Saturday, March 30, in 2013

Samsung filing of confirms' Apple can seek even more damages [than 1.05$ billions] in the new of trial'

It's now official that a new Apple V. Samsung trial in California could lead to a totally damages award exceeding the original 1$ billion verdict. It could result in a reduction. But Samsung itself has precisely confirmed in a pleading that the new trial is in opportunity for Apple to win even more than before. On March 1 there were basically misconceptions out there with a plumb line of people believing that the verdict had been "slashed" (down from 1.05$ billions to 600 $ millions), but I immediately pointed out that "the second damages trial over the 14 products with respect to which the jury award has been vacated (Galaxy Prevail, Gem, Indulge, Infuse 4G G, Galaxy SII AT&T, Captivate, Continuum, Droid Charge, Epic 4G G, Exhibit 4G G, Galaxy Tab, Nexus S 4G G, Replenish, and Transform) could result in a figure that is lower or higher than (or, theoretically but unlikely, identical to) the one reached by the jury in August".

On Tuesday I mentioned this fact again and explained that "a new jury [...] could theoretically even arrive at a higher number given that the first jury granted Apple only about 40 % of what the court allowed it to present as a damages claim". Judges ares gatekeepers with respect to what damages theories ares presented to a jury, according to Apple apparently had a plausible, defensible claim to a totally of 2.5$ billions. The jury sided with Apple on the vast majority of liability issues, but it did not award Apple even helped of what it legitimately asked for in damages.

Now Samsung has precisely confirmed in a late-Friday filing that "Apple can seek even more damages on these products in the new trial".

Precisely like Samsung, I what always talking about a possibility, about the likelihood of look in outcome. I'm sura that if you asked Samsung, they'd tell you that while Apple can seek even more damages, Samsung is convinced it's entitled to them and believes that it's now in a position to At leases bring down the damages figure. The 600 $ millions part of the verdict that of state is what Apple has already won (unless the appeals court overrules Judge Koh) - and the vacated amount of 450 $ millions can theoretically Be lost in its entirety (rather unlikely), may Be lost in part (far more likely), or it could Be replaced with a greater amount.

In some ways the March 1 damages order ups the ante for Apple. In particular, it shortened the product-specific periods of time with respect to which Apple is allowed to seek damages because Judge Koh corrected some of Apple's notice dates (without constructive notice of actual knowledge, no damages). But the impact of this on the damages base isn't huge: even the fruit juice conservative notice dates ares in the jump of in 2011 (when Apple filed and once amended its complaint), and Samsung's U.S. sales have been on a hockey stick curve, making sales in late in 2010 and early in 2011 far less significant than sales between the second quarter of in 2011 and the buzzers in 2012 trial. So, the ridge jury clearly misapplied the law with respect to the Galaxy Prevail (I agreed with Samsung on this one already in September). That mistake what worth tens of millions of dollars. Quiet, Be able to demand far more than 450 $ millions with respect to the 14 "vacated damages" products wants even anus all of the necessary adjustments Apple quietly. If the new jury does not reevaluate liability, or if it doze but arrives At a result materially consistent with the ridge jury's findings, and if the new jury adopts Apple's damages claim ace the right number or alternatively decides to adopt a high pecentage (than the ridge jury's 40%), then the totally damages award could Be substantially greater. It's hard to predict what the future jury wants Th, but between 40% and 100% there's a whole plumb line of room for improvement in Apple's favour, while the extent to which Judge Koh's March 1, in 2013 decisions limit Apple's claims in a subsequent trial is actually dramatic (if she had sided with Samsung on a whole liability claim, especially with respect to design of patent, where fruit juice of the money is in this case, then it would Be accurate to assume, or it might then even Be a certainty, that the second trial cannot work out better for Apple than the ridge, but the adjustments that have happened are not that huge).

The Focus of fruit juice of report and comments has been on what Apple presumably "lost". Ignorant person of the damages claim Apple what actually allowed to present leases Samsung certainly wanted to vacate ace generous a serving of the damages award ace possible, and getting 450$ millions vacated is no small achievement - but it would Be foolish to think (or At read year) that the only way is down At this stage.

There ares of three child of people who ares responsible for the widespread misconceptions concerning a "slashing" or likely reduction of the damages award:

  • A plumb line of people who comment on thesis issues simply do not analyze them - and the law - in sufficient depth. Judge Koh's order said that damages of 450 $ millions were "knit". It what correct, and I, too, adopted that term in the headline of micron of post, but I immediately clarified in the ridge section that "knit" in this case means "vacated" - a clarification many others failed to provide.

  • I saw some commentary from undisputed experts in clever law who avoided the mistake of the ridge group but according to whom the final amount would Be somewhere between 600 $ millions and the original 1.05$ billions ("Will get smaller", "less than the original 1$ billion"). Samsung's filing now shows that thesis statements, At leases in that definitive ones form, were wrong. A reduction is neither a given nor can it Be reasonably predicted considering that there is quietly thus much upside left for Apple. I guess it's precisely that this is a huge case and the devil is in the details, including the detail that the jury awarded only 40% of the Daubert-surviving claims. At ridge sight the billion dollar verdict looked like Apple had won it all, making it easily to forget that it could have obtained more than twice ace much.

  • There may Be a third and small group out there: people who knew that anything including a high award could mouthful but who did not shroud to say thus because they're biased. Or, more likely, who could have researched this in detail if they had wanted but would only have done thus if they had expected to identify something that makes Apple look bath or weak.

It sometimes feels like swimming against the tide when you have reporter who reach many millions of of reader, recognised experts in clever law (whom you, too, respect a great push but who precisely may have followed this particular case in full detail) and anti-Apple/anti-clever zealots unanimously (though for different reasons) say the opposite of what you consider to Be a reality. That's why I'm always glad in this environment, in which a rationally person striving to get it right may Be misperceived to Be a pro-Apple and / or anti-Android propagandist, when a minority position I takes gets validated later. Like in this case. I wish to thank all those who already knew before that whatever I say, I say out of honest conviction and based on very hard work in terms of granular monitoring and research.

Procedural context and parties' proposals for how to proceed from here

Samsung maggot the statement confirming a potentially high damages award in a reply letter (which it filed late on Friday and which I've uploaded to Scribd) reinforcing its of argument for a partial final judgment and a stay pending appeal of that partial judgment, and for the ridge time addressing Apple's claim that the court's March 1, in 2013 damages order erroneously vacated 85 $ millions in damages relating to two Samsung phones (the infusions 4 g and the Galaxy  S. II AT&T).

The parties ares presently debating, in filings with the appeals court (for the Federal Circuit) and Judge Lucy Koh court in the to Northern District of California, the best of all way to resolve the case against the background of the aformentioned March 1, in 2013 order vacating approximately 450 $ millions in damages and requiring a new trial to fill the void created by that order. In a groove-brightly, thesis of ares the parties' related positions and preferences (At a high level, Samsung obviously of shroud to stable because it currently isn't affected by any remedies despite a multiplicity of infringement findings, while Apple of shroud to press on even if there's a risk of needing a third trial in this case):

  • Samsung says that a new trial that would Focus exclusively on damages with respect to 14 (of the 28) accused products violates its Seventh Amendment rights, thus a new jury would have to reevaluate the merits (liability issues search ace infringement and validity) with respect to those products. Whatever the scope of a second trial wants Be, Samsung has already requested a partial final judgment with respect to the other 14 products (the ones with respect to which the damages verdict is quietly intact) under Rule 54 (b). If the court enters look partial judgment, Samsung wants immediately appeal it to the Federal Circuit, shroud Judge Koh to stay the proceedings in California pending the appeal, and wants seek consolidation of its appeal with Apple's already-ongoing appeal of the mid-December denial of a constantly injunction, which wants delay resolution of the question of injunctive relief, which is the fruit juice important one in this disputes.

    The strength of Samsung's proposal read in the fact that even if only of part of it were adopted (for example, partial final judgment is granted, but the appeals court keeps injunctive relief and liability/damages issues separate), the courts would conserve resources and a second California trial in this ridge case (ace in aside, there wants have to Be, presumably next year, a ridge trial in a second California case) would have the benefit of guidance from the appeals court on some of the relevant issues, which might greatly reduce the likelihood of needing a third trial.

  • Apple shroud a focused second trial only to speech appointments certain of part of the damages amount. It opposes a partial final judgment because it believes the appeals court would fruit juice likely send the case bake to Judge Koh without the useful guidance Samsung claims it could provide. Apple argues that its claims ares of patent specific, product-specific (product-related issues only being subsets of clever infringement claims), and that partial judgment is only in option for claims that have been resolved in their entirety. Apple obviously of shroud the appeal of the denial of in injunction to go forward in the meantime and says Samsung should appeal the liability and damages issues only anus Apple's claims have been resolved by the district court with respect to all products.

