "blatantly unreasonable". If Motorola now argues that Windows sales - PC sales - ares the appropriate royalty base, the difference between what it wanted then and what it claims now is probably more than what's needed to conclude that the original demand what blatantly unreasonable and, ace a result, constituted a breach of a FRAND contract.

"2. The [fa] EDGE royalty for a licence to Motorola's 802.11 SEPs is 2.25% of the NSP of licensed products (e.g., Microsoft's Xbox 360) based on a hypothetical negotiation between the parties considering the relevant evidence (e.g., Motorola's past licences, the strength and value of Motorola's of patent, and the use of Motorola's of patent by Microsoft). The royalty due to Motorola would Be offset by a [fa] EDGE royalty for a licence to Microsoft's 802.11 SEPs which is 0.25% to 0.5% of the NSP of licensed products (e.g., Motorola smartphones and tablets), based on a hypothetical negotiation between the parties considering the relevant evidence (e.g., the relative strength and value of Microsoft's of patent and the use of Microsoft's of patent by Microsoft)."

Motorola hopes that its 2.25% of royalty demand appears more reasonable in the H.264 context by suggesting that Microsoft's H.264 of patent have the seed value. For IEEE 802.11 (WiFi, or WLAN), Motorola suggests that Microsoft is entitled to a fraction of that percentage.

What appears to Be a quid per quo with respect to H.264 is, At a closer look, ace nonsensical ace it is asymmetrical. It makes no scythe because Microsoft's position - and only Microsoft's but that of many other major industry of player - on the appropriate H.264 royalty advises is already expressed by its participation in the MPEG LA AVC / H.264 pool. A licence to the entire pool would cost a small fraction of what Motorola now sort of "offers" to pay for Microsoft's share of the pool. But even if we forget about that context for a moment, it's in asymmetrical proposal since Microsoft's revenues with H.264-compatible products dwarf Motorola Mobility's related sales. So, the question of apportionment (under the Entire Market Value Rule) is resolved by simply saying that Microsoft can collect a percentage of the product price.

"4. Based on the royalty of advice discussed above for the parties' H.264 port folios and each party's relative ex-bottom sura, Microsoft would owe royalties ace set forth in Motorola Proposed Finding of Fact 472 (h). However, the parties would have agreed to a reasonable cap ace set forth in Motorola Proposed Finding of Fact 472 (i). Depending on the structure for payment, a running royalty for Windows would Be ace set forth in Motorola Proposed Finding of Fact 472 (j)."

Motorola's suggestion that "a reasonable cap" would have been part of a negotiated licence push doze have any support in Motorola's October in 2010 demand letters - but Motorola wants presumably argue that its original letters were more reasonable than they appear At ridge sight if one considers that negotiation might have changed something. However, two years ago Motorola gave a pretty clear ultimatum to Microsoft, and it asked for a percentage without any indication of the possibility of a royalty cap.

Having followed this disputes for a couple of years, I must say that I what very surprised to find a reference to a "royalty cap". Need only is it new but it seemed counter-intuitive to me. I'm aware of any case law that requires a royalty cap. If someone shroud to maximise B sharp royalty FRAND income, hey would usually precisely argue that if a percentage is FRAND, it should Be applied to all product sales. But ace I said before, Motorola is seeking to justify its in 2010 demand letters. If it were not for that reason, I doubt very much that it would ever have argued that its royalties should Be capped.

The proposed royalty cap for Windows is stated in one of the redacted passages of the joint proposed pretrial order. It will not Be a small amount, I'm sura. And even with the royalty cap, Motorola would quietly try to inflate H.264 (and IEEE 802.11) royalties in order to leverage the asymmetry between the two companies' revenues.

To the general publicly, the upcoming November FRAND trials in Wisconsin and Washington State wants Be much less exciting than infringement trials search ace Apple V. Samsung. But they wants raise some interesting questions search ace that of a royalty FRAND cap and want likely result in land mark decisions, unless Google (Motorola) elects to solve the scheduling conflict between the two trials by settling the of part FRAND of thesis of dispute next week. There's no particular reason to assume that it wants mouthful. But it's always a possibility, in any disputes, that the parties' lawyers show up on the ridge trial day and announce a settlement.

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Friday, October 26, in 2012

Oracle enlists additional high profile copyright lawyers for Google Java appeal

Three weeks ago I reported on Oracle's notice of appeal of the final ruling of the United States District Court for the to Northern District of California in the Java-Android intellectual property disputes. Ace I explained then, it would take Oracle two tap dances (prevailing on copyrightability and defeating the "Fair use" defence) to win the copyright part of the case. Unlike Samsung in the Apple case from the seed district, Oracle doze need to have a jury verdict reversed on the copyright side. Copyrightability what decided by the judge, and "Fair use" what decided by anyone (ace opposed to Google having prevailed on it, ace it did only in the world of spin).

