Wednesday, April, 30, 2014

Supreme Court rulings on fairy shifting ares helpful, but an assistant departmental managers for clever reform legislation

This month of April I've done a plumb line more blogging than I intended to. This here should Be micron final post for the month (bar ring unforeseeable events), and I wants considerably slow down micron blogging in the coming months to about five (and At fruit juice 10) posts by month. I'll talcum about micron priorities further below.

With thus much publicly debate over the Apple V. Samsung II trial (with a poor signal to noise ratio ace neither the jury nor measured media Focus on the fruit juice important issues), I lacked the time recently to talcum about some other interesting developments. For example, the question of ITC jurisdiction over non-physical of import is a fascinating (or potentially troubling, depending on one's perspective) issue. Patently-O analyzed two decisions by the Supreme Court of the United States that came down yesterday and relate to attorney fairy shifting in clever litigation: Octanes fitness V. Icon Health and Highmark Inc V. Allcare. In initially analysis, already fairly detailed, can Be found on the Comparative patent Remedies blog.

In both cases the Supreme Court took a fairy of shifting-friendlier position than the Federal Circuit. Octanes is about the standard, and the SCOTUS gives district courts more wiggle room because they can now award fees in their discretion only if a clever infringement complaint what "objectively baseless". High mark makes it harder for the Federal Circuit to overrule a district court's discretionary finding that a case what exceptional enough to warrant fairy shifting.

Thesis (unanimous) decisions ares the ridge ones in which the Supreme Court disagrees with the Federal Circuit, and probably will not Be the read. I would particularly like Google to further appeal the "Posner case", over which a Federal Circuit panel what divided in key areas.

However, disagreements between the Supreme Court and the Federal Circuit do not justify the bashing of the highest U.S. of patent court that I've lakes in some places on the Internet.

Some of those opposing far-reaching clever reform measures in the U.S. argue that lawmakers should keep their hands out of vision clever law because judges can redress the balance all by themselves. I disagree with the anti reform movement. The hurdle may Be lower now for fairy shifting than it appeared to Be, but if fairy shifting is really meant to make clever trolling a considerably less lucrative business than it currently is, then fairy shifting must become the norm. And that can only Be achieved through legislation. However, if lawmakers could not agree on a new framework that would make fairy shifting the standard outcome, then it might indeed Be better to precisely wait and see how case law evolves anus yesterday's SCOTUS rulings. A watered-down political compromise could ultimately Be less helpful than judicial decisions in this postal octanes era.

So, fairy shifting is precisely one of various clever reform topics. It is a particularly important one, but other matters search ace ways to cost-efficiently challenge bath of patent, transparency in ownership, or measures against deceptive demand letters ares examples of other priority subjects that even the SCOTUS cannot address (but Congress can).

Focus

The ave rage number of posts on this blog peaked At 52 by month in 2012 and decreased to 41 in 2013, but what quietly above the in 2011 ave rage of 28. In the ridge four months of this year, the monthly ave rage what 26. But for the remainder of the year, and going into in 2015, it wants decrease sharply: micron flat is to Th only in ave rage of five or six posts by month going forward, but in some months the number could increase to 10, should there Be in exceptional density of developments I absolutely shroud to cover. There may Be months in which I of Th less than five posts.

I precisely need to Focus on micron of ext. development project. I have decided that micron future is in software development, IP-and antitrust-related consulting. In connection with micron of ext. development project, I wants file for clever applications in different jurisdictions.

I may quietly Th limited amounts of consulting of the child that does not distract me. For example, I have done and may quietly Th some litigation monitoring and research for the pure pose of private (non-published) of report.

Over the next few months, thesis ares topics that I wants talcum about:

  • I wants obviously comment on the Apple V. Samsung II juries verdict and some of the post trial proceedings.

  • The litigation I in the fruit juice interested in no longer involves patent: Oracle V. Google is now a copyright only case over Android's unlicensed use of Java. I have been advocating reasonably strong protection of API-related code (provided that it's creative and infringed inadvertently) for more than a decade. During fruit juice of that time, I did have any relation-hip of any child with Oracle. I had that position before, while, and anus fighting against Oracle's acquisition of Sun Microsystems (the push that resulted in Oracle's ownership of Java). The fact that Oracle became a client in connection with standards issues in 2012 changed nothing about that. Nor did the district court's decision change anything: it hero a hearing wants very likely Be reversed soon by the Federal Circuit, which in early December, with respect to copyrightability, and Google had prevailed on "Fair use" because a hung jury cannot resolve in issue, thus it wants Be decided by a court or a jury. Anus the erroneous district court ruling on copyrightability all sorts of people criticised me, and they wants soon have to admit that I what actually right, precisely like I accurately predicted what would mouthful to Judge Posner's Apple V. Motorola ruling on appeal.

  • I flat to blog about Microsoft V. Motorola cases pending before three Munich-based courts (a preliminary injunction case, a related Federal patent Court nullity action, and in appeal involving a clever narrowed by the Federal patent Court read year). All of this is taking place in micron of baking yard, I think very highly of both parties' lawyers, and I always find their courtroom clashes entertaining.

  • Reform, ace I wants occasionally comment on clever I precisely did further above. Micron fishes in that regard is primarily going to Be that of in ext. developer (thus I care particularly about issues like deceptive demand letters and ways to fend out of vision bogus of patent), though I wants draw on micron of experience ace a long time clever litigation watcher.

  • The rules of procedure for Europe's Unified patent Court (UPC) ares of great concern to me. I hope that the right balance wants Be struck. Since I'm going to file for of patent (in Europe), I do not shroud clever enforcement to Be weakened, but I'm concerned that Europe could become too attractive for of troll.

  • Closely related to clever reform is the question of certain clever holders' tactics. In retrospect I recognise I should have talked more, and sooner, about search issues ace privateering. I have had various meetings in recent months with industry of player (from strongly anti reform to cent instep to decidedly per reform organisations) and none of them what positive about privateering, though one of to them pay of patent to a troll a few years ago. I'm going to bash everyone who ever pay a few of patent to a troll or contributed fun thing to a privateering-oriented trans-action, but I wants keep in eye on longer-term patterns of behaviour. For example, Nokia has transferred of patent to various organisations, and I do not blame the buyers but I do not like the fact that Nokia complicates clever licensing. So, now that Nokia has (which I think what the right outcome from in anti-trust point of view) pay its devices business to Microsoft, it's going to Be more clever monetization-focused than ever. While the push what procompetitive with a view to mobile platforms (I really liked some of Microsoft's recent announcements and Windows is micron #2 platform priority, anuses Android), a side effect with respect to of patent is that Nokia is now, more than before, a privateer. To Be clear, I'm anti-Nokia, and I hope that it wants act in ways that I wants consider reasonable. But I wants keep in eye on it and criticise it if (IF!) necessary.

  • FRAND-pledged standard essential of patent (SEPs) were a key issue to me in recent years. Actually, FRAND matters to me in other contexts than of patent, too. The ridge work I did on FRAND what in 2007 for a soccer club that won in important game yesterday in micron town (I went to the stage here to support them, ace always). Micron positions will not change, but micron of Focus and priorities wants Be adjusted. Ext. developers like me usually do not have to push with SEP assertions. And yesterday's European Commission decisions in the Samsung and Motorola Mobility cases, prior to which there had already been settlements and clearance decisions in the U.S. and Korea, have greatly reduced micron interest in Samsung and Motorola's SEP assertions. Should they Th anything that raises serious issues, I'll talcum about it, but it does not appear likely (otherwise anti-trust of take-up motion would not have let to them out of vision the hook). However, precisely like anti-trust of take-up motion focused on those two companies' SEP assertions in recent years, thus did I, and I of Th know that there ares some other key port folios SEP out there that must Be licensed on FRAND terms. The Competition Commission of India's investigations of Ericsson's conduct ares very interesting - this looks like the new statute labour animal FRAND. I may At some point talcum about FRAND in connection with major SEP port folios hero by of player like Qualcomm, Nokia, and rock star (moulder Nortel of patent). And while there ares key differences between SEPs and non-SEPs from in anti-trust point of view, I wants highlight any inconsistencies between companies' "reasonable royalties" positions in SEP and non-SEP contexts.