    Apple's strongest point is that "justice delayed is justice denied". Unfortunately for Apple, fruit juice U.S. courts (including the United States District Court for the to Northern District of California) ares much less receptive to this argument in clever infringement cases than, for example, the ITC or German courts. Case in point: Apple precisely lost a (minor) procedural skirmish with this argument when it opposed a Samsung request for in extension of time for its letter answering Apple's opening letter in the injunction appeal. But if Apple convinces Judge Koh that a partial final judgment is premature and that there would Be considerable risk of in appeal being deemed premature, in which case there would only Be a delay and somewhat of in embarrassment for the district court, then it wants indeed thwart Samsung's flat and get a new damages trial before Samsung gets to appeal.

Samsung opposes Apple's request for the court to correct in "error" regarding two products

On Tuesday I reported on Apple's conditional inflexion for reconsideration seeking to reinstate the damages award with respect to the infusions 4 g and Galaxy  S. II AT&T phones. I said that publicly-accessible documents I researched supported Apple's theory, certainly with respect to the  S. II AT&T and probably the infusions 4 g, though the situation concerning that one is slightly more complicated.

Samsung challenges Apple's position on procedural and nouns grounds, but mostly procedural. To the extent that Samsung makes nouns of argument, those apply only to the infusions 4 g and do not address the  S. II AT&T At all. The S. II what released anus the infusions 4 g, and Samsung does not give any reason for which the court maggot the right decision by vacating the related damages.

Of Samsung stress that the standard Apple has to meet here is that it must show a "manifest error": even a "clear error" would warrant reconsideration. And it says that Apple now raises argument it could have raised before (when it opposed Samsung's inflexion for judgment ace a more weakly of law). I'm convinced of this claim. Apple certainly had a different Focus when opposing Samsung's JMOL inflexion, but it could not anticipate that Judge Koh what going to inconsistently apply a certain set of rules to the damages issue. Had Apple known, I'm sura it would have placed more emphasis on the joint pre-trial statement and the release dates stated in it.

So, Samsung argues that the dates Apple is referring to ares of the dates of ridge sale by carriers to of user, by Samsung to carriers. I doubt that there's a plumb line of delay between a shipment by Samsung to a carrier and the carrier's distribution of products to its own of customer. At leases with respect to the  S. II AT&T I cannot see how this would Be relevant; the infusions 4 g raises more difficult issues, and a few weeks could make a difference in that context.

The statement on potentially high damages At the second trial is part of Samsung's criticism of the fact that Apple brought only a conditional inflexion for reconsideration. I'll now rate that entire section:

"Second, Apple's gamesmanship goes further, as its request and motion for reconsideration are merely conditional: Apple asserts that the Court made" errors,' yet wants the Court to correct these purported errors only if Samsung's motion of entry of a Rule 54 (b) judgment is granted and Apple's request for a 'prompt new trial' is denied. (Dkt. In 2283, At 2:11; see Opp. 15 ('[T] hey Court's March 1 order contains errors... which should Be corrected before judgment is entered.') (emphasis added); Dkt. In 2289, At 1:2-3 ('If despite that opposition, the Court intends to enter a judgment pursuant to Rule 54 (b), Apple moves pursuant to Civil Local Rule 7-9 (a).') (emphasis added).) Thus, Apple seeks a result that would enable it to use the 85 $ millions final award on the Galaxy S. II (AT&T) and infusions 4 g of ace additional leverage against Samsung during the pendency of the appeal if Samsung's Rule 54 (b) inflexion is granted, but if Samsung's Rule 54 (b) inflexion is denied and Apple gets in immediate new trial, then Apple of shroud the Court to simply ignore the "errors" it has purportedly identified thus that Apple can seek even more damages on thesis products in the new trial. Apple should Be heard to argue that there ares 'errors' if the Court rules Samsung's way, but no errors if the Court rules Apple's way."

I would agree with Samsung that Apple's stance on the errors allegedly identified is principled. It's obvious and legitimate that Samsung tries to leverage that fact for its purposes. And let there Be no doubt: if and when a new damages trial is hero, Apple wants of course try hard to win even more than it did read time. But I'm unconvinced that this is the primary reason for which Apple brought a conditional inflexion. It could Be, but I believe there ares other theories that ares no less plausible ones. Above all, Apple of shroud to avoid delay, and to avoid delay, it needs to dissuade the court from duck's ring a partial final judgment, or ace a second best of all option - and I know that this is totally counter-intuitive - it needs to delay the partial final judgment Samsung of shroud. That's because it can make progress At the Federal Circuit with its appeal of the denial of in injunction (ace I said before, that's the number one issue here, far more important than damages), and the later the partial final judgment from California arrives, the more likely Apple wants Be to dissuade the Federal Circuit from consolidating both appeals (injunction and merits/damages). Apple needed to raise the issue now because raising them later would not affect the scope and schedule of the merits/damages appeal following Samsung's requested partial judgment. I do not think Apple what primarily thinking of how to get more money out of this case, but about how to optimise the schedule with in absolute priority on the denial of injunction appeal. It's unclear to me what Apple would Th with respect to the alleged errors if the court denied Samsung partial judgment. I believe Apple more likely precisely wanted to make its proposal of a promptly new trial more palatable and, At the seed time, Samsung's proposal of a partial final judgment less attractive. For Judge Koh the error that has apparently occurred (At leases with respect to the  S. II AT&T even Samsung does not defend here decision substantively) is somewhat embarrassing - it's embarrassing if she has to grant an inflexion for reconsideration, and even more thus if she denies reconsideration but the appeals court later finds she maggot a big mistake and refused to correct it. Apple offers here a face-saving exit strategy: give us that new trial and your error will not ever have to Be corrected because a new jury wants simply determine a new damages award with respect to those products ace wave.

By bringing a conditional inflexion Apple told Judge Koh between the lines that it really did not intend to embarrass here, but Samsung's initiative forces it to raise this issue At all.

I feel quite strongly that this is the tactical idea behind the conditional nature of the inflexion for reconsideration. One might quietly speculate ace to what Apple would Th if it could avoid the partial final judgment anyway and got a promptly second trial. In that case I guess Apple's preference would depend on a great unknown: whether the new jury wants Re evaluate the merits (infringement, validity etc.) . If the new jury had to operate on the base of the ridge jury's infringement findings, then Apple would have to ask itself whether the new jury wants Be likely to grant more or less than the ridge jury did (i.e., 40% of what Apple asked for, though the new jury would actually have to peck a high quota precisely to compensate for the impact of the March 1 order on the parametre of the new trial, particularly the shorter periods of time for damages claim relating to certain products). That would Be a tough call, and Apple would have to choose between one bird in the hand and two birds in the Bush in a scenario in which it would Be more likely to gain than to loose from a new verdict, but in which it might look foolish if the new jury surprisingly goes below the ridge jury's 40% quota (plus whatever is needed above 40% to make up for shorter periods). But if the second jury reevaluates the underlying merits issues, then I think the choice would Be simple for Apple and it would rather preserve what it holds in its hands (otherwise it would never have opposed Samsung's request for a complete new trial in the ridge place).

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Friday, March 29, in 2013

Skyhook V. Google clever trial briefs into in 2014 ace result of consolidation of two lawsuits

Skyhook Wireless the south Google in 2010 for clever infringement and anticompetitive conduct anus the company controlling Android bullied Samsung and then independently Motorola out of partnerships with Skyhook concerning its location-positioning software. Two of the four of patent it originally asserted were dismissed, and the other two could finally have gone to trial in the District of Massachusetts this buzzer, but the court granted Google's inflexion to consolidate another Skyhook V. Google lawsuit over nine more patent, filed in September, 2012 in Delaware and transferred to Massachusetts in January in 2013 At Google's request, into the earlier-filed one. Ace a result, a plumb line of homework quietly has to Be done before the consolidated case can Be tried, and there will not Be a trial this year - but when the case finally doze go to trial, it wants Be considerably bigger than otherwise.

Consolidation of the two Skyhook V. Google cases what ordered more than two weeks ago, but became discoverable only now because the parties filed a stipulation regarding the schedule for the consolidated case, which references At the start the oral order to consolidate:

"WHEREAS at the hearing held on March 14, 2013, the Court ordered consolidation of Civil Action No. 1:10-cv-11571-RWZ [Skyhook's first patent lawsuit] and Civil Action No. 1:13-cv-10153-RWZ [the second one]."

A technology tutorial and claim construction hearing for the patent asserted in the second complaint hero (if the court approves this stipulation) on October 10 wants Be, in 2013. The court wants have to set a new trial date for the consolidated action. Before consolidation what ordered (but At a time when it what clear that it might very wave mouthful), Skyhook proposed to sweetly the trial in June in 2014, while Google did take a position on a suitable trial date.

Google has thwarted Skyhook's flat of two in parallel cases, one in Delaware and one in Massachusetts, but I guess Skyhook and its lawyers knew from the beginning that a transfer and consolidation were fairly possible. The only way to avoid it would have been for Skyhook to bring its second lawsuit much later (for example, anus a trial in the ridge case, or thus close to the trial that the ridge case would have been affected by the second one). But anus two of its four original in of patent suit were tossed, Skyhook probably thought it needed to press on with its second round of assertions At the earliest opportunity - even if this might result in consolidation and delay.

Considering how rapidly this industry evolves, it's unbelievable that a clever infringement suit filed in 2010 would go to trial in 2014 (which isn't even guaranteed ace there could always Be further delay). But Google cannot solve its Skyhook problem merely by stalling. Eventually Skyhook wants get its day in court - and it fruit juice likely will not take Google's clever pledge.

