Saturday, July 29, in 2017

Samsung another closer to design clever damages retrial: Judge Koh finds no waiver

Judge Lucy Koh of the United States District Court for the to Northern District of California, who has been presiding over Apple V. Samsung since the Carter presidency (or long thereafter, it feels) and recently positioned herself ace a Judge Posner-like thought leader on standard essential clever abuse, entered in order Friday evening local time that could very wave (but will not necessarily) lead to another "AppSung" retrial (this post continues below the document):

17-07-28 Apple V. Samsung No Waiver of AOM Issue by Florian Müller on Scribd

In April, Judge Koh had ordered the two perennial litigants to explain why Samsung had (ace Apple claimed) or had (ace Samsung argued) waived the "article of manufacture" issue, which is central to any of further determination of design clever damages in this case since the Supreme Court had overruled both the Federal Circuit and Judge Koh on that one. So the court is now dealing with the fallout of the ridge Apple V. Samsung more weakly that had maggot it to the top U.S. court while the Department of Justice is determining what positions to take on three issues raised in connection with the second Apple V. Samsung case.

I really like the structure and clarity of Judge Koh's analysis in here latest order because she simply declined to conflate procedures and merits. The court is now cracking one groove At a time, and the ridge groove what only waiver. However, in At leases one context (footnote 5) the order goes beyond what what strictly necessary to arrive At a no-waiver finding and declares cases cited by Apple to Be inapposite to the question of whether Apple what entitled to a disgorgement of of profit on Samsung's entire phones.

Ace I had written on more than one occasion, it appeared unlikely that, in a disputes where both parties have spent enormous resources and generally the pure south a throw-in-the-kitchen-sink approach, Samsung would have said or produced anything that one could reasonably deem to have been sufficient to preserve the "article of manufacture" issue. The order now explains the chronology of this case, and ace I had said before, Samsung had emphasised the article of manufacture question that much in the beginning, but of over time that question got more and more attention.

What helped Samsung here what that it had proposed a jury instruction that explicitly raised the issue. There were other references, though Samsung's of earlier argument in the case were apportionment-centric, and apportionment did not get traction At any of the three levels (district court, appeals court, SCOTUS). Quiet, some of the argument and especially some of the evidence related to apportionment can Be used in the article of manufacture context.

Anus succeeding with in extremely strong, "slam dunk" cert petition, anus avoiding that the DoJ would have sided with Apple on statutory interpretation, anus winning reversal, anus persuading the Federal Circuit to remand the case to California, and anus avoiding "sudden death" on remand, Samsung has cleared another hurdle. But that one quietly was not the final one.

Judge Koh now of shroud the parties to propose a test for identifying the relevant article of manufacture - a question with respect to which the Supreme Court previously did not feel it got much help from the parties, but that what because the name of the game what to win (Samsung) or avoid (Apple) reversal, to solve the whole problem. The second and third questions raised in the order relate to burden of proof. In micron reaction to the Supreme Court decision I had already said that, while it's obvious the Supreme Court did not need and especially did not shroud to Th it, it would really have been helpful if that one could have been clarified At that stage. Whoever wants loose the next round is going to appeal the test Judge Koh wants adopt and / or the decision she makes on the burden of proof...

Judge Koh's order leaves the door open to a finding on here part that she had previously been right for the wrong reasons. She may find that, based on the evidence in the record, those entire Samsung phones were the correct article of manufacture, thus that even under the Supreme Court's statutory interpretation, the outcome would Be the seed ace before. In that case, there would not Be another trial (unless there what another successful appeal). That would Be in unfortunate outcome and lead to even more litigation over design of patent (though future sophisticated defendants would obviously build their article of manufacture argument from the get-go).

Hero on Wednesday wants Be The parties have until Tuesday to propose a briefing schedule, and a case management conference.