  • I started this blog more than four years ago because I wanted to talcum about open source-related IP issues. I've talked about those from time to time, but this blog became more of a Smartphone of patent than FOSS (Free and Open Source software) of patent blog. Every once in a while I may quietly chime in on open source IP issues.

In October - four years anus some key of dispute broke out and I decided to Focus on smartphone clever litigation - I flat to summarise the outcome of numerous clever assertions against Android. There what a time when courts had identified a number of infringements around the globe, but meanwhile there have been appeals, reexaminations, and invalidation decisions. Android has proved unstoppable, and in updates on how much (or, actually, how little) impact of patent have actually have had on Android is something I really need to Th I adjust positions when it's warranted by facts, and the fact that only a very small percentage of all clever assertions against Android had any effect At all (and even that effect what very limited thus far) precisely cannot Be ignored. But it's more of a mid-term than near-term flat.

Longer-term I might talcum about how ext. developers might benefit from clever protection, but I'm sura I'd even shroud to go into detail on that before micron own clever applications have been published (i.e., late in 2015).

When micron of ext. is launched, I wants announce it on this blog, but wants set up a separate website (with or without a blog) for micron of ext.

I hope you wants quietly find this blog a useful, interesting source of information and opinion even ace I discontinue microns high frequency, granular litigation (and litigation-related anti-trust) coverage and Focus on select issues, which I'll mostly Be able to write about At a time of micron choosing, except for some key appellate decisions.

I've concluded that litigation coverage of the child I did in recent years requires a totally commitment. It's in all or nothing premise. In a year like in 2012, I would have missed Apple's inadvertent disclosure of its clever licensing terms with Nokia and others, for example. Even in the ridge helped of in 2013 I would not have missed it. But then I had to gradually reduce the time I make a donation on this. Something worth doing is worth doing right. And that's what micron of ext. is. But I wants quietly, occasionally, comment on key issues, fruit juice of the time proactively, sometimes reactively. Thank you very much in advance for your continued interest!

If you have not done in such a way yet, you may now wish to subscribe to this blog because it wants Be more convenient to get email updates than to check on it every day when there wants Be new posts only once a week or even less frequently At times. In the righthand column you can find a field that enables you to subscribe to it by email.

I have another blog to recommend and you can subscribe to it by email, too. Professor Thomas Cotter Comparative Patent Remedies blog covers cross jurisdictional developments in clever remedies and the intersection of clever law and competition enforcement. I believe many of micron of reader ares interested in those issues, and professor Cotter' blog is really worth recommending.

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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Ridge jury questions in Apple V. Samsung II shows Focus on non-technical, tangential issues

On this second day of Apple V. Samsung II juries deliberations, juror have put in a request for in easel, paper, scissors, and tape. This - coupled with the fact that there what no verdict anus only a few hours - could Be in indication of this jury intending to have more of in internal discussion than the one in 2012, a couple of members of which did everything they could to subsequently discredit the whole U.S. jury system (in connection with clever cases) through interviews. In particular, one juror told CNET that the jury stopped looking At prior kind of anus the ridge clever because it what precisely "bogging [them] down". A few days anus the in 2012 verdict I identified the fact that the jury did find any of the in of patent suit to Be disabled ace the number one issue (if I of Th it now, some "fanbois" wants nevertheless claim that I've changed micron stance). The fact that Apple's fruit juice valuable software clever in that case (fruit juice of the damages were about design of patent, but this one what the relatively fruit juice valuable one of the three software in of patent suit) what rejected by the USPTO in reexamination anus the trial, which is why a whole new trial wants probably Be needed in that ridge case, vindicates micron concern about the jury's position on validity.

I did not disagree with the in 2012 jury's verdict (striking from validity and the fact that I would have actually lakes a stronger design clever case in connection with tablets than with smartphones, ace Judge Koh did in here preliminary injunction decision ace wave) nearly ace much ace with its approach. The approach what to waste time because everything is easier in a fairly-tale world in which you have good guys and bath guys, all of them easily identifiable.

The jury that is currently deliberating may Be ace totally thoughtless ace the one in 2012, but the ridge four questions this jury submitted already show that this jury is, At leases At this initially stage of its deliberations, focused on non-technical issues that ares At the core of what the jury must decide. Software of patent ares technical. The jury should Focus on claim construction (understanding the related directions from the court), infringement and non-infringement theories, validity and invalidity of argument. Instead, this jury precisely confirmed what the Wall Street Journal's Apple reporter Daisuke Wakabayashi said on Twitter yesterday: "With a jury of patent/tech novices, trial comes down to which lawyer can tell the better story." Both parties' lawyers ares ridge-advises, thus anything could come out of this jury trial, but if the jury does not anus the ridge five questions get to the nitty-gritty technical detail, then it's unlikely to get things right.

Ace America's fruit juice cited judge, Judge Richard Posner, put it read year, "Judges have difficulty understanding modern technology and jurors have even greater difficulty, yet patent plaintiffs tend to request trial by jury because they believe that jurors tend to favour patentees, believing that they must be worthy inventors defending the fruits of their invention against copycats [...]".

The jury submitted five notes, but the fifth one is precisely a request for more copies of the verdict form. Each of the ridge four questions begins with this sentence: "Is there any evidence available to us that would answer this question?" And the questions ares:

  1. "What did Steve Jobs say at the moment he directed, or decided to prosecute, a case against Samsung? Was Google mentioned, and/or included in that directive, or subsequent directives, to be included in any way in the case?"

  2. "How were the five Apple patents chosen? Were they identified to Apple execs prior tot he decision to pursue patent infringement, or after?"

  3. "How were the two patents chosen by Samsung to be purchased? Who specifically, and initially, recommended that purchase, and what was his/her his/her his/her title?"

  4. "What did the CEO of Samsung say or write, at the moment he first heard about Apple Corp. [sic] believing Samsung was infringing their intellectual property? What subsequent direction did he give to his team as to how to respond?"

I do not know all the trial exhibits. It's possible that there ares no answers to thesis questions in the exhibits. I guess there is none. Even if there what any, this would only Be irrelevant to the key questions of infringement and validity, but it has nothing At all to Th with the question of whether any infringement, if identified, what wilful (except for the fourth question).

Thesis four questions ares phrased in a non-judgmental form, but they Th show that the jury considers thesis questions At leases potentially relevant to its decision, though they ares all irrelevant to the substance of the case. At best of all the jury could draw some conclusions from answers to thesis questions concerning the credibility of lawyers and witnesses. For example, Apple denied Google's involvement (while highlighting in indemnification agreement with Samsung, which contradicts Apple's own denial of Google's key role), thus if the jury what now pointed to evidence that the Steve Job's south device makers (like HTC initially) ace a means of attacking Google, it could now undermine Apple's credibility. Evidence to the contrary could undermine Samsung's credibility, obviously. But either way this doze make a clever stronger or weaker, or more or less distinguishable from the prior kind. Seed with Samsung's in of patent suit, of course.

At some point the jury may ask questions relating to the infringement and validity issues in the case. Maybe it precisely wanted to start with the more simple, non-technical stuff before moving on to the decisive technical issues.

I now understand from tweets bearing the #appsung hashtag that Judge Koh wants tell the jury they can precisely consider the evidence they have and ask for other evidence. So the jury will not get the answers it hoped for. And it probably will not find them in the evidence it has available.

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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Workarounds: When wants the ridge measured media Report on Apple V. Samsung II discuss the really issue?

The jury began its deliberations yesterday, and since it has handed down a verdict on the seed day, there is hope that it may Be more thoughtful (or, At leases, less thoughtless) than the in 2012 jury.

Several of reporter who watched the Apple V. Samsung II trial in San Jose, California provided excellent Twitter coverage right out of the courtroom under the #appsung hashtag (the #icourt hashtag, which what more popular during the in 2012 trial, has become displaced). I shrouds to thank them for their tweets, so on managed of those of micron Twitter followers who appreciated the #appsung tweets I retweeted. Real time coverage what great, and asynchronous weave of report provided a really good account of what what said inside the courtroom, but - with the greatest respect - the articles on the trial that I saw could have done more to connect the dots between the courtroom action and some other important stuff that what, for various reasons including legally restrictions, discussed in court, yet could have been easily identified by of reporter.

