Google's Motorola Mobility, represented by Quinn Emanuel, scored a surprise win over a Microsoft patent yesterday at the Munich-based Bundespatentgericht (Federal Patent Court of Germany). A spokeswoman for the Federal Patent Court just confirmed to me that the court's Second Nullity Senate declared EP0669021 on "multilingual computer programs" invalid within the territory of Germany. Microsoft can appeal this decision to the Karlsruhe-based Bundesgerichtshof (Federal Court of Justice). The decision has (very) limited impact on the Microsoft-Motorola dispute anyway because the patent will expire next month, reducing the set of available remedies to damages for past infringement.
The Munich I Regional Court, one of Germany's three leading courts for patent infringement lawsuits, had cleared Motorola Mobility's Android-based devices of infringement of this patent last year. Last month the Munich Higher Regional Court heard Microsoft's appeal and did not rule out a reversal of this finding, provided that the patent is upheld in the parallel nullity action based on a claim construction having sufficient scope for an infringement holding. The appeals court scheduled its ruling for December 19, 2013. In light of yesterday's nullity decision, it's a given that the infringement proceedings will be stayed pending final resolution of the nullity action (i.e., pending the nullity-related appeal to the Federal Court of Justice).
It's usually not surprising at all, but rather the ordinary course of business, that the Federal Patent Court invalidates challenged patents in this field. Not a single one of all patents-in-suit in the smartphone disputes I watch has been affirmed by the Federal Patent Court in the form in which the European Patent Office had granted it. So far, the only smartphone patent-in-suit that has survived a Federal Patent Court hearing at least in an amended form (i.e., with a narrowed scope) is another patent asserted by Microsoft against Motorola (an event architecture patent). By contrast, the Federal Patent Court has thrown out all Apple (1, 2, 3) and Samsung (1) patents it has adjudged so far, and Motorola's infamous push notification patent is sure to be thrown out next month. Negative preliminary rulings on two more Microsoft patents (one of which was found infringed last year while the other was not) have already been communicated to the parties (I have been able to obtain copies from the court).
Microsoft and Google agree that the rules of procedure for Europe's future Unified Patent Court should be designed to minimize the risk of injunctions issuing over patents that are subsequently (due to bifurcation of infringement and validity determinations) found invalid. While the Federal Patent Court's invalidity findings are sometimes reversed by the Federal Court of Justice, the fact that not even one of all of the current smartphone patents-in-suit that have come to judgment was affirmed in the granted form shows that patents granted by the European Patent Office must be evaluated very carefully before granting an injunction over them. It would be politically irresponsible to allow too many injunctions over EPO-granted patents in this industry in a bifurcated litigation because this would give plaintiffs leverage (often resulting in settlements) they wouldn't get if the patent underwent, in litigation, serious scrutiny. It doesn't mean too much that a patent office, which is never aware of all of the relevant prior art and is under pressure from only one side (the patentee), decides to grant a patent. The moment of truth for a patent is litigation.
In the case of Microsoft's about-to-expire multilingual programs patent, the Federal Patent Court had held all claims patentable in a preliminary ruling. That's why yesterday's outcome is surprising, though it's consistent with what happened to other smartphone patents-in-suit. I didn't attend yesterday's hearing because the dispute over this one is only about damages and if the patent had been upheld by the Federal Patent Court, the appeals court's infringement ruling would have come down in December and I would have focused on the outcome of that one.
Various Microsoft v. Motorola Mobility hearings and trials will be held in Germany next month. In the United States the parties want a final FRAND ruling (they disagree only on details), which Google will then appeal. The parties' infringement claims against each other in the Western District of Washington were stayed last year, and once the FRAND ruling has been brought into an appealable form, I guess the infringement proceedings in the U.S. will continue.
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