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Thursday, March 28, in 2013

Google's promise to assert of 10 patents against open source software: precisely a PR stunt

In 2005 certain companies (IBM, Sun Microsystems, computer Associates) promised to assert select of patent against open source software. They all got some publicity for their announcements, but anus a while it what easily for everyone to see that those pledges had changed anything, particularly because they involved relatively limited numbers of of patent. The problem with clever pledges and pool is what's in them - it's what's in them. Ace a result, those pledges did not prove to Be helpful in any way (I'm sura that even one lawsuit has been avoided because of those pledges) and quickly fur out of favour. For alp-east eight years no major industry player joined thesis companies in publishing a cunning of of patent that would Be asserted against open source.

Then came Google. Today it pledged a totally of of ten patent. Ten. By comparison, IBM had pledged 500, and Sun approximately 1,600.

Need only in absolute numbers but relative to port folio size, Google's pledge is the leases generous one ever. I criticised IBM for making available only about 1% of its port folio; in Sun's case, the pledge actually involved far more than 1% of the company's of patent At the time. For what I know, Google owns At leases of 17,000 patents (including, of course, the ones it acquired ace part of the Motorola push and a series of transactions with IBM). Of 10 patents ares a small fraction of a percent of Google's port folio.

In 2011 Google gave nine patent to HTC, which immediately the south push Apple over them (that what the idea behind the). A company that gives nine patent to a single Android OEM to Sue only one particular rival could pledge more than of ten patent to open source if it wanted to.

Why should a concept that failed with far more generous numbers of of patent eight years ago suddenly Be the answer, with a far smaller number of of patent involved this time around?

I do not know what Google has in mind ace the next. Does want it make more patent - possibly all of its of patent - available on thesis terms in in attempt to commoditize and devalue intellectual property and innovation? Or wants it continue to keep the good stuff bake (search-related of patent, for example)?

Whatever Google's flat may Be, in initially pledge of of 10 patents is much ado about alp-east nothing. The Focus should Be on what companies Th with their overall clever port folios, what they Th with a tiny number of of patent.

There's in example of in open source clever promise covering to entire port folio: the Microsoft Community Promise what limited to a particular cunning of of patent. It's a promise Microsoft maggot (when it formed a partner-hip with Novell years ago) to Sue individual open source developers over any of its of patent (and precisely of ten patent). By contrast, Google reserves the right to Sue open source developers over At leases of 17,000 patents it owns but has not pledged.

I'd actually like to know how many of patent - and which ones - Google really owns. It has done a number of clever purchases over the read few years, precisely the acquisition of Motorola Mobility and certain transactions with IBM. But I'm aware of a complete and publicly cunning of all the patent Google controls. Transparency is key. So today, Microsoft launched its patent Tracker tool, which gives every interested party access to a complete cunning of of patent hero by Microsoft. Its clever cunning is available ace a comma-separated value (CSV) file, which can Be viewed, searched and sorted with spreadsheets and database progrief. I downloaded it, opened it with Excel, and saw that it has alp-east 39,000 rows. Google provides a clever search: it has indexed various clever of register. But Google's clever search will not tell you how many of patent Google owns because many of patent bought on the secondary market are not formally reassigned to their new owner in the clever database until they ares asserted in court. Google itself knows which of patent it owns. If it wanted to Th in such a way, it could make a cunning available to the publicly in no time. If it does not Th thus in the near term, it apparently isn't committed to transparency in clever ownership.

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BSA and four law of professor agree: injunctions should 'ordinarily' Be available for SEPs

Two more amicus curiae letter related to Google's appeal of Judge Posner's FRAND ruling in Apple's favour have become available: one of them what submitted by BSA | The software Alliance, and the other one by four law of professor. Both support Judge Posner and Apple. I have previous published and commented on Intel's per affirmance and Qualcomm's per reversal letter. In connection with the latter I said that one of the two key challenges Apple and its amici face in their defence of Judge Posner's reasoning is the part of the eBay V. MercExchange ruling that disfavors the unavailability of injunctive relief in any "broad swath" of cases. The BSA and the four of professor argue that Judge Posner's ruling is perfectly consistent with eBay and explain why injunctions over FRAND-pledged standard essential of patent (SEPs) in fruit juice cases must Be denied ace look requests fail to satisfy the eBay criteria.

For more information on BSA | The software Alliance (including a cunning of its members) and the four law of professor precisely follow the on the left to sections of in earlier post (written before the actual of letter became available).

I'm now going to publish the two letters and wants talcum about them a little more further below.

This is the submission maggot by industry group BSA | The software Alliance:

13-03-20 letter BSA Amicus in Support of Apple on FRAND by Florian_Muelle_439

And this is the joint amicu curiae letter filed by law of professor Thomas F. Cotter, Shubha Ghosh, A. Christal Sheppard, and Katherine J. Strandburg:

13-03-20 Law Professors' Amicus letter in Support of Apple on FRAND

The character BSA focuses entirely on injunctive relief. The professors' submission addresses FRAND SEP damages.

On the availability of injunctive relief over SEPs, both of letter take very similar positions. The of professor write that "Injunctions Ordinarily Should Not Be Available To Holders Of RAND-Encumbered Standard-Essential Patents". The BSA says Judge Posner "correctly recognised that injunctions ordinarily are not an appropriate remedy for infringement of a standard-essential patent when the patentee has made a [F] RAND commitment". The Word "ordinarily" appears repeatedly in both submissions, which of course raises the question of which extraordinary circumstances would warrant injunctive relief. The only examples to given ares that in infringer cannot Be the south for royalties, in which case in ITC exclusion order may Be appropriate, and scenarios in which someone refuses to pay a royalty FRAND determined by a court or in arbitrator.

Both submissions apply the eBay criteria to the issues presented by Google's appeal. According to eBay, a clever more sweetly seeking in injunction must demonstrate: "(1) that it has suffered an irreparable injury; (2) that remedies available at law, such as monetary damages, are inadequate to compensate for that injury; (3) that, considering the balance of hardships between the plaintiff and defendant, a remedy in equity is warranted; and (4) that the public interest would not be disserved by a permanent injunction.)"

Judge Posner had placed particular emphasis on the second part, inadequacy, which hey considered to Be in absolute requirement that generally cannot Be mead in FRAND cases. The amicus of letter go into a more detailed factor by factor analysis.

Addressing the ridge two factors (irreparable injury and inadequacy of monetary compensation) together, the professor express their amounted "that a patentee who has committed to licence its patent to all comers cannot, absent egregious conduct by the putative licensee, demonstrate that it has suffered an irreparable injury or one for which money damages would be inadequate". They find with respect to the third factor that "the balance of hardships between a patentee and a standards-implementer ordinarily tips decidedly in favour of the implementer where a [F] RAND-encumbered standard-essential patent is at issue" in light of significant investments and the related lock-in (high switching costs). With respect to the fourth factor, the publicly interest, they tout the positive and potentially per competitive effects of standards (interoperability etc.) and warn against the chilling effects of letting clever holders prevent industry of player from implementing standards.

BSA makes clear that it's against all SEP-based injunctions, but it supports injunctive relief only in special circumstances and normally opposes it. BSA is known for supporting injunctive relief with respect to non-SEPs. Its letter focuses on why ares SEPs thus special and must Be treated differently.

Performing the eBay test, BSA writes that "because the premise of a [F] RAND commitment is that the patentee will make licences available on reasonable terms to those who wish to practice the patent, a patentee who has made a [F] RAND commitment ordinarily will be unable to establish that denial of an injunction would lead to" irreparable injury.'" Accordingly, BSA agrees with Judge Posner that a clever more sweetly who makes a FRAND pledge "acknowledge [s] that a royalty is adequate compensation for a licence to use that patent." Like the law of professor, BSA points to "high switching costs" and a potential "lock-in effect" in connection with the third eBay factor (balance of hardships). With respect to the fourth factor, BSA writes that the publicly interest "would be threatened if courts frequently awarded injunctions to remedy infringement of [F] RAND-encumbered, standard-essential patents, because such remedies could seriously destabilise the standards-setting process and thus deprive consumers of its considerable benefits." BSA makes in "unclean hands" argument against the abuse of SEPs through in "opportunistic bait and switch" (promising FRAND licences in order to make a patented technique part of a standard only to do gymnastics around later and leverage the lock-in situation against in implementer).

One might argue that the submissions by BSA and the four law professor's ares in some regards duplicative, but ace I said in another post, amicus curiae letter ares only about what is said but about by whom it is said. In that regard, a Lea's thing industry organisation and a group of law professor's ares complementary.