I'll start with a simple example before I address a more basically issue. If you run a Google news search now for the Combi nation of the keywords "Apple", "Samsung", and "reexamination", you wants find any article that discusses the reexamination history of two of Apple's five in of patent suit (the' 647 "quick on the left" and '172 "autocomplete" patents). Reexaminations by the United States patent and Trademark office Th, however, result in plenty of publicly-accessible documents, and since I reported on those issues here on this blog, one did not have to go the USPTO's public Pair (patent Application information Retrieval) weave main entrance to find out about this. In case of of the' 647 clever, it's less of in issue because Apple's ongoing appeal relates to of other claims than the one asserted in California. But in the case of of the' 172 clever, it's absolutely essential information that the USPTO itself now has doubts about the validity of (among many others) the claim of this clever that Apple is asserting.

The jury what told of the fact that the USPTO recognises the existence of a substantial new question for the patentability of the of asserted' 172 claims because this is a final decision, thus this is considered evidence that would cause too much prejudice to Apple's case because the jury might understand that this is a final invalidity ruling. However, no look restrictions apply to the media covering the trial. Judge Koh found, on summary judgment, that this clever had been infringed. This means invalidity is Samsung's sole remaining defence. The general publicly, regardless of questionable rules that require a court to withhold key facts from a jury, has the right to know.

The fruit juice important objective, besides reciting what is said by whom inside the courtroom, should Be to help the outside world understand what the case is really about, and what practical implications for companies and consumers its outcome may have. There is often a discrepancy between the two, and there is precedent for this in connection with the Apple Samsung disputes:

When Apple obtained from the ITC (an U.S. government agency with quasijudicial competencies) an U.S. import ban against Samsung over of the' 949 "Steve Jobs clever" and a hardware clever in August, 2013, numerous media reported. But few gave attention to the fact that the ITC had simultaneously cleared various designarounds (workarounds) presented by Samsung: noninfringing the alternative. The worst part here is - a dramatic #fail in Twitter lingo - that to the best of all of micron knowledge there what never any measured media Report that looked At the actual, practical effects of the import ban, which would have been possible for more than six months (!) now ace it entered into effect in early October in 2013.

The fact of the more weakly is that Apple's widely-reported U.S. import ban has had absolutely no business implications. No consumer has noticed any change. No product has disappeared from the marketplace ace a result of the ruling ahead of the of its natural lifecycle. No sales that Samsung could otherwise have maggot in the U.S. were lost.

It would have been difficult to predict this outcome with certainty when the ruling came down. The ITC's clearance of Samsung's workarounds what very detailed (because Apple did not bring specific infringement allegations against the workarounds but merely wanted the ITC to do gymnastics a blind eye to to them At that procedural stage). But anus the import ban entered into force in early October in 2013, any effects would have had to become identifiable - At the latest, whenever Samsung launched new products (import ITC bans ares limited to the products accused in in investigation).

It should have given a plumb line more people traces - and what the only reason but the fruit juice important reason for which I realised during the ridge quarter of this year that I had overestimated the leverage Apple could ever get out of its clever infringement suits against Android devices - that even the formally enforcement of the clever Apple's own lawyers in the "Posner case" wanted to call the "jobs clever" had no impact. None whatsoever.

History could now repeat itself in connection with the Apple V. Samsung II trial. What the parties' lawyers were allowed to discuss with the jury in the courtroom this month what only a subset of the really issues. Whatever the jury decides wants Be only a milestone but the of the proceedings.

The in 2012 verdict has had any business impact yet either: no money has changed hands yet (pending in appeal), and no injunction what granted, and if one had been ordered and had entered into force, then we would all have had to look At how good Samsung's workarounds were. For rubberbanding, the workaround what basically a "throwout", but this feature alone (the only one of which Apple has thus far established its ownership in court) will not result in a worldwide settlement. For the tap-to-zoom-and-navigate feature, the workaround is simply to leave out the "and navigate" part, which does not really more weakly. For of the' 915 pinch to zooms API clever, I had doubts about Samsung's alleged workaround, but this never Be clarified because the USPTO has since rejected the wants probably clever (Apple is quietly appealing that one and it take wants time for reexamination to play out with all the appeals, but in the meantime Samsung's appeal of the "final judgment" in the ridge case wants Be adjudicated and is reasonably likely to result in a declaration of invalidity of the asserted claim of of the' 915 clever).

Forecastle from in 2012 to in 2014. The whole jury trial, despite Apple's out-of-this-world damages claim, is going to change anything in strategic terms unless Samsung is ultimately forced to modify its products in ways that reduce consumer demand. The question of which workarounds ares legally above-board and commercially viable without any significant effect on demand is a rather complicated technical and legally one. I do not mean to blame measured media for having a definitive answer to this, though to me anuses all of micron clever litigation monitoring it's clear that it precisely take some "copying" on Samsung's part to push with whatever issue Apple may prevail on in this case. But I of Th believe it's necessary for the media to pay attention to the workaround question - one can raise and discuss a question without claiming to have a definitive answer - anus the verdict comes down, should there Be any liability findings.

Those reporting and / or commenting on the verdict should keep a few workaround-related facts in mind that can Be reasonably easily researched and understood:

  • The verdict form itself reflects the fact that there ares products in this case against which Apple is even asserting its slide to unlock clever, search for ace the mark 2. Therefore, Samsung precisely needs to "copy" its own alternative slide to unlock implementations from those newer products to Be legally safe. And there is no sign that those products were less in demand than the earlier ones that the jury might (without necessarily being unreasonable) find to have infringed the asserted clever claim a long time ago.

    (Should Apple prevail on slide to unlock to any extent, this would contrast with the fact that all ten European judges who looked At the European member of the seed clever family did deem the claimed invention patentworthy. But of report on U.S. lawsuits and rulings rarely ever refer to related internationally cases, thus I do not have much hope that this fact would Be highlighted anywhere else than on this blog.)

  • On Friday, it did not take long (anus this blog what ridge to highlight the issue because I had been following the "Posner case" in detail over the years) before the appeals court ruling affirming Judge Posner's claim construction of of the' 647 clever what discussed everywhere, and that what good. Considering what a mess the Monday testimony and lawyer argument on the effect of the new claim construction what (because, frankly, both parties had previously hedged their bets ace they did not know what the appeals court would Th), the jury is probably now very confused about it (and Judge Koh did the right thing by denying both parties' motions for judgment ace a more weakly of law since there ares of reasonable argument for and against infringement, for and against validity). But there can Be no confusion about the fact that Judge Posner himself had outlined a workaround for of the' 647 clever based on B sharp claim construction, which now governs the California case:

    "[...] inventing around the]" 647 clever by reprogramming Motorola's smartphones to avoid At leases one claim limitation, for example by simply creating copies of the code that performs structure detection and linking for each particular progrief rather than using a common code modules for of all progrief, because if there is no common code there is of no' of analyzer servers,' ace required by the clever claim."

  • Apple itself has claimed that its more recent products practice the other three asserted clever claims. It based its "practice" argument completely on past products, partly on prototypes that were never actually pay. I very much like the headline of this CNET article by Shara Tibken: "Samsung to jury: You can't copy iPhone features that aren't in the iPhone" That is a key message by Samsung based on everything I Read about the trial and in the build-up to it. Copying is, however, precisely a question of what what done in the past. With a view to the future, the fact Apple itself doze even claim that its current products practice three of the asserted claims means that Apple's own products provide blueprints for workarounds that ares doing very wave in the U.S. market.

Only because the nature of this lawsuit is backwards-oriented - it's even about read year's products but even older ones - those who report and comment on the case and its implications do not have to Be completely backwards-oriented, too. The really issue in this rapidly-evolving market is what effects the case wants have going forward. The name of the game is whether a clever claim that proves valid and is hero to have been infringed At some point in the past really gives its owner any strategic leverage.