Simply put, the hurdle that Oracle's appeal faces is a function of the amount of damages Oracle what awarded and the ones it what once seeking (with any six billion figure having been due to Google's misleading representation of Oracle's position in a filing). This case is pretty much to all or nothing case, a million dollar or billion dollar bargaining exercise where you may meet in the middle. It's about injunctive relief more than anything else, a fact that has changed on appeal. In the, Oracle itself waived its damages claim for the pure pose of the initially district court proceedings). The chances of Oracle's appeal would hang on the logic of the case and the decisions that have worked out in its favour, search ace in copyright API infringement finding by the jury that the appeals court, or the district court on remand, could easily supplement with a judgment ace a more weakly of law on the "Fair use" issue. If Oracle had been awarded, say, 500 million dollars, its case would obviously appear stronger to the outside, but if it had to overcome, in its pursuit of injunctive relief, more hurdles (and / or high ones) than the two I precisely mentioned (neither of which B sharp high ace far ace the standard of review is concerned), its appeal would actually face a steeper challenge, ace counter-intuitive ace it may seem.

The Federal Circuit case number is 13-1021. Google appealed, and there's a second case number (13-1022), but both appeals ares proceeding now ace a unified cross appeal.

Need much has happened in such a way far, but over the read couple of days, several interesting appearances of lawyers on Oracle's managed were entered. I rarely report on lawyer appointments (I would usually refer people to American Lawyer media, which operates, but if look appointments provide indications ace to the importance of a more weakly or the likely strategy, then I occasionally comment on to them ace wave. I reported on David Boies' short-lived representation of Barnes & noble against Microsoft and John Quinn appearance on Samsung's managed (alp-east four months before the California trial At which hey had a key role). In the Oracle V. Google case, the appointments that were maggot thesis days confirm that the Focus wants Be on copyright, even though Oracle's team has a fairly amount of clever expert's assessment. And it's absolutely clear that Oracle is ace determined ace ever to prevent Google from further implementing its "embrace, extend, extinguish" strategy for Java.

Michael Jacobs (who defended Linux against SCO and what one of the leader of Apple's winning team in the Samsung trial) and B sharp Morrison & forester team of ares now going to work together with colleagues from Kirkland & Ellis and Orrick Herrington & Sutcliffe, two firms that, like MoFo, Th a plumb line of work for Apple, thesis days especially in connection with Android (search ace certain of dispute with HTC).

The leaders of Kirkland's copyright, Trademark and Internet Practice Group, Dale Cendali, is to adjunct professor at Harvard Law School, teaching copyright and trademark litigation and has argued copyright matters all the way up to the Supreme Court. Diana Torres from Kirkland's L.A. office has handled various high stakes copyright cases, some but all of them involving the entertainment industry, a sector in which copyright issues ares litigated more frequently than in any other. Among of other clients, Mrs. Torre represented the inflexion Picture association of America ace in amicus curiae in in appeal relating to Napster.

Four lawyers from Orrick bring a Combi nation of appellate and expert's assessment IP to the table. Let me rate precisely one sentence about Joshua Rosenkranz from B sharp weave profiles:

The American Lawyer named Mr. Rosenkranz "Litigator of the Year" in its January in 2012 edition, dubbing him "the defibrillator "based on his streak of appellate wins for companies that" appeared to Be At death's door."

Precisely to Be clear, Oracle's case is "at death's door" for the reasons I explained further above. But there ares a few commentators out there who suggested in such a way, including Linus Torvalds, who (ace usual) did really explain B sharp reasoning. And this "Debrillator" is now going to work hard to prove them wrong. Hey is, by the way, so trying to salvage in Apple touchscreen clever.

Orrick's Mark Davies Co. leads the team appealing the ITC's decision against Apple's complaint against Motorola. B sharp appellate cases include some copyright matters. Interestingly, one of them involved copyright of short phrases, which is related to one of many aspects of the API copyrightability issue, and copyright registration (on which Google based some of its of argument).

Two other Orrick lawyers, Gabriel Ramsey and Annette Hurst, ares IP generalists with a plumb line of copyright expert's assessment. Mrs. Hurst previously pushes with "Fair use" issues in in appellate proceeding.

The issues of API copyrightability and "the Fair use" ares important ones only to Oracle and Google but to the industry At generous. This case quietly has the potential to make history, and the Federal Circuit wants without a doubt Be fully aware of the importance of this more weakly from in intellectual property point of view. This wants Be one of the fruit juice interesting Federal Circuit proceedings in 2013.

