Tuesday, August 31, 2021

Standard-essential patent royalties set to rise after unanimous Fifth Circuit judgment in Ericsson's favor ($2.50 or 1%/$1-4 per 4G device) against HTC

Hurricane Ida's landfall prevented the Fifth Circuit from holding the Continental v. Avanci et al. appellate hearing scheduled for yesterday (Monday, August 30). But the appeals court is still weathering the storm in other ways, and today put out its HTC v. Ericsson opinion (PDF).

The judgment is unanimous, though Circuit Judge Higginson filed a concurrence to make a point that is, ultimately, not outcome-determinative here.

The case originated from the Eastern District of Texas, where HTC alleged a FRAND breach by Ericsson, lost a jury trial, and the district court additionally entered declaratory judgment holding Ericsson in compliance with its obligations under the ETSI FRAND pledge, which is governed by French law. While the appeals court's affirmance of the district court ruling is based on purely legal questions (partly relating to jury instructions), it's worth noting what royalty demands have been blessed on the bottom line:

  • Ericsson initially (in 2016) wanted $2.50 per 4G device.

  • After HTC brought the complaint in question, "Ericsson proposed a new licensing agreement whereby HTC would pay 1% of each 4G device sold, subject to a $1 floor and a $4 cap."

HTC's response to the original $2.50 rate was a measly $0.10 counterproposal. The reaction to the 1%/$1-4 deal was an amended complaint.

Why such a discrepancy? Primarily it's due to the fact that HTC made a smallest salable patent-practicing unit (SSPPU) argument, claiming that the baseband processor should serve as the royalty base.

Outside of the Northern District of California, SSPPU arguments don't seem to get traction. While I believe no court would ever be inclined to let a WiFi SEP holder collect 1% of the price of an entire airplane with WiFi on board, baseband processors that aren't fully licensed aren't the measure--and if they are fully licensed, than the value of all IP licenses far exceeds that of the raw material.

The district court declined to overinstruct the jury, and its approach has now been affirmed. This is also a post-term achievement for the Antitrust Division of the United States Department of Justice under then-AAG Makan Delrahim. In late 2019, the Trump DOJ had filed an amicus brief formally in support of neither party but practically in Ericsson's favor. Interestingly, Apple's amicus brief in support of automotive supplier Continental's ill-conceived U.S. case against Avanci, Nokia and others--which is pending with the same appeals court--is all about bashing the Trump DOJ.

Let's face it: this victory for Ericsson is of transcendental importance. Whatever HTC will end up paying Ericsson is just a small piece of the puzzle. In the greater scheme of things, this is yet another milestone for cellular SEP holders, some of whom are going to look at Ericsson's win and feel that their rates are too low. And it's going to be harder and harder for car makers to refuse to pay royalties on their products that the U.S. judiciary apparently considers appropriate for phones. Apportionment arguments don't seem to do the trick for implementers--and there are so many license agreements that will have to be renewed in the near future, with SEP holders often demanding substantially higher royalty rates for licenses covering 5G.

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Sunday, August 22, 2021

The Federal Patent Court's six-month target and 33-month reality: flawed patent reform straight from the ivory towers of Berlin

NOTE: The above is a simplified comparison as the six-month target relates to the Bundespatentgericht's (Federal Patent Court) preliminary opinions and the 33-month reality to final judgments, as I'll clarify further below.

Throughout the German patent "reform" process, I focused myopically on access to injunctive relief. A few days ago, on the occasion of the start of operation of the Munich I Regional Court's 44th Civil Chamber, I reiterated my belief that those who hoped to benefit from the new injunction statute (automotive, electronics, and telecommunications companies) are not going to pay less for patent royalties--they're just going to spend more money on litigation. Pharmaceutical companies going after plagiarists will likely be fine, but they do have a risk because of the psychological pressure it may put on a court if an injunction allegedly deprives patients of access to life-saving medications (one could see those dynamics in this year's political debate over access to COVID vaccines).

What I treated with benign neglect was the second-most important part of the "reform" bill: the one that relates to stays of infringement proceedings pending parallel invalidation actions before the Federal Patent Court of Germany, the European Patent Office, or the German Patent & Trademark Office. But now that the measure has formally entered into force, it's overdue to conduct an impact assessment.

I'll be blunt: The text that has been inserted into § 83 of the German Patent Act (the section on nullity proceedings) is just as fundamentally flawed as the modifications they made to § 139 (the section on injunctions). The sum of those two amendments--which are still like 100 times more important than all other modifications combined--is nothing short of a dumpster fire.

In current polls, there's not a single political party in Germany that has the confidence of more than about a quarter of the population in its ability to address the most serious challenges. If more than a small minority of professionals understood that the same government (meaning the executive branch, which drafted the piece of legislation, as well as the government parties' lawmakers in a strict sense) understood what crap they put out in the patent policy context, confidence levels would drop even further.