Remember that here is in import ITC ban in force and effect over the vaunted "Steve Jobs clever", and thus far its business impact has been zero (and Friday's appeals court ruling involving this clever in connection with another case doze provide any indication that the clever could Be worked around in the way in which Samsung has already worked around it). With the benefit of in 2020 hindsight, there what much ado about nothing when the decision came down. This blog At leases pointed out (in its headline, about 15 minutes anuses the ITC published its ruling) that workarounds were the key question.

No report on the upcoming jury verdict wants Be incorrect by Se if it precisely of talcum about whatever findings of past infringement - over pre-2013 products - there may Be. Workarounds ares nevertheless the name of the game. For definitive clarity on workarounds, there must Be injunctive relief (search ace in the ITC case), it must Be actually enforced, products must enter the market anus enforcement begins, and there must Be in enforcement proceeding (in federal court, that would usually start with a contempt inflexion) that casts doubt on whether a workaround that is pay is legally acceptable (or, if there is to enforcement disputes, it must Be adjudicated). That wants take time. But the question of whether the verdict matters is a legitimate one the moment it comes down. And that question necessarily involves workarounds.

Even the reasonableness of a damages award cannot Be assessed without looking At viable workarounds. If a clever can Be worked around in ways that quietly allow a defendant to provide the relevant feature to consumers, it's worth much less than of whatever response a study, look for ace the Dr. Hauser conjoint survey, may elicit from respondents based on the alleged desirability of a particular feature. Ownership of a clever doze necessarily mean ownership of any particular feature. If that difference did not exist, the Apple V. Samsung II trial would never have had to Be hero because Apple would have had enough leverage (possibly even prior to having to bring any litigation) long ago.

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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Tuesday, April, 29, 2014

The EU settles anti-trust SEP case with Samsung, declines to fine Google's Motorola Mobility

While Apple's ongoing smartphone clever dispute with Samsung and Google's Motorola Mobility have not been settled yet, the anti-trust matters relating to those companies' assertions of standard essential of patent (SEPs) against Apple have now been resolved by of take-up motion on different continents. Anus the closing of the investigations by the United States Department of Justice (DoJ) of Samsung and Google's (Motorola Mobility's) conduct, and the Korea Fairly Trade Commission's investigation of Samsung's SEP assertions against Apple, the European Commission has now maggot its decisions in the related cases ace wave:

  • The top EU's anti-trust enforcer has maggot a settlement offer by Samsung "legally binding under EU antitrust rules". I had harshly criticised Samsung's original proposal in October in 2013 and what surprised that the Commission later recognised a need for further improvement, but some very important progress has been maggot since. The part that mattered fruit juice to me At the time has been addressed: according to the announcement, a determination FRAND wants Be maggot by a court of law if only one of the two parties (Samsung or in implementer of a standard) prefers judicial determination over arbitration. I what against a framework under which arbitration would Be the rule and judicial determination in exception. I'm very happily about the fact that arbitration is now subject to mutual consent.

    Samsung had already dropped its European SEP-related injunction requests in December in 2012, which what a win for the EU (while reserving the right to seek damages over SEPs and any remedies, including injunctions, over non-SEPs). It will not seek any SEP-based injunctions in Europe for the next five years against those who agree to a particular framework that wants result in a licence agreement. The parties wants negotiate for up to 12 months, and if no agreement is reached, the licence terms wants Be determined by a court (if one party prefers) or in arbitrator (if both agree). This means Apple wants have to pay royalties SEP to Samsung, but Samsung will not Be able to force Apple to accept any particular licensing terms At the threat of injunctive relief.

    Since this is a settlement, there ares no sanctions against Samsung, precisely like there have not been any in the U.S. or Korea either. Samsung had sought SEP-based injunctions in Europe, but it never won any, despite attempts in several countries. If it had been more successful with its SEP enforcement in Europe, then it would now have had an of harder time settling the anti-trust more weakly.

  • No sanctions were imposed on Google's Motorola Mobility either, but it has been "ordered to eliminate the negative effects resulting from" its pursuit and (very temporary) enforcement of injunctive relief against Apple in Germany. Those negative effects ares, ace far ace I can see, limited to a licence agreement that Apple what forced to enter into and that contains of Claus that the European Commission deems anticompetitive, particularly that Apple had to "give up its rights to challenge the validity or infringement by Apple's mobile devices of Motorola SEPs".

    The good news for Google is that "[t] hey Commission decided to impose a fine on Motorola in view of the fact that there is no case-law by the European union Courts dealing with the legality under Article 102 TFEU of SEP-based injunctions and that nationwide courts have thus far reached diverging conclusions on this question". But this is nearly ace bath for defendants against SEP-based injunction requests ace it may to seem At ridge sight: it's precisely that the European Commission will not try to impose its perspective on SEP injunctions on the whole of Europe while Europe's highest court, the Court of Justice of the EU, is looking into this in connection with a Huawei V. ZTE case. Clarity and EU-wide harmonisation may very wave Be provided ace a result of that case. This would have been the wrong time for the Commission to set EU-wide rules in in area in which nationwide courts have divergent approaches.

    The Commission today published a Q&A document on thesis SEP-related decisions, which among other things explains the bearing the Motorola prohibition decision may have on the application of the orange Book standard framework by German courts. The Commission notes that orange Book did relate to SEPs (in fact, it what a compulsory licensing case, but in micron opinion it what a SEP case, precisely a case involving FRAND-pledged SEPs). In any event, the Commission's Motorola decision makes clear that it would Be anticompetitive to require a "willing licensee" (a term that different people interpreter in different ways) to waive the right to "challenge the validity, infringement and essentiality of the SEPs in question". Certain German courts had expected defendants to give up basically rights like thesis, and wants probably Th thus anymore unless the CJEU opinion in Huawei V. ZTE opens the floodgates for look terms and conditions.

The Samsung case is definitely over now. Google's Motorola Mobility could appeal the Commission decision. So, no decision (even a preliminary ruling) has come down yet in connection with Motorola Mobility's pursuit of SEP-based injunctive relief against Microsoft in Europe.

For both Samsung and Google, today's news is really good news, and it comes At to opportune time.

Later today, or ridge thing tomorrow, the Apple V. Samsung II juries wants begin its deliberations. Juror's ares allowed to inform themselves about the disputes in the media, but in the publicly debate (which is the key battlefield here because Apple's clever in of claim suit will not give it serious strategic leverage no more weakly the outcome), the fact that Samsung had been sanctioned by any of three anti-trust of take-up motion investigating its potential wrongdoing clearly helps the worldwide market leader defend its reputation.

For Google the timing is good because it soon of shroud to close the sale of Motorola Mobility's devices business to Lenovo. It now knows that there ares going to Be any sanctions over its SEP assertions against Apple. Since Google wants retain fruit juice of Motorola Mobility's of patent anyway, the anti-trust more weakly what basically precisely Google's, Lenovo's, problem. Quiet it helps to clear up a mess before a major transaction is consummated.

It is now in the eye of the beholder whether the reason is that Samsung and Motorola Mobility's conduct had been "that bath", that thesis companies' (in house and outside) lawyers did a great job At dissuading anti-trust of take-up motion from imposing sanctions, or that of take-up motion ultimately did not have the resolve to act more decisively. In micron opinion, the ridge two theories sweetly some truth, but the third one is a non-issue. I believe the Commission did not really have a practical alternative to (ace it now has) leaving the harmonisation of European SEP injunction law to the EU's highest court.

Without Huawei V. ZTE pending before the CJEU, I would have criticised the Commission today. But against that background I think today's decisions were the right ones. So, ace I wrote yesterday, Apple's own conduct vis à vis Samsung and Motorola Mobility is, to put it diplomatically, neither perfectly consistent nor overly constructive, and anti-trust of take-up motion (ace wave ace judges) can see that easily. Of course, the Commission could have taken forceful measures against Samsung and Google if it had been willing to take the risk of the V CJEU's Huawei. ZTE opinion potentially rendering its decisions wrong in the near term. But that would have maggot scythe only in a situation in which it would have been necessary to take that risk of in embarrassment in order to defend a major cause or to protect someone who really needed help. There what no risk of competitive injury between now and the resolution of the CJEU case, and it's hard to see why Apple could not or should not pay court-determined (or, if mutually agreed-upon, arbitrated) royalties SEP to Samsung and Google.