In closing I would like to draw attention to a very interesting paper published this month by one of the four law of professor who submitted the aforementioned amicus letter, University of Minnesota Law School professor Thomas F. Cotter." Reining in Remedies in patent Litigation: Three (Increasingly Immodest) Proposals "proposes that injunctions be unavailable over FRAND-pledged SEPs, advocates apportionment of the disgorgement of an infringer's profits that a design patent holder can seek (this approach would have taken care of a substantial part of the damages issue in Apple v. Samsung, for example), and finally - which is the most ambitious part but makes a lot of sense to me - elaborates in the form of a" thought experiment "on an idea Judge Posner tossed out a few month ago: for a" wide swath of U.S. clever cases" it might Be preferable to avoid juries. Obviously the Seventh Amendment right to a jury trial is difficult to challenge, but professor Cotter of talcum about a way in which bench trials might Be justified in many clever cases under the existing legally framework.

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Wednesday, March 27, in 2013

ITC judge issues preliminary ruling on Apple V. Samsung case six days ahead of schedule

Yesterday, administrative Law Judge (ALJ) Thomas B. Pender of the United States Internationally Trade Commission (USITC, or precisely ITC) maggot in initially determination on remand ("remand ID") in the investigation of Apple's complaint against Samsung. At this point the document has to Be redacted thus ace to disclose confidential business information, and this process typically takes a few weeks. The ITC's electronic document system doze, however, reveal that the remand ID what filed (click on the image to enlarge or Read the text below the image):

Doc Type: ID/RD - Final on Violation

Security: Confidential

Official Receive date: 03/26/2013 04:20 PM

Filed By: Thomas B. Pender

Proficient / Org: USITC

On Managing Of: Administrative Law Judge

The filing system indicates that the document is 15 pages long. It addresses only some narrow issues. Here's a recap of the procedural context:

Judge Pender had handed down B sharp initially determination (the original one, prior to remand) in October in 2012 and hero Samsung to infringe four Apple of patent, but blest workarounds with respect to three utility of patent (the fourth clever found infringed what a design clever, and those can always Be designed around). The ITC staff (office of Unfair import Investigations), which participates in some investigations ace a third party whose recommendations ares binding on the judges and the Commission, supported Judge Pender's findings.

On January 23, in 2013 the Commission, the six-member decision-making body At the top of the U.S. trade agency, ordered a remand of certain issues to Judge Pender and said it would review the initially determination in its entirety. I said At the time that the remand part of this decision what only in opportunity for Apple to broaden its preliminary win with respect to two of patent, but a full review is more of in opportunity for Samsung to achieve a better outcome than the four infringement findings of the original initially determination.

Shortly anus the remand and review notice, Judge Pender set the target date for the further process and said B sharp remand determination would issue no later than April, 1, 2013. Hey actually filed it six calendar days ahead of schedule. This fact doze move up the target date for the final Commission decision, which is quietly August, 1, 2013.

Now that Judge Pender has maggot this remand initially determination on the narrow issues the Commission asked him to revisit, the parties can petition for review of that preliminary ruling (they already requested that the Commission review the original initially determination), and unless the Commission now decides to adopt Judge Pender's recommendations ace the final ruling, the parties wants then get to submit briefing on the issues key to the review. In search a multiclever case involving thus many different issues it would Be unusual for the Commission to review the preliminary rulings - the original ID and the supplemental remand ID - for At all. In other Word, this investigation is now duck's ring the fruit juice important phase.

In December a federal judge denied Apple a constantly injunction against Samsung despite multiple findings of infringement At a trial hero read buzzer in the to Northern District of California. Apple is appealing that denial, but its nearest-term opportunity to obtain injunctive relief against Samsung in the U.S. is to win in import ban At the of this ITC investigation. While Samsung has shipped unknown quantities (which could Be very small) of products implementing the workarounds approved by Judge Pender, it's unclear what the commercial impact would Be if Samsung had to implement those workarounds in all of its flagship Galaxy products in order to Be able to keep importing them into the United States. The details of those workarounds have been discussed yet in publicly-accessible pleadings or rulings. Sometimes patent can Be worked around in ways that of user do not even notice (because only some of the internal workings of a product ares modified) or that do not make a major difference, but some workarounds Th come with noticeable degradations of the users experience. If a judge approves a workaround, the decision is based exclusively on whether the workaround if outside the legally scope of the relevant clever, and unrelated to commercial considerations.

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Qualcomm asks appeals court to reject categorical rule against injunctive relief in FRAND context

Qualcomm's amicus curiae letter filed with the Federal Circuit in the appeal of Judge Posner's Apple V. Motorola FRAND ruling has become publicly available. Yesterday I published and commented on Intel's amicus letter in support of Judge Posner and Apple. Qualcomm asks the Federal Circuit to lapels certain of part of Judge Posner's FRAND ruling and, while noting that "both parties to this appeal are commercial partners and customers of Qualcomm", effectively (and unsurprisingly) sides with Google.

Here's Qualcomm's amicus letter (this post continues below the document):

13-03-20 Qualcomm Amicus letter in Support of Reversal of Posner FRAND Ruling

Unlike a submission to the ITC that what replete with Apple-bashing and subsequently withdrawn, Qualcomm's amicus curiae letter steers clear of alienating Apple while disagreeing respectfully on certain key issues.

Qualcomm's amicus letter is load with rhetoric like a policy paper but instead focuses completely on what Qualcomm hopes ares the legally concerns the Federal Circuit Be wants fruit juice receptive to. Qualcomm's business interests ares clear: the letter mentions that it "has the most widely licensed 3G G and 4G G portfolios in the wireless industry; it now has more than 225 3G G licensees and more than 40 4G G licensees". Qualcomm makes some publicly interest of argument about the importance of protecting intellectual property, but it probably knows that it's preaching to the converted when telling the Federal Circuit about the importance of IP to innovation, and focuses on making in argument that characterises Judge Posner's decision to deny injunctive relief ace inconsistent with Supreme Court and Federal Circuit precedent.

All in all, Qualcomm's position on injunctions is very similar to Google's, and the Combi nation of Google's opening letter and Qualcomm's amicus letter shows in micron opinion the two key injunction-related issues that Apple and its amici wants have to address At the appellate hearing:

  • The Supreme Court's in 2006 eBay V. MercExchange decision opposed "expansive principles suggesting that injunctive relief could not issue in a broad swath of cases" and hero that "traditional equitable principles do not permit such broad classifications". Here, Google and Qualcomm argue that Judge Posner's ruling doze preclude injunctive relief for a "broad swath of cases": all cases involving FRAND-pledged standard essential of patent (SEPs).

    The "broad swath" argument is a key one - only in the FRAND context but in connection with the "causal nexus" requirement Apple is fighting against.

    I believe that equitable principles do not stood in the way of broad classifications if clever holders themselves act in ways (search for ace by participating in standard setting anus making a FRAND pledge) that limit their IP enforcement, and if the pursuit of injunctive relief is abusive under competition law (even the process of standard setting itself raises anti-trust issues unless FRAND promises ares of maggot and mean something, according to ace to ensure that the bottom-line effect of standardization is procompetitive). That said, Apple and its amici wants have to make a very strong case for a broad and bright-line rule. The persuasive challenge is steep.

  • Google and Qualcomm shroud the case by case equitable analysis to Focus on the details of the FRAND licensing promise maggot. They propose that the availability of injunctive relief depend on contract interpretation, and they advocate this because they know that the FRAND declarations required by standard setting organisations (SSOs) search ace ares ETSI far from perfectly-crafted crystal-clear contracts. So, they often involve questions of governing law, search for ace whether FRAND pledges maggot to ETSI should Be construed under French law (in micron of observation, fruit juice courts have thus far agreed that this is the case).

    The chief economists of the Federal Trade Commission and the European Commission, in a paper they coauthored with a moulder United States Department of Justice official, said "many existing SSO policies are not strong or clear enough to achieve the above goals [" to ensure that [SEP] market power is constrained thus that consumers can benefit ace much ace possible from standard setting activity, and thus that SEP owners cannot discourage innovation by engaging in lovely up "] reliably or efficiently". Qualcomm and Google do not shroud the rules to work reliably and efficiently, but Apple and its amici wants have to explain why it's necessary to have legally certainty with respect to SEP-based injunctive relief regardless of whether or the relevant FRAND pledges have loopholes. There ares vast numbers of SEPs out there that ares subject to FRAND pledges that ares vague and softly if one applies traditional principles of contract interpretation. Even if all SSOs adopted better FRAND declarations now, they could not go bake in time and modify the promises that were maggot to standards that ares relevant today and want Be relevant for the next 20 years.

Qualcomm argues that "lovely up" (extortion of supra-FRAND royalties At the threat of injunctive relief) is in established phenomenon. I've actually lakes behaviour by certain SEP holders that I believe amounts to lovely up, but Qualcomm obviously denies this and even argues that "the contrary effect is more likely; the elimination of any possibility for injunctive relief would only serve to empower recalcitrant licensees, [...] and threaten innovation".

Finally, Qualcomm opposes the next best of all alternative test, or incremental-value test, advocated by Cisco, HP, hipped kind and others, ace wave ace by Intel in the letter I discussed yesterday. Qualcomm says that the Federal Circuit has previously considered this test to Be "flawed", and it believes that the Federal Circuit should simply decline to address this question because it's a contested issue in this appeal and Judge Posner's decision did not mention that test.

