Wednesday, June 20, 2012

HTC argues Apple isn't entitled to immediate import ban, needs whole new lawsuit

Two weeks ago, Apple filed an enforcement complaint against HTC with the ITC, asking for an emergency proceeding that could result in an import ban of 29 HTC devices that allegedly infringe Apple's '647 "data tapping" patent. Yesterday, HTC replied to Apple's request. The letter was originally sealed and entered the public record today.

It was to be expected that HTC would argue that its current-generation devices don't infringe the '647 patent. HTC's immediate objective is to dissuade the ITC from issuing temporary emergency relief, which could be another import ban or a requirement that HTC post a bond amounting to 100% of its U.S. revenues. HTC argues that Apple's enforcement complaint presents questions that are sufficiently different from the original complaint (the one that led to the December 2011 ruling) to require a whole new ITC investigation, which would probably take a year and a half.

HTC claims that "Apple's Enforcement Complaint targets new products, new applications and new functionality that were never before the Commission in the [original] 710 investigation". HTC makes reference to an ITC investigation in which Funai accused several digital TV makers of violation of an exclusion order but the ITC felt that it "[did] not have the information necessary to determine whether the respondents are currently violating the Commission's limited exclusion and cease and desist orders".

I have read HTC's argument and compared it to the December 2011 Commission determination and the claim charts provided by Apple in the original investigation as well as the claim charts Apple provided as exhibits to this month's enforcement complaint. At this stage, I'm somewhat inclined to subscribe to HTC's argument that Apple's enforcement complaint goes beyond the interpretation of the valid scope of the '647 patent that the final Commission determination indicated, but only in part. That's because the ITC indeed held the patent to be valid only if a plurality of actions is linked to a detected structure (for example, allowing a phone number to be dialed or added to an address book), not a single action, and Apple's enforcement claim charts somehow suggest that even a single action falls under the scope of the relevant patent claims because multiple internal operations (which nevertheless represent a single action from the end user's point of view) are performed in response to a tap on the detected structure. I doubt that Apple will succeed with that part of its allegations.

But other parts of HTC's argument are unconvincing to say the least. For example, its emphasis on "new products" makes no sense. If the infringement of a given patent has to end, it has to end. And other parts of Apple's infringement allegations are consistent with the ITC's construction of the two relevant patent claims because there are data structured that are linked (even if a long press may be required) to multiple actions. HTC's argument in connection with those is merely that in the original investigation Apple didn't conduct discovery of Google with respect to the GMail client. HTC claims that Apple's original complaint only focused on three applications (HTC Messages, Android Messages, and Browser) and that its enforcement complaint should also be limited to those. But the fact of the matter is that Apple's original claim charts accused Android's Linkify library of infringement. Apple may have focused on a few applications on a purely exemplary basis, but I don't think HTC can reasonably claim that Apple limited its assertion to only three apps.

Even if some of Apple's infringement accusations appear overreaching to me, I don't think HTC is right that Apple can't reasonably ask for immediate enforcement against its current generation of devices. But I don't know whether the ITC will start an emergency proceeding if there is reasonable doubt about the merits of parts of Apple's allegations. Maybe Apple should have focused on where it has its strongest points to make.

In connection with the GMail client, it's interesting how HTC stresses that app's closed-source nature: "HTC does not write, modify, or otherwise have access to source code underlying the Gmail application." This shows once again how disingenuous Google's constant claims of "openness" in its communications ith the ITC, many courts and some antitrust regulators are. But Google's hypocrisy does not excuse HTC's infringement. HTC cannot just refer to GMail as a "third-party" app. HTC builds Android-based phones and accepted Google's Android license terms, which obligate HTC to ship the GMail client and Google's other closed-source Android components. Apple does not have to tolerate continued infringement by Google if it can prove such infringement.

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