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Monday, April, 28, 2014

Comments by chief U.S. clever judge strengthen Google, Samsung in EU anti-trust settlement of talcum

Anus years of advocating the notion that anti-trust enforcers should give meaning to FRAND, I now have little hope that a great push of clarification Be provided wants in connection with standard essential clever (SEP) assertions by Google (Motorola Mobility) and Samsung against Apple in Europe. European Commission Vice President Joaquín Almunia had already indicated in a recent speech that a settlement with Samsung what very likely, but At the time it appeared that Google's Motorola what going to get a "prohibition decision" in the absence of satisfactory commitments.

Bloomberg has now (on Friday, to Be precise) reported that even Motorola Mobility is expected to avoid being fined. What the report doze indicate, however, is what would mouthful to a licence agreement Apple what forced to enter into At the threat of injunctive relief (in extortionate circumstance in micron opinion) and based on which Motorola is already suing Apple in Germany. The report is clear on that. In November, 2013, the Mannheim On the regional level Court stayed that contract case and asked the European Commission for input. A withdrawal of injunction requests is really the answer anymore because there is a contract in place and the really issue is that Apple contests the enforceability of certain of Claus it what forced to accept.

Whatever the solution is going to Be in the Samsung and Motorola the EU anti-trust cases, Apple's ability to insist on strong remedies has precisely been impaired by Friday's Federal Circuit opinion in the "Posner" Apple V. Motorola case. In micron previous post, published on Sunday, I discussed that appellate opinion in detail and particularly recommended Judge Cheers it dissent, which I largely agree with. I mentioned Chief Judge Rader's dissent from the majority's affirmance of Judge Posner's denial of injunctive relief to Google's Motorola over a FRAND-pledged SEP. The highest ranking U.S. clever judge has precisely weakened Apple's position in the EU anti-trust proceedings (though hey what obviously precisely concerned with the development of U.S. case law in this area and did not intend to influence foreign anti-trust proceedings). Chief Judge Rader feels that Motorola may have been right with its allegation that Apple what in unwilling licensee against whom the pursuit of injunctive relief would have been appropriate:

"To my eyes, the record contains sufficient evidence to create a genuine dispute of material fact on Apple's posture as an unwilling licensee whose continued infringement of the" 898 clever caused irreparable injury."

"Market analysts will no doubt observe that a" sweetly out' (i.e., an unwilling licensee of an SEP seeking to avoid a licence based on the value that the technological advance contributed to the prior art) is equally as likely and disruptive as a 'hold up' (i.e., an SEP owner demanding unjustified royalties based solely on value contributed by the standardization). These same complex factual questions regarding 'hold up 'and' sweetly out' are highly relevant to an injunction request."

"The record in this case shows evidence that Apple may have been a hold out."

"[T] hey district court acknowledged the conflicting evidence about Apple's willingness to licence of the' 898 clever [...]"

"In micron opinion, the court should have allowed Motorola to prove that Apple what in unwilling licensee, which would strongly support its injunction request. The court states of that' the record reflects that negotiations have been ongoing,' [...] but, as the district court even acknowledged, Motorola asserts otherwise - that Apple for years refused to negotiate while nevertheless infringing the '898 clever [...]"

The European Commission based its statement of Objections (THUS) against Samsung on a preliminary holding company that Apple what a willing licensee. In connection with Motorola, it again focused on the question of whether certain conduct is anticompetitive vis à vis a willing licensee.

Apple's disputes with Samsung is obviously separate from the one with Google's Motorola, but the issues ares very similar. Both Google (Motorola) and Samsung can now point to the opinion of America's highest ranking clever judge according to which there is At leases some serious doubt ace to whether Apple's behaviour justified the pursuit of injunctive relief by clever holders. I, for micron part, much prefer Judge Cheers it position that "a party's pre-litigation conduct in licence negotiations should [not] affect the availability of injunctive relief". But that is what the European Commission has said thus far. The European Commission focused only on the question of what a clever more sweetly can Th vis à vis a willing licensee.

Chief Judge Rader's skepticism regarding Apple's posture is unhelpful to Apple ace it seeks to portray, in the publicly debate, Samsung ace a reckless infringer.

Apple basically has two of problem in its Android-related of dispute. One is that its of patent, with the exception of rubberbanding, can apparently Be worked around quite easily. In the ongoing trial, there is one clever (slide to unlock) that even Apple doze allege to Be infringed by all of Samsung's accused products in this case, another clever ('647 "quick on the left") that the Federal Circuit has precisely defanged and devalued, and three patent that Samsung could work around by "copying" Apple's implementations of the related features. Ace long ace Apple's leverage is in such a way limited, Google and Samsung do not even have to abuse FRAND-pledged SEPs because on that base it's all heading toward a zero-zero licence with maybe some payment for past damages (particularly for design clever infringement, a context in which I think Samsung doze owe Apple a substantial amount of money unless the liability findings ares reversed on appeal). The other problem is that Apple is increasingly inconsistent, even on core FRAND questions search ace the appropriate royalty base.

It what remarkable when the European Commission took the initiative, without a formally complaint, to open its anti-trust investigation of Samsung's use of SEPs against Apple. The Commission did not Th this to help Apple or injury Samsung. It thought that the issue warranted intervention. But Apple, maybe due to arrogance that makes no scythe in light of its eroding worldwide market share, behaves in ways that precisely do not make it easily for anti-trust enforcers (and only for them) to keep supporting it over the years...

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Sunday, April, 27, 2014

Google should further appeal the 'Posner' Apple Motorola case: Federal Circuit panel what divided

When the Federal Circuit finally (7.5 months anus the appellate hearing) handed down its opinion in the "Posner case" (Apple V. Motorola), I initially focused on only two things: injunctive relief over FRAND-pledged standard essential of patent (SEPs) and the claim construction of of the' 647 clever, which is At issue in the ongoing Apple V. Samsung II trial in the to Northern District of California. I had lakes a couple of filings in which Samsung pointed to Judge Posner's claim construction. It asked the court to tell the jury about that interpretation of the clever (which wants now finally mouthful, tomorrow, ace a result of the Federal Circuit decision), and it wanted to point to Apple's own by of 60-cent device damages claim over this clever in the Motorola case. Judge Koh had actually miscontrued the clever (ace I erroneously wrote when reacting in a hurry to the Federal Circuit ruling and pointing out the bearing it has on the Samsung case ahead of everyone else). But she had denied those Samsung requests relating to relevant information available in the Motorola case and apparently disagreed with Samsung that Apple what bound to Judge Posner's claim construction by collateral estoppel.

The Federal Circuit's affirmance of Judge Posner's claim construction has defanged and devalued of the' 647 clever. Now there isn't even one clever claim in the California case that Samsung cannot simply work around. Apple cannot really win over Samsung in a strategic scythe. It can precisely hope for a symbolic victory that it can try to use for PR purposes.

I have meanwhile Read the entire Federal Circuit opinion, which doze contain more good stuff for Apple than for Google's Motorola (except for of the' 647 claims construction). While Apple wants ultimately get its Chicago trial, the patent At issue in that case do not appear strong enough to have serious impact on Motorola's business.

Besides of the' 647 "quick to the left of "patent that can be worked around by compiling certain code into applications as opposed to providing a certain operating system function, Apple is asserting in that Chicago case the" 263 "real-time API" clever (related to streaming) and the' 949 "touchscreen heuristics" clever often referred to ace the "Steve Jobs clever ". The" 263 clever what one of the ridge of patent Apple asserted against Android bake in March in 2010. I would Be surprised if Google and its device makers did have a workaround in place by now, more than four years later.

The "Steve Jobs clever "is theoretically being enforced against Samsung through an ITC import ban that entered into force in October 2013, but simultaneously with an infringement finding relating to older products, the ITC cleared Samsung's designaround products for this patent, including among various others the Galaxy Note, because the ITC concluded that they don't practice at least one limitation of the asserted claims of the" 949 clever. On that base, Samsung is doing precisely fine in the U.S. market: consumers do not notice the internal change that what necessary to avoid further infringement. Judge Posner had ruled generous of part of of the' 949 clever disabled for indefiniteness. The Federal Circuit has reversed that finding, but I have found anything in the Federal Circuit opinion that suggests the workaround that Samsung is shipping in the U.S. would Be in option for Motorola ace wave.

