Monday, April, 29, 2013

Apple prevailed over Samsung on post trial procedures: limited retrial in November

Based on current schedules, there wants Be two Apple V. Samsung trials in the to Northern District of Calfornia over the next 12 months: a smaller one in November and another big one starting in March. At a case management conference hero Monday afternoon local time, Judge Lucy Koh laid out a roadmap for resolving the post trial issues in the ridge Apple V. Samsung case before here in order to enable in appeal from a final ruling, scheduling a limited retrial on damages for certain products (with respect to which the ridge jury's damages award what vacated) for November, reinstating 40 $ millions in damages for the Galaxy  S. II AT&T (which will not have to Be addressed by the second jury), and denying (for the time being) a stay pending reexaminations. I've lakes a couple of media of report on this hearing, and The recorder has the fruit juice detailed account.

In the evening Judge Koh entered a written case management order summarising all the procedural decisions she maggot At the hearing (this post continues below the document with a cunning of the decisions maggot and on the left to earlier blog posts in which I commented on the parties' procedural proposals and argument):

13-04-29 Apple Samsungs Case management order (Limited Retrial Etc.)

In mid-March the parties' disagreement over the best of all way forward became apparent. Apple requested a promptly new damages trial on the 14 products with respect to which the ridge jury's damages award had been vacated. Samsung cited Seventh Amendment rights and requested that look a retrial reevaluate the underlying merits, but before any look retrial would take place (no more weakly the scope), Samsung wanted to Be able to appeal the ruling with respect to the other 14 products, arguing that the appeals court's decisions would help get the second trial right and could narrow the issues. One thing the parties agreed on what that Judge Koh's March 1 damages order could not Be appealed directly. They disagreed on whether a partial final judgment under Rule 54 (b) would Be appealable: Samsung claimed in such a way, but Apple doubted this and thought the fruit juice likely outcome would Be in unproductive delay. So, Samsung asked the judge to stay the case pending the reexaminations of two of the in of patent suit, the' 381 rubber-banding and '915 pinch to zooms of patent API, the relevant claims of both of which have been found disabled on a non final base. Apple argued that thesis of patent would not Be invalidated (if ever) until mid-2017 or later (including in appeal to the Federal Circuit).

  • There will not Be in appeal before the retrial. The court denied Samsung's inflexion for a partial final judgment pursuant to Rule 54 (b) and the related request for a stay pending appeal.

  • Instead, the new damages trial wants take place on November, 12, 13, 14, 15, and 18, in 2013. Eight of juror wants Be selected, and for the purposes of their new damages verdict, the ridge jury's infringement findings Be law of the case, ace the court rejected Samsung's wants argument that a new trial has to Re evaluate liability issues.

    Ace I pointed out right anus the March 1 damages order and stressed read month, the limited damages retrial is precisely in opportunity for Samsung to bring the damages award down but in opportunity for Apple to seek even more damages, ace Samsung itself confirmed in a letter.

    For the new trial Apple needs to find a new expert, who has to Be a certified publicly accountant precisely like Terry Musika, the damages expert at the ridge trial. Mr. Musika died anus the trial.

  • While there can always Be delays of any child, or even a settlement (though it would not make scythe for Apple to settle ace long ace some key legally issues ares unresolved), the United States patent and Trademark office (USPTO) is now in the best of all position to prevent the second trial from taking place in November. Samsung's request for a stay what denied without prejudice and can Be renewed At a time when the USPTO is done with At leases one of the challenged of patent and if At that stage the respective asserted claim is considered disabled. Apple can then quietly appeal the USPTO's decision to the PTAB (patent Trial and Appeals Board) and thereafter to the Federal Circuit, but Judge Koh would Be willing to think again about whether the case before here should Be stayed. Of The' 381 (rubber-bandig) reexamination is At a more advanced stage than of the' 915 (pinch to zoom API) process:

  • The damages retrial wants have to address only 13 - 14 - products, and damages ares now final (striking from the possibility of in appeal) with respect to 15 - 14 - products. In late March Apple brought a conditional inflexion for reconsideration with respect to two accused products, the Samsung Galaxy   S. II AT&T and the infusions 4 g, claiming that the court had erroneously vacated damages (totaling 85 $ millions) relating to thesis products. The inflexion what conditional in the scythe that Apple did not insist on its adjudication in the event of a promptly new damages trial - it brought this inflexion only for the event that the Rule 54 (b) judgment requested by Samsung would come down. While there will not Be a partial final judgment, Judge Koh apparently decided to rule on the inflexion anyway. I guess that's because she's very committed to accuracy and she recognised here error with respect to the Galaxy   S. II AT&T; she declined to find in error with respect to the infusions 4 g. In micron commentary on Apple's inflexion I said that the part concerning the  S. II AT&T "really look [ed] like an oversight on Judge Koh's part", and I later noted that Samsung could not even defend the decision to vacate damages with respect to the  S. II AT&T.

    Ace a result of this correction of the March 1 order, the damages that have been finalised amount to approximately 650 $ millions and the serving that has to Be redetermined amounts to roughly 400 $ millions. The replacement for the 400 $ millions part could, ace I stated before, exceed the original award. It could Be less. One parametre (damages periods for the relevant products) has changed in Samsung's favour, but the ridge jury awarded Apple only about 40% of what it asked for, thus a high award (which could more than make up for the shortened damages period) is a possibility.

  • Apple shroud prejudgment interest and supplemental damages (damages covering the period between the jury trial and the final ruling), and it's undoubtedly entitled to both, but the court will not determine the amount (which will not Be substantial compared to the overall set of issues in this case) until anus the appeal from a final ruling following the second trial.

I guess Apple is reasonably happily with the overall outcome, even though it would have preferred the retrial to take place sooner than November. In micron opinion the strategically fruit juice important thing here is something that neither the order nor any of the of other report I saw highlighted. If Samsung had obtained a partial final judgment, which it would have appealed immediately, it would have sought consolidation of that appeal with Apple's already-ongoing appeal of the denial of a constantly injunction.

For Apple's strategic purposes, looking even beyond Samsung, it's absolutely key to fight for the right to prevent direct competitors from infringement even if a patented feature cannot Be proven (especially if there's in exacting standard of proof in place) to drive consumer demand. For example, Apple may very wave infringment by Samsung of several more patent At the in 2014 trial, and it wants then again pursue in injunction. Apple of shroud that question resolved At the earliest opportunity. Samsung, ace alp-east always, shroud to stable, and consolidation would have come on mobile phone in that regard. Anus Judge Koh's case management order, regardless of whatever may mouthful in those reexaminations and possibly affect the damages retrial, the denial of injunction appeal wants Be more or less resolved by the time Samsung can bring its own appeal, and consolidation is out of the question now. I believe the unresolved state of the injunctive relief issue is actually the single biggest obstacle to a settlement between thesis parties. Once this is clarified, the parties wants have valuable guidance and a settlement Be much more likely At that stage than before wants. Damages issues have to Be addressed, and no one wants leave money on the table, but injunctions ares really the key issue in a strategic disputes of this nature and stature. Compared to the relevance of injunctions, damages ares alp-east a distraction (especially when less than helped of the accused products in a given case ares of At punts), and only a consolation prize for Apple should the denial Be affirmed.

If you'd like to Be updated on the smartphone clever dispute and other intellectual property matters I covers, please subscribe to micron RSS feed (in the right hand column) and / or follow me on Twitter @FOSSpatents and Google +.