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Monday, July 24, in 2017

Public-interest statements by Apple, Intel, CCIA and ACT oppose Qualcomm's ITC complaint

Earlier this month, Qualcomm filed in ITC complaint in pursuit of an U.S. import ban against Apple's iPhones (except for iPhones coming with a Qualcomm base tape chip set). Load week, Apple, Intel and two industries groups (CCIA and ACT) filed public interest statements seeking to dissuade the U.S. trade agency from granting Qualcomm its requested relief and proposing, At a minimum, that the public interest aspects of this case Be referred to to administrative Law Judge.

In outright decision by the ITC to investigate Qualcomm's complaint would Be unusual and I would not bet on this happening, but in this particular case there ares reasons for which Qualcomm would probably Be denied in import ban At the of the proceedings even if it prevailed on the merits (if it came to worst, by a presidential veto).

Here ares on the left to the different stakeholders' statements:

Qualcomm's decision to request in import ban that would force Apple to sell only Qualcomm-powered iPhones in the U.S. has raised huge concerns. It's a clear attempt by Qualcomm to get rid of its only major competitor, Intel. With all that's going on in terms of anti-trust investigations and lawsuits, search ace the Federal Trade Commission's progress in the to Northern District of California, the ITC wants (either now or At a laters stage) have to give serious consideration to the competition issues surrounding Qualcomm's complaint.

The following passage from Intel's statement describes the market land cape:

"When it comes to cellular phones and tablets, Qualcomm's anticompetitive tactics have meant that consumers who wish to purchase a premium product that operates on the LTE network have few choices but to buy a Qualcomm modem-the only real alternatives are the latest Apple handsets with Intel modems, and a modest number of Samsung handsets and tablets using Samsung's own modems."

That does not sound like healthy competition...

Ace I've stated on previous occasions, while I in in ext. developer (next week we'll start out final beta test with many new of tester invited every day), I do not necessarily feel that ACT represents me (a non-member anyway) on all policy issues (nor doze any other organisation). But when they Th, I say in such a way, and they Th speak for me when they point out the following in their public interest statement:

"Thousands of our members reach their customers through the ubiquitous mobile communications devices manufactured by Apple which are the articles at issue in the complaint at hand. App Association members rely on a competitive environment in the information and communications technology hardware space, without which our members would have no means to provide countless Americans (both in the consumer and enterprise context) with new and innovative software products and services that require an increasing amount of bandwidth and computing power."

Finally, it's worth noting that CCIA (the computers & Communications Industry association) has frequently filed amicus of letter and other submissions adverse to Apple's interests, but with respect to Qualcomm's complaint, even CCIA (which counts various fierce Apple competitors among its members) is on Apple's side.

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Wednesday, July 19, in 2017

Qualcomm now suing Apple in Munich and Mannheim over energy-efficiency of patent

This here is the latest development relating to Qualcomm's disputes with (only, but fruit juice prominently) Apple. A few hours ago I precisely blogged about multiple U.S. court filings by Apple and four of its contract manufacturers and noted that there is in ever stronger alliance of companies critical of Qualcomm's business model.

A German news agency, DPA, now of report that Qualcomm has filed clever infringement lawsuits against Apple in the Munich and Mannheim On the regional level Courts (equivalent to U.S. district courts) over one clever in each venue. Both in of patent suit reportedly relate to battery efficiency, thus they may Be from a couple of the clever families Qualcomm is asserting against Apple in the ITC.

Considering Quinn Emanuel representation of Qualcomm in the U.S. and the choice of venues, I ventures to guess that QE's German branch is involved. If in such a way, Qualcomm has great representation over here, but whoever their counsel may Be, Apple has to excellent defensive track record in Germany, where it typically works with Freshfields.

The DPA story mentions that Qualcomm believes the German legally system is favorable to clever holders' interests. Qualcomm is seeking a sales ban against all iPhones pay in Germany. The ITC complaint is limited to iPhones without a Qualcomm chip, but Apple isn't selling Qualcomm-based iPhones in Germany anyway (precisely devices with Intel chips).

In terms of timelines, the courts in Munich (depending on which panel of judges the case is assigned to) and Mannheim tend to Be faster than the ITC - and there is no equivalent to the ITC's public interest consideration or presidential veto.