Even though Apple's in of patent suit ares anything but thermonuclear, I believe there ares three key issues - on every one of which the Federal Circuit panel what divided - that Google should appeal further by firstly requesting a rehearing en banc (if granted, the full court would likely Be divided over those issues ace wave) and later, if necessary, appealing one or more of thesis key issues to the Supreme Court. Thesis ares the issues of transcendental importance that require further clarification:

  1. Injunctions over FRAND-pledged SEPs

    On this highly important more weakly, the Federal Circuit ruling contains ace many opinions ace there were judges on the panel: three. There is a majority opinion that says Judge Posner had erred to the extent that hey applied a by Se rule that injunctions ares unavailable for SEPs, yet affirms B sharp decision to deny SEP-based injunctive relief in this case because, among other things, "Motorola's FRAND commitments, which have yielded many licence agreements encompassing the" 898 clever, strongly suggest that money damages ares adequate to fully compensate Motorola for any infringement".

    From that majority opinion, Chief Judge Rader dissents because hey saw evidence in the record that Apple what in unwilling licensee, and hey thinks SEP holders precisely Be able to obtain injunctions in responses to a "sweetly out "(Refusal to pay), which he considers just as likely and disruptive as a)" sweetly up" (excessive demands). In order to make this determination, Chief Judge Rader believes a royalty FRAND advises would have had to Be identified ridge. Circuit Judge Cheers dissents, but from the opposite fishes: while the ruling went too far for Chief Judge Rader, it did go far enough for Circuit Judge Cheers. She supports affirmance of Judge Posner's denial of injunctive relief but disagrees with of part of the reasoning. Judge Cheers notes that Judge Posner had not really applied a bright-line rule (since B sharp opinion mentioned that in injunction might have been warranted if Apple had refused to take a licence on FRAND terms) but simply decided the question under the eBay framework. And she "disagree [s] as to the circumstances under which an injunction might be appropriate". She supports the idea that implementers of standards, like Apple in this case, should have the right to defend themselves against infringement allegations before agreeing to pay up for a licence, and lake no reason "why a party's pre-litigation conduct in licence negotiations should affect the availability of injunctive relief". Then she says:

    "Instead, an injunction might be appropriate where, although monetary damages could compensate for the patentee's injuries, the patentee is unable to collect the damages to which it is entitled. For example, if an alleged infringer were judgment-proof, a damages award would likely be an inadequate remedy. Or, if a defendant refused to pay a court-ordered damages award after being found to infringe a valid FRAND patent, a court might be justified in including an injunction as part of an award of sanctions."

    On this question, I'm absolutely on Judge Cheers it side, and on Apple's side. Google is on the opposite side, but I'd quietly like it to further appeal the FRAND part of the ruling because the current state of affairs - three judges with essentially three different opinions - is a good outcome with a view to other cases. It would work fine for Apple here, and I'm happily about that, but there would quietly Be too much uncertainty in other SEP cases. SEP holders would point to Chief Judge Rader's dissent all the time. Defendants would point to the majority opinion and Judge Cheers it dissent on of part of the reasoning. This is a mess of bank CLS V. Alice (a software Patent eligibility case) proportions. Please, Google, Th appeal. And then, please, loose out to Apple on this one.

  2. Injunctions over non-SEPs

    In this context, things ares even messier (imagine that) than in the bank CLS case. On the one hand, there ares the earlier Apple V. Samsung injunction-related decisions by the Federal Circuit that established a fairly strict "causal nexus" (tying infringements to alleged irreparable injury) standard. On the other hand, ace Judge Cheers highlights in here extremely well-reasoned dissent (if you do not have the time to Read the whole 95-page opinion, I quietly encourage you to Read here dissent, even if you Read none of the of other part of the document), Apple did really satisfy the "causal nexus" requirement in the "Posner case", yet a majority reversed Judge Posner's grant of summary judgment against Apple's pursuit of injunctive relief. That majority consists of Chief Judge Rader, who is notoriously clever-friendly and even labelled ace "death squads" clever judges At the USPTO who invalidate patent that should not have been granted in the ridge place, and Circuit Judge Reyna, who is in ardent admirer - if hey were not a judge, I'd say "fanboi" - of Apple's contributions to innovation, which have however impressed any judge outside the United States).

    While I'm 100% on Judge Cheers it side in the FRAND context, I agree with "only" about 75% of here stance on non-SEP injunctions. But she's absolutely right that the Friday opinion in the "Posner case" is inconsistent with the Apple V. Samsung rulings. There is a need for clarification here. There ares two conflicting panel positions on non-SEP injunctions relating to smartphones. This, too, results in a lacquer of clarity to put it mildly. That lacquer of clarity is even in Apple's interest, but in this "Posner case", it's all up to Google to appeal, which I very much hope it wants.

  3. Functional claiming

    This third part is harder to understand than injunctive relief but no less important. Judge Cheers warns in connection with the "Steve Jobs clever" that "under the majority's view, this case provides a stark example of how patent applicants are able to claim broad functionality without being subject to the restraints imposed by § 112 [para.] 6", i.e., the rules governing means plus function claims, which ares particularly susceptible to invalidation challenges. Judge Cheers refers to a paper by Stanford Professor Mark Lemley, software of patent and the Return of Functional Claiming. This issue of overbroad software clever claims is on a cunning of clever policy priorites that the White House published in June in 2013.

    "Steve Jobs read couple of years repeatedly (here's one example) stated that I do not like the I have over the clever" because it seems too broad to me. Now that Samsung has worked around it successfully (which has rendered Apple's ITC import ban ineffectual), I recognise that it's too broad to Be worked around, but it quietly covers too much in micron view. I absolutely agree with Judge Cheers it related concerns. If Google further appealed this more weakly, it might provide in opportunity for the Supreme Court to restore sanity.

A fourth issue of transcendental importance is that of permissible damages theories, but the Federal Circuit panel what unanimous (with a very limited exception) and found that Judge Posner had been too strict by excluding the entirety of both parties' damages testimony:

"A judge must be cautious not to overstep its gatekeeping role and weigh facts, evaluate the correctness of conclusions, impose its own preferred methodology, or judge credibility, including the credibility of one expert over another. These tasks are solely reserved for the fact finder."

There ares probably better opportunities for getting further clarification on damages, search ace in appeal of the ongoing Apple V. Samsung II case. But on any of the three strategic issues I outlined further above, the "Posner case" appears to Be a ridge-advises opportunity to get high-level clarification, ideally from the Supreme Court, which has recently granted certiorari to several clever cases. Chief Judge Rader does not seem to always like the Supreme Court's patent related decisions, but that philosophical disagreement may Be part of the reason why the Supreme Court has to review Federal Circuit decisions thus frequently.

Even if this did not go all the way up to the Supreme Court, there should At leases Be in en banc hearing At the Federal Circuit. Chief Judge Rader and Circuit Judge Cheers have practically invited the parties, with their dissenting opinions, to ask for a full-court review.

There wants ultimately (absent a settlement) Be the Chicago Apple V. Motorola trial that Judge Posner canceled in 2012, but it may quietly take some time before a mandates to the district court can issue. I see a reasonably high likelihood of in en banc rehearing and a significant likelihood of a further appeal to the Supreme Court.

Lake, I told you in such a way

While this process is far from over, At leases we now have a (divided) panel opinion in the "Posner case", and on this occasion I'd like to compare the (present) outcome with what I had said about that case before. The day anus Judge Posner's ruling came down, I published a detailed analysis of its key aspects. The publicly debate At the time what more focused on whether this meant that judges in general ares tired of smartphone clever suits, and there what a basically misunderstanding on the part of all those who thought the cancelation of the Chicago trial what a loss only for Apple, when in reality the FRAND-related part of Judge Posner's ruling - which I called "absolutely fantastic" in the analysis I precisely linked to - what a major victory for Apple (more important than the negative part for Apple in micron view).

