While Microsoft's efforts to ensure the enforcement of an import ban it won last year against Google's Motorola Mobility over a meeting scheduler patent are delayed by the current government shutdown, it achieved a breakthrough today in its push for a broader import ban. Obviously, even a broader ban would be useful only if actually enforced, but that's what Microsoft is fighting for.
This morning the United States Court of Appeals for the Federal Circuit agreed in part with Microsoft that the United States International Trade Commission (USITC, or just ITC) should have ordered an import ban against Motorola's Android-based devices over more than just one patent. It affirmed the ITC ruling with respect to three patents (one of them was not infringed, while the Federal Circuit did not find that Microsoft established a domestic industry for the other two), but reversed in part and remanded the decision with respect to a fourth patent, U.S. Patent No. 5,664,113 on a "context sensitive menu system/menu behavior".
As a result of this, if the patent wasn't set to expire in December,the ITC would have to resume the investigation of Microsoft's October 2010 complaint (its first lawsuit ever involving Android), and the outcome would reasonably likely have been a broadening of the existing import ban. Motorola would then have had to work around two patents instead of only one or U.S. customs officers will hold its shipments. Products made in the U.S. would not be affected, however, and this may be a big part of the reason why the Google subsidiary is "assembling" the Moto X in the United States. But by avoiding U.S. import bans this way, Google still can't change the fact that Android did infringe, and Microsoft can seek monetary compensation in federal court.
Microsoft has been saying for years that Android infringes its patents, and it keeps proving this in court, despite delays particularly in U.S. lawsuits. Besides the import ban it won last year, it also obtained three German patent injunctions against Motorola's Android devices (1, 2, 3), the first one of which has already been affirmed by an appeals court. Microsoft has struck at least 20 royalty-bearing patent license deals with Android device makers and with manufacturers serving multiple device makers. Motorola would most likely be a paying licensee by now, too, if not for Google's adamant position that Android is "free" -- which no one in the industry believes anymore. Today's ruling further supports Microsoft's claim that it's entitled to Android patent royalties.
The world's leading court for patent appeals found that the ITC had incorrectly interpreted the '133 patent. Claim constructions are a matter of law and reviewed by the Federal Circuit without deference (while the ITC's findings of fact enjoy considerable deference, making them difficult to overturn).
One claim construction issue here is that Administrative Law Judge Theodore Essex, whose interpretation of the patent was approved by the Commission, believed the main group of the accused products did not practice the claim limitation (claim element) of displaying (a context-sensivitive menu) "in proximity" of a graphical representation of the selected computer resource (or object). That finding was based on his injection of a requirement that, as the Federal Circuit describes Judge Essex's thinking, "the placement of the context menu in relation to the graphical representation of the selected resource must be 'deliberate.'" The Federal Circuit disagrees that this should be a requirement and points to the space constraints on a small-screen device.
Similar issues affected other parts of the non-infringement ruling on the '133 patent. Google's Motorola ultimately avoided an infringement finding by the ITC with respect to the '133 finding just because of the ITC's "view of what the claims require", which is a more narrow perspective on claim scope than that of the Federal Circuit in this case.
With the Federal Circuit's broader claim construction, it appears that Microsoft would be more likely than not to win a ruling over this patent. Infringement per se is a given. As for the domestic industry requirement, the ALJ found that Microsoft met it (certain mobile devices running Windows Mobile 6.5, specifically the LG Fathom, were shown to the ITC and practice claim 1 of the '133 patent), and the Commission (the six-member decision-making body at the top of the ITC) did not overrule him -- nor did Google's Motorola challenge the domestic industry finding on appeal. Therefore, two of the three requirements (infringement and domestic industry) for an ITC import ban are met. The only requirement the Federal Circuit doesn't comment on at all is validity. A broader claim construction always comes with a heightened risk of a patent being found invalid, but Microsoft has been at the forefront of operating system development for decades and could probably defend this patent against any invalidity contentions even under the Federal Circuit's broader claim construction.
Here's the infringement claim chart Microsoft filed three years ago with the ITC over this patent (this post continues below the document)
The Federal Circuit ruling "affirm[s] the noninfringement finding for the accused alternative design", so Google can work around this patent -- all patents that aren't standard-essential can be worked around somehow, but workarounds often come with degradations of the user experience, functionality, or performance. Here, the Federal Circuit opinion indicates in my view that there will be degradation of the user experience:
"The ALJ found the alternative design to be non-infringing based on his conclusion that, for the context menu to be in the proximity of the graphical representation of the selected object, the graphical representation must remain at least partly visible on the screen when the context menu appears. Noting that there is little to go on in deciding this question (the ALJ's analysis was just one sentence), we adopt the ALJ's construction."
This means the workaround requires Google to display a full-screen context menu instead of putting it on top of the object to which it relates. That's a loss.
Today's ruling relates only to Microsoft's appeal of certain unfavorable parts of the ruling, not to Google's (Motorola's) attempt to have the import ban reversed (technically, these are two appeals against the same ITC ruling). But at the appellate hearing, held in early August, it was rather clear that Google was struggling to convince the court of its invalidity contentions regarding the scheduler patent over which Microsoft won last year's import ban.
Theoretically, the remand proceedings could be delayed by the U.S. government shutdown. The ITC is closed (at least with respect to these patent cases). But today's ruling is not yet a mandate, and by the time the Federal Circuit issues a mandate, the ITC will presumably be at work again.
Recently, Apple also succeeded with its appeal of an ITC ruling on a complaint against Motorola.
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