Friday, September 21, 2018

iOS 12 seems to contain workaround: Qualcomm's Munich patent lawsuits against Apple's Spotlight search

Yesterday the Munich I Regional Court held a six-hour (including breaks, though) trial on Qualcomm's eight lawsuits asserting four different search user interface patents against Apple's Spotlight search, with two lawsuits per patents targeting a total of three different Apple entities. A first hearing had been held in early May.

That part of the wide-ranging, earth-spanning, multifaceted Apple-Qualcomm dispute is, however, strategically so unimportant that it's not worth multiple posts or anything. That set of eight cases is a total waste of court and party resources--sort of a tempest in a teacup--as these Munich Spotlight cases have been defanged in three important ways:

  • Presiding Judge Dr. Matthias Zigann made clear, and Qualcomm apparently failed to change his position, that some of those lawsuits will result in a non-infringement finding because they require a "standby" functionality where an app does not have to be started by the user by means of tapping on an icon. But even that is strategically not that important; it just has cost implications under Germany's "loser pays" rule.

  • Just like in the Mannheim case tried earlier this week, at least one of Apple's contract manufacturers, Pegatron, is licensed. Qualcomm conceded this, which may have cost implications as well. It could still obtain an injunction as Pegatron is not the only Apple CM, but theoretically Apple could just have Pegatron make whatever it wishes to sell in Germany after an injunction. For the patents asserted against Spotlight, even that logistical measure won't be necessary:

  • Qualcomm's lead counsel, Quinn Emanuel's Dr. Marcus Grosch, conceded that iOS 12, at least in Germany (though purportedly not in other places), "works differently" with respect to the accused feature. When asked by the court whether iOS 12 keeps clear of infringement, Dr. Grosch stopped short of admitting that much, but he did reiterate that it "works differently."

    That's a highly significant concession. Enforcement of an injunction is very similar in Germany to how it works in the U.S.: if you as a patentee identify an infringement despite an injunction being in force and effect, you have to file a contempt motion and get the infringer sanctioned. If the infringement involves new products, but is in technical terms materially the same, the old injunction applies (in the U.S. it's more important than in Germany to ensure that the language captures such future infringements). Otherwise, you need a new proceeding on the merits and a new injunction (as mentioned, for instance, in the Apple v. Samsung context). In Germany, the key term is "kerngleicher VerstoƟ" ("violation with identical core"). I can't see how Qualcomm could still make such a claim, should it obtain an injunction over older iOS versions, against iOS 12 with respect to the Spotlight patents.

For reasons previously explained, I don't believe there is an infringement here because the accused products lack a certain filter. But that aspect of the case wasn't rediscussed yesterday, and most of the time was spent on (in)validity issues, followed by a licensing (behind closed doors) and antitrust discussion.

In the validity part it was easy to see why iOS 12 is apparently in the clear: in connection with a search for ways to contact a person, Spotlight in iOS 12--purportedly just for Germany--displays text, but not icons, when distinguishing between a given contact's phone number, email address, and other contact data. Does this sound ridiculous to you? It sure does to me. But Qualcomm's last straw for getting at least some valid, but significantly narrowed, claims at the end of the ongoing nullity and revocation against rests on the icon/text distinction. I don't know whether one should laugh or cry. Anyway, this makes the presence of icons critical for the infringement theory as well, but iOS 12 simply doesn't show icons to German users in that particular context.

So if Qualcomm were to obtain a German injunction, it would only be symbolic, but commercially irrelevant.

Frankly, I can't even see how the patents will survive on that basis:

  • Judge Dr. Zigann raised the question of whether the use of icons instead of text meets the technicity requirement under the European Patent Convention. In order to do so, it needs to have a technical effect. He tossed out the possibility of saving memory, but as a software developer I know that even on low-resolution screens in the 1980s (long before the patents' priority date), even a small monochrome (!) icon already occupied more memory than a string like "email" or "phone". Nowadays, with higher resolutions and colors, icons are more memory-consuming by a large factor. Dr. Grosch said that whether an icon saves memory "depends on details of the execution," but that's simply not true. There is no way to make it more space-saving unless you store a text string, say, 1,000 times in memory instead of once. The other possible technical effect that was discussed was that an icon might save screen space. While that is true, I believe the mere replacement of a text with an icon still isn't technical enough to meet the technicity requirement: it's at the semantic level, and then you would also save screen space by replacing "telephone" with "phone", or German texts with English or Spanish ones (less verbose languages), none of which would seriously count as a technical contribution to a solution of a technical problem. Something technically more sophisticated would have to happen in the background.