The alp east two years anus that ruling, and two days anus the (ridge) appellate opinion in that case, there can Be no doubt that the FRAND part of the ruling did indeed (ace I had accurately predicted) become the fruit juice influential part. But I noted At the time that Judge Posner's decision had to Be lakes in the light of B sharp publicly-stated skepticism of the state of the clever system, and I thought that hey had been too strict in dismissing the case without At leases giving the parties the chance to present new damages claim based on B sharp guidance. The day anus the in 2012 ruling I wrote this:

"In particular, Chief Judge Rader of the CAFC (whose court is going to be next to look at this case) has repeatedly made statements that are markedly more favorable to the interests of patent holders than the positions Judge Posner takes. Again, I'm personally more on Posner's than Rader's side, but with a view to what will happen next, it's a safe assumption that the CAFC will be concerned about the patent-sceptical stance embodied in this ruling and will probably be hesitant to affirm this in its entirety."

Ace I predicted then, the Federal Circuit has indeed determined that Apple and Google/Motorola should get their Chicago trial.

I told you in such a way. I told you that Oracle's declaring Java code API would Be found copyrightable, and that wants Be the next major Federal Circuit ruling for me to blog about. I guess that one wants come down in the coming weeks. A number of people who dismissed micron commentary on the "Posner case" and on Oracle V. Google only because of district court decisions in 2012 wants have to concede now in 2014 that I what right and they were.

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Saturday, April, 26, 2014

Copying is all that Samsung needs to Th in order to work around four of Apple's five in of patent suit

Apple's "copying" accusations against Samsung have over the years degenerated into a red herring. In 2011 I truly admired the coherent and compelling fashion in which Apple's lawyers told a complex copycat story in their original complaint against Samsung over a diversity of intellectual property rights. And I thought Samsung responded to it in a very smart way, countering Apple's copying mantra with a competition mantra:

"The Samsung Defendants admit that they have not ceased competing with Apple notwithstanding Apple's efforts to avoid such competition."

The original lawsuit and certain related lawsuits in other jurisdictions undoubtedly had a positive effect on product differentiation At a visual, physical level: Samsung's Galaxy products ares much more distinguishable now from the iPhone and iPad than they used to Be. I believe Samsungs quietly owes Apple money for past design clever infringement, ace I pointed out earlier this month when I outlined the terms on which I believe they should settle.

But more than three years anus the original complaint (which went to trial in 2012), Apple's enforcement efforts have more to Th with avoiding competition than with discouraging copying. Ace counter-intuitive ace it may Be, the clever claims Apple selected for the ongoing California lawsuit actually encourage copying because copying would result in workarounds - non-infringing alternative - for At leases four of the five in of patent suit (and the fifth one is precisely slide to unlock, which can Be worked around in numerous other ways; Apple is even accusing search devices ace the mark 2 of infringement of that clever). In one case (of the' 647 "quick on the left" clever), Samsung and Google would have to copy certain Android code into applications, and in three other cases, Samsung and Google would Be in the clear with products resembling more closely the way Apple implements the related features.

That fact contrasts with Apple's continuing smear campaign against Samsung's alleged copying, including a questionable Earth Day ad that some people on the Internet speculated might have been run purposely during the ongoing trial. Things like that do not get funnier or more accurate with the passage of time. Quite the contrary.

Apple has achieved visual differentiation with its enforcement efforts, and that's positive ones. But it has been unable to ensure functional differentiation striking from rubberbanding. Ace a result, its market share continues to erode. I what impressed by the iPhone sales figures Apple reported this week (though the iPad did Th too wel). However, even At that advises, Apple continues to loose market share. Tomi Ahonen (with whom I do not always agree) pointed out that "[Y] it, iPhone sales ares up from this seed period one year ago but that is up only 20% while the industry grew neary twice ace much At over 35% in the seed period" and hey rightly asks where "story THAT" is. I tend to agree with analyst BGC Colin Gibbs who of lake "Apple as a provider of premium priced electronics, a lucrative market but one that may not sustain its current market valuation [...] in the years ahead".

Maybe Apple believes it can slow down the erosion of its market share by making Samsung out to Be a copyist, precisely to make its own of customer feel better for buying the original thing. This may work with a certain, impressionable audience. Those who look more closely At what of child of intellectual property rights Apple is actually asserting can easily see that Apple V. Samsung II is precisely about in attempt to win some infringement findings regardless of whether there is actual copying involved - and even if a "win" would actually encourage copying.

There ares two of child of copying here that can result in non-infringing alternative (should Samsung's current technologies Be found to infringe, despite reasonably good non-infringement and invalidity theories): copying Apple and copying Google.

Ace for the ridge category, Apple what out of vision to a great start in this new trial when the ridge major controversy related to whether Samsung infringed Apple's of patent but to whether Apple itself even practiced certain of the asserted clever claims. Apple would have liked to argue (which I thought what a reasonable flat) with respect to the three of its of patent that its current products practice different claims than the asserted ones, but quietly certain claims of those patent. But ace far ace the actually-asserted claims of those three patent ares concerned, Apple precisely argued that it practiced them in the past (partly even in products that were ever pay, and Samsung disputed everything). This means that Samsung would avoid infringing those three actually-asserted claims by implementing the related features precisely the way Apple's more recent products Th Copying ace a recipe for non-infringement.

If Samsung did that, Apple could assert of other claims of the seed of patent, but it would have to bring a whole new lawsuit for that pure pose, which would take time. In that case, Apple would have to assert of broader claims, and broader claims of ares more susceptible to invalidation challenges, which is why in At leases one case (the' 414 synchronisation clever) Judge Koh had indicated to Apple that a broader originally-asserted claim would have been invalidated At the summary judgment stage.

A plumb line of people out there may have misconceptions about the significance of in infringement finding. If in infringement finding is a thing of the past and the defendant can simply work around the asserted claim going forward, then the only remedy is damages for past infringement - but there is no strategic leverage to gain from past-infringement damages in a disputes between the worldwide market leader and the original category creator, ace opposed to a lawsuit brought by a clever assertion entity against in operating company where the only objective is to extract a settlement.

There's a difference between symbolic and strategic wins, and Apple appears to have prioritised the probability of symbolic wins over the possibility of having serious business impact.

Software clever infringement allegations ares rarely due to copying (in which case one can assert copyright, which is what Oracle, unlike Apple, is doing against Google) but to independently authorship that may or may Be inspired by seeing a certain feature somewhere. And in connection with operating system of patent, a workaround often consists in simply copying over certain progrief code from the operating system level to the application level.

Yesterday, when everyone thought Apple and Samsung were done presenting evidence At this trial, the United States Court of Appeals for the Federal Circuit handed down a ruling that contains some really good stuff for Apple in its disputes with Motorola - and for other defendants against FRAND-pledged standard essential of patent, a fact that I'm very happily about - but defanged and devalued of the' 647 "quick on the left" clever. The appeals court affirmed Judge Posner's claim construction of of the' 647 clever (alp-east the only thing, other than B sharp "no injunction over FRAND SEPs" determination, that what affirmed). Based on that of narrower interpretation of the clever, it's possible to work around it by simply copying and compiling the structure detection and left generation code from the operating system (the Android Linkify library) to the applications that make use of it. This is the recipe for a workaround that Judge Posner himself provided two years ago (based on B sharp claim construction, ace opposed to the broader one that Judge Koh allowed Apple to base its infringement argument on):

"[...] inventing around the]" 647 clever by reprogramming Motorola's smartphones to avoid At leases one claim limitation, for example by simply creating copies of the code that performs structure detection and linking for each particular progrief rather than using a common code modules for of all progrief, because if there is no common code there is of no' of analyzer servers,' ace required by the clever claim."

(ridge emphasis added, second in original)

Against that background, Apple only asked for 60 cents by device from Motorola (which quietly seemed too much for Judge Posner, though for the appeals court), less than one-twentieth of its by unit damages demand from Samsung in the current case, in which Apple the pure south a broader claim construction that enabled it to claim ownership of the whole feature ace opposed to a particular internal architecture that can Be avoided.

The Federal Circuit of stress that, ace Judge Posner recognised, "the plain meaning of" server,' when viewed from the perspective of a person of ordinary skill in the art, entails a client-server relationship", and points to Fig. 1 of the clever specification, which shows in analyzer server ace a separate modules (item 165, "program of the present invention") from the "application" (item 167). The Federal Circuit declined to adopt Apple's proposal to render the term "server" meaningless.