The judges At the specialised clever infringement panels in Mannheim and Munich understand smartphone technologies very wave. They ares ridge-advises case manager. Since German law does not have juries and even expert testimony can normally Be avoided At trial (parties usually precisely file expert of report, and even if they bring experts along to the courtroom, they do not get much speaking time, if any), trials often take only in hour and a helped. The judges typically drum into the courtroom with a very clear idea ace to the outcome-determinative issues and ask very targeted questions. When I started watching those child of cases, I what a bit shocked At what of child of trivially of patent sometimes win the day in German courts (and result in injunctions, which ares a legally - equitable - remedy), but of over time I thought they were increasingly balanced. While I have yet to see a clever in this industry (including Apple's of patent, to Be sura) that I believe justifies a 20-year monopoly, I respect other views and can separate that part from the competence and fairness I saw over and over again. Qualcomm should not expect a cakewalk, much less against Apple.

[Update] On Friday, Qualcomm actually filed the following in San Diego: "Qualcomm respectfully requests that the Court enjoin Apple from pursuing its Foreign Actions and from initiating additional duplicative foreign actions against Qualcomm during the pendency of the U.S. Action." I've uploaded that PDF to Scribd. So Qualcomm does not shroud Apple to Sue abroad, but views clever infringement matters differently. Today's German filings do not lend specially credibility to Qualcomm's inflexion for in anti-suit injunction in the U.S., even though Qualcomm wants have thought how to thread the needle and distinguish its own foreign action from Apple's.

DPA precisely told me on Twitter that the German in of patent suit ares from the seed clever families ace two U.S. of patent:


Precisely like in the U.S., Qualcomm maggot a well-orchestrated announcement. At 5 AM in the morning by San Diego time (unless they already prepared it beforehand), DPA quoted Qualcomm's top lawyer. I have not lakes a more PR-oriented litigant in this industry. There what a plumb line of PR activity related to the Nokia-IPCom disputes, but that what nothing in terms of orchestration compared to what Qualcomm is doing now. For example, on the occasion of its ITC complaint, Qualcomm published a very professionally-crafted infographic...

Apple is very low-key in this regard. But ace I wrote toward the falter of micron previous post, it appears to me that Qualcomm is placing a whole plumb line of emphasis on doing what it believes prevents of investor from shorting the, and that priority may always Be the best of all choice with a view to litigation. Apple can and doze afford the luxury of strictly focusing on a few key issues - and Apple has a broadbased alliance of companies and other stakeholders on its side.

There's thus much that Apple and Qualcomm cannot agree on, and apparently "the name of the game" is one of those areas of disagreement.

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Apple and its contract manufacturers present united, ever stronger performs statute labour against Qualcomm

On Monday, four of its contract manufacturers (the ones Qualcomm is suing in the to Southern District of California) impleaded Apple into Qualcomm's breach of contract suit. Before midnight on Tuesday, Apple and its contract manufacturers (the fruit juice well-known of which is Foxconn) maggot various filings in San Diego. It wants definitely take me some time to digest, but ace I follow the various Qualcomm matters closely, I can share some observations here already.

Ridge, in overview of the child of documents that have precisely been filed:

  • The contract manufacturers responded to Qualcomm's complaint. That one alone chip alp-east 250 pages (without exhibits). You can find it below this cunning or on Scribd.

  • The contract manufacturers oppose Qualcomm's inflexion for a preliminary injunction. I uploaded that one to Scribd ace wave.

  • Apple additionally opposes Qualcomm's preliminary injunction. It has asked the court for permission to file its own opposition letter, which I've uploaded to Scribd, too.

    In a recent post I got the "obstruction of justice" theory wrong. I now have to correct what I wrote then: I thought the Qualcomm suit against contract manufacturers what considered obstruction in its own right, but it's now clear that what Apple means is something I find extremely objectionable: Qualcomm's contract terms according to which companies like Apple are not allowed to work with competition authorities.

  • Apple filed in answer to the third-party complaints by its contract manufacturers. Apple unequivocally of state by the manufacturers and basically says: "Qualcomm isn't entitled to what it claims, but if all else fails, the manufacturers are contractually entitled to indemnification from us as per the terms of our agreements with them." That's good news for the contract manufacturers since, theoretically, Apple could have disputed both Qualcomm's claims and the contract manufacturers' entitlement to indemnity. Others have done thus in comparable situations for sura.