  • While German courts are reluctant to stay infringement cases for doubting the validity of patents for lack of an inventive step, the use of icons instead of text is such a ridiculous thing that it's really easy to see it's common general knowledge of a person of ordinary (or even way less than ordinary) skill in the art--and would have been so not only at the time of the priority date but decades (!) before. I believe German courts just make a summary determination of the prospects of a validity challenge, but here they could bring in a court-appointed expert and resolve the question very quickly. All I can say is that I knew about icons in the early 1980s and would have known about them before if I had been born earlier.

  • But the suggestion to use icons instead of text is also in the prior art reference most of the (in)validity discussion focused on. Thankfully, Apple and Intel's opposition briefs (petitions for revocation) filed with the European Patent Office are publicly available. "Haitani" is a PCT patent application for a "user-interface for computing devices" (WO2007019481). If you run a full-text search in your browser for "icon" over the description, you find multiple explanations. So there wouldn't even be a need to combine Haitani with any other prior art reference. It's all there. However, Qualcomm tried to get mileage out of some suboptimal drawings.

Due to resource constraints I'll write about in a different post where I'll express concern over the future of Munich as a patent infringement venue, the three-judge panel didn't have the chance to confer prior to the trial. They'll do so afterwards, and maybe they'll then see that a stay is warranted. Or revisit infringement. But even if Qualcomm got an injunction, it would just be toothless, pointless, useless (apart from maybe decorating someone's wall).

As for antitrust, such a weak set of patents was the least interesting context for discussing Qualcomm's "grand evil scheme" (a term that was not reiterated yesterday, but the message was consistent). I would like to mention just three things that the judge asked, all of which were very valid questions:

  • How could Qualcomm enforce its intellectual property rights without violating antitrust law? Apple mentioned different aspects and criticized Qualcomm for the selectivity of its attacks. In my opinion, the single most important part is that Qualcomm would recognize the antitrust implications of its actions and would seek only monetary damages, not injunctive relief. That would not be unprecedented. It's been done in Germany (such as by IPCom against Apple, over a standard-essential patent); it's also been done in the U.S., where Nokia in its 2009 Delaware lawsuits (again against Apple) made a distinction between standard-essential patents, for which it merely sought to be compensated, and others (they called them "implementation patents"). I remember this very well because Nokia's differentiated approach made a lot of sense to me at the time. In late 2010 I compared Microsoft's FRAND lawsuit against Motorola to Apple's FRAND defense against Nokia. I would still say that's the way to go. Of course, seeking way supra-FRAND damages could also constitute a violation. But in Germany, the first step is usually just to get a ruling on the merits, with damages being addressed in a subsequent proceeding.

  • For how long should Qualcomm be barred from fully enforcing its patents against Apple? The answer was: as long as it's in a dominant position in the baseband chipset market.

  • Couldn't Qualcomm just work around it by means of privateering (selling patents to a troll who would then go after Apple)? This part wasn't addressed in much detail. But I've been campaigning against privateering on this blog for a few years and have looked into some of those typical patent "transfer" agreements, and I can provide the answer: it wouldn't work. In order for Qualcomm to leverage patent suits to force Apple to stop buying from Intel to and force it to return to buying baseband chips exclusively from Qualcomm again, Qualcomm would sooner or later have to tell Apple that certain troll lawsuits would also be withdrawn the moment Apple does so. So Qualcomm couldn't hide the fact. Then there are requirements for patent transfer agreements under U.S. law with a view to standing, and in the post-eBay era in the U.S., trolls hardly obtain injunctions. But even if they wanted to do it only for Germany, they'd have to sooner or later admit that they can call off the troll, and then the antitrust implications (in the event of a complaint subsequent to such admission, or to a settlement after which the troll lawsuit is magically withdrawn) would be the same.

A decision has been scheduled for December 20, 2018, which is partly attributable to leave granted to Apple for a post-trial brief (two weeks) but may mostly be due to the present resource constraints of the 7th civil chamber of the Munich I Regional Court.

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