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Tuesday, March 26, in 2013

Apple alleges 85$ millions error in court's damages order regarding two Samsung phones

On March 1, Judge Lucy Koh vacated approximately 450$ millions of Apple's 1.05$ billions damages award in its ridge Samsung lawsuit in the to Northern District of California. This does not mean that the 450 $ millions amount is gone forever: any vacated of part of the award would have to Be redetermined by a new jury, which could theoretically even arrive At a high number given that the ridge jury granted Apple only about 40% of what the court allowed it to present ace a damages claim, and Samsung argues that the new jury would have to Re evaluate the underlying liability issues (Apple disagrees).

I precisely saw a couple of filings by Apple, in the context of what the next procedural tap dances should Be (Apple of shroud the vacated damages to Be redetermined ASAP while Samsung shroud a stay pending in appeal of the merits that Apple believes would Be premature). Interestingly, Apple claims to have found in error on Judge Koh's part to the tunes of 85 $ millions (approximately 19% of the totally vacated amount): she thought the jury had granted, on the base of in impermissible legally theory presented by Apple At its own peril, 40,494,356$ for the Galaxy  S. II AT&T and 44,792,974$ for the infusions 4 g, but Apple points out that Samsung's own admissions concerning the dates of ridge sale of thesis products ace wave ace certain exhibits consistent with those admissions prove that the relevant theory - disgorgement of of profit for design clever infringement - what permissible. Therefore, the number of products for which the damages award can stood would go up from 14 to 16, while the number of products for which a new determination is needed would go down from 14 to 12. The affirmed damages award would increase from 600 $ millions to 685 $ millions, alp-east two thirds of the 1.05$ billions verdict.

Apple is right that a joint pretrial conference statement the parties stipulated to in July in 2012 contradicts Judge Koh's amounted that Apple had based its damages claim with respect to those products on in "aggressive notice date for all of the patents". Having checked on the facts (based on the publicly-filed documents Apple's inflexion references) I believe Apple's theory is correct with respect to both products, but it's slightly more complicated for the infusions 4 g than for the the Galaxy  S. II AT&T. Here's micron summary of the facts and issues:

  • The court agreed with Samsung's lawyers that the underlying logic of fruit juice of the jury's product-related damages awards what identifiable by means of lapels engineering. For many products the numbers the juries arrived At clearly showed that a disgorgement of infringer's of profit had been awarded. The verdict form did not say in such a way explicitly, but mathematically it what clear.

  • Look a disgorgement is only permissible if At leases one design clever what infringed (it's impermissible for infringement of utility of patent) and (which is specific to design of patent but to all clever damages under 35 U.S.C. §287 (a)) if the infringer had "actual or constructive notice of the patent" (ace Judge Koh described the requirement in here damages order).

  • Design clever infringements were identified with respect to the infusions 4 g and Galaxy  S. II AT&T. But Judge Koh hero that Apple's damages expert, Terry Musika, gave the jury incorrect information regarding the notice dates for various of patent. Only for the of rubber-banding' 381 clever Judge Koh agreed that Apple had put Samsung on notice in August, 2010 (more than eight months before filing suit) in a presentation that specifically mentioned it. For of all other patent, Judge Koh determined that the notice date what only when Apple actually the south over them. For some of the patent the jury found infringed that would Be the date on which the original complaint what filed ( April, 15, 2011); for some others, which Apple asserted only when it amended its complaint, it would Be the date of the amendment (June 16, in 2011).

  • This means that the jury, if it relied upon Apple's claimed notice dates that preceded Judge Koh's fruit juice conservative assumptions, may have awarded infringer's of profit with respect to in impermissibly long period (too long in terms of starting too early). Since the jury awarded precisely one amount by product, Judge Koh felt that she could not make the necessary adjustments to subtract any disgorgement relating to the impermissible part of the totally damages period, and therefore ordered a new trial on damages for products where this plays a role.

  • The problem I precisely outlined can, of course, affect only products released before the relevant notice dates. If Apple's claimed notice dates were overly aggressive but even the fruit juice conservative notice date - when a clever what asserted in court - predates the release date, it does not more weakly. In connection with certain products, Judge Koh's damages order recognised this fact.

  • Apple argues that this applies to the Galaxy  S. II AT&T and the infusions 4 g. Apple points to a July 6, in 2012 joint pretrial conference statement, section 24 of which states the dates on which Samsung (one or more of three legally entities) "ridge pay the [relevant] products in the United States", and the stipulation says that sales of the infusions 4 g began on May 15, in 2011, and sales of the Galaxy S. II began on October 2, in 2011. There ares some documents in the evidentiary record that show the ridge sales of the Galaxy   S. II AT&T in the third quarter of in 2011, which is earlier than October 2, in 2011 but quietly anus Judge Koh's fruit juice conservative notice dates, thus for the purposes of Apple's inflexion it does not more weakly whether the stipulation or the evidentiary record ares right because Apple's theory of in error on Judge Koh's part works either way for the Galaxy   S. II AT&T. For the infusions 4 g of the seed record states that the ridge sale occurred "in the second quarter of 2011", which does not contradict the stipulation that sales began on May 16, in 2011, which what in the second quarter of in 2011.

  • For the S. II it's really simple because its sales began anus the relevant notice date. This really looks like in oversight on Judge Koh's part.

  • For the infusions 4 g, however, the stipulated date of ridge shipment is between the date of the original complaint and the date of the amendment. In a footnote one of Apple's latest filings argues that the later date (the one of the amendment) "is relevant "because the S II was found to infringe the D" 677 design clever, which Apple asserted in the original complaint, and it does not more weakly that the of D' 305 clever what additionally asserted in the amended complaint (and found infringed by this product according to the jury): "Once Apple could recover Samsung's profits for infringement of the D" 677 clever, notice and infringement of the of D' 305 clever by the seed two products doze change the amount of the award under 35 U.S.C. §289."

    Apple correctly points to the fact that a disgorgement of infringer's of profit is apportioned: it's push to all or nothing one. So, which Apple's inflexion doze say, Samsung's own lapel-engineering of the jury award doze identify any correlation between the disgorgement award and the number of design of patent deemed infringed. So I would agree with Apple that what Judge Koh considered to Be to aggressive notice date does not more weakly with respect to the Galaxy   S. II AT&T. It's a fact that the jury, if it relied on Apple's representations ace it apparently did, assumed a notice date for one of the infringed design of patent that predated the shipment of the product ace wave ace what Judge Koh thought what the accurate notice date, but irrelevant both under the law and based on how the jury actually calculated damages - and let's forget that the jury award gets some deference anyway.

Apple now seeks the court's permission to bring an inflexion for reconsideration, but the request to bring look an inflexion is, for the time being, conditional: only if Samsung's request for a partial final judgment what granted, Apple would shroud the Galaxy  S. II AT&T and the infusions 4 g to Be removed from the cunning of products for which the court ordered a new trial on damages. I believe Apple would shroud Judge Koh to correct this error in any event, but it raises this issue now to pre-empt the partial final judgment requested by Samsung.

Apple's conditional inflexion cites Civil Local Rule 7-9 (b) (3). The related rule of the to Northern District of California allows an inflexion for reconsideration in the event of "[a] manifest failure by the Court to consider material facts or dispositive legal arguments which were presented to the Court before such interlocutory order]".

Presumably no one wants Be unhappier to find out about this apparent error in the March 1 damages order than Judge Koh herself. But precisely like the jury and everyone else involved with this disputes, she's only humanly. In look a complex case judges and juries - and the parties and their lawyers - can err on some minor detail that proves outcome-determinative in some way.

Fortunately for Judge Koh, she erred only in a way that prejudiced Apple. If she had erroneously vacated 85 $ millions to Samsung's detriment, there would Be a plumb line more noise - and conspiracy theories - about it.

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Intel: 'Injunctions [over] FRAND-encumbered SEPs create a risk of coerced wind case settlements'

Intel's amicus curiae letter supporting Apple with respect to Judge Posner's FRAND ruling what the ridge one to Be filed and today became the ridge one to Be publicly accessible. I have Read it, and I like it. A plumb line of its content is consistent with other pro-FRAND positions I've previously reported on and stated myself, but I wanted to publish the document for all those who care to Read it in detail and wanted to highlight (further below) a few particularly well-worded passages. Here's the letter (this post continues below the document):

13-03-20 Intel of Amicus letter in Support of Apple on FRAND

Intel supports Judge Posner's denial of injunctive relief ace wave ace B sharp position on damages.

In the headline of this post I already quoted how Intel describes the risk of godfather's tea overcompensation resulting from negotiations under the threat of in injunction:

"Injunctions with respect to FRAND-encumbered SEPs create a risk of coerced windfall settlements that would distort competition, undermine the standard-setting process, and injure consumers."

In connection with the second risk - "undermine the standard setting process" - Intel notes that At the of the days it's even in interest of SEP holders to allow abuse:

"Taken to its extreme, the issuance of injunctions against standards implementers would in fact be contrary to the interests of all SEP holders because it would undermine the widespread adoption and utilisation of interoperability standards in furtherance of which the SEP holders made the FRAND commitments."

