Friday, October 21, 2011

HTC asks ITC to drop patent from investigation after Apple allegedly narrowed its scope

The December 6, 2011 target date for a decision on Apple's first ITC complaint (of two) against HTC is nearing. In my previous post I wrote about the ITC staff's statement according to which a possible import ban of HTC's Android-based devices would not run counter to the public interest. In another development, HTC is trying to leverage a recent Federal Circuit ruling to remove from the ongoing investigation one of the two Apple patents an Administrative Law Judge deemed valid and infringed.

Yesterday, HTC's lawyers filed the public version of a document originally filed on Monday. Its title: "motion for summary determination of intervening rights as to U.S. Patent No. 5,946,647 in view of claim narrowing in reexamination of same and for termination of investigation as to same in view of intervening rights". The simplified version is that they want to get rid of the '647 patent arguing that the patent now has a narrower scope than it had when the investigation started.

Recap: the '647 patent

In July I published the infringement claim charts with which Apple argued at the time of its complaint that its rights were infringed. I called it an "action-on-data-structure patent" or, to just use one example of what it's good for, a "number tapping patent". If you receive an email on your phone that contains phone numbers, real-world addresses or website URLs, those will be recognized and underlined like links on a web page. You can then tap on, for example, a phone number to bring up a dialer, or on an address to show it on a map. produced a screenshot that shows multiple linked data structures in a single email.

Apple came up with the underlying idea long before the iPhone. This patent is from the mid-1990s.

Assertions against HTC, Nokia and Motorola Mobility

Apple asserted this patent in its ITC complaint against HTC in March 2010. Nokia was temporarily a co-defendant in that investigation, but the '647 patent was not among the patents that Apple asserted against both Nokia and HTC at the ITC. However, Apple asserted it against Nokia on June 28, 2010 in a federal lawsuit filed in Wisconsin and later transferred to Delaware.

Apple also asserted it against Motorola Mobility in December 2010. On October 8, 2010, MMI had already requested declaratory judgment of invalidity and non-infringement of a dozen Apple patents including this one.

Ex parte reexamination requested in October 2010 resulted in potentially narrowing statement by Apple in August 2011

On October 15, 2010, the USPTO received an ex parte reexamination request, meaning that a party raised issues based on which the patent should be invalidated or narrowed. I have not been able to find out who brought that request. The request that I tracked down was filed by a patent attorney without stating a client as far as I could see. Theoretically it could be any of the three parties Apple asserted the patent against, or maybe it was a coordinated effort of two or all three of those parties.

The reexamination request presented different pieces of prior art, and the relevant one in this context is a European patent application filed by Nokia, back in 1991, on a "multi-function telephone apparatus".

It's not unusual for a first Office action (the first statement of the USPTO following a decision to reexamine a patent) to preliminary reject all of the challenged patent claims. The patent holder then has to convince the USPTO that those claims should be affirmed. For that reason, Apple explained in late August 2011 why it believed the '647 patent related to an innovative achievement despite such prior art as the aforementioned Nokia patent application.

In that document, Apple argued that the Nokia invention from 1991 did not link at least one action to the detected structure (as the Apple patent describes) because it did not link an action directly to a phone number. HTC now says that "linking directly" is a narrower definition than just "linking". HTC argues Apple narrowed the scope of the patent claim regardless of what will happen during the remainder of the reexamination: the mere fact that Apple made such a statement can be held against Apple from now on.

The Federal Circuit's Marine Polymer decision (September 26, 2011)

Less than a month ago, the Court of Appeals for the Federal Circuit (which hears appeals of patent-related decisions from the district courts as well as appeals to ITC decisions) took a landmark decision on so-called intervening rights. For a description of Marine Polymer Tech. v. Hemcon, Inc., I recommend PatentlyO's article.

Intervening rights basically let an infringer continue with an infringement for some time if the scope of a patent changes during reexamination. That's nothing new. What's new since the Marine Polymer decision, however, is that such rights can be based not only on the final outcome of a reexamination but also on a patent holder's representations to the USPTO in the reexamination process.

Citing the Marine Polymer decision, HTC now claims that "Apple's arguments narrowing the asserted claims in the reexamination must be 'treated as an irrebuttable presumption that the original claims were materially flawed.'"

As a result, HTC claims it has intervening rights, and therefore the ITC should terminate the investigation as to the '647 patent.

HTC says that the Commission (the six-member decision-making body at the top of the ITC) doesn't even have to refer this question to the ALJ. Instead, HTC believes the Commission could decide on this matter of law itself.


It's difficult to analyze the merits of HTC's theory because large parts (multiple pages, in fact) of the passages of the ALJ's initial determination discussing the infringement of the '647 patent are redacted. That makes it very hard to assess whether Apple's clarifying insertion of the word "directly" really changes anything about the infringement of that patent by HTC's Android-based devices and, in particular, an Android library named Linkify. Interestingly, HTC says that, according to Marine Polymer, "intervening rights arise when claims are narrowed in reexamination regardless of whether the narrowed claims are infringed".

Based on the original claim charts and the differences Apple claims to exist between the '647 patent and the Nokia patent application, I don't think that the insertion of "directly" (in the sense in which it was meant in the context of that filing with the USPTO) is a get-out-of-jail-free card for HTC. I have the impression that "directly" was meant as "immediately" (in terms of an immediate mark-up) while the Nokia application passes data around before anything happens with it. But again, some of the relevant information is not accessible.

Even though HTC says that the investigation should be terminated with respect to the '647 patent regardless of whether it still infringes the claim, I'm not sure this will really happen. I guess the ITC will take a decision on whether or not the '647 patent is valid and infringed. Apart from the specifics of this case, the alternative would mean that the ITC would probably have to terminate its investigations with respect to many patents if the hurdle was too low for arguments made by a patent holder during reexamination to render a patent unenforceable for the purposes of an ITC proceeding.

But HTC might benefit from this initiative in a psychological sense even if its motion failed. Should the ITC already has doubts about the '647 patent, then this additional potential issue could tip the scales in HTC's favor.

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