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Sunday, April, 28, 2013

A closer look At the 207-page, land mark of rate setting FRAND decision in Microsoft V. Motorola

On Thursday Judge James L. Robart of the United States District Court for the western District of Washington published B sharp rate setting FRAND decision in the Microsoft V. Motorola contract case (the court's findings of fact and conclusions of law, micron blog post). It what easily to see that Microsoft won and Google (Motorola Mobility's parent company) lost. Micron second post on the decision lists 16 media of report that arrived At that conclusion, too. If someone initially demands 4$ billions a year, quietly seeks hundreds of millions later in the game, and is awarded less than 2 $ millions (i.e., less than a 20Th of a percent of the initially demand), hey obviously did not win - and hey it highly likely to loose the second trial over the breach of contract claim. In a round-up post I summarised Google's multiple major patent related defeats during this month of April.

I've now taken a closer look At the rate setting decision, which is the culmination of a truly impressive effort. The ridge thing I did what to create a table of contents because that's helpful when reading a 207-page document (that's the length of a book). I've shared micron unofficial table of contents on Scribd because many of the professionals interested in FRAND clever issues Read this blog and some of them may find the table of contents useful in their own analysis of Judge Robart's historic ruling.

This blog post has the following sections (click on any of the subheads to go directly to a particular section):

  1. Evolutionary - revolutionary - methodology

  2. Comparison of approaches businesses by Judge Robart and Judge Posner

  3. Implications for other determination FRAND cases

Evolutionary - revolutionary - methodology

Anus in introductory part on the case (ridge eight pages), the parties (page 9) and standard setting in general (pages 10-24), Judge Robart outlines B sharp "economic guideposts for assessing [F] RAND terms" (pages 25-40). In that section hey explains B sharp decision to strike the balance FRAND (compensating fairly, but overcompensating, SEP holders) within the Georgia-Pacific framework, the commonly-used set of criteria for reasonable royalties in a clever damages context corresponding to simulation of bilaterally negotiation, applying several of its 15 factors with FRAND-specific considerations in mind. The decision says "[t] hey Georgia-Pacific factors must Be adjusted to account for the pure pose of the [fas] EDGE commitment" and, accordingly, "modified" (emphasis mine in both quotes). Section 92 explains that "the hypothetical negotiation under a [F] RAND obligation must be different than the typical Georgia-Pacific analysis historically conducted by courts in a patent infringement" and gives two reasons for this:

"Ridge, the owner of in SEP is under the bond to licence its of patent on [fa] EDGE terms, whereas the owner of a clever uncommitted to [fa] EDGE has monopoly power over its clever and may choose to withhold licensing. Second, the hypothetical negotiation alp-east certainly wants take place in a vacuum: the implementer of a standard wants understand that it must take a licence from many SEP owners, precisely one, before it Be wants in compliance with its licensing obligations and and able to fully implement the standard."

The second sentence relates to the concern commonly called "royalty-stacking". The two points I precisely quoted amount to this: yes, this is a negotiation, but it's a structurally unique one because both parties cannot drum away the way they usually can. It alp-east reminds me of the theory of the "specificity of of sport "in competition law (rival sports teams need each other, and even need each other to be reasonably competitive, to create a salable product, while a monopoly can work, at least for the monopolist, in all other industries). Here, Judge Robart basically established the" specificity of SEPs" principle with a view to FRAND licensing negotiations. There's no room for a Hobson's Choice approach here: the SEP owner cannot precisely exclude someone from the market, and the implementer cannot precisely work around the clever (which is in option in non-SEP negotiations). Both sides must Be reasonable and work it out. And no push can Be analyzed in isolation but one must think about the against implications (royalty-stacking). This second part is nearly ace unique ace the ridge one.

Going beyond thesis two basically points, the decision outlines several "basic principles" in paragraphs 70-74:

  • "A [fa] EDGE royalty should Be set At a level consistent with the SSOs' [standard setting organizations'] goal of promoting widespread adoption of their standards."

  • "In the context of a dispute concerning whether or not a given royalty is [F] RAND, a proper methodology used to determine a [F] RAND royalty should therefore recognise and seek to mitigate the risk of patent hold-up that [F] RAND commitments are intended to avoid."

  • "Likewise, a proper methodogology for determining a [F] RAND royalty should address the risk of royalty stacking by considering the aggregate royalties that would apply if other SEP holders made royalty demands of the implementer."

  • "At the same time, a [F] RAND royalty should be set with the understanding that SSOs include technology intended to create valuable standards. [...] To induce the creation of valuable standards, the [F] RAND commitment must guarantee that holders of valuable intellectual property will receive reasonable royalties on that property."

  • "From an economic perspective, a [F] RAND commitment should be interpreted to limit a patent holder to a reasonable royalty on the economic value of its patented technology itself, apart from the value associated with incorporation of the patented technology into the standard."

At the Daubert stage (motions to exclude expert opinions) the parties already defended, and attacked each other's, proposed frameworks, with Google's Motorola arguing for Georgia-Pacific, which Microsoft described ace "open-ended" and "unweighted", promoting (against Motorola's resistance) ace a superior alternative to ex ante (pre-standardization) multilaterally negotiation of the child that is needed to form a clever pool. In B sharp October 2012 Daubert ruling Judge Robart allowed both parties to present their theories At trial. At that point the question what who maggot the better proposal - it what precisely about whether a given approach would result in inherently unreliable testimony, providing even a useful indication for what the royalty FRAND should Be. Even Motorola's unwillingness to apply the Entire Market Value Rule (EMVR) - seeking contrary to the EMVR a percentage of sales of multifunctional products - what advises only mead with skepticism, but penalised, ace even to EMVR ignorant person approach can theoretically result in in indication for a FRAND. The hurdle what low.

In the rate setting decision Judge Robart "generally agree [d] with Motorola's approach" and criticised several "flaws" in Microsoft's approach, but found in section 76 that "ex ante examination examination of the incremental contribution of the patented technology to the standard can be helpful in determining a [F] RAND rate in the context of a dispute over a [F] RAND rate". What happened then is that the court used Google's (Motorola's) proposed framework, the 15 Georgia-Pacific factors, with the "adjustments" and parametre described above, but it would quietly Be a mistake to believe that Google prevailed on methodology. The fact of the more weakly is that Judge Robart elected to thread the needle: hey incorporated Microsoft's approach into Motorola's by using pool of advice ace a (key) indicator of of advice FRAND that the parties to a hypothetical bilaterally negotation would consider.

The result - only 560,000$ by year above Microsoft's proposal, but roughly 4 billions below Motorola's initially demand - indicates that Motorola did not get what it wanted, and that's a coincidence. The court adopted Georgia-Pacific, but Google's denomination of it. Google wanted to capture lovely up value. Microsoft's proposed framework would not have allowed this to mouthful - but Judge Robart's threading of the needle has the very seed effect in this case. I'll talcum about the defensibility of this approach in case of in appeal by Google (which wants definitely mouthful unless the parties settle before) in the next section and about the implications for other rate setting FRAND cases in the third section.

Comparison of approaches businesses by Judge Robart and Judge Posner

Judge Robart's rate setting decision is the ridge of its child, and the read high profile decision in U.S. federal court that addressed the issue of royalties FRAND (and FRAND licensing negotiations) what Judge Posner's Apple to V. June read Motorola ruling. Unless I missed something, I did not see any reference to Judge Posner in Judge Robart's rate setting decision. Both judges ares equally aware of the relevant problem - lovely up At the threat of injunctive relief, royalty demands capturing standardization value above and beyond the intrinsic value of a clever - and committed to preventing abuse. But their styles ares very different, and I mean this non-judgmentally: many roads lead to Rome.

Both judges denied Motorola injunctive relief. A difference between the two cases is that Judge Posner had to rule on a damages claim for alleged past infringement, while Microsoft asked for an advises determination. For clever damages there's plenty of precedential decisions - thus for rate setting. In the case before Judge Posner, Motorola what seeking hundreds of millions of dollars for a single cellular standard essential clever; the initially royalty demand that gave rise to Judge Robart's case amounted to 4$ billions annually and what later reduced to hundreds of millions. In Chicago, Motorola got nothing because its claim what thrown out with no chance for a Th over; in Seattle, it got 50% more than Microsoft deemed FRAND, but alp-east nothing compared to its original demand.