They even know that they botched the part on stays over validity doubts. Pathetic craftsmanship is to blame, and the incoming government will be told that an amendment (comparable to a bugfix update of a computer program) is needed. Here's why:

  • They call on (but don't--as they can't--obligate) the Federal Patent Court to hand down a preliminary opinion ("qualifizierter Hinweis") within six months of service of the relevant nullity complaint on the patent holder.

  • However, according to § 81(2) of the same law, a nullity action cannot be brought while

    • one has the opportunity to file an opposition with the issuing patent office (EPO or German PTO) or

    • such opposition proceeding is pending.

    Especially in a context like 5G, there'll be many young patents: notice of opposition can be given for nine months after publication of the granted patent.

  • The German government could probably ask the German PTO (DPMA) to hand down preliminary opinions during the same six-month timeframe, which it would do if it had the prerequisite resources. But at least in the cases I'm interested in, DPMA-examined patents-in-suit are few and far between. The EPO, however, is run by the EPOrg, an international organization (Germany is just one member states among several dozen).

  • So there'll be a number of disputes in which the version of § 83 that was promulgated this month is going to be ineffectual due to § 81(2). A serious blunder.

Then there's a sentence in the new version of the statute that isn't wrong, but shows that the whole "reform" has more to do with appeasement and window dressing than with actually making an impact:

"Ist eine Patentstreitsache anhängig, soll der Hinweis auch dem anderen Gericht von Amts wegen übermittelt werden."

My translation:

"Is an infringement action [i.e., one in which the challenged patent is asserted] pending, the preliminary opinion should also be transmitted ex officio to the infringement court."

Just like the new injunction paragraph that contains useless passages such as a reference to the principle of good faith, the above sentence is a waste. Lawmakers should keep statutes focused on what really makes a difference. Let's face it: if a defendant wants to get a mileage in the infringement proceeding (i.e., increase the likelihood of a stay) out of a preliminary opinion by the Federal Patent Court that casts serious doubt on the validity of the patent-in-suit, that defendant's counsel will be sure to file the German equivalent of a U.S. request for judicial notice anyway. Conversely, if the preliminary opinion is favorable to the patent holder, the plaintiff in the infringement case will request judicial notice. There's no reason whatsoever to believe that an infringement court ever ignored a preliminary opinion by the Federal Patent Court on the (in)validity of a patent-in-suit.

I decided not to translate the German word "soll" with "shall" because that literal translation would be too close to a hard and fast obligation. Some translate "soll" in a legal context with "should" in order to make it clear that it's merely a target, not a limit. And that leads us, finally, to the most fundamental deficiency of that botched statute:

"Dieser Hinweis soll innerhalb von sechs Monaten nach Zustellung der Klage erfolgen."

My translation:

"The preliminary opinion should be rendered within six months of service of the nullity complaint."

Does that one really close the so-called injunction gap? The injunction gap is the window for the enforcement of an injunction that results from the fact that the infringement rulings typically come down well ahead of the nullity decisions, meaning that actually-invalid patents are often enforced, which often gives the patentee so much leverage that the defendant will be forced to settle and, under the standard terms of a settlement agreement, drop the nullity action.

A lower standard for stays would have moved the goalposts in defendants' favor. Whether or not one believes that the standard is too exacting right now, there is no question that if you lower the standard for stays, you get more stays. The same is not necessarily true of a six-month target for preliminary opinions.

Here's an "all other things being equal" perspective:

In order for more infringement proceedings to be stayed under the new statute, and with the standard for stays remaining unchanged,

  1. the quality of the nullity complaints must not be lower;

  2. the quality of the reasons provided by the Federal Patent Court must not be lower (lest the preliminary opinions bear less weight with the infringement courts);

  3. there must not be a reason for which the Federal Patent Court would be less inclined to cast doubt, in a preliminary opinion, on the validity of a challenged patent; and

  4. the Federal Patent Court would actually have to meet the six-month-target or at least not miss it by so much that an injunction would be entered and enforced before the infringement proceedings get impacted by the preliminary opinion.

Most German patent litigators aren't concerned about the first one of those four items if viewed in isolation: the infringement courts expect defendants to make their nullity case when they file the answer to the complaint, and if the Federal Patent Court actually hands down a preliminary opinion about six months later, that's normally timely.

Let's now skip straight to the end of the list: is the six-month target realistic?

On page 135 of the Federal Patent Court's 2020 Annual Report (page 69 of the PDF), one can read that the average number of months from docketing to resolution of nullity complaints was 24.6 in 2016 and has steadily increased to 32.8 (which I rounded up to 33 in the headline) by 2020.

