Wednesday, August 7, 2013

Apple succeeds on appeal: dismissed ITC patent case against Google's Motorola Mobility alive again

The United States Court of Appeals for the Federal Circuit just handed down its opinion on Apple's appeal of the ITC's March 2012 dismissal of its three-patent complaint against now-Google-owned Motorola Mobility. The ITC decision has been reversed in part and vacated in part, and remanded to the U.S. trade agency for further proceedings with respect to two Apple multi-touch patents that have been asserted and could be reasserted anytime against Samsung:

Today's remand decision gives Apple another opportunity to win a U.S. import ban against the Google subsidiary's Android-based devices, which would have the Android ecosystem at large concerned. Google believes that Motorola's new flagship smartphone, the Moto X, would not be affected by an import ban because it's "assembled [as opposed to "made"] in the United States". But other Motorola devices would undoubtedly be subject to an import ban because they are imported into the U.S. market.

The '607 patent, a potentially very powerful hardware patent, was deemed invalid by the ITC. But the Federal Circuit finds the ITC's reasoning deficient as far as independent claim 10 of the patent -- one of the claims asserted by Apple -- is concerned. The ITC will have to make a new determination, and based on the appellate decision, claim 10 may ultimately be found valid, in which case Google faces an infringement problem. Very recently an anonymous reexamination request was filed against this patent with the United States Patent and Trademark Office.

The '828 patent was not found infringed, but the Federal Circuit has now "vacate[d] the ITC's decision that Motorola does not infringe the ’828 patent claims and remand[ed] the case to allow the ITC to consider in the first instance whether the accused products infringe under the correct construction of 'mathematically fitting an ellipse.'" In my analysis of Apple's petition for a Commission review of the Administrative Law Judge's preliminary ruling (which the ITC rubberstamped in the end) I already criticized the ITC's claim construction, which was obviously weak (among other things, the word "actually", which I criticized, indicated that the ALJ didn't get this right). In today's ruling, the Federal Circuit "agree[s] with Apple [and, by extension, with me] that the ITC erroneously construed the 'mathematically fitting an ellipse' limitation".

As I mentioned in my report on the '607 reexamination request, Apple temporarily asserted this patent against Samsung in the Northern District of California and reserved the right to reassert it, which also applies to the '828 patent, the other patent that is back in the game after today's appellate ruling. Without a doubt, Samsung, which is represented by the same law firm against Apple as Motorola Mobility (Quinn Emanuel), has been watching this appeal with great concern, and will be very unhappy about today's decision.

Apple's lead counsel before the Federal Circuit was Orrick Herrington Sutcliffe's Joshua Rosenkranz, who also represents Apple in two FRAND-related appeals against Motorola Mobility (the "Posner appeal" and the appeal of the dismissal of a rate-setting case in Wisconsin) leads Oracle's appeal against the ruling in the Android/Java copyright case. Mr. Rosenkranz has been named "the Defibrillator" for his repeatedly-proven ability to resuscitate dismissed lawsuits on appeal.

Only one of the three patents Apple asserted against Motorola in its 2010 ITC complaint, U.S. Patent No. 5,379,430 on an "object-oriented system locator system", is definitively out of the game. Apple did not pursue its claims over this patent on appeal. It was too close to expiration to be worth it. But the two most important patents are now coming back, possibly with a vengeance.

Should Apple prevail on remand, which is anyting but unlikely (though not a given since the Federal Circuit ruling still gives the ITC some wiggle room in the further proceedings), this could be strategically more important than last year's jury verdict in the Samsung case. Injunctions are more important than damages, and these patents are more fundamental than the ones asserted at the California trial a year ago.

The following passage from one judge's dissent-in-part (Circuit Judge Reyna would have sided with Apple on even more claims) underscores the importance of the '607 patent and credits Apple for groundbreaking "true innovation":

"The Smartphone has defined modern life. Be it in the workplace, the home, airports, or entertainment venues across America, individuals are tethered to their handheld devices. Not long ago, users primarily spoke into these devices. Today, fingers tapping, grazing, pinching, or scrolling the screen is a ubiquitous image that reflects how we conduct business, work, play, and live. The asserted patent in this case is an invention that has propelled not just technology, but also dramatically altered how humans across the globe interact and communicate. It marks true innovation."

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