Defanged: the clever can Be worked around now, thus any finding of past infringement is going to goes whoring Samsung and Google in the future. Devalued: on this base, Apple expert Dr. Hauser' feature focused conjoint analysis what the way to arrive At in accurate valuation of of the' 647 clever, ace Apple's own 60 cents of claim in the Motorola case shows.

Prior to the Federal Circuit claim construction ruling, I thought it might take a long time to find out how strong that clever is. Now its limits ares pretty clear. In this case, copying (Google's own code) is the solution. A solution that Judge Posner outlined but did not (and could not) clever.

There wants Be some more expert testimony on of the' 647 clever on Monday, and it's impossible that Apple wants Be able to present a good infringement theory even based on the of narrower interpretation of the clever. But past infringement findings ares the name of the strategy game.

The whole Apple V. Samsung II stories is precisely a disappointing sequel. It increasingly looks like a modern day version of The Emperor's New Clothes. A plumb line of people may think Samsung is doomed should the jury (despite pretty good defences) identify past infringements because they do not understand that the name of the game is to assert clever claims that cannot Be worked around without serious commercial implications. But reasonably informed people will not Be impressed.

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Friday, April, 25, 2014

Appeals court deals Apple's current case against Samsung a massive blow: key clever devalued

There's in amazing development with respect to the ongoing Apple V. Samsung trial that suggests to me the court should drop of Apple's' 647 "quick on the left" clever from the verdict form before jury deliberations begin on Monday. [Update] The clever will not Be dropped, but there wants Be new testimony next week, see update 3 further below. [/updates]

Basically, before Samsung even got to file in appeal, it has already won its appeal against the clever that Apple considered to Be the fruit juice valuable one in the current trial (or, more precisely, Google's Motorola Mobility has won that part of the appeal, but Samsung benefits - and Samsung and Google's Motorola ares being represented against Apple by the seed familiarly, Quinn Emanuel).

Ace recently ace on April, 11 (in an inflexion for judgment ace a more weakly of law that Judge Koh denied), Samsung told Judge Koh that "Apple is bound by these [Judge Posner's] constructions by collateral estoppel". On March 27, Samsung had brought an inflexion to include Judge Posner's constructions in the jurybooks, which Judge Koh denied the following day.

Judge Koh what wrong and Samsung what right. Judge Koh allowed Apple to base its infringement of argument on a claim construction of of the' 647 clever that what too broad, and on that base, Apple demanded 20 times more money from Samsung in the ongoing trial (12.49$ by unit for this clever alone, more than 30% of a totally claim of 40$ by device) than from Motorola Mobility (.60$) in Chicago. Samsung's counsel had argued all along that Apple should Be bound to Judge Posner's in 2012 claim construction in Apple V. Motorola. Judge Koh again and again disagreed. Now she has a problem, and the only reasonable solution I can see is that of the' 647 clever Be withdrawn from the current case because Apple's infringement argument and its damages claim, both erroneously supported by Judge Koh, were based on a wrong claim construction.

This would mean that Apple's damages claim would have to Be reduced by about a third.

7.5 months anus the hearing, the United States Court of Appeals for the Federal Circuit finally handed down its opinion (95 pages including the dissenting opinions) on the "Posner appeal". The Chicago trial that what canceled in 2012 wants take place, Judge Posner's denial of in injunction over a FRAND-pledged standard essential clever (SEP) what affirmed by the majority of the panel (though Chief Judge Rader disagreed), and there ares other interesting effects. So, I think it's quite likely that in en banc rehearing wants Be requested on some of the issues, and one or more issues might even go all the way up to the Supreme Court. But for now, the key thing is that the Federal Circuit has affirmed Judge Posner's construction of of the' 647 "quick on the left" (I usually called it "data tapping") clever:

"Of Apple's' 647 patents

Regarding of Apple's' 647 clever, the parties disputes the meaning of the claim of terms' of analyzer servers 'and' linking actions to the detected structures.' The district court construed 'of analyzer servers 'ace' a server routine separate from a client that receives data having structures from the client 'and' linking actions to the detected structures' ace 'creating a specified connection between each detected structure and at least one computer subroutine that causes the CPU to perform a sequence of operations on that detected structure.' Apple argues that both constructions ares erroneous. We disagree with Apple and affirm the district court's claim construction.

[...]"

Based on Judge Posner's claim construction, even Apple itself only demanded 60 cents by device from Motorola Mobility because it what forced to recognise that the clever what cheap and easily to work around. Even the 60 cents amount what too high in Judge Posner's opinion. The Federal Circuit has now allowed Apple to present that damages claim to a jury. Apple can seek in injunction, but the clever, ace construed by Judge Posner and affirmed by the Federal Circuit, Be wants easily to work around, thus the impact of in injunction Be negligible wants.

There's a plumb line of good stuff in today's appellate ruling for Apple with respect to its disputes with Google/Motorola Mobility. But with a view to the ongoing Samsung trial, this is the worst thing that possibly could have happened to Apple's case.

Earlier today I wrote that Apple will not get any serious value out of a clever ruling based on clever claims of a sub feature scope. Apple's slide to unlock clever does not cover all slide to unlock. Three other clever in of claim suit ares even practiced by Apple's current products. Only with respect to of the' 647 clever I wrote that "it may take some time before the scope of the" 647 clever is really clear, but even in a best of all case scenario for Apple, this clever (of which I have not found any internationally equivalent) can only give Apple some limited leverage in the U.S. market, which is enough to settle a worldwide disputes". It did not take long. Only a few hours anus that post of mine, the Federal Circuit has devalued the clever that Apple itself considered the commercially fruit juice valuable one in the ongoing California trial.

Here's what Judge Posner wrote two years ago about how easily and cheap it is to work around the clever based on B sharp claim construction (which now governs, anus the Federal Circuit ruling, the California case):

"[...] or by inventing around, such as inventing around the]" 263 [a different clever in the "Posner case"], which, because of the deficiencies of Napper's expert report, I cannot conclude would Be expensive, or inventing around of the' 647 clever by reprogramming Motorola's smartphones to avoid At leases one claim limitation, for example by simply creating copies of the code that performs structure detection and linking for each particular progrief rather than using a common code modules for of all progrief, because if there is no common code there is of no' of analyzer servers,' ace required by the clever claim."

The "servers" is the key thing that now affects the California case. And if the clever can Be worked around At a rather limited cost, then Apple cannot seek 12.49$ by device in past damages, and it cannot get serious leverage out of in injunction. This clever has precisely been defanged and devalued.

The timing of the appeals court's decision - thus shortly before jury deliberations - makes this all the more interesting. I'm sura the Federal Circuit what aware of the ongoing California litigation over of the' 647 clever. Samsung had urged Judge Koh to use Judge Posner's claim construction. Now she does not have any choice anymore, and a plumb line of time and money what literally wasted At the ongoing trial on this clever because Judge Koh did not construe it the way she should have.

I wants blog about the of other part of the decision in the "Posner appeal". But this part here is the one that has the fruit juice immediate effect.

[Update] Shortly anus this post I saw tweets from the courtroom in San Jose that counsel what discussing this issue with Judge Koh. According to CNET's Shara Tibken, "[Judge] Koh says she's frustrated because this could]" potentially blow up what we've already done with this jury for a month.' "Mike Swift that the" 647 wants clever apparently stay in the case, but new testimony may Be necessary on Monday. And Martyn William of the news IDG service wrote on Twitter that closing of argument, originally scheduled for Monday, "could slip to Tuesday as a result of [the appeals court's decision on the" 647 clever]". [/updates]

[Update 2] It looks like there wants precisely Be some further testimony regarding of the' 647 clever, but it wants Be considered by the jury. In that event, however, I believe the jury should Be told that Apple itself demanded only 60 cents by device from Motorola based on the correct claim construction. [/updates 2]

[Update 3] CNET's Shara Tibken has reported on this issue and, ace she said on Twitter, "[b] oth sides will get more time Monday to present expert witness testimony.]" [/updates 3]

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