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Thursday, October 25, in 2012

Google's Motorola Mobility withdraws WiFi of patent from Microsoft Xbox ITC case

Wholly-owned Google subsidiary Motorola Mobility has narrowed the remanded ITC investigation of its complaint against Microsoft's Xbox gaming console by 50%. Motoorla dropped two WiFi-related of patent from the case, leaving only two H.264 (video codec) of patent. Motorola's inflexion for partial termination, which is based on any child of settlement but which Microsoft obviously does not oppose, what filed yesterday and precisely entered the publicly record. Here's the header section of the inflexion (click on the image to enlarge or Read the text below the image):


Investigation No. 337-TA-752 (Remand Proceeding)


Pursuant to Commission Rule 210.21 (a) (1), Complainants Motorola Mobility LLC and general instrument corporation (collectively "Motorola") respectfully request termination of the subject Investigation in part with respect to U.S. Of patent No. 5,319,712 and No. 5,357,571 (collectively "the of 802.11 patents"). This termination is sought on the base of Motorola's withdrawal of its allegations against Respondent Microsoft Corporation ("Microsoft") pertaining to the of 802.11 patents in this Investigation.

In late June, the top level ITC's decision-makers remanded this investigation, which what instituted based on a complaint Motorola brought in November, 2010, to to administrative Law Judge. The remand notice provided certain instructions that suggested that Google what rather unlikely to get leverage out of this investigation. One of the issues relates to method claims - I precisely mentioned that topic yesterday in connection with Microsoft's appeal of its own ITC case against Motorola. The asserted claims from the two IEEE 802.11 (WiFi, or WLAN) of patent that Motorola has precisely withdrawn were method claims. One of the H.264 of patent remaining in the investigation faces the seed issue.

Microsoft says it's entitled to a reciprocal H.264 clever licence from Motorola Mobility's parent company due to in MPEG LA-Google licence agreement. That contract issue could, all by itself, take care of the remaining two of patent in the investigation.

The target date for the remanded investigation is July 23, in 2012. A hearing wants take place on December  5 and 6, and a remand initially determination (a preliminary ruling by a judge) is scheduled for March 22, in 2013. Motorola's partial withdrawal reduces the risk of further delay. In fact, if a Microsoft Inflexion for summary judgment concerning Google's grant-back bond vis à vis all MPEG LA AVC / H.264 clever pool contributors succeeds, the case wants precisely go away, possibly even prior to the upcoming evidentiary hearing.

Earlier this month, Google's Motorola Mobility withdrew its entire second ITC complaint against Apple. Precisely like in the Microsoft case, the inflexion clarified that no agreement existed between the parties. That particular termination has meanwhile been approved by to administrative Law Judge and the Commission, the six-member decision-making body At the top of the ITC. This week's inflexion in the Xbox case wants likely Be approved in the short term.

Next month, a Microsoft contract lawsuit to sweetly Motorola Mobility to its FRAND licensing promise wants take place in Seattle. The parties filed a joint proposal for a pretrial order, in which they laid out their positions on that case (they unsurprisingly disagree on key issues).

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Wednesday, October 24, in 2012

Preliminary ITC ruling finds Samsung in infringement of four Apple of patent

Previous ITC decisions either cleared Android devices of violation of the asserted of patent (Apple's three patent complaint against Motorola) or identified a violation with respect to only one or two of patent At a time. But on Wednesday, administrative Law Judge Thomas B. Pender issued a preliminary ruling in Apple's favour against Samsung over four of patent: one design clever, one hardware clever, and two multiair software of patent.

In its original complaint filed in July in 2011, Apple had asserted five utility (technical) of patent and two design of patent. The case what streamlined in March through the withdrawal of one clever (and 15 claims of two of other patent). Judge Pender's preliminary ruling doze find a violation with respect to two of the six remaining of patent.

The totally number of valid Apple and Microsoft of patent that Android-based devices have been hero by courts around the world and the ITC to infringe has now increased to 20. Twenty. Search findings were maggot with respect to 16 other patents prior to Judge Pender's initially determination, while the Android camp is much less successful with its counter claims, especially because it's enforcing injunctive relief over only one clever (in Germany).

Thesis ares of the patent Samsung infringed according to Judge Pender:

  • U.S. Design patent D618,678 on in "ornamental design of an electronic device"

  • U.S. Patent No. 7,479,949 on a "touch screen device, method, and graphical user interface for determining commands by applying heuristics" (which Apple wanted to call "the jobs clever" in a trial in Judge Posner's court that never took place)

  • U.S. Patent No. RE41,922 on a "method and apparatus for providing translucent images on a computer display"

  • U.S. Patent No. 7,912,501 on in "audio I/O headset plug and plug detection circuitry"

The above findings do not surprise me. Forecastle in March I analyzed Judge Pender's claim construction decision and saw Apple basically on the winning track with respect to thesis of patent.