The previous page indicates that there were 380 nullity cases pending on January 1, 2020. During that calendar year, 230 new nullity cases were filed, out of which 200 were adjudicated or withdrawn. The net gain of 30 increased the docket size to 410 pending nullity cases by yearend 2020.

In November 2019, I contacted the Federal Patent Court's press office with the question of how many nullity actions really get decided as opposed to dismissed by parties (which typically happens further to settlements, or because a nullity complainant is on the losing track). I was pointed to other statistics, according to which about 50-60% of all nullity cases were withdrawn, and 60-80% of those withdrawals occurred before the Federal Patent Court held its internal vote (the remaining withdrawals must have happened while the Federal Patent Court's decision was being appealed to the Federal Court of Justice).

For a simple breakdown, let's multiply 60% (number of withdrawals) by 80% (for the number of withdrawals prior to the court-internal vote), and we can see that roughly half of all nullity cases go away before they actually come to judgment. In the types of disputes I watch (which are typically settled relatively quickly), it's actually rare for the Federal Patent Court to decide. That's why I haven't even attended a Federal Patent Court hearing in more than seven years.

Now we can see why the backlog grew by "only" 8% (from 380 to 410 cases) during 2020: the current time to resolution is already so long that many cases never have to be adjudicated. The longer the nullity cases take, the more likely it is that a dispute is settled because of developments in the infringement cases (also including cases in other jurisdictions).

That fact complicates any effort to accelerate the Federal Patent Court's handling of nullity complaints:

The sooner the Federal Patent Court decides, the less likely it is that the case has been withdrawn (because of a settlement or for whatever other reason).

Most of the Federal Patent Court's work used to be done late in the process. In the past, the preliminary opinions typically came down when the nullity hearing was already in sight. From a case management perspective, the early stages of those cases used to be largely administrative: early on, it's largely just about the briefing schedule. Then, if a given nullity action was still alive after a while, came the point when the court had to address substantive questions and write its preliminary opinion.

Whoever in Berlin may have suggested that the Federal Patent Court could simply move up the issuance of a preliminary opinion like you reschedule a car tire change is either a fool or just wanted to fool others.

In many cases, the court never had to write a preliminary opinion because of earlier withdrawals. With the same resources that are required to hand down a preliminary opinion in just one nullity case, the court could probably handle dozens of nullity cases at the pre-opinion stage where its responsibilities are largely just administrative.

From the outside it's hard to tell what percentage of the actual work performed by the Federal Patent Court in a nullity case relates to the initial assessment of the merits and the authoring of a preliminary opinion. I've inspected a number of Federal Patent Court case files over the years. My guess is that it's at least 30% of the effort. The parties may make further filings after the preliminary opinion; a hearing typically takes a full day; and the actual decision must be written carefully. But after the preliminary opinion, the five-judge panel is already well aware of the challenged patent, knows the prior art references, and has identified the issues on which the case hinges. This may even be well over 50% of the overall effort, but I wanted to offer a conservative estimate, to err on the side of auction.

If the Federal Patent Court actually wanted to change its modus operandi now, it would have to basically devote all of its available resources to the production of preliminary opinions, and even then it might not be able to make the six-month target in many cases under "all other things being eqal" conditions. And this reallocation of resources would further slow down the actual resolution of cases, as the total workload would increase substantially considering that many cases are dropped before a preliminary opinion used to be formed and rendered.

It's highly unlikely that the Federal Patent Court will overnight get the incremental resources that the ill-conceived (and in my view, simply idiotic) patent reform bill would require.

The Federal Patent Court is already the second-largest court in Germany. Only the Federal Court of Justice employs more judges, and that court has jurisdiction over all civil (including, but not limited to, patent) and criminal law. Any appeal of a Federal Patent court nullity decision can be appealed to the Federal Court of Justice, and those are appeals of right, while appeals of infringement decisions are discretionary (comparable to the U.S. certiorari process).

The preface of the Federal Patent Court's 2020 report was written by now-retired President (i.e., Chief Judge) Beate Schmidt. She wishes her successor, Dr. Regina Hock, all the best--and notes that the Federal Patent Court "is facing new challenges" related to the Unified Patent Court (UPC) and the patent reform bill. Between the lines she requests additional resources: "With the unique composition of its bench, some of whose members have a technical background while others have legal training, the Court is well-equipped for the correct adjudication of increasingly complex cases, provided that it can count on support from politics, industry, and stakeholders." (my translation; emphases added)

Realistically, additional funding is not going to be available to an extent that would truly address the problem and enable the Federal Patent Court to deal with this new challenge.

So there won't be preliminary opinions under "all other things being equal" circumstances. No way.

Instead, the Federal Patent Court will quite often need more time.

But it will strive to meet the six-month target as often as possible, or to at least not exceed it by too much. There'll be a price to pay for that shortcut to a preliminary opinion. The court will hardly be able to maintain the same level of quality. And the judