Friday, December 16, 2011

Samsung hits Apple with four new patents in Germany but backtracks on the iPhone 4S

Today the Mannheim Regional Court held two hearings involving Apple and Samsung. In the first one, Apple was the defendant; in the second one, Samsung faced a lawsuit from Apple over a rather famous (slide-to-unlock) patent. Further below I'll talk a little more about how those hearings went. But the most interesting parts came up right at the beginning of the session:

  • With the help of two additional law firms, Samsung is now suing Apple over four more patents in Mannheim, in addition to three that were already asserted in April. Apple, for its part, is suing Samsung over six patents in Mannheim.

    I'll list Samsung's four new patents further below. One of them is, ironically, a smiley input patent. The four new patents include two FRAND patents and two unencumbered patents. The smiley patent is part of the latter group.

  • Samsung is backtracking with respect to Apple products containing Qualcomm baseband chips, which at this stage means the iPhone 4S.

    The procedural tactics involved require some more explanation (which I'll provide further below), but the short version is that this is a defensive move no matter how you look at it, and most likely it's due to the setback Samsung suffered in France last week, where a motion for a preliminary injunction against the iPhone 4S was denied because the Tribunal de Grande Instance de Paris held that Apple's use of Qualcomm baseband chips eliminated the need for a separate license from Samsung. Samsung can still bring 3G patent assertions against the iPhone 4S. It hasn't waived that right. But if it thought it had a strong case in that regard, today's backtracking wouldn't make sense.

Now let's look more closely at the new lawsuits brought today, the iPhone 4S matter, and the patent infringement claims discussed at today's hearings.

Four more patents, two more law firms

Only a few hours prior to today's hearing, Samsung filed two "extensions" to the first of those lawsuits, adding four more patents to the dispute. The court granted an immediate Apple motion to sever those extensions. As a result, there are two new Samsung v. Apple lawsuits in Mannheim over two patents each.

Three Samsung v. Apple complaints were filed in April 2011, all of them now waiting for a decision since the related hearings have taken place. Also, Apple is suing Samsung in Mannheim over six patents. In other words, more than a dozen patents are at issue between those two companies in only one German regional court. Around the globe they have several dozen lawsuits going between each other, and there's no sign of slowing down.

Samsung is also lawyering up in Germany. The new claims were filed by two law firms that didn't previously represent Samsung against Apple. So far, the firm of Rospatt Otten Pross handled all of Samsung's German disputes with Apple. Now Samsung also brought in Quinn Emanuel, a firm whose Mannheim office is already helping Motorola against both Apple and Microsoft. Quinn Emanuel, often just referred to as "QE", is Samsung's counsel against Apple in the United States, and it's now becoming involved with the German part of the dispute as well. I have no idea why that wasn't the case all along. Furthermore, Samsung has appointed Krieger Mes & Graf von der Groeben, a top-notch IP litigation firm from Düsseldorf.

These are the four new patents:

Samsung's original three German patent lawsuits against Apple were all about standards-related patents. Now Samsung has a total of five declared-essential patents in play against Apple in Germany -- and two others.

I wouldn't be surprised if Apple decided to respond to this escalation by bringing several additional patent infringement lawsuits against Samsung in Germany. Since Apple already has six lawsuits going against Samsung in Mannheim, it might start a few new ones in Munich. Apple is also suing Motorola and HTC in both regional courts in parallel. And in a third one (Düsseldorf), Apple has its design-related litigation going with Samsung. Two hearings are scheduled in those litigations for next week.

Samsung backtracks (but keeps all options open) on Apple products using Qualcomm chips (iPhone 4S)

Samsung's counsel said that in the lawsuit discussed today, his client doesn't request a ruling with respect to Apple products having a Qualcomm baseband chip. Samsung used that definition rather than naming products, but as of now, the only Apple product known to come with a Qualcomm chip is the iPhone 4S.

While Samsung positioned this as what could have been a mere clarification rather than a modification of the claims, Apple's counsel asked the court to treat this as a voluntary partial dismissal of the case and asked the court to impose the related costs, under the German loser-pays principle, on Samsung. In a German lawsuit, a withdrawal of a lawsuit, in whole or in part, is possible until the beginning of the decisive hearing and is without prejudice (meaning the same claims can be brought again in another litigation), but it requires the defendant's consent. For the event that the court agrees this is a partial withdrawal, Apple's counsel expressed his consent.

In a short break between the two hearings I tweeted about this (from outside the building), and my tweet may have appeared to overstate what Samsung actually did. That's why I later added tweets that Samsung has clarified it did not waive its rights with respect to baseband patent assertions against the iPhone 4S in general.

According to Samsung, the purpose of today's tactical move was to streamline the particular lawsuit discussed today. However, there can be no doubt that this is defensive. About a month ago, at a hearing on two other Samsung lawsuits against Apple in Mannheim (also over 3G patents), Samsung opposed Apple's request not to consider the iPhone 4S an accused product in those litigations (because it was released months after the related complaints). What has changed since? There's no reason to assume that it's just because of the patent at issue today. If the patents at issue in the other two actions are licensed to Qualcomm, so is today's patent.

The most probable reason is this: last week, a French court denied Samsung's motion for a preliminary injunction against the iPhone 4S and found that its 3G patent rights are exhausted because of a license agreement between Qualcomm and Samsung. In other words, Apple benefits from the license granted to its vendor, Qualcomm. The Tribunal de Grande Instance de Paris held Samsung's termination of that agreement with respect to Apple as a customer invalid.

Samsung's lawyer claimed that Apple previously refused to disclose the names of its baseband chipset vendors for the various accused devices, and now that it's clear how Apple uses Qualcomm's chips, it's a different situation. That argument doesn't make too much sense either. At the previous hearings Apple also provided that information. I have furthermore seen plenty of evidence for Apple being forthcoming about this. For example, in the United States Apple even had to file a separate action to compel Qualcomm to provide documents Apple subsequently presented to foreign (mostly but not exclusively European) courts.

After the hearing today, Samsung told the press that today's partial withdrawal in only one of those litigations serves the purpose of streamlining one particular lawsuit. They didn't want the iPhone 4S issue to slow down the process.

Frankly, I doubt that the court would have scheduled its decision differently if Samsung had insisted on a ruling with respect to the iPhone 4S. If there had been a delay at all, it would have amounted to a few weeks, I believe.

Also, Samsung risked a major delay of this lawsuit by adding four new patents just on the morning of the hearing. Samsung apparently figured that the court was going to sever those new assertions from the original case, but there was no guarantee. Had the court not done so, it would have had to set a new hearing date and start a whole new briefing process. Samsung could have filed those other assertions as a separate lawsuit from the beginning.

It remains to be seen in which jurisdictions Samsung is going to continue to assert 3G patents against the iPhone 4S. Maybe this will depend on the outcome of the main proceeding of the French litigation. The court order denying Samsung's request for a preliminary injunction wasn't a final decision.

Just to be clear, for patents that wouldn't be implemented by a baseband chip (such as the smiley input patent), the Qualcomm contract is a non-issue.

Patent infringement claims discussed today

Today's doubleheader hearing covered one Samsung lawsuit over a declared-essential 3G patent and one Apple lawsuit over a slide-to-unlock patent.

The Mannheim court will hand the decisions on February 17 (Apple's lawsuit) and March 2, 2012 (Samsung's lawsuit).

Both plaintiffs have some explaining to do if they want to prevail. The court is unconvinced of the breadth of the parties' understanding of the scope of their patents.

The problem with Samsung's EP1188269 on an "apparatus for encoding a transport format combination indicator for a communication system" is that it covers the "generation" of a code, or actually it appears to be more like a matrix of codes, but if Apple uses those numbers by reading them from a prepared table, that doesn't necessarily fall within the scope of the word "to generate". Samsung says it does, Apple denies it, and on this one the court appears to be on Apple's side. In my view, it would be bad precedent if the court allowed the monopolization of tables of numbers.

The U.S. equivalent of that patent, U.S. Patent No. 7,706,348, was asserted by Samsung in an ITC complaint against Apple (the investigation is ongoing) and in a companion (mirror) lawsuit in Delaware. It will be interesting to see how the term "to generate" will be construed on both sides of the Atlantic.

But Apple's slide-to-unlock patent -- EP1964022 on "unlocking a device by performing gestures on an unlock image" -- may also be less broad than Apple argues, and as a result, Samsung might steer clear of infringement. It appears that Samsung's engineers and user interface designers got help from their lawyers, or from patent engineers, to figure out ways to implement the slide-to-unlock feature with a sliding image in ways that may be just outside the scope of the claims of that patent.

The issue here is that the patent covers the concept of moving (by way of a sliding movement) an imagine along a pre-defined, displayed path. Judge Voß said that the common understanding of a path is not just a starting point and an end point, but really a depiction of the way from A to B.

While I agree with the judge that a trail map would show more than just a starting point and a destination (he used a mountain summit as an example), the size of a touchscreen is such that a start point and an end path really are all that even the most obtuse user would need to know to figure out a way from A to B.

We'll see what comes out of this. Apple lost a bid for a preliminary injunction in the Netherlands with respect to this European patent, which a Dutch judge deemed to be likely invalid. Samsung presented the same prior art in Mannheim, but German courts interrupt infringement proceedings only if there's a high probability of a patent being invalidated, and this means that only prior art that actually anticipated an invention ahead of its priority date is relevant. German courts don't want to address obviousness issues (in this case, the question would be whether the slide-to-unlock patent is obvious over the combination of two prior art contentions) during an infringement proceeding. That's favorable to patent holders, but it won't help Apple unless it can prove an actual infringement. The outcome could be that one or two slide-to-unlock implementations found in certain Samsung products will be deemed infringing while others won't. In that case, Samsung could easily modify its operating software accordingly (while the process would likely continue with an appeal by Apple).

Apple is also using the slide-to-unlock patent in U.S. lawsuits.

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