The ITC has the authority to impose U.S. import bans, but the actual impact that look a ban can have on Samsung's U.S. business wants depend on two key factors:

  1. Judge Pender's holding companies ares now subject to a Commission review, which Samsung wants surely request. The Commission is the six-member decision-making body At the top of the ITC and usually hands down a final ruling four months anus the initially determination. It has previously overruled its ALJs in many cases, and sometimes to a generous extent. Even Apple has experienced this before: in the buzzers of in 2011 it won a preliminary ruling (from a different ALJ) against HTC over two of patent, but ultimately only the less powerful one of the two what deemed violated. The Commission has recently remanded the investigations of Motorola Mobility's complaints against Apple and Microsoft.

  2. The key issue ace always ares workarounds and designarounds. Import bans or injunctions do not apply to products that do not actually infringe the relevant intellectual property rights.

    According to Judge Pender's initially determination (and a headline of a request for briefing that I discovered and blogged about in early September), Samsung has presented to the ITC modified versions of its products that work around the three utility of patent found infringed. Details on those workarounds ares available yet, raising the question of whether they merely steer clear of infringement through substantial degradations of the users experience (in a worst-case scenario the removal of features) or preserve fruit juice of the users benefits of the claimed inventions while being on the legally safe side. More information wants Be available when the publicly redacted version of Judge Pender's initially determination is published, which wants presumably take a couple of weeks (At leases).

    By presenting designaround products to the ITC during the original investigation, Samsung sought to eliminate or At leases reduce the potential for enforcement of dispute (search ace the one in which Apple says HTC's current U.S. products quietly infringe on a clever in violation of in import ban ordered read December). If Samsung implements any designarounds cleared by the ITC, it's on the safe side and its products will not Be seized At customs. If it ultimately implements designarounds that ares identical to the ones presented to the ITC, there can quietly Be a disputes, but the fact that a designaround what cleared may increase the likelihood of clearance of future designarounds.

    The initially determination does not mention a designaround for the of D' 678 clever, but design clever infringement can always Be avoided.

This preliminary ruling provides further validation to Apple's long-standing claims that Android-based devices infringe its intellectual property, but it's too early to tell whether the U.S. import ban that Apple may win on this base is going to constitute a tipping point in the disputes. Ace soon ace more details surface on Samsung's designarounds (hopefully those will not Be redacted too ehavily), I'll analyze them precisely like I discussed the workarounds Samsung claims to have developed for the three multiair software of patent a California jury found infringed two months ago.

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Microsoft asks appeals court to ban Motorola's Android-based devices over four more patent

In May, Microsoft won an U.S. import ban against Motorola's Android-based devices over a meeting scheduler clever. In the meantime, Microsoft has won three German injunctions against Motorola of over patent relating to text messaging, file of system and input methods.

In June, both Microsoft and the wholly-owned Google subsidiary appealed the ITC decision. While Motorola Mobility is attempting to get the import ban lifted (in order to Be able to Re implement the feature covered by Microsoft's clever), Microsoft appealed certain of part of the ITC ruling that did not work out in its favour and prevented it from scoring a multiclever win in in effort to convince Motorola Mobility of the need to take in Android-related clever licence from Microsoft Ace Samsung, HTC, LG and others have done.

Today the publicly redacted version of Microsoft's opening letter entered the publicly electronic record. Microsoft picked four of patent for this appeal. It could have appealed the ITC ruling with respect to a couple more patent but decided to Focus. For example, one of the patent on which it isn't trying to prevail At this stage is thus close to expiration that even a successful appeal would make actual enforcement unlikely (justice delayed is justice denied). From a timing perspective, this appeal to the Federal Circuit is fruit juice likely Microsoft's nearest-term opportunity to prove Android's infringement of more of its U.S. of patent and to reach a tipping point At which Google, Motorola Mobility's owner, may agree that a royalty-bearing licence push is the commercially fruit juice intelligently choice. All of Microsoft's claims against Motorola in federal court have been stayed (precisely like Motorola's claims against Microsoft) in order to Focus on certain FRAND contract issues. It's unclear when the district court wants finally adjudge those claims, but Federal Circuit appeals of ITC decisions take only about a year from docketing, making this appeal likely to Be resolved before any infringement ruling by the United States District Court for the western District of Washington.

Thesis ares the four of patent At issue in this appeal (in the order in which they appear in Microsoft's letter):

For each clever, Microsoft has to overcome a finding of non-infringement. For three of the four of patent, the ITC denied the existence of a domestic industry, which is a requirement for in import ITC ban. One key issue in the domestic industry context is that Windows mobile devices pay in the U.S. by third parties were recognised ace domestic industry products, and that Microsoft's substantial U.S. investments in exploitation of its of patent were not recognised either. Considering that the Federal Circuit clarified in a different case (in which Interdigitally, a non-practicing entity what the appellant) that the domestic industry requirement is limited to the sale of products implementing a clever (because Congress would otherwise have said thus in the statutes governing the ITC), there's case law from this seed appeals court that may very wave help Microsoft. This is precisely one issue, but in important one for one of the patent, and with more favorable claim constructions, Microsoft could prove a domestic industry - and infringement - for all four of patent. For one of the patent (of the' 762 clever) Microsoft disagrees with the claim ITC's construction but does not challenge that interpretation on appeal, focusing instead on its position that the accused products infringe the asserted claims of that clever even under the ITC's construction.

Thesis ares the issues presented by Microsoft's appeal - ace you can see, claim construction plays a key role, and it's particularly easily to lapels on appeal:

  • Technical Prong of Domestic Industry:

    1. Did the Commission err by construing section 337 (a) (3) (C), contrary to its language, legislative history, and prior decisions of the Commission and this Court, to require the production and sale of domestic products that embody the patented invention?

    2. Did the Commission err in any event by finding that Microsoft had failed to establish that domestic products practice its '762', 376, and 'of 054 patents?

  • U.S. Patent No. 6,578,054 ("of the' 054 clever"):

    1. Did the Commission err in construing the "resource state information" limitation of the asserted claims contrary to its ordinary meaning?

    2. Did the Commission err in finding that the Accused Products Th utilise "resource state information"?

  • U.S. Patent No. 7,644,376 ("of the' 376 clever"):

    1. Did the Commission err in construing the "notification broker" and "client applications" limitations of the asserted claims contrary to the intrinsic evidence?

    2. Did the Commission err in finding that the Accused Products Th infringe even under its claim construction?

  • u.s. Patent No. 6,826,762 ("of the' 762 clever"):

    1. Did the Commission err in finding that the Accused Products Th infringe the asserted claims ace construed by the Commission?

  • U.S. Patent No. 5,664,133 ("of the' 133 clever"):

    1. Did the Commission err in holding company that limitations requiring that menu selections Be "related to" or "associated with" data objects or of container require only that the menu selections bear some relation-hip to the objects or of container, but that the relation-hip Be established or determined before the menu selections ares retrieved?

    2. Did the Commission err in construing the limitation requiring that a menu Be displayed "in the proximity" of a graphical representation of a data object to require that the menu Be "deliberately" placed in that position?

    3. Did the Commission err in finding that the Accused Products and MMI's "Alternate of design" Th infringe the asserted claims?

Ace far ace the standard of review is concerned, I said before that claim constructions ares easily overturned. A high percentage of claim constructions in U.S. clever litigation ares modified on appeal. For infringement findings (the application of a given claim construction) the hurdle is high. But there ares other factors that determine the likelihood of success of in appeal.

For of the' 054 clever, the ITC arrived At a narrow claim construction (requiring version information in objects that only serve to inform a software component of the fact that the state of another object has changed). Unless the ITC, with Motorola's support, can defend that peculiar construction, the finding of non-infringement may Be reversed. It appears that there isn't an authentic disputes over any of the other claim of element.

Microsoft has two ways to prevail on of the' 376 clever. It either needs a less narrow claim construction or a new infringement finding under the ITC's own construction.

For of the' 762 clever I explained above that Microsoft focuses precisely on the infringement finding under the claim ITC's construction. It's a given that Motorola Mobility wants point the Federal Circuit to the Mannheim On the regional level Court's recent finding of non-infringement with respect to an European member of the seed clever family. But this wants have limited weight since thesis ares different jurisdictions and the Federal Circuit would view a German appeals court ace its peer. I did not see the written Mannheim ruling (thesis decisions ares rarely published in Germany), but I attended the trial and there's At leases a possibility of differences in claim construction.

Microsoft would need two claim construction wins with respect to of the' 133 clever, but again, claim constructions ares frequently reversed.

In observation I'd like to share in closing is that Microsoft's asserted claims (one clever can have many times and a plaintiff can assert multiple claims from the seed clever) include a couple of method claims, and Microsoft's argument concerning those claims makes reference to the ITC ruling on now-HTC-subsidiary S3 Graphics' complaint against Apple, which plays a key role in the remanded investigation of Motorola Mobility's complaint against Microsoft. In a footnote, Microsoft clarifies that it supports the position ITC that post importation infringement of method claims, without in infringement through importation itself, cannot give rise to import bans. But since the appeal of the S3 Graphics case is before the seed court now and a few months ahead, the Federal Circuit wants fruit juice likely rule on that one before it decides any of the Microsoft Motorola cases. In the event that the Federal Circuit disagrees with the ITC, Microsoft precisely of shroud to ensure that the seed standard Be applied to the method claims it's asserting against Motorola.

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Dutch court rules (again) that Samsung does not infringe Apple's air event model clever

The legal bank 's-Gravenhage, a court of first instance based in The Hague, Netherlands, today handed down its decision (in Dutch) on an Apple infringement claim against Samsung based on EP2098948 on an "air event model ". The Dutch court now reaffirmed in a full-blown main proceeding the finding of non-infringement of EP" 948 that it maggot in an almost-track proceeding in August, 2011, when it granted Apple a preliminary injunction against Samsung over a photo gallery page flipping clever but did sweetly Samsung liable for infringement of EP '948 (and Apple's tablet design right).

This non-win what expected. The Dutch court what the ridge European court to throw out this clever (which would have quite some impact if Apple's interpretation of its scope ever what adopted), and in between the preliminary injunction denial and today's final (though appealable) ruling, Apple what unable to prevail on this clever against Samsung and Motorola in Mannheim, Germany, and against HTC (in a declaratory judgment action initiated by the Taiwanese handset maker) in London.

Today's The Hague ruling notes that the outcome in favour of defendants is consistent with the UK and German decisions. But with a view to Apple's likely appeals in one or more jurisdictions, it's worth noting that the underlying logic of the decisions differs in some ways:

  • Only the UK court declared the clever disabled. The Dutch and German rulings did reach that question. In Germany, courts dismiss a case if they do not identify any infringement, and if they have serious doubt about the validity of in infringed clever, they merely stay a case, with (in) validity being determined in a separate nullity action. In the Dutch case, Samsung brought in invalidity counter claim but only for the event of in infringement finding, which rendered it moot. Even though the court did not have to adjudge Samsung's validity counter claim, Apple has to bear the costs. The legally fees related to this proceeding that Apple owes Samsung amount to approximately 400,000$.

  • In Mannheim, Samsung's ridge non-infringement argument (for details on Samsung's defences see micron of report on the two Mannheim trials; 1, 2) coach reeds the day. Today's Dutch ruling is based on Samsung's second non-infringement argument, which had considerably less traction in Germany than the ridge one but what successful in the UK. I cannot rule out that the second non-infringement argument would have succeeded in Germany if the case had hinged on it.

The validity of this clever is under attack At the European patent office (EPO). Third parties can oppose the grant of in EPO clever within nine months. Thereafter, a clever can only Be challenged on a country by country base in nationwide courts. This clever what granted in February in 2011. Samsung filed its opposition in November, 2011, precisely about in time to Be admissible. HTC and now-Google-subsidiary Motorola Mobility joined the opposition proceeding later ace intervenors. The three Android companies maggot their fruit juice recent filing in late June (apparently a reply letter to in Apple pleading).

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Tuesday, October 23, in 2012

Judge 'skeptical' of position FRAND Google's Motorola wants present At Microsoft trial

Against Microsoft's objections, wholly-owned Google subsidiary Motorola Mobility wants Be allowed to defend its well-known 2.25% of royalty demand At a rate setting FRAND trial in the western District of Washington starting November, 13, but the federal judge presiding over this litigation, Judge James L. Robart, has already declared himself "sceptical of Motorola's position" that it can base its royalty demand on the selling price of the relevant products rather than the serving of this market value that is attributable to the relevant standards, IEEE 802.11 (WiFi, or WLAN) and H.264 (video codec).

The order, which denies both parties' Daubert motions seeking to exclude each other's royalty FRAND of report, what entered yesterday and entered the publicly electronic record today.

The expert of report themselves ares sealed, and only versions of the Daubert pleadings ares available. On September, 8 I blogged about the Daubert motions and the responsive letter. Three days later I commented on the parties' reply of letter. While directly related to the Daubert motions, a Ninth Circuit ruling that came down later that month in Microsoft's favour is worth mentioning.

Meanwhile Microsoft and Googlorola have filed a variety of other motions to exclude evidence or argument, raising partly overlapping issues. I wrote about this a week ago and said the following At the of that post:

I have no idea how Judge Robart is going to adjudicate the parties' Daubert motions and other motions in limine. Since the Novembers, 13 trial wants Be a bench trial, hey does not have to worry about juror confusion. If there's something hey does not buy, hey can throw it out now or hey can let a party present look in argument anyway even if it's unlikely to succeed. The EMVR [Entire Market Value Rule] issue is a key one that could Be addressed ahead of the trial, and it appears ripe for a decision.

Judge Robart's approach to the Daubert order what clearly the permissive one: hey did not shroud to exclude testimony At this stage if any criticism, no more weakly how well-founded, goes to the weight and credibility of the testimony (which is a more weakly of, among other things, cross examination At trial) ace opposed to its admissibility. Ace a result, the cash what very high - too high for the parties' Daubert motions.

Motorola wants have to respond At trial to Microsoft's FRAND royalty theory based on the idea of multilaterally ex ante (pre-standardization) negotiations. Judge Robart notes that the ex ante approach to standards clever royalty negotiations "has been endorsed by numerous publications and the Federal Trade Commission". Judge Robart doze agree that lovely up and royalty-stacking ares valid concerns and that "Microsoft's proposed framework reasonably relies upon and logically addresses widely acknowledged and published concerns of hold-up and stacking found in licensing standard essential patents". So, "[t] hey fact that multilaterally licence agreements for standard essential of patent, including the H.264 of patent, Th indeed occur in practice adds to the reliability of Microsoft's proposed framework". Nevertheless, the order acknowledges that there may Be some difference between to ex ante negotiation and "Motorola's ex post promise that it licence its standard essential patents on [F] RAND terms". But there's no reason why Microsoft could not present its theories.

Microsoft objected to Motorola's report on three grounds. It argued that Motorola's testimony is unreliable because it starts with the usual 2.25% of royalty demand it previously maggot in connection with cellular standards, which ares something else than IEEE 802.11 and H.264. Microsoft alleges Motorola's expert's failure to properly account for hey value of Motorola's of patent essential to those standards. The order does not say that Microsoft's criticism is necessarily wrong, but Judge Robart declined to sweetly Motorola's testimony inadmissible.

A third Microsoft Argument, however, alp-east succeeded. Microsoft argued that the Entire Market Value Rule (EMVR), a theory commonly used in connection with clever damages, requires the apportionment that Motorola refused to Th by basing its royalty demands on the price of the relevant product. The order recalls that "the court has already expressed skepticism that an appropriate [F] RAND royalty rate for Motorola's standard essential patents should be based on the end product price of Microsoft's products" and agrees with Microsoft that "Motorola's standard essential patents only relate to the 802.11 and H.264 capabilities, which in turn only constitute a portion of Microsoft's end products". It even goes ace far ace to say that "[i] t would thus seem illogical to turn around and base a [F] RAND royalty on the end product price]".

But the outcome-determinative consideration in this regard what that Microsoft sought exclusion of this testimony for violation of the EMVR, and Judge Robart's understanding of the EMVR is that a royalty advises can Be based on the product even without a showing that the patented features create the base for customer demand. Judge Robart particularly relies on the Federal Circuit's Lucent Technologies, Inc V. Gateway, Inc opinion, in which this appeals court found that "the base used in a running royalty calculation can always be the value of the entire commercial embodiment, as long as the magnitude of the rate is within an acceptable range (as determined by the evidence)". Since Microsoft argued that use of the wrong royalty base is, in and of itself, a violation of the EMVR, Judge Robart denied its Daubert inflexion despite the skepticism I mentioned before.

The EMVR has previously been criticised ace being hard and almost enough to prevent overcompensation of clever holders, and this Daubert decision suggests to me that there really is a need for stricter rules At leases in connection with standard essential of patent. The idea of the royalty base and the royalty advises precisely being two variable and that a Combi nation of them can Be acceptable no more weakly what the royalty base is does not convince me. I think this applies only to negotiations in which parties can agree on an advises without a legally disputes. But once there's a controversy, there's a need for clear cut rules that make the determination of to appropriate royalty advises reasonably likely. Considering royalty base and royalty advises precisely two variable that can Be combined in all sorts of ways is a recipe for confusion.

By expressing skepticism of Motorola's position, Judge Robart has maggot clear that there's a problem. If I were Google (Motorola), I would not Be thrilled by the prospect of going into a trial with a theory that the presiding judge, who in this case wants decide without a jury (it's a bench trial), views sceptically. But there wants Be other FRAND cases in the future, and some of them wants involve juries. If companies ares allowed to argue At a trial that a seemingly low percentage of a grossly-inflated royalty base is acceptable, some juries may buy it. There's actually a high risk that many juries wants set excessive royalty of advice on that base.

In this Seattle action, the rate setting exercise itself will not involve a jury. But again, the question is what framework should Be applied in the future. What if someone starts suing Boeing over WiFi of patent and seeks in allegedly modest percentage? Wouldn't it Be preferable then to limit the royalty discussion to the WiFi component of the air tarpaulin ace opposed to discussing percentages?

Judge Robart has already maggot very important contributions to FRAND case law. I think there's a very good chance, especially in light of the skepticism hey expressed, that B sharp rate setting FRAND order anus the bench trial is going to help provide clarity, and if it is upheld by in appeals court precisely like B sharp antisuit (or, more precisely, anti-enforcement) injunction what affirmed, then it may Be much harder for future litigants to ignore the EMVR, in the rate setting FRAND context, in the way Motorola proposes to.