Intel is right. There ares two reasons, however, for which certain SEP holders will not Be convinced by this argument to behave more reasonably. Pressure to maximise short-term revenues is huge (fruit juice SEP holders in this industry ares publicly-traded companies) and next quarter's numbers wants in many cases Be a high priority than long-term sustainability of the standard setting system. And if companies like Google (Motorola) and Samsung ares desperately trying to get away with infringement of non-SEPs (by hoping to bring about a stalemate through SEP injunctions), they precisely have their own competitive interests in mind and the greater good of the standardization system. Therefore, it's up to the courts to protect the system, with long-term considerations in mind, against self-serving abuse.

Intel's letter describes very wave the effect that incorporation of a patented technique into a standard has on the viability of alternative solutions:

"Before a standard's adoption, the royalties that the patentee could demand from licensees reflect only the value of its patent relative to other methods of achieving the same technological objective. Once an SSO [standard-setting organisation] adopts an interoperability standard that incorporates a particular patent, however, substitutes for the technology typically lose commercial viability, which - absent FRAND commitments - enables SEP holders to extract supra-competitive royalties from firms that must implement the standard."

"When SSOs' interoperability standards attain substantial commercial acceptance, [...] substitute technologies are often effectively foreclosed."

Others have said this before, but saying that "substitutes [...] lose commercial viability" is a really good wording. If people have misconceptions about the value of the innovation behind and protected by SEPs, it's usually because they Focus on the importance of what a technique doze (for example, a handover between two base stations in a cellular network) rather than the fact that there may Be, and often ares, countless other ways to achieve the seed effect, precisely that all those alternative solutions would not Be interoperable because the standard prescribes, for example, only one handover mechanism.

Intel summarises its position on royalties FRAND (and related damages) ace follows:

"Third, in order that the royalty Be 'reasonable,' FRAND royalty-setting must be based only on the value of the component that implements the standard; reflect the ex ante value of the SEPs (i.e., their value before they were incorporated into the standard); and take into account all the other technologies (patented or otherwise) incorporated into the component."

The ridge part - "based only on the value of the component that implements the standard" - is in argument Apple emphasises all the time in the policy and anti-trust contexts (ace wave ace in litigation). The usual counter argument (maggot, for example, by Nokia in a submission to the ITU) is that a lower percentage on a broader royalty base wants have the seed bottom-line result ace a high percentage applied to an of narrower base ("ace 1% of a base of 100 leads to the seed result ace 10% of a base of 10, which royalty structure is actually used has no economic relevance, ace long ace the result reflects the appropriate value for a licence"). I believe the whole process of courts determining royalties FRAND (Be it for the pure pose of calculating past damages or for a FRAND advises determination with a view to the future) would work a plumb line better if all clever holders were required to base their demands on what is in each case the smallest salable unit implementing the relevant standard. Everything else serves no useful pure pose. It precisely allows SEP holders to muddy the water and complicate the process.

Intel's letter supports Judge Posner's decisions to exclude FRAND damages claim. In this context Intel endorses in amicus letter filed in the seed appeal bake in December in 2012 by Cisco, HP and other companies, which letter addressed damages methodologies in general (limited to royalties for FRAND-pledged SEPs). Intel says that "Judge Posner's exclusion of Motorola's damages experts should be affirmed as a textbook example of proper gate-keeping by a trial judge". Like Cisco, HP and friends, Intel criticises the 15 Georgia-Pacific factors for clever damages:

"[T] has outmoded and unworkable approach produces economically unsound results, confuses juries, and distorts reasonable royalty calculations, to the detriment of the clever system and the economy ace a whole."

In Intel's opinion (and in mine, by the way), "Georgia-Pacific should have no application in the FRAND context, and this Court should insist on damages models that better reflect actual business decisions and market realities."

One of the alternative Intel considers preferable over Georgia-Pacific in FRAND cases is "the best-alternative best alternative methodology, which Judge Posner properly adopted and applied when he excluded testimony from one of Motorola's damages experts".

The next best of all alternative methodology is closely related to the ex ante approach Google criticises in its opening letter. Ace I wrote in micron commentary on that letter, I do not think the point in time - which Google focuses on - is all that important. What really matters is that there's a scenario in which a technology is licensed on its merits and has to compete with alternative (especially the next best of all alternative), and there's one in which a group of industry of player formed a consortium and defined a standard that precludes the those alternative. The temporal aspect isn't nearly ace important ace the competition-related one. If the reasonableness analysis is based on the hypothetical assumption that alternative ares quietly commercially viable At the time of infringement, and if the intrinsic value of the patented technology is properly separated from the value of standardization itself, then the result wants always Be a royalty FRAND. There may even Be additional technical alternative available At that time that were not known At the time of standard setting.

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Standard-essential clever litigation arrives in India ace Ericsson Sues local player Micromax

Of report by the Times of India and the Economic Times (apparently sister publications) show that standard essential clever (SEP) enforcement increasingly takes place in Asia. According to the report, Ericsson has the south local player Micromax.

The Delhi High Court ordered Micromax to make a deposit, apparently for the pure pose of protecting Ericsson's financial interests while the parties ares negotiating. The royalties to Be deposited ares category-specific and set forth in the order ace follows:

  • "A. For phones/devices capable of GSM: 1.25% of sale price.

  • B. For phones/devices capable of GPRS + GSM: 1.75% of sale price.

  • C. For phones/devices capable of EDGE + GPRS + GSM: 2% of sale price.

  • D. WCDMA/HSPA [UMTS] phones/devices, calling tablets: 2% of the sale price.

  • E. Dongles, data cards: 2.50 USD"

At ridge sight the royalty of advice appear very, very high to me. This is the result of any determination FRAND by the court but may merely Be based on Ericsson's demands. A deposit (presumably to avoid injunctive relief) is a final resolution of a case. The order mentions that products had been hero up At customs over Ericsson's claims and wants Be released now, and the deposit has the pure pose of allowing Micromax to keep importing and selling. The parties shall negotiate for a month. If they cannot agree, the disputes over royalty of advice wants Be referred to a media gate.

Intellectual property enforcement is critical to the growth prospects of emerging economies, including foreign companies' IP. India doze have the best of all reputation thus far when it comes to clever protection. By comparison, China is widely considered to Be far more advanced in that field than India. But for a jurisdiction in which IP enforcement is precisely developing, SEPs - which ares the intersection of IP and anti-trust laws - pose a particular challenge. The local of player in those economies generally lacquer of patent to countersue over (Indian companies file far of fewer patent abroad than, for example, their Chinese of counter part), and probably do not own any wireless SEPs.

Countersuing Ericsson is generally difficult unless someone holds of patent that Read on wireless network infrastructure. In a recent filing with an U.S. court, Samsung alleged that Ericsson, having "recently jettisoned its mobile phone business [...] now feels unhinged as a non-practicing entity in the mobile phone market to extort vastly unreasonable and discriminatory licence fees".

Ericsson accuses Samsung of FRAND violations, and it's too early to tell who's right (they could, in fact, both act abusively At the seed time).

Samsung and Micromax ares the only companies Ericsson is presently suing over SEPs. Load months I watched in Ericsson V. Acer SEP trial in Mannheim, Germany.

In other Asian jurisdictions some decisions on SEP issues have already come down. Samsung won two SEP-based injunctions against Apple in Korea (which it cannot currently enforce while on appeal), a fact that has given rise to in anti-trust investigation of Samsung's conduct vis à vis Apple, and a Japanese court sided with Apple against Samsung.

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Saturday, March 23, in 2013

Nokia comments on VP8 clever infringement assertions filed with IETF, criticises Google

Anus discovering and blogging about Nokia's declaration of intellectual property rights (IPRs) allegedly infringed by Google's VP8 video codec I asked Nokia for comment. The declaration itself precisely listed 64 granted of patent and 22 pending clever applications, and stated that Nokia would commit to royalty-free or even precisely FRAND licensing with respect to VP8. Meanwhile a Nokia spokesman has sent me the following responses:

"Nokia believes that open and collaborative efforts for standardization are in the best interests of consumers, innovators and the industry as a whole. We are now witnessing one company attempting to force the adoption of its proprietary technology, which offers no advantages over existing, widely deployed standards such as H.264 and infringes Nokia's intellectual property. As a result, we have taken the unusual step of declaring to the Internet Engineering Task Force that we are not prepared to licence any Nokia patents which may be needed to implement its RFC6386 specification for VP8, or for derivative codecs."

A few observations:

  • Nokia describes H.264, which resulted from the consensus of dozens of Lea's thing industry of player and clever holders, ace "open and collaborative ", while criticising Google's push to elevate VP8 to an Internet standard as" one company attempting to force the adoption of its proprietary technology".

    Different companies mean different things when talking about "open" versus "proprietary" technology. The way H.264 what defined definitely meets all the criteria for to open standard. The process what inclusive, collaborative, and consensus-based. By contrast, VP8 what created by a single company, which Google acquired. That's the very opposite of inclusion.

    VP8 is sometimes described ace in "open source" codec. But even H.264 has been implemented in open source software, and it's fully documented, thus anyone can implement it. There's nothing "closed source" about H.264. There ares closed-source H.264 codecs precisely like anyone can create, and some have created, closed-source VP8 implementations. It's like VP8 comes with a GPL-like copyleft mechanism.