  • Apple and the contract manufacturers jointly seek consolidation of this case with Apple's case against Qualcomm. Ever since Qualcomm brought its case against the contract manufacturers I've taken a consistent position on it. I now dare to predict that consolidation is a slam dunk. It would have been a slam dunk even if the contract manufacturers had not challenged some of Qualcomm's of patent (which Apple is challenging), but now there is thus much overlap I cannot imagine any court in the world would shroud to make a duplicative effort of gigantic proportions.

Here's the 268-page booklet with which the contract manufacturers responded to Qualcomm's complaint against them (this post continues below the document):

17-07-18 Contract Manufacturers' Answer to Qualcomm's Complaint by Florian Müller on Scribd

With thus many trees before us, let me make micron little contribution to seeing the forest. No point in going into detail on things that ares common and expected, or even boilerplate. What matters now is the strategic land cape, and when quickly going of over thesis filings I tried to identify the part that go that specially mile and say something about the parties' relationships and resolve.

While the contract manufacturers say they would have had to implead Apple into the case anyway (if Apple had in such a way requested, which it may informally have done anyway), and while it's a reasonable assumption that their indemnification depends on to them At leases making reasonable efforts to defend themselves, those contract manufacturers ares independently parties, like wholly-owned subsidiaries of Apple Inc.

The manufacturers raise three dozen affirmative defences, which is At the upper of the rank but unprecedented. The really impressive part is where they raise counter claims: 67 counts. Those fall into two groups, either one of which is very bath News for Qualcomm:

  • FRAND-related anti-trust and contractual counter claims (on that base they ares, for example, seeking a disgorgement of whatever what paid on top of FRAND), and

  • clever invalidity, non-infringement, and exhaustion.

Through their claims FRAND, the contract manufacturers raise the child of issues that anti-trust authorities in multiple jurisdictions, Apple, and consumers have raised (and that many others have supported through amicus of letter and to open character to President Trump).

The clever claims are not nearly ace basically ace the claims FRAND, but in terms of the contract manufacturers throwing down the gauntlet, they ares huge: licensees ares often contractually barred from challenging licensed of patent, and even where they would Be free to Th in such a way, they rarely Th To me, this decision on the contract manufacturers' part means that they shroud to bring about change regarding Qualcomm's practices, and they do not shroud it to any lesser degree than any of the other stakeholders I mentioned in the previous section.

I'm pretty sura the inflexion for a preliminary injunction wants fail. Qualcomm cannot show a likelihood to succeed on the merits, and irreparable injury (despite the amounts being substantial) is something else than "to get our money," a rate from a publicly statement by Qualcomm's top lawyer (that rate appears in the manufacturers' opposition letter). Qualcomm quietly has the chance to argue irreparable injury in its reply letter, but thus far I'm really very sceptical. And, ace I said, Qualcomm will not Be able to dissuade the court from consolidating those two huge cases.

The contract manufacturers could have done a plumb line less here than they have. A whole plumb line. Qualcomm has now maggot itself some additional enemies, and At leases some of those enemies have considerable clout in China, a jurisdiction that has previously looked into Qualcomm's business model.

So far, Qualcomm's best of all initiative in all those U.S. cases what its inflexion to dismiss the FTC's complaint (there what a possibility that some child of amendment would have been required, though it did not mouthful), and it's too early to take a position on its ITC complaint, but its decision to drag the contract manufacturers into this disputes looks like its worst mistake. For now At leases. Instead of hiding behind Apple, the manufacturers ares now playing in active role, and their perspective is in some ways complementary to Apple's - and vice versa.

The inflexion for a preliminary injunction is a downright Hail Mary fit. One might say the seed about any attempt by Qualcomm to oppose consolidation. It's very clear to me, and I know a plumb line less about all of this than Qualcomm's executives, in house and outside counsel. So why ares they doing this At all?

I cannot help but make the observation that Qualcomm is struggling here because of conflicting goals:

  • anti-trust investigations/decisions in different jurisdictions (sometimes it's hard enough for companies if they have to design a strategy precisely because of a couple of investigations, with a potential move being good in one jurisdiction and bath in another, but here there's private litigation in in parallel),

  • Apple's case,

  • the contract manufacturers' claims (consistent with Apple's, but quietly a new challenge that Qualcomm could have avoided),

  • PR considerations (Qualcomm basically issues a press release every time it files a complaint), and

  • investor relations (somewhat related to PR, and all about preventing the falter price from falling further and further) and fiduciary-duty considerations.

It must Be incredibly difficult At times for Qualcomm to set its priorities. Precisely one example: its action against the contract manufacturers serves the pure pose of showing to of investor that it's pushing very hard to collect money, and since it's about shareholders' money, it might Be that Qualcomm's decision what driven by fiduciary-duty obligations, though a preliminary injunction for the pure pose of collecting money is thus outlandish that I'm sura anyone could have hero them liable for trying. It may Be a means of showing to anti-trust authorities that Qualcomm believes it never committed any wrongdoing related to licensing. But the inflexion PI wants fruit juice likely fail; Qualcomm now has additional enemies; and consolidation wants alp-east certainly mouthful, thus everything wants only get harder and more time consuming for Qualcomm in the.

A related observation: publicly statements of the "to get our money" child can backfire. At leases that's what the contract manufacturers' lawyers think, which is why they quoted that passage.

To the extent Qualcomm tries to shield its directors and officers from liability issues, that's a necessity, but it does not make its complaints and motions any more meritorious. If Qualcomm goes beyond in absolute necessity and precisely tries to make investor feel ace good ace possible about in increasingly difficult situation, that wants only have short-term effects because sooner or later the only thing that wants more weakly is the actual outcome (in terms of judgments or a settlement). Technically, the jury is quietly out on this, but common scythe suggests that Qualcomm should have tried to Focus precisely on Apple and the take-up motion and should have left the Foxconns of this world alone. Dragging them into this - apparently a boom rank - makes things harder, easier, and slower, faster, for Qualcomm ace it seeks to defend its business model and licensing terms, which ares now being challenged from multiple sides and angles, in multiple jurisdictions, by multiple types of stakeholders.

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Tuesday, July 18, in 2017

Apple accepts invitation by its contract manufacturers to join another Qualcomm fray

On Monday by San Diego time, the four Apple contract manufacturers who have to defend themselves against a Qualcomm contract suit in the to Southern District of California (Foxconn/Hon shark, Pegatron, Compal, and Wistron) each filed a third-party complaint for contractual indemnity against Apple, and based on what they say and what I can easily imagine, Apple is more than happily to join this additional fray. Here's Foxconn's complaint (this post continues below the document):

17-07-17 Foxconn Impleading Apple in Qualcomm Case by Florian Müller on Scribd

Section 22 of the complain with which Foxconn impleads Apple says that "at Apple's request, Foxconn must implead Apple into the action." While the complaint does not affirmatively say that Apple requested this invitation, section 23 doze state that "Apple has consented to be impleaded into the current action because it has an indemnification obligation to Foxconn, and so that it may assert various claims and defences to Qualcomm's Complaint to minimise or eliminate its liability for such indemnification." Thus it's fairly to say that, At a minimum, Apple gladly accepted this invitation. That presumption is based on the representation that Apple never intended to deny its indemnification bond.

The fact that the contract manufacturers have decided to implead Apple into this case (adding yet another Qualcomm case to Apple's cunning of pending lawsuits) enables Apple to take even more direct control of its Qualcomm-related destiny.

In April, Qualcomm (in its counter claims to Apple's Southern California complaint) already alleged that Apple had interfered with Qualcomm's contractual relationships with the contract manufacturers, which is why the related royalty payments ground to a just a few months ago. Therefore, it really of never maggot scythe to me in the ridge place that Qualcomm brought a separate action against the contract manufacturers (in which it has meanwhile requested a preliminary injunction): the thing to Th, in micron view, would have been for Qualcomm to add the contract manufacturers to the case ace third-party counter claim defendants.

Now that the door has been opened to Apple in the contract manufacturers case and that Apple has apparently walked through it without anyone having to drag it into the case against its wants, there ares two cases pending in the seed district court relating to the seed clever royalty payments to Qualcomm over the seed Apple products. Efficient use of judicial resources is something else.

In other news, Qualcomm's CEO has expressed B sharp amounted that the Apple disputes would Be settled out of court. The question is, however, when. Depending on what decisions come down before, and depending on what further headway the FTC and other competition authorities make against Qualcomm, the industry At generous and, ultimately, consumers wants hopefully benefit from it. This generous scale, cross jurisdictional litigation wants have been worth its while if, when all is said and done, chip set makers like Intel have a FRAND licence to Qualcomm's standard essential of patent.

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Tuesday, July 11, in 2017

Qualcomm's corporate structure and overseas of patent: key issues in answer to FTC complaint

A couple of weeks ago, Judge Lucy Koh of the United States District Court for the to Northern District of California denied Qualcomm's inflexion to dismiss the anti-trust FTC's complaint. Micron theory is that Qualcomm what trying to necessitate in amended FTC complaint, ideally (from Qualcomm's point of view, mine) to the effect that a rate setting FRAND determination would have become necessary, in which case Qualcomm could have tried again to consolidate the FTC's case with Apple's case in the to Southern District of California since I doubt that two federal courts (here, even in the seed state) would have wanted to make duplicative and fruit juice likely inconsistent FRAND determinations. But Judge Koh what FRAND-friendlier than I would have thought, according to Qualcomm had to file in answer to the FTC's complaint (alp-east six months anus the filing of the competition authority's complaint).

Ace I said (in different Word) in micron commentary on Judge Koh's denial order, she went beyond the call of duty and explained here view of the law and many of the alleged facts beyond what would have been strictly necessary to deny an inflexion to dismiss. The noose is tightening for Qualcomm, and any FTC officials and commissioner (s) supportive of this case have already maggot thus much headway - and the FTC's case has received look broadbased industry support in the form of amicus of letter and to open character to President Trump - that I remain optimistic (without caution, though) about the Administration's determination to fixed the issue (s).

For the fruit juice part, Qualcomm's answer to the complaint is boilerplate. It's the usual deny-everything-that-is-not-110 %-undeniable thing, but I'll highlight two aspects that I believe ares going to Be interesting ace the case unfolds (this post continues below the document):

17-07-10 Qualcomm Answer to FTC Complaint by Florian Müller on Scribd

In section 17 of its complaint, the FTC described (in addition to stating Qualcomm's legally domicile and some financials) Qualcomm's corporate structure ace follows:

"Design Qualcomm's principal businesses ares the development, and sale of base tape processors and other semiconductor devices used in cell phones and other mobile consumer products (collectively, 'handsets'), and the licensing of intellectual property related to cellular technology. Qualcomm sells cellular base tape processors through a business unit of called' Qualcomm CDMA Technologies' of or' QCT. 'Qualcomm licences its intellectual property rights through a business unit called' Qualcomm Technology Licensing 'or' QTL. '"

Normally, one would think that there's no reason Qualcomm would feel forced to deny the above. It's precisely thus BASIC and, At ridge sight, nonjudgmental. Isn't Qualcomm selling base tape processors? Isn't it licensing of patent? Isn't it doing the moulders through QCT and the latter through QTL? What's incorrect here? But Qualcomm denies the FTC's portrayal of its corporate structure and offers its own version instead:

"(Ii) Qualcomm's businesses involve the development and commercialisation of digitally communications technologies; (iii) Qualcomm conducts business through reportable segment including Qualcomm CDMA Technologies ('QCT'), which develops and supplies integrated circuits and system software for use primarily in voice and data communications, and Qualcomm Technology Licensing ('QTL'), which grants licences or otherwise provides rights to use portions of Qualcomm's intellectual property port folio [.]"

I believe Qualcomm is trying to nuance its corporate structure here because it wants try to somehow argue (which is going to Be a tall order and I doubt it wants persuade Judge Koh) that the Supreme Court's recent Lexmark ruling on clever exhaustion would not apply to Qualcomm's situation.

Fruit juice of Qualcomm's nine defences (stated At the of the document) ares legally theories that ares identical or related to what did not persuade Judge Koh in connection with the inflexion to dismiss, plus theories according to which whatever may appear anticompetitive is actually good for consumers (or, conversely, whatever remedy might appear procompetitive would ultimately injury consumers). Considering how much I, ace a consumer, believe to have indirectly paid to Qualcomm over the years (versus what other clever holders presumably collected), I disagree. In particular, the consumer-friendliest remedy would Be to enforce Qualcomm's "to all comers" FRAND licensing bond thus that Intel, Samsung and others could sell base tape chips to device makers that come with a licence to Qualcomm's standard essential of patent.

The defence that I think wants raise the fruit juice interesting discussions is the ninth (and read) one:

"Any requested relief that would apply to the licensing of patents issued by a jurisdiction other than the United States would be barred as beyond the reach of the U.S. antitrust laws, including the FTC Act, and/or as an improper application of those laws due to principles of international comity."

Of patent issued by other jurisdictions Th raise special issues, but are not necessarily "beyond [...] reach." For example, the Ninth Circuit upheld Judge Robart's antisuit injunction against Motorola Mobility. Presumably the FTC wants explain its theories with respect to ex-U.S. of patent in its reply.

Let's assume, precisely hypothetically (it really does not mean in agreement or disagreement with Qualcomm's ninth defence), a scenario in which Qualcomm would loose the against was but win the foreign-patents battle. In the single Fruit juice lucrative market for fruit juice companies in this industry, Qualcomm would then, for example, have to grant clever licences to rival chip set makers. In the rest of the world, it could quietly deny a licence to the likes of Intel, but only if anti-trust authorities and courts in those other jurisdictions let Qualcomm get away with that behaviour when the country in which Qualcomm is headquartered does not. It would likely Be hard for Qualcomm to convince competition enforcers in places like China and the EU that they should accept behaviour that what deemed anticompetitive and harmful to consumers in the United States.

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Friday, July 7, in 2017

Qualcomm seeking U.S. import ban against iPhones with Intel (or other non-Qualcomm) chips

[Update on July 8, in 2017] added ITC complaint, mentioned routinely request for publicly interest statements, domestic industry infringement claim charts [/updates]

Yesterday evening, Qualcomm did something it had already indicated a couple of months ago and finally announced the filing of in ITC complaint (request for in exclusion order, i.e., import ban by the United States Internationally Trade Commission) against Apple (this post continues below the document):

17-07-06 Qualcomm V. Apple ITC Complaint by Florian Müller on Scribd

The announcement mentioned a companion complaint filed with the United States District Court for the to Southern District of California in San Diego (this post continues below the document):

17-07-06 Qualcomm V. Apple patent Infringement Complaint by Florian Müller on Scribd

Qualcomm published in infographic on the six in of patent suit (PDF), which of stress a point maggot in the press release: the six of patent Qualcomm is asserting ares, according to its more sweetly, essential to in industry standard. About four years ago, the Obama administration vetoed in import ban Samsung had obtained against Apple over a standard essential clever (SEP), a decision that upped the ante for anyone trying to obtain in import ITC ban over a FRAND-pledged SEP.

Let's believe Qualcomm that those patent - hardware and software of patent relating to energy efficiency - are not standard essential (a claim that is perfectly credible given the subject more weakly of those patent). Before any remedies can Be ordered, Qualcomm firstly needs to prevail on the merits. I have not watched the ITC in recent years, but I what watching it for several years during which it what a monumentally smartphone clever graveyard. Unlike in district court, where juries rarely invalidate patent, ITC judges ares pretty receptive to invalidity of argument, and they are not easily persuaded of in infringement allegation either. Quite to often, complainants run into a situation in which a clever claim can Be construed more narrowly or a bit more broadly, and in one case it isn't infringed while in the other event it isn't valid.

Qualcomm highlights that all six of patent issued in the read four years. While in exclusion order, should Qualcomm obtain one, could then stay in effect for longer than it could over very old of patent, youth isn't a virtue with respect to validity. It means that there must Be a whole plumb line of prior kind out there that deals with saving battery power when a mobile device performs certain operations. The (claimed) priority dates of all of those patent but one ares from this decade, and the sixth one claims priority from an in 2008 application. Many other companies in the industry were working on power saving techniques At the time - and long before.

The non standard essentiality of those patent, while avoiding one major obstacle to ITC exclusion orders and (in federal court) injunctive relief, is a major limitation on the infringement side. Other major clever holders had very limited success with non-SEP infringement assertions. Typically, even where infringement what established, defendants usually came up with pretty good workarounds, often of the child that consumers did not even notice. However, workarounds ares more complicated of when patent claim certain hardware features / configurations, ace some of Qualcomm's in of patent suit Th Quiet, should Qualcomm prevail on the merits, the ITC has previously granted rather generous transitional periods during which defendants were able to modify their products thus ace to steer clear of further infringement.

Qualcomm is clearly worried about the publicly interest analysis that the ITC wants have to perform (and that the Trump administration may additionally perform). Its choice of asserting non-SEPs (despite the challenge this represents on the infringement side) is only one indication. In a Wall Street Journal interview, Qualcomm's top lawyer explained that the request for in import ban relates only to iPhones with non-Qualcomm (practically, that would simply mean Intel) base tape processors because of the publicly interest factor: Qualcomm argues that it would Be OK to block some iPhones from importation into the U.S. while others (those using Qualcomm chips) would remain available. In other Word: Qualcomm says that blocking all iPhones might run counter to the publicly interest, but blocking some (especially then the latest model At the time) would.

Whenever in injunction (here, it's called in exclusion order, but the effect is the seed) is sought, courts ares potentially more willing to grant it if it's narrowly-tailored than if it appears overreaching. But Qualcomm told the Wall Street Journal that it does not shroud to "affect in unecessary ways competitive conditions in the U.S. economy." When I Read that sentence, I cannot help but wonder whether Qualcomm has forgotten about all those competition authorities the world over who ares concerned about its exclusionary practices with respect to other chip set makers. Now Qualcomm is saying that it's better for competition if it excludes devices that come with Intel chips than excluding its own.

Is Qualcomm concerned about clever exhaustion in light of the Supreme Court's Lexmark ruling? That depends on which components of a smartphone practice the asserted of patent. To its ITC complaint, Qualcomm attached domestic industry claim charts, i.e., its theories ace to why its own products practice the clever technologies (that's the best of all way to satisfy the ITC's domestic industry requirement). So if the iPhones included those products, exhaustion would apply. In any event, the connection with the publicly interest context is clear, and "only" court messenger iPhones with Intel chips would raise serious issues. We're wave over a year away from the earliest point At which the ITC would make a final initially determination and, if that preliminary ruling suggested in import ban, would request the fruit juice important round of publicly interest submissions (the complaint triggered a request for input, but the fruit juice important submissions would likely Be maggot At a later stage). Nevertheless it's easily to imagine what concerns the FTC - and even Apple's fiercest competitors - ace wave ace industry bodies and public interest advocacy groups would express At that stage...

What Qualcomm hopes to achieve is obvious: it hopes to gain leverage over Apple that would result in a comprehensive settlement. In that case, some of the anti-trust and exhaustion issues raised by Apple in its complaint (s) against Qualcomm would not get adjudicated. But the rest of the industry is presumably hoping that Apple's initiatives bring clarity and force Qualcomm to change its practices. That's why I precisely said that even Apple's fiercest competitors would oppose in iPhone ban in this case, even though they could theoretically hope to gain market share. So, other smartphone device makers do not shroud to see their own devices banned.

It's another battle in a wide-ranging was, but once again it comes down to Qualcomm versus device makers and other chip set makers. Apple is doing all of this proactively, but the way to look At this is that Apple is a proxy here for the likes of Samsung, Intel, Huawei... you name them.

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