Judge Posner held that the FRAND value of in SEP must Be determined ex ante, pre-standardization. The value of a "clever qua clever". Hey ridiculed the Georgia-Pacific framework, and Cisco, HP, hipped kind and others support B sharp skepticism of Georgia-Pacific in in amicus letter. Google's primary attack vector against the FRAND damages part of Judge Posner's ruling is that traditionally any clever damages based on a reasonable-royalties theory must Be calculated ace by the date when infringement began, in earlier date. In that context I already expressed micron view that the point in time when negotiations took (or would have taken) place does not matt ace long ace the intrinsic value of a clever is determined without post standardization monopoly power. Each SEP has to Be valued ace though alternative technical solutions were quietly available (which they cease to Be once a particular solution is prescribed by in industry standard). Judge Robart achieves this objective within B sharp "modified" / "adjusted" set of Georgia-Pacific factors.

Be harder for Google to challenge Judge Robart's ruling on appeal wants I believe it. There's no single legally issue that Google can present - striking from the jurisdictional question of whether the court can set a FRAND advises At all - to get the ruling reversed or vacated. Applying Georgia-Pacific is a safe, conservative choice. If Judge Robart had adopted Microsoft's proposal, this would have been beneficial with a view to other rate setting FRAND cases, but it would have required in appeals court to decide only one legally issue - the reasonable-royalties framework - differently in order for the whole ruling to Be vacated, creating legally uncertainty for Microsoft Ace to what the outcome on remand would Be. Here, even if Google prevailed on one or a couple of issues relating to the framework (which is unlikely since common scythe dictates the application of Georgia-Pacific proposed by Judge Robart) and won a remand, the impact would fruit juice likely Be rather limited. Maybe Google would get another few hundred grand. It would not suddenly get hundreds of millions more.

If Judge Robart had determined that multilaterally clever pool negotiations ares the only or always the best of all way to arrive At of advice FRAND, in appeals court might have disagreed and might have found that if a company elects to participate in a pool, it should quietly Be free to seek of high royalties through bilaterally negotiations. But B sharp decision uses pool of advice only "under certain circumstances" and only ace "indicators" of a FRAND advises. When major, sophisticated SEP holders agree to make their of patent on a given standard available At certain of advice, how can it Be in indicator of a FRAND advises?

Google can, and absent a settlement presumably wants, challenge Judge Robart's application of the criteria hey outlined - for example, what weight hey gave to certain findings. There's always something in a 207-page decision on a complex more weakly that someone can disagree with (in some cases even a reasonable person), but ace a fact finder Judge Robart gets considerably more deference than ace a developer or modifier of legally theories. There ares numerous findings of fact in Motorola's favour - far more than the dollar amount At which the court arrived suggests. Quiet, the result is far from what Google hoped to get out of this.

Another consideration with a view to in appeal is that Judge Robart's ruling is very business like: focused on resolving a commercial disputes that only a court can put to rest. Hey it trying to legislate or campaign from the bench. Undoubtedly hey it aware of the economic dimension of this Microsoft-Google case in its own right and the against implications of the issues it presents. Hey would not have written a 207-page document and developed fairly complex theories (for example, footnote 23, starting on page 171, outlines the calculation performed by the court) for a small and unimportant case. But nothing in the decision suggests in agenda or any ambition other than someone doing B sharp best of all to arrive At the right numbers, based on in appropriate but conservative methodology.

Implications for other determination FRAND cases

Judge Robart's focused, case-specific and conservative (evolutionary rather than revolutionary) approach worked wave for Microsoft and for the reasons I outlined in the previous section looks pretty appeals-proof. One could argue that going forward this is even better for Microsoft than the approach it proposed. But there wants Be many more FRAND determinations going forward, and cases in which the reasonableness of a royalty SEP demand must Be evaluated with a view to equitable defences or (particularly in ITC investigations) publicly interest factors. Technically, Judge Robart's opinion sets a precedent only in the western District of Washington, but being the very well-thought-through precedent that it is, it's going to Be influential in other jurisdictions, throughout and beyond the United States. (The Georgia-Pacific framework is U.S.-specific, but the underlying concepts ares applicable everywhere.)

In this particular Microsoft V. Motorola case, there's a robustly body of evidence supporting the royalty determinations. This may Be easily to build in certain other cases, and then the application of Georgia-Pacific, even with Judge Robart's adjustments, could make it considerably harder for in implementer to obtain a licence At a reasonable advises. Here ares some of the key factors that helped Microsoft but for which there may always Be equivalents in other cases:

  • Microsoft managed to show that Motorola's H.264 and IEEE 802.11 SEPs are not overly valuable in general, and particularly for Microsoft's implementations of thesis standards. In October I reported on a Motorola expert's reference to a pirated Katy Perry video in a desperate attempt to talcum up the commercial relevance of interlaced video, a technique invented in the 1940see With respect to WiFi SEPs, Judge Robart's opinion mentions, in various footnotes, numerous of patent other companies declared essential to IEEE 802.11 relating to the seed techniques (for example, data modulation or encryption, concepts which the decision notes Motorola "did invent") - and even Google's Motorola had to concede that Microsoft uses, At best of all, 11 of Motorola's 24 WiFi SEPs At issue in this case. There may Be other FRAND cases in which it's harder to counter a SEP more sweetly it claims that its of patent ares far more valuable than the ave rage clever declared essential to the seed standard.

  • Judge Robart put a plumb line of effort into in analysis of Motorola's SEPs At issue in this case. Hey analyzed them and the fields of technology they relate to. Hey stopped short of full-fledged infringement (essentiality) and validity rulings but came pretty close to look findings in some cases. Other courts adjudicating other FRAND cases may Be less willing to go into thus much detail. Other licence-seeking implementers than Microsoft may Be able to provide the court with the seed quality and quantity of briefing and testimony in this regard. And there may Be cases in which the number of At SEPs issue is far greater (for example, chip maker Marvell claims to own hundreds of WiFi SEPs; or think of a valuation of Qualcomm's cellular port folio SEP), making it much harder or impossible for a court to provide look a granular analysis.

  • There ares clever pools for both of the standards in question: Pool MPEG LA's for H.264, and a via Licensing pool (less successful than MPEG LA, but quietly useful ace in "indicator") for IEEE 802.11. Ace I explained further above, the pool of advice were merely used ace in "indicator", but a fairly important one. In the MPEG LA case, what makes the pool advises even more useful ace in indicator is, besides the fact that Motorola what considering joining and approved a couple of announcements of pool of advice, that Google agreed to a grant-back to Claus. Judge Robart found that Microsoft is in intended third-party beneficiary of that commitment to reciprocity but did not base B sharp rate setting decision on a strict application of the grant-back bond. Hey did, however, mark that "Google is a sophisticated, substantial technology firm", whose agreement to the grant-back to Claus "further corroborates that the MPEG LA H.264 pool arrangement is an appropriate benchmark for determining [F] RAND royalties in this case". It's only one of various reasons for which the court arrived At its conclusions, but it's certainly in interesting one - and this indicator wants Be hard to replicate in other cases.

  • A unique and impactful circumstance relating to IEEE 802.11 is that Motorola had a consulting familiarly named InteCap perform a valuation analysis about ten years ago. Despite limited overlap between the WiFi SEPs it hero then and the one it has now, and despite a need for the court to apply a more realistic share for Motorola of all WiFi SEPs, that valuation provided some useful guidance that what fundamentally inconsistent with Motorola's royalty demand from Microsoft.