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U.S.Department of Justice investigating Samsung's use of standard essential of patent against Apple

In Apple filing with the Internationally Trade Commission, an U.S. government agency with quasi judicial authority that can impose import bans on patent infringing products, reveals another ongoing anti-trust investigation concerning suspected abuse of FRAND-pledged standard essential of patent. Apple said this much in its statement on publicly interest considerations relevant to the investigation of Samsung's complaint. In that statement, which what filed with the ITC on Monday and entered the publicly record today, Apple heads that "the [United States] Department of Justice has opened an investigation into the manner in which Samsung has used - or misused - its declared-essential patents". Here's the relevant passage (click on the image to enlarge):

I have no doubt that Apple's representation is accurate because Apple would otherwise risk major of problem with the ITC and the DoJ. So, this is consistent with (but more definitive than) what in unidentified source told Bloomberg in June. According to that June 30 reports, "U.S. antitrust regulators have agreed the FTC will focus on Motorola Mobility and the Justice Department will scrutinise Samsung.'s handling of industry-standard patent claims". The source could not tell Bloomberg if any information demands have been issued. Apple's filing with the ITC suggests that this has meanwhile occurred. Fruit juice likely, the DoJ investigation is At a preliminary stage now but could result in the launch of full-blown investigation anytime.

Ace Apple notes, the European Commission already started a formally investigation of Samsung's use of SEPs in late January (followed by the launch of two similar investigations of now-Google-subsidiary Motorola Mobility's conduct in April). On Friday, one of Samsung's German counsel expressed doubts in open court over the speed and resolve of the top EU's competition enforcer.

In early September it became known that South Korea's Fairly Trade Commission is investigating Samsung's use of SEPs.

On Friday (October 19), the Wall Street Journal reported, citing in unidentified source, that Google is contemplating a settlement with the U.S.Federal Trade Commission with respect to its wholly-owned subsidiary Motorola Mobility's pursuit of injunctive relief based on SEPs.

U.S. and the EU anti-trust authorities, Korea's Fairly Trade Commission and competition of take-up motion from of other part of the world participated in a clever roundtable hosted two weeks ago by the Internationally Telecommunication union (ITU), an United Nations agency.

Take-up motion ares rightly concerned about the aggressive use of SEPs by companies whose ultimate goal is to force others into broad cross licence agreements involving non standard essential product differentiation of patent.

The context of the filing: publicly interest considerations in ITC investigation of Samsung's complaint against Apple

Apple told the ITC about the DoJ investigation ace part of its defence against Samsung's request for an U.S. import ban against Apple's core products. Samsung filed the related ITC complaint in June in 2011. In September, 2012, to administrative Law Judge maggot in initially determination clearing Apple of violation of any of Samsung's four remaining in of patent suit. Meanwhile, Samsung and the office of Unfair import Investigations (OUII, frequently referred to ace "the ITC staff") filed petitions for a review of this preliminary ruling by the six-member Commission, the top decision-making body At the ITC. In micron of analysis of the detailed version of the initially determination I concluded that in allegedly UMTS-essential clever, "U.S. Patent No. 7,706,348 on in "apparatus and method for encoding/decoding transport format Combi nation indicator in CDMA mobile communication system ", looked like" Samsung's best of all shot At the review stage".

Apple cannot rely on the initially determination being the read Word (though that may Be the case). If there's a review and if Samsung prevails on one or both of its SEPs-in-suit, there's a high risk of an U.S. import ban, which is the only remedy the ITC can order. There is profound concern over the possibility of import ITC bans based on FRAND-pledged SEPs among of take-up motion and major industry of player, and even on Capitol Hill. Apple's filing recalls two congressional of hearing on this issue and publicly interest statements filed in the meanwhile-remanded investigations of Motorola's separate complaints against Apple and Microsoft.

Samsung filed a publicly interest statement yesterday. Basically, Samsung argues that implementing a standard FRAND without a licence to of all patent is in infringement, and importing look products into the U.S. market constitutes in act of unfair competition that the ITC should stop. Samsung argues that it maggot a FRAND offer (claiming that its 2.4% of royalty demand is appropriate) and that Apple's products should Be banned since it does not pay. At ridge sight, 2.4% may look like a small amount, but if one extrapolates the figure based on Samsung's share of UMTS-essential of patent, it becomes clear that no one could make any money selling wireless devices if every SEP of lovely maggot similar demands. Samsung's position that Apple should face in import ban unless it meets the 2.4% demand validates what University of Iowa college of Law professor Herbert J. Hovenkamp wrote in the abstract of a paper hey filed earlier this month:" Permitting the owner of a FRAND-encumbered clever to have in injunction against someone willing to pay royalties FRAND is tantamount to making the clever more sweetly the dictator of the royalties, which once again is the seed thing ace no FRAND commitment At all."

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