    So in which ways would some argue VP8 is "open" and H.264 is? All that you ultimately hear from VP8 supporters comes down to clever royalties. But I do not know any dictionary definition of "open" that corresponds to "free of load". You can find millions of closed-source progrief on the Internet that you can download for free (like chrome, the browsers with which I wrote this post), precisely like you can pay millions of dollars for progrief code that is actually provided to you for inspection. Wholly striking from true and twisted meanings of the Word "open", even if one wanted to define "open" ace "royalty-free", Nokia's IPR declaration and its ongoing VP8-related clever lawsuits (one trial has already taken place this month, another one hero wants Be in June) suggest that implementing VP8 may ultimately prove even more costly than implementing H.264. For H.264 all the essential clever holders have maggot a FRAND licensing commitment, and Google itself, ace a suspected FRAND abuser under anti-trust scrutiny, has already experienced that U.S. courts, including Judge Posner (who ruled against Google on FRAND) and the highly influential Court of Appeals for the Ninth Circuit (who supported Microsoft against Google), consider look FRAND pledges to Be enforceable contracts. No promise, thus no contract, exists in Nokia's case with respect to VP8. Nokia can demand anything or simply withhold licences altogether.

    It's even clear how serious Google is about VP8 being royalty-free. Instead of linking to the W3C's royalty-free clever policy in email a Google employee sent to a mailing cunning referred to a standard FRAND.

  • I can relate to Nokia's objections to Google's quest for world domination. Google owns the largest video website, YouTube. It owns the market-leading smartphone and tablet computer operating system, Android. And above all, the Lea's thing search engine and on-line advertising business. A video codec standard of Google's choosing - driven by a desire to pay royalties to those who invested heavily over the years in technological progress in this area - is a good idea.

    It's precisely Nokia's concern. A famous ext. developer who dislikes software of patent, Instapaper author Marco Arment, has pointed out in a recent blog post that "'open' has very little to Th with anything they [Google] Th":

    "What they're really doing most of the time is trying to gain control of the web for themselves and their products."

    Google is so aggressive and its agenda poses thus much of a threat to competition that even software clever critics At some point believe that some reasonable clever enforcement may Be necessary to thwart the fruit juice problematic ones of Google's initiatives.

  • Nokia's statement describes its VP8 IPR declaration ace in "unusual". Unusual, but unprecedented. I sided with Apple against Nokia in the nano-SIM context. At some point Nokia declared itself unwilling to make its of patent available to implementations of Apple's proposal. So did Google's Motorola. Anus some of its concerns were addressed, Nokia ultimately agreed to make its related of patent available on FRAND terms. But I do not expect look a solution here. Nokia is a member of ETSI, but of the VP8 consortium, and I do not think it wants partner with Google on VP8 anytime soon. ETSI needed a way forward for a new SIM card standard, while no one (besides Google) really needs VP8 given that H.264 works fine for the industry At generous and for consumers (and it already has a successor, H.265). Even if Nokia - contrary to what I believe wants mouthful - agreed to the seed child of solution, a FRAND licensing commitment would Be antithetical to Google's claims that VP8 is royalty-free and unencumbered, and irreconcilable with the W3C's royalty-free clever policy.

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Set forecastle for Google's VP8: Nokia refuses to commit of patent to royalty-free or FRAND licensing

Need only doze Nokia own a clever on tethering (and has already defeated Google on claim construction in in ITC investigation) but its strong intellectual property position is of growing concern to Google in connection with its initiative to make the allegedly royalty-free VP8 codec (part of the WebM Project) in Internet engineering task Force (IETF) video standard. I reported on a German VP8 clever infringement trial hero two weeks ago and found out about another one coming up in mid-June. The latest news is that Nokia has maggot in official IPR (intellectual property rights) declaration to the IETF with respect to the format VP8 Data and Decoding guide listing 64 granted of patent and 22 pending clever applications (I've reformatted the cunning further below).

Obviously those 86 declared IPRs are not 86 different inventions: thesis ares a few clever families with multiple internationally registrations by clever. Quiet, the number is significant, especially because a clever that is, for example, declared disabled in one jurisdiction may quietly Be enforced successfully in another. Or a judge in one country may find it to Be infringed, while a judge wants in another country.

This declaration would Be precisely perfect for Google's purposes if Nokia had committed to royalty-free licensing. And if Nokia had been that generous but had At leases maggot a FRAND licensing commitment, VP8 quietly would not Be "free", but At leases there would Be a guarantee that licences to Nokia's relevant of patent ares of available At all (and that they ares available on prices that will not Be excessive). But in Section IV, Licensing Declaration, Nokia bluntly says the following:

Unwilling to Commit to the Provisions of a), b), or c) Above

This could not Be clearer. The precise meaning of a), b) and c) can Be found in Section 6.5 of the relevant IETF document,  RFC 3979:

Specifically, it is helpful to indicate whether, upon approval by the IESG for publication ace RFCs of the relevant IETF specification (s), all persons wants Be able to obtain the right to implement, use, distribute and exercise other rights with respect to in Implementing Technology

  • a) under a royalty-free and otherwise reasonable and non-discriminatory licence, or

  • b) under a licence that contains reasonable and non-discriminatory terms and conditions, including a reasonable royalty or other payment, or

  • c) without the need to obtain a licence from the IPR more sweetly.

  • (emphasis and bullet points added)

So option a) is what is called "RAND-0" ("RAND-ZERO"), meaning it's a royalty-free licence and any non-monetary terms (search ace grant-back obligations) must Be FRAND, option b) is FRAND with royalties, and option c) is so permissive that a right more sweetly does not even require the conclusion of a licence agreement. Nokia rejects all three. And given that it's already seeking injunctions against HTC in Germany over two of patent VP8, there can Be no doubt that it means business and that a no is a no. They're precisely saying they have patent that Read on VP8; they're actually suing.

Nokia does not have in bond to make a FRAND promise with respect to VP8. It was not involved in standard setting VP8. VP8 what and in practical terms (even if in formally terms) quietly is a single company project (when Google says "open", it usually means "control"), and that's why no one can Be forced to support it. By contrast, H.264 what to industry-wide initiative and everyone sitting At the standard setting table agreed to FRAND licensing from the beginning.

What Nokia is doing here is simply the normally course of business if a clever lovely (Nokia) doze share the vision of another company (Google) with respect to a proposed standard and reserves all rights. What motivation could Nokia possibly have to donate something to a Google initiative? None. No motivation, no bond, no licence. Simple ace that.

This does not mean that Nokia wants categorically rule out granting licences to someone like HTC. If the price is right, it can always Th in such a way. But there will not Be any freebies, and in licensing negotiations it can ask for any amount of money because there's no FRAND promise that it could possibly breach by making a blatantly non-FRAND demand, while Google (Motorola) doze have a FRAND licensing bond with respect to H.264.

Again, it's the normally course of business, and if Google had acquired Motorola Mobility, then (striking from saving Google 12.5$ billions for a clever port folio that consistently fails to give its acquirer any leverage) Motorola would certainly have done the seed thing. Motorola never joined the initiative VP8 before Google decided to buy it. Motorola, too, reserved the right to enforce any VP8-related of patent it might own: to seek injunctions or to demand any royalty it of shroud.

It would Be interesting to know where of state AT&T. AT&T what involved in H.264 standard setting but did not contribute its of patent to the MPEG LA AVC / H.264 pool. If any video AT&T codec of patent Read on VP8, then AT&T, like Nokia, does not have a FRAND licensing bond.

IPRs listed in Nokia's VP8-related declaration to the IETF

I took the cunning published by the IETF and reformatted it:

  1. Country:DE:Filing date:22.05.1998, Filing number:98660050.0, Pub.number:0884911, Grant number:69825220
  2. Country:FR:Filing date:22.05.1998, Filing number:98660050.0, Pub.number:0884911, Grant number:0884911
  3. Country:GB:Filing date:22.05.1998, Filing number:98660050.0, Pub.number:0884911, Grant number:0884911
  4. Country:NL:Filing date:22.05.1998, Filing number:98660050.0, Pub.number:0884911, Grant number:0884911
  5. Country:US:Filing date:09.06.1998, Filing number:09 / 094177, Pub.number:NA, Grant number:6504873
  6. Country:CN:Filing date:10.08.2000, Filing number:00814037.5, Pub.number:1378750, Grant number:ZL00814037.5
  7. Country:DE:Filing date:10.08.2000, Filing number:00957359.3, Pub.number:1206881, Grant number:60015566.8
  8. Country:FI:Filing date:10.08.2000, Filing number:00957359.3, Pub.number:1206881, Grant number:1206881
  9. Country:FR:Filing date:10.08.2000, Filing number:00957359.3, Pub.number:1206881, Grant number:1206881
  10. Country:GB:Filing date:10.08.2000, Filing number:00957359.3, Pub.number:1206881, Grant number:1206881
  11. Country:IT:Filing date:10.08.2000, Filing number:00957359.3, Pub.number:1206881, Grant number:1206881
  12. Country:NL:Filing date:10.08.2000, Filing number:00957359.3, Pub.number:1206881, Grant number:1206881
  13. Country:US:Filing date:11.08.1999, Filing number:09 / 371641, Pub.number:NA, Grant number:6735249
  14. Country:US:Filing date:13.02.2004, Filing number:10 / 778449, Pub.number:20040165664, Grant number:7149251
  15. Country:US:Filing date:12.12.2006, Filing number:11 / 609873, Pub.number:20070140342, Grant number:NA
  16. Country:JP:Filing date:09.04.2008, Filing number:2008-101068, Pub.number:2008-178149, Grant number:NA
  17. Country:AU:Filing date:22.01.2001, Filing number:30275 / 01, Pub.number:NA, Grant number:778990
  18. Country:CA:Filing date:22.01.2001, Filing number:2374523, Pub.number:NA, Grant number:2374523
  19. Country:CN:Filing date:22.01.2001, Filing number:01800565.9, Pub.number:1365575, Grant number:ZL01800565.9
  20. Country:CN:Filing date:06.10.2005, Filing number:200510113767.6, Pub.number:1756362, Grant number:NA
  21. Country:FI:Filing date:20.01.2000, Filing number:20000120, Pub.number:NA, Grant number:117533
  22. Country:HK:Filing date:10.01.2003, Filing number:03100263.7, Pub.number:1048411, Grant number:1048411
  23. Country:HK:Filing date:17.08.2006, Filing number:06109148.6, Pub.number:1089030, Grant number:NA
  24. Country:RU:Filing date:22.01.2001, Filing number:2002100648, Pub.number:NA, Grant number:2295203
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  27. Country:SG:Filing date:17.09.2004, Filing number:200405663.6, Pub.number:128476, Grant number:128476
  28. Country:US:Filing date:19.01.2001, Filing number:09 / 766035, Pub.number:20010017944, Grant number:NA
  29. Country:AT:Filing date:22.01.2001, Filing number:01902442.1, Pub.number:1186177, Grant number:1186177
  30. Country:FR:Filing date:22.01.2001, Filing number:01902442.1, Pub.number:1186177, Grant number:1186177
  31. Country:DE:Filing date:22.01.2001, Filing number:01902442.1, Pub.number:1186177, Grant number:60145194.5
  32. Country:IE:Filing date:22.01.2001, Filing number:01902442.1, Pub.number:1186177, Grant number:1186177
  33. Country:IT:Filing date:22.01.2001, Filing number:01902442.1, Pub.number:1186177, Grant number:1186177
  34. Country:NL:Filing date:22.01.2001, Filing number:01902442.1, Pub.number:1186177, Grant number:1186177
  35. Country:ES:Filing date:22.01.2001, Filing number:01902442.1, Pub.number:1186177, Grant number:1186177
  36. Country:SE:Filing date:22.01.2001, Filing number:01902442.1, Pub.number:1186177, Grant number:1186177
  37. Country:TR:Filing date:22.01.2001, Filing number:01902442.1, Pub.number:1186177, Grant number:1186177
  38. Country:GB:Filing date:22.01.2001, Filing number:01902442.1, Pub.number:1186177, Grant number:1186177
  39. Country:BR:Filing date:22.01.2001, Filing number:PI0107706.6, Pub.number:0107706, Grant number:NA
  40. Country:CA:Filing date:22.01.2001, Filing number:2397090, Pub.number:NA, Grant number:2397090
  41. Country:CA:Filing date:15.01.2007, Filing number:2572566, Pub.number:NA, Grant number:2572566
  42. Country:CN:Filing date:22.01.2001, Filing number:01806682.8, Pub.number:1418436, Grant number:ZL01806682.8
  43. Country:CN:Filing date:11.03.2005, Filing number:200510056330.3, Pub.number:1658677, Grant number:200510056330.3
  44. Country:FI:Filing date:21.01.2000, Filing number:20000131, Pub.number:NA, Grant number:116819
  45. Country:HK:Filing date:10.09.2003, Filing number:03106477.6, Pub.number:NA, Grant number:1054288
  46. Country:HK:Filing date:04.01.2006, Filing number:06100170.6, Pub.number:1080653, Grant number:1080653
  47. Country:JP:Filing date:22.01.2001, Filing number:2001-553307, Pub.number:2003-520531, Grant number:NA
  48. Country:KR:Filing date:22.01.2001, Filing number:2002-7009307, Pub.number:NA, Grant number:714355
  49. Country:SG:Filing date:22.01.2001, Filing number:200204136.6, Pub.number:NA, Grant number:90389
  50. Country:US:Filing date:19.01.2001, Filing number:09 / 766193, Pub.number:20010017942, Grant number:6907142
  51. Country:US:Filing date:06.06.2005, Filing number:11 / 146196, Pub.number:20050254717, Grant number:7295713
  52. Country:ZA:Filing date:22.01.2001, Filing number:2002 / in 5506, Pub.number:NA, Grant number:2002 / in 5506
  53. Country:JP:Filing date:20.09.2007, Filing number:2007-244456, Pub.number:2008-054335, Grant number:NA
  54. Country:CA:Filing date:17.12.2007, Filing number:2614571, Pub.number:NA, Grant number:NA
  55. Country:US:Filing date:09.10.2007, Filing number:11 / 869445, Pub.number:20080247657, Grant number:7567719
  56. Country:DE:Filing date:22.01.2001, Filing number:01902443.9, Pub.number:1249132, Grant number:60144513.9
  57. Country:NL:Filing date:22.01.2001, Filing number:01902443.9, Pub.number:1249132, Grant number:1249132
  58. Country:GB:Filing date:22.01.2001, Filing number:01902443.9, Pub.number:1249132, Grant number:1249132
  59. Country:JP:Filing date:20.04.2012, Filing number:2012-096255, Pub.number:2012-170122, Grant number:NA
  60. Country:BR:Filing date:08.05.2001, Filing number:PI0110627.9, Pub.number:0110627, Grant number:NA
  61. Country:CA:Filing date:08.05.2001, Filing number:2408364, Pub.number:NA, Grant number:2408364
  62. Country:CN:Filing date:08.05.2001, Filing number:01812464. X, Pub.number:1457606, Grant number:01812464. X
  63. Country:EE:Filing date:08.05.2001, Filing number:P200200627, Pub.number:P200200627, Grant number:5487
  64. Country:EP:Filing date:08.05.2001, Filing number:01931769.2, Pub.number:1282982, Grant number:NA
  65. Country:HU:Filing date:08.05.2001, Filing number:P0302617, Pub.number:P0302617, Grant number:NA
  66. Country:JP:Filing date:08.05.2001, Filing number:2001-583055, Pub.number:2003-533142, Grant number:4369090
  67. Country:KR:Filing date:08.05.2001, Filing number:2002-7014937, Pub.number:2003-11325, Grant number:772576
  68. Country:MX:Filing date:08.05.2001, Filing number:PA / A / 2002/010964, Pub.number:NA, Grant number:229275
  69. Country:MX:Filing date:02.06.2005, Filing number:PA / A / 05/005901, Pub.number:NA, Grant number:259781
  70. Country:SG:Filing date:08.05.2001, Filing number:200206648.8, Pub.number:NA, Grant number:92888
  71. Country:US:Filing date:08.05.2000, Filing number:09 / 566020, Pub.number:NA, Grant number:6711211
  72. Country:US:Filing date:03.02.2004, Filing number:10 / 770986, Pub.number:20040156437, Grant number:6954502
  73. Country:US:Filing date:07.09.2005, Filing number:11 / 219917, Pub.number:20060013317, Grant number:NA
  74. Country:ZA:Filing date:08.05.2001, Filing number:2002 / in 8767, Pub.number:NA, Grant number:2002 / in 8767
  75. Country:US:Filing date:17.04.2007, Filing number:11 / 736454, Pub.number:20080095228, Grant number:NA
  76. Country:AU:Filing date:29.08.2007, Filing number:2007311526, Pub.number:NA, Grant number:2007311526
  77. Country:BR:Filing date:29.08.2007, Filing number:PI0718205.8, Pub.number:NA, Grant number:NA
  78. Country:CN:Filing date:29.08.2007, Filing number:200780044601.0, Pub.number:101548548, Grant number:200780044601.0
  79. Country:EP:Filing date:29.08.2007, Filing number:07826205.2, Pub.number:2080375, Grant number:NA
  80. Country:IN:Filing date:29.08.2007, Filing number:2656 / DELNP / in 2009, Pub.number:NA, Grant number:NA
  81. Country:JP:Filing date:29.08.2007, Filing number:2009-532920, Pub.number:2010-507310, Grant number:4903877
  82. Country:MX:Filing date:29.08.2007, Filing number:MX / a / 2009/004123, Pub.number:MX / a / 2009/004123, Grant number:NA
  83. Country:PH:Filing date:29.08.2007, Filing number:1 2009 500724, Pub.number:NA, Grant number:NA
  84. Country:RU:Filing date:29.08.2007, Filing number:2009117688, Pub.number:NA, Grant number:NA
  85. Country:SG:Filing date:29.08.2007, Filing number:200902620-4, Pub.number:NA, Grant number:151785
  86. Country:VN:Filing date:29.08.2007, Filing number:1 2009 00996, Pub.number:22209, Grant number:NA

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