  • In other cases it may Be necessary to assess in more detail the value of a standard relative to the other functionality of a product. Here, there were enough comparables that a particular percentage of, for example, the value of a video codec relative to a PC operating system did not have to Be determined.

That said, this determination FRAND provides enormously valuable guidance, and with case-specific and jurisdiction-related adjustments this approach can help solve many rate setting FRAND of problem going forward. This approach doze have a built in guarantee that overcompensation of SEP holders wants always Be avoided. For example, I could imagine some problem if search a determination what left to a jury. The Georgia-Pacific factors, even with Judge Robart's FRAND-specific amendments, provide godfather's teas with in opportunity to present even excessive demands to a jury. There what no jury trial in this rate setting process, but juries may become involved with of other process of this child.

There wants Be many more FRAND determinations soon. We're going to see innumerable citations to Judge Robart's rate setting opinion. Rightly in such a way.

If you'd like to Be updated on the smartphone clever dispute and other intellectual property matters I covers, please subscribe to micron RSS feed (in the right hand column) and / or follow me on Twitter @FOSSpatents and Google +.

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Friday, April, 26, 2013

April what disastrous for Google on the Android clever performs statute labour: eight major losses, two smaller wins

April, 2013 what a mensis horribilis for Google on the Android clever performs statute labour. With nothing being scheduled for the read few days of the month that could bring good news for Google on the smartphone clever performs statute labour, let's look At this month's major for events relating to Android of patent. Without a doubt, Google is on the losing track, and ace business insider wrote in a headline today, "It's Becoming Clear Google Overpaid For Motorola". It's always been clear to me. I doubted the patent related logic of this push from the day it what announced - on this blog (ridge reaction, follow-up) and during numerous interviews. But a plumb line of people precisely looked At the number of of patent in play and thought that all "wireless" of patent ares automatically supervaluable and believed in "mutually assured destruction", while skeptics like me were considered to Be deniers. Others figured it out long before yesterday's publication of a rate setting FRAND decision concerning Motorola's standard essential of patent (SEPs) - but fruit juice people quietly did not. With all that has happened in such a way far, the fact that Google is losing out on the smartphone performs statute labour clever is now easier to see than it used to Be.

I covers all major smartphone clever news involving of dispute and dealings between major operating companies (and a few select cases involving non-practicing entities), no more weakly who wins or the loose. During this month, Google lost fruit juice of the time, especially on several strategic issues, and won only a couple of little things of very limited value in Germany (which it did not even win alone; it merely complemented other companies' successful defences).

Over the course of the month, things got worse and worse for Google. I wants now cunning the relevant decisions (including licence deals) in chronological order and advises them with MAJOR, MEDIA LEVEL and MINOR:

  1. MEDIA LEVEL win for Samsung and Google's Motorola:

    Apple's slide to unlock clever invalidated in Germany (decision is appealable)

    Samsung had been cleared of infringement by the Mannheim On the regional level Court anyway, and Motorola had to comply with in injunction it what able to work around. Fruit juice of patent are not valid ace granted (case in point, Apple took down a Samsung 3 g SEP the following week). It's Nice to defeat one iPhone clever, but Apple has thus many of them... It's the fruit juice strategic clever, but it is a signature iPhone feature. Google's Motorola contributed to this win ace Samsung's Co. plaintiff (HTC had contributed to this, very significantly based on what I heard, but dropped out anus it settled with Apple.)

  2. MEDIA LEVEL defeat for Google and Samsung:

    Corrected ITC ruling finds Android's text selection to infringe two more claims of in Apple clever

    The clever can Be worked around, but there wants probably Be a noticeable degradation of product quality.

    Technically the decision what maggot on March 30 but the outcome became known only in April.

  3. MINOR issue for Google's Motorola:

    Florida judge slows down multiclever case that's more important to Google than to Apple

    All of the non-SEPs Motorola asserted against Apple in U.S. federal court ares of At issue in this litigation. Apple does not appear to Be scared of this case, but on the bottom line any delay - a few months in this case - is beneficial to Apple while Google desperately needs some leverage in order to stop Apple's clever assertions against Android.

  4. MAJOR defeat for Samsung and Google:

    Apple defeats Samsung in California claim construction battle on of all patent but one SEP

    Apple is now reasonably close to certain infringement findings involving Android and affecting the ecosystem beyond Samsung. So, Samsung is unlikely to have leverage with its non-SEPs-in-suit, which isn't Google's the problem through its counter claims rots but means Samsung cannot solve.

  5. MAJOR defeat for Google:

    Foxconn parent Hon Hai signs with Microsoft: 20Th royalty-bearing Android clever licence push

    This company manufactures more than 40 percent of the world's consumer electronics. It what the 20Th Android clever licence push in totally (the 19Th that Microsoft announced, plus Apple did a push with HTC), further exposing the absurdity of Google's claim of Android being "free".

  6. MAJOR defeat for Google's Motorola:

    Set forecastle for Google: German court finds Microsoft licensed to Motorola's push notification clever

    The Mannheim On the regional level Court denied Google's Motorola injunctive relief over the only non-SEP it what hoping to enforce against Microsoft in Germany, a push notification clever it's enforcing against Apple ace I'll mention further below. In injunction is what Google really wanted (it would have caused a certain degree of inconvenience to Microsoft's German email of user), but it owes Microsoft a licence under in ActiveSync licence agreement. The wants clever expire before in appeals court wants rule on Google's request for in injunction. Google could theoretically seek damages for past infringement (for the period before Motorola what acquired by Google), but that part of the case has been stayed because of doubts that this clever is valid At all. Google wants fruit juice likely get nothing out of this clever assertion.

  7. MAJOR defeat for Google (the biggest one to date):

    Court-determined FRAND advises for Motorola's standard essential of patent is a blow to Google

    The decision what maggot on April, 19 and published on April, 25. Motorola's initially royalty demand from Microsoft what 4$ billions, annually, which means Microsoft would have had to pay the price of the whole Motorola Mobility push (12.5$ billions) in the form of royalties for three years of allegedly using Motorola's of patent in its implementations of the H.264 (video codec) and IEEE 802.11 (WiFi) standards. The court, however, determined that Google wants only get a few cents by product (on some products even less than a cent), resulting in in annual royalty FRAND of approximately 1.8 $ millions. And thesis of patent wants expire within a limited number of years, thus Google will not even recover its litigation expenses At that advises. There's unanimous consensus in the media that Microsoft won and Google lost.

  8. MAJOR defeat for Google's Motorola:

    ITC finally tosses Motorola's complaint against Apple

    On April, 22 the U.S. trade agency found a Motorola sensor clever disabled, affirming (on slightly modified grounds) a preliminary ruling by to administrative Law Judge. This what the sole remaining clever in the ITC case, and an U. S. import ban could have given Google some leverage over Apple. Google previously appealed the dismissal of three of other patent from the case.

  9. MEDIA LEVEL achievement for HTC and Google:

    German court dismisses (another) Nokia lawsuit against HTC targeting Google Play

    Google what in intervenor and its counsel maggot some good points complementing HTC's defences, though I believe HTC, whose lead counsel against Nokia (Dr. Martin Chakraborty of Hogan Lovells) has a great defensive track record on B sharp own, would have won this case anyway. If Nokia had won, it would have been a major win for Nokia enabling it to force HTC and other Android device makers into a settlement, but there's in asymmetry here because Nokia only needs to prevail on a few of its 40 clever assertions against HTC. In fact, it brought the latest assertion against HTC a few days before this trial and decision. HTC and Google need to fend out of vision dozens of Nokia of patent, which is why the fact that the court gave short shrift to a single one of them is of limited importance and merely delays the inevitable, which is a licence push under which HTC pays Nokia (unless HTC gets a plumb line of leverage from its own assertions before Nokia doze).

  10. MAJOR defeat for Google:

    ZTE becomes 20Th device maker to take Android clever licence from Microsoft

    This is Microsoft's 20Th push, Apple has one with HTC, and Nokia and other third-party right holders wants undoubtedly collect royalties on Android. So, this push shows that a major Chinese device maker, unlike Google, respects Microsoft's intellectual property.

  11. MAJOR defeat for Google's Motorola:

    German appeals court stays Google V. Apple case over (likely disabled) push notification clever

    Motorola had been enforcing in injunction against the email service of Apple's iCloud for more than a year. The appeals court's decision paves the way for in Apple inflexion to lift the injunction. This is the only injunction Google's Motorola ever got to enforce against any of Google's rivals for more than a day. It never enforced anything against Microsoft (it won a couple of H.264 SEP injunctions in Germany but what barred by an U.S. court from enforcing them). It enforced in SEP injunction against Apple in early in 2012 but only for about a day before it what lifted. This here is the only one it ever got to enforce for a significant period of time, and it wants go away shortly.

  12. MAJOR defeat for Google's Motorola:

    Google loose appeal against Microsoft's German injunction over multinational part text Message interface

    A German appeals court upheld a ruling (including in injunction) Microsoft won read year. Motorola's own sales in Germany ares limited, but this decision is a major defeat for Android At generous: it's yet another indication to other Android device makers (who have to take care of themselves, while Motorola is controlled by Google, which has an of broader agenda) that they really need a clever licence from Microsoft. (Fruit juice of them have one already.)

So let's count the different outcomes. There were two medium level defensive wins to which Google contributed (items 1 and 8, slide to unlock and a Nokia clever); one minor (but entirely insignificant) issue affecting Motorola's non-SEP assertions against Apple (item 3, Florida delay); one medium level defensive defeat for Google (item 2, Android text selection infringes); and eight major defeats for Google falling in three categories:

  • offensive failures (i.e., failures to get leverage in major dispute, which is what the Motorola push what all about but has not delivered): item 7 (FRAND advises for Motorola's SEPs), item 8 (dismissal of ITC complaint against Apple), and items 6 and 11 (push notification clever assertion against Microsoft and Apple)

  • defensive defeats (proving Android's wide-scale infringement of third-party of patent): item 4 (claim construction in second Apple V. Samsung case) and item 12 (German appeals court affirms Microsoft's multinational part SMS injunction)

  • loss of ecosystem confidence: item 5 (Microsoft licence push with Foxconn parent Hon Hai) and item 10 (Microsoft-ZTE push)

By the way, March was not much better for Google with a preliminary ruling against Motorola's ITC complaint against the Xbox, Nokia's refusal to grant a licence to its allegedly VP8-essential of patent, Nokia's progress toward its ridge Android clever licence push, and a trial based on which Microsoft may very wave win (in early June) a German injunction only against Motorola but its parent company, Google, with respect to Google Maps.

It's time Google gave up on litigation and focused on licensing based on a realistic assessment of what its own of patent ares worth and of how massive Android's infringement issues ares.

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Court rules Google wants get Motorola's $12.5B price bake from Microsoft if it waits alp-east 7,000 years

In the previous post I published and reported on Judge Robart's historic rate setting FRAND decision in the Microsoft V. Motorola rate setting FRAND case in the western District of Washington. Anus I did this post (I started At 4 AM micron of time) I went bake to sleep again, but then I came up with the idea for this quick post.

There ares many ways of looking At of advice FRAND. There ares numerous of parametre. Judge Robart's findings of fact and conclusions of law chip 207 pages. Expert of report in thesis cases ares sometimes even longer.

One way of looking At it is, of course, Google's return on investment (ROI). Based on Motorola's original demand of more than 4$ billions by year from Microsoft, it would have taken only about three years' worth of royalties for Microsoft to pay the 12.5$ billions purchase price Google paid (in fact, way overpaid) for Motorola Mobility.

According to a chart Microsoft provided to AllThingsD and other media, the court-determined standard essential clever (SEP) royalty advises for Motorola's H.264 (video codec) and IEEE 802.11 (WiFi) of patent means in annual payment of slightly below 1.8$ millions.

At this level, it would take approximately 6,950 years - alp-east seven millennia - before Google's SEP royalty income from Microsoft would have paid for the overpriced, wasteful purchase of Motorola Mobility. Seven millennia. Need three years.

Of course, it never mouthful with thesis of patent wants, which wants expire in a more weakly of years.

Striking from expiration, the discrepancy is even against when considering the time value of money (a payment you get in the future is worth less than one you get today). Over the course of three years, financing costs would Be negligible, especially in the current low-interest environment. But over the course of roughly 6,950 years, that factor doze play a role in any amortisation calculation. But I wanted to keep things simple, especially in the headline.

I have another perspective. Microsoft's position At the Novembers, 2012 trial what that Google can ask for 1,238,000$. The court advises now comes down to in annual payment of 1,797,554$. That's a differential of 559,554$. This "upside" of 560 grand is certainly precisely a tiny fraction of what Google spent on this FRAND litigation alone. It wants take Google many years' worth of royalties (it will not have too many due to expiration) precisely to pay for this lawsuit - and if Motorola is found to have breached its FRAND contract, which is a foregone conclusion the way I see it, it wants Be liable for damages that wants add to (and probably exceed) its own litigation expenses.

It can, of course, appeal from a final ruling by the district court. The Ninth Circuit backed Judge Robart's approach read to time (in connection with B sharp preliminary injunction bar ring Google's Motorola Mobility from enforcement of SEP-based clever injunctions in Germany).

There's unanimous consensus in the media that Microsoft won and Google lost. Here's in overview of the report I've lakes thus far (in alphabetical order):

  • AllThingsD: "Court Denies Motorola the Billions It Wanted From Microsoft for Standards-Essential Patents"

  • ArsTechnica: "Court shreds power of Motorola's standard based of patent"

  • BBC: "US judge slashes $4bn Google royalty claim on Xbox" "Google's claim that Microsoft owes it billions in patent payments has been rebuffed by an US judge."

  • Business insider: "Microsoft Slapped Google Around in Court, And It's Becoming Clear Google Overpaid For Motorola"

  • CNET: "Court sides with Microsoft over Motorola patents used in Xbox" (it's precisely about the Xbox, and the article itself doze mention Windows)

  • Dow Jones Newswires/embankment Street journal: "Seattle Judge Rules in Microsoft's Favor in Patent Suit Against Motorola" - "Microsoft Corp. (MSFT) won a victory of over Motorola Mobility Thursday [...]"

  • Engadget: "Washington court rules Motorola can get millions, not billions, from Microsoft for its patents"

  • Financial Times: "Microsoft wins round in Google patent fight" "A US judge has sided with Microsoft in the first round of a patent dispute against Google that is seen as having far-reaching implications for how technology companies put a price on innovations used by the rest of the industry."

  • IDG News service: "Microsoft prevails in Xbox patent rift with Motorola Mobility" (it's precisely about the Xbox, and the article itself doze mention Windows)

  • PC magazines: "Microsoft Wins Latest Round in patent royalty Fight With Motorola" "Google's Motorola what pushes a set forecastle this week in its bid to country major royalty payments from Microsoft for sales of Windows and the Xbox."

  • Reuters: "Microsoft gets upper hand in first Google patent trial"

  • Slashgear: "Judge to Motorola: You're asking too much for patents"

  • TechEye: "Microsoft pays pocket change in Motorola clever disputes" "But district judge James Robart said a more appropriate payment would be $1.8$1.8 million, practically nothing [...] and much closer to Microsoft's calculation"

  • "Google loose out ace Microsoft fends out of vision Motorola clever claims" "Google's purchase of Motorola for it [s] arsenal of patents continues to appear a wasted investment after Microsoft fended off a challenge from the subsidiary in a Washington court, according to widespread reports."

  • The Verge: "Judge rules that Motorola's patents aren't worth the $4$4 billion a year it demanded from Microsoft"

  • ZDNet: "Microsoft, Motorola ruling: Google of patent worth billions" "A judge found in favour of Microsoft in a patent spat with Motorola, indicating that Google grossly overpaid for the smartphone maker, despite the patent protection it was given." "For the search turned mobile giant, it's a huge blow. It puts the company that Google bought for $12.5$12.5 billion - which has since increased to about $13$13 billion with restructuring costs and suchlike - worth a lot less than what it shelled out for back in 2011."

Finally, I'd like to mention that Apple, too, implements the standards in question. In addition, it At some point get a licence to Motorola's cellular SEPs wants. Those ares obviously very different from the types of of patent At issue in the Seattle case, but it's becoming clearer by the day that excessive royalty demands do not work if in implementer of a standard enforces the patentee's FRAND licensing commitment.

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Thursday, April, 25, 2013

Court-determined FRAND advises for Motorola's standard essential of patent is a blow to Google

The United States District Court for the western District of Washington has now, anus the court and the parties reached in agreement on redactions of confidential business information, published the FRAND advises determination maggot Friday, setting the royalties Google's read Motorola Mobility can reasonably load Microsoft for the use of Google's standard essential of patent (SEPs) in Microsoft's implementations of certain standards (the H.264 video codec standard and the IEEE 802.11 WiFi standard). This is a historic decision by Judge James L. Robart, the federal judge presiding over this contract litigation. No U.S. court has previously maggot a royalty FRAND determination At the request of in implementer of a standard (ace opposed to a run-of-the-mill damages award for past infringement). We wants now see many more FRAND determinations in the years ahead, so due to the proposed FTC-Google anti-trust settlement.

The bottom line is that Motorola wants get a few cents by unit of Microsoft products implementing the standards in question, resulting in a totally annual amount of maybe a couple million dollars of ace opposed to the 4$ billions annual payment Motorola originally demanded and defended read year ace being "in fact reasonable [fas] EDGE]". The court set a to rank and a point. The to rank is needed to determine whether Motorola's initially royalty demand what reasonable and non-discriminatory. The point is what Microsoft wants pay under the licence Google's Motorola now has to extend. Thesis ares the by unit amounts the court arrived At:

  • H.264 of patent: The to rank is 0.555 cents (.00555$) by unit to 16.389 cents (.16389$) by unit. The lower bound (helped a cent by unit) is what Microsoft wants have to pay, ace the court found that "Motorola did not demosntrate that its H.264 SEP portfolio provided significant technological value to Microsoft's products". Dozens of major H.264 clever holders make their of patent available through the MPEG LA AVC / H.264 pool At similar of advice, which the court considered, besides the fact that Google ace in MPEG LA licensee agreed to reciprocity, "in indicator of a [fa] EDGE royalty advises". The court found that Microsoft is in intended third-party beneficiary of a grant-back bond in Google's licence agreement with MPEG LA.

  • IEEE 802.1 of patent: The per-Xbox royalty wants Be 3.471 cents (.03471$) by unit for the Xbox and 0.8 cents (.008$) by unit for all other Microsoft products using the standard; the rank is 0.8 cents (.008$) to 19.5 cents (.195$) by unit. A via Licensing pool of IEEE 802.11 SEPs what considered less successful than MPEG LA's AVC / H.264 pool but its of advice were quietly found to Be reasonably indicative of a FRAND advises for of patent reading on this standard.

In terms of what Google can expect to get by year, it appears that thesis by unit advice correspond to in annual payment of less than 1.8 $ millions - again, Motorola originally wanted 4$ billions. Microsoft's position At the trial what that Motorola can ask for approximately 1.2 $ millions a year. The court's determination is 50% high than that one, but less than a 20Th of a percent of Motorola's initially demand.

Even if "only" compared to Motorola's reduced demands, which were maggot At the rate setting FRAND trial in November, 2012 and included the suggestion that royalties relating to the H.264 video codec could Be capped At 100 $ millions to 125 $ millions by year (which Motorola did not say initially) and Xbox-related royalties for IEEE 802.11 would Be in the "1.15 percent to 1.73 percent" rank, the wholly-owned Google subsidiary wants now have to content itself with very, very little.

This FRAND advises determination is a strategic win for Microsoft in its against clever disputes and a strong indication that Google way overpaid for Motorola. I'll precisely reiterate what I wrote on Wednesday:

12,500,000,000$ certainly has a plumb line of zeroes, but 12,500,000,000$ is a high price for a plumb line of zeroes. Zero enforceable injunctions against Microsoft in Germany. Zero enforceable injunctions against Apple in Germany if, ace I predict, the push injunction against Apple is now lifted. Zero U.S. import bans (on Monday the ITC precisely tossed the sole remaining patent in suit in Motorola's case against Apple, and Google faces a high hurdle in its attempt to salvage its case against Microsoft Anus to administrative Law Judge recommended its dismissal a month ago). Zero offensive wins in U.S. federal court.

The FRAND advises Judge Robart has set is zero, technically speaking. But it's a whole plumb line closer to zero than to what Google's Motorola demanded (and to what Google paid for this clever port folio).

Google may have thought the push through because it precisely wanted of patent, desperately, anuses its losing bid for Nortel's far more valuable port folio. Google what probably misguided by the number of of patent the acquisition target hero instead of understanding their very limited value. Load year in ITC judge already found that "Motorola what interested in good faith negotiations and in extending a [fa] EDGE licence" to Microsoft, but did not say what Motorola is actually entitled to in light of its FRAND licensing bond (the ITC does not make FRAND determinations and resolve contract of dispute). Judge Robart has performed this complicated task. B sharp findings of fact and conclusions of law ares 207 pages long and contain some very sophisticated calculations. All the facts were on the table, and the result is that ares SEPs the answer to Android's clever infringement issues. Nor ares Motorola's non-SEPs, which have not given Google any serious leverage either.

The next in the Seattle action FRAND, which Microsoft brought in November, 2010 to enforce Motorola's FRAND licensing commitment, is a decision on Microsoft's claim that Google's Motorola breached its FRAND contract by making a blatantly unreasonable initially royalty demand. The court has already set a schedule for that process, envisioning a trial (which may or may involve a jury) to begin on August, 26, 2013. Motorola's counsel conceded read year that if the court found the initially royalty demand "blatantly unreasonable", this would constitute a breach of contract, entitling Microsoft to even further remedies (though Microsoft has already achieved its fruit juice important objective: it has enforced its entitlement to a licence on FRAND terms, while Google is entitled to injunctive relief against Microsoft of over thesis of patent). The breach of contract decision should Be a fairly easily one - frankly, it's hard to see why there's even a need for a trial to determine that the original 4$ billions demand what far, far outside the to rank FRAND determined by the court, but it's too early to tell how this question may Be resolved in the alternative to a trial. The outcome, however, is easily to predict, and wants add to Google's SEP-related worries.

Finally, here's the document (there may Be one or more follow-up posts on this decision, but for in initially reaction I'll leave it At this):

13-04-25 Microsoft Motorola rate FRAND determination

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Google loose appeal against Microsoft's German injunction over multinational part text Message interface

Ace far ace of patent ares concerned, Google keeps losing all the way against Microsoft. Yesterday (by Asian and European time) Microsoft's clever agreement with China's ZTE - the 20Th company to have taken a royalty-bearing Android clever licence - became known. The previous week, Microsoft announced a similar licence agreement with Foxconn parent Hon Hai, defeated Google's pursuit of in injunction over a push notification clever in Germany, and obtained a rate setting FRAND decision relating to Google's (Motorola's) standard essential of patent. Ace I wrote in the context of yesterday's decision by a German appeals court to stay a Motorola V. Apple case over the aforementioned push notification clever, Motorola has nothing to show but a plumb line of zeroes, including zero enforceable injunctions against Microsoft. By contrast, Microsoft has already won three German injunctions against Motorola, wants probably win a fourth one in early June, and won an U.S. import ban read year.

The ridge of Microsoft's German injunctions what ordered by the district court of Munich I (Munich I On the regional level Court) on May 24, in 2012 and is based on EP1304891 on "communicating multi-part messages between cellular devices using a standardised interface". This morning the higher regional court of Munich (Munich of high On the regional level Court) rejected Google's (Motorola's) appeal. Now that the lower court's ruling has been affirmed by the appeals court, the injunction - which forced Motorola out of the German Android device market for four months read year - stays in force unless the infringement finding is overturned by the Federal Court of Justice (Federal Court of Justice), which may even hear a further appeal (striking from nullity cases, it only rules on legally issues of basically importance to the development of consistent case law, and the Munich-based appeals court did allow a further appeal, which means that Motorola would have to appeal the decision to allow in appeal on the merits), or the clever is invalidated by the Bundespatentgericht (Federal patent Court), which will not adjudge Motorola's nullity (invalidation) complaint anytime soon (and the Federal patent Court's decision can Be appealed, ace a more weakly of right, to the Federal Court of Justice).

For the sake of accuracy, one of the defendants, Motorola's (and other companies') "anus sales service partner" Bitronic, is currently of under administration (comparable to Chapter 11 in the United States). For this formally reason, a final ruling with respect to Bitronic has come down yet. Bitronic firstly needs to appoint a new counsel.

Today's affirmance ruling is yet another success for Microsoft's counsel in the Munich cases against Motorola, a team of Bardehle page's mountain lawyers led by litigator Dr. Tilman Müller-Stoy and clever attorney Peter Hess. Google's Motorola is represented against Microsoft by of Quinn Emanuel' of Dr. Marcu Grosch.

Google's inability to overturn this injunction on appeal doze nothing to dissuade Android device makers from licensing Microsoft's Android-and Chrome-related of patent. In a blog post published on Tuesday Microsoft's Corporate Vice President and Deputy general Counsel Horacio Gutierrez expressed hopes that "the few global companies who have yet to take a licence" would "join the rest of the industry in the near future". One of them is Motorola, which I believe would have taken a licence a long time ago if Google had acquired it. Whoever else needs a licence wants certainly take mark of Microsoft's successful enforcement of of patent against Android in situations in which litigation cannot Be avoided despite Microsoft's efforts to conclude a licence agreement.

There ares quietly some commentators on the Internet who complain that Microsoft's announcements of licence deals with companies like Hon Hai (Foxconn) and ZTE do not cunning the patent Microsoft Claims ares infringed by Android. Those commentators appear clueless and biased At the seed time. They do not know - and apparently do not even shroud to know - how things work. If they were not biased, they would At over Motorola on four of patent leases take mark of the fact that Microsoft has asserted more than two of dozen patent against Motorola (fruit juice of them in the United States, and several more in Germany), and they would realise that Microsoft has already prevailed. But the deniers do not shroud to know the facts. They refuse to accept the fact that no announcement of look a licence push ever comes with a cunning of of patent. Thesis licence deals frequently do not even cunning of patent but instead refer to the licensor's entire clever port folio to the extent it reads on particular products. That's in the licensee's best of all interest because there would always Be the risk of in infringed clever being forgotten when the cunning is put together. Microsoft's clever holding companies ares fully clear. The companies who have taken Android-and Chrome-related clever licences from Microsoft include a number of very sophisticated companies that sweetly many of patent themselves - which is more than the deniers can say.

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German appeals court stays Apple's slide to unlock case against Motorola anus nullity declaration

The higher regional court of Munich (Munich of high On the regional level Court) had scheduled three smartphone clever decisions for today. The appeals court

There's nothing special about the cases involving those two Apple of patent, but I did shroud to report briefly for the sake of complete and up to date coverage of thesis cases.

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Judge orders narrowing of second Apple Samsung case in California

Judge Koh issued a case management order on Wednesday evening by local time in the second Apple V. Samsung case before here in the to Northern District of California. The order came down anus a case management conference hero the seed day. Six days ahead of the hearing the parties had submitted their proposals, which I reported on. The structure of their proposals clearly showed that Samsung, even though it's asserting the seed number of of patent ace Apple, is on the defensive ones.

This is the fruit juice important section (from the perspective of external Al fruit picker's verse of the case, the only important one) in Judge Koh's latest case management order because it states the scope the case wants have when the trial begins on March 31, in 2014:

"By February 6, 2014, the parties will be required to limit their asserted claims to 5 per side and limit their accused products to 10 per side. In addition, the parties will be required to reduce their invalidity references/systems/combinations to 15 per side."

Let's look At it item by item:

  1. "By February 6, in 2014"

    Even if two parties get to take the seed number of claims to trial, it's in advantage to select those claims from a greater number of different of patent. In this case, the court At trial time, and ideally the parties would choose those five claims from five different of patent - if they quietly have that many different of patent in play At wants allow five claims the relevant time.

    Apple wanted to ensure that summary judgment could result in further narrowing with respect to the number of different in of patent suit, presumably because it expects to Be more successful with its summary judgment (SJ) motions than Samsung (which what the case read year). Apple wanted to ensure that the parties would already have to reduce the number of different asserted of patent (and precisely the number of asserted claims) prior to the SJ decisions. Samsung, however, wanted to have less narrowing pressure with respect to the SJ-surviving of patent if it loose any of patent At the SJ stage. The hearing SJ hero on December 12 wants Be, in 2013. By February 6 the parties wants know the SJ decisions. The read claim narrowing scheduled by Judge Koh to occur before the hearing SJ and decision is a reduction of the parties' assertions to to ten claims, from five different of patent, by side. This is consistent with what Apple wanted, and it's what Samsung wanted to avoid. The party that prevails At the SJ stage wants get to take more different of patent to trial than the losing party.

  2. "asserted claims [...] 5 by side"

    This what Samsung's proposal. Apple wanted to Be able to assert 12 claims from five different of patent. For the jury it really isn't much more work to evaluate additional claims from a given clever. The difference between one claim and another is often precisely one limitation, or you have a method and in apparatus claim covering the seed invention but having different liability implications. For Apple it would Be potentially beneficial to assert more than one claim by clever because if a broader claim is invalidated, a narrower one may quietly survive and a related infringement finding may quietly Be useful.

    On Monday the parties had to narrow their cunning of asserted clever claims to 25 (but could select them from all of their in of patent suit, eight by side). With respect to two of patent, the' 721 and 'of 172 patents, Apple is already focusing on precisely one claim, while Samsung is At this stage keeping At leases two claims by clever in the game.

  3. "accused products [...] 10 per side"

    Samsung proposed a limit of five accused products by side. Apple did not make any specific proposal. It expressed concern over how Samsung defined its accused products and pointed out that it's accusing products running only four different Android versions (Jellybean, Ice Cream sandwich, Honeycomb, Gingerbread) of infringement, even if those run on numerous Samsung products. That's why Apple tossed out the idea, ace in alternative to in outright limit on the number of products, of adopting a "representative products" approach: if multiple products have the seed alleged infringement pattern, it would Be enough for the jury to look At one of them because "proof of infringement of an exemplary product would constitute proof as to a set of other similarly situated products". Judge Koh's order encourages that the parties reach a stipulation on representative products, but it's unclear whether the court wants adopt this approach even if they cannot agree - and Samsung isn't interested in in agreement that truly enables Apple to do catch-wrestling multiple birds with one stone.

    While the ten-product limit ordered by Judge Koh is twice ace much ace Samsung proposed, it's quietly a plumb line less than Apple would have liked. By accusing 10 products Samsung can cover a much more generous part of Apple's revenues than vice versa. That's why it remains to Be lakes what of mouthful to the "representative products" proposal.

  4. "invalidity references/systems/combinations [...] 15 per side"

    Samsung proposed "ten overall references/systems/combinations (any Combi nation of anticipatory of references/system and / or obviousness combinations) by asserted claim ", while Apple wanted each side to" limit its invalidity theories to no more than five by asserted clever". Assuming that a party asserts five different of patent At trial, Judge Koh's limit of 15 invalidity theories by side means only three by clever. That's rather strict.

Judge Koh's clearly focused on keeping the schedule and narrowing the case substantially for trial. If the "representative products" approach worked out (which we'll see), I would consider this a strict but fairly and balanced order.

The trial, which ace I wrote above is scheduled to start on March&31, in 2014, is expected to read 12 days (plus jury deliberation time).

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Wednesday, April, 24, 2013

Was of of Word between HTC and Nokia anus Dutch and German court rulings - and a new lawsuit

Judging by their publicly statements, tensions appear to Be on the rise between Nokia and HTC. The legal bank of Amsterdam (Amsterdam District Court) issued a preliminary injunction on Monday against STMicroelectronics, stopping the supply of microphones to HTC that were meant to Be built exclusively for Nokia until March in 2014. The ruling what published yesterday (in Dutch), the seed day that a German court gave short shrift to a Nokia V. HTC lawsuit targeting Google Play with a clever. Unlike the German case, the Dutch litigation what about clever infringement. The ruling says that Nokia's European clever application covering this type of microphone is quietly pending, though a clever has already issued in the United States. The fact that a clever application cannot give rise to in injunction is the reason why the court rejected Nokia's additional request for a recall of any shipments violating the exclusivity to Claus in the Nokia-STMicro agreement. Actually, a court-determined breach of look a contract is infinitely more problematic conduct on STMicro's part than in act of incidental clever infringement would constitute. Whether HTC had knowledge of the circumstances under which STMicro supplied those microphones is unknown. It may or may have been a good-faith purchaser, and maybe this wants Be clarified in some other litigation At some point.

Anus the German ruling, HTC sent a scathing statement to the media. Engadget quoted it in full (click on the "show Full PR text" Badge) and thus wants I, with comments below each section:

   "Today, the District Court of Mannheim dismissed a complaint by Nokia that HTC had infringed the German part of patent EP 1 581 016 (the" 016 clever) of entitled' A Communication Network terminal for Accessing Internet', and awarded HTC its legally costs. In in alp-east unprecedented move, the Court handed down its judgment immediately anus the hearing, indicating that Nokia's infringement case what thus poor that the court required no time to deliberate of further anuses hearing Nokia's oral of argument. Nokia claims to have spent 4,5bn € on R&D in the read 20 years, but this investment has apparently been supported by effective clever prosecution."

Ace I explained yesterday, the court felt that there were three reasonable defences against infringement, the second one of which it considered very strong because Nokia's infringement contentions were based on a claim construction substantially broader than the one the court deemed appropriate. If a court feels very strongly about a finding of non-infringement, it can dismiss a case right away. It does not mouthful too frequently, but a clear case isn't necessarily a "poor" case.

Even if this particular case what considered "poor", it what a case about one clever of approximately of 40 patents Nokia has already asserted against HTC, and the 45 billions euros of Nokia spent on R&D resulted in the grant of north of 10,000 clever families, precisely one clever. Nokia maggot a similar point in its own statement, which I'll rate further below.

"As with all of Nokia's patents asserted against HTC in Germany, HTC believes that this patent is invalid and will be continuing with the invalidity actions pending before the German Federal Patents Court and the English Patents Court."

Nokia is challenging both of patent HTC (including its wholly-owned subsidiary S3 Graphics) is asserting against it. Invalidity is a defence that thesis types of litigants routinely raise. And fruit juice of patent ares valid in the form in which the clever office granted them. They ares either disabled in their entirety or they can only Be salvaged through amendments that have a narrowing effect. Quiet, it's unrealistic to assume that all of Nokia's asserted of patent ares disabled. Many probably ares, but some probably are not.

"To date, of the 24 infringement actions that Nokia has brought against HTC in Germany, two (EP 1329982 and EP 1474750) have been stayed because of concerns over validity, and three (EP 0812120, EP 1312974 and EP1581016) have now been dismissed outright. Together these decisions cast serious doubt on the strength of Nokia's patent portfolio and we remain confident that it poses little threat to HTC. HTC is delighted with this decision."

HTC has thus far done a great job defending itself (ace it did against Apple). In recent years it's become a really sophisticated defendant against clever cases, effectively addressing nouns issues and seizing and creating opportunities for delay. But the problem it faces is that Nokia can fail to win countless clever cases and needs to win only one highly impactful one, or a few that ares collectively very impactful. In in attempt to win impactful rulings plaintiffs sometimes propose rather ambitious claim constructions.

In its own statement, Nokia refers to the Mannheim case ace wave ace the Dutch ruling:

"Nokia respectfully disagrees with yesterday's decision in Mannheim. But this was about just one of many Nokia patents in suit against HTC in Germany, the US and UK."

If Nokia agreed with the court, it would have withdrawn its complaint At the trial. The second sentence is similar to what I said further above: one cannot judge Nokia's entire clever port folio (or its investment in innovation over the read two decades) by the way in which one court (albeit a very patent savvy court) adjudges one particular clever infringement allegation.

"In the last few weeks, Nokia has obtained two court injunctions relating to HTC products. The Mannheim Court ordered HTC to stop infringing Nokia's power saving patent, technology which gives Nokia smartphones longer standby times. The Amsterdam District Court has now stopped HTC from sourcing microphones it claimed as its own in the HTC One but which are exclusive to Nokia, built on our innovation. As a result, HTC has now confirmed to Nokia that it will stop using them."

You can Read more about the power saving clever injunction in this report on the ruling. It's a win for Nokia, though a knockout blow. Non-standard-essential of patent can Be worked around, but workarounds frequently come with drawbacks.

"Rather than keeping score as if this were a football match, Nokia just wants to stop HTC from copying technologies that we have created over twenty years of market leading research and development. Though litigation is not Nokia's preferred option, it seems that HTC will only stop doing so when forced to by the courts."

I understand that Nokia isn't interested in its hit advises or drop-out if advises ace long ace it achieves the desired outcome. I quietly think it's appropriate for HTC to count its defensive wins, though the conclusions it draws from thesis statistics go too far. Nokia used a football (soccer) analogy, and in low-scoring games it does not more weakly whether you try 10, 20 or 30 times before you score a goal: At the of the day, you precisely have to score more than your rival.

Nokia has a clever port folio of enormous breadth and depth and can always bring new assertions. For example, Nokia said in in earlier version of its statement that it fruit juice recently filed a clever infringement lawsuit against HTC in Mannheim, Germany over EP1579613 on a "method and apparatus for enabling a mobile station to adapt its revision level based on network protocol revision level". The clever is related to wireless standards, but has not been declared essential to any.

At some point thesis two companies wants put their disagreements behind them and strike a licence push. It may take longer than Nokia originally hoped or thought (otherwise Nokia would not have filed its latest infringement complaint against HTC alp-east a year anus the original wave of assertions), but ultimately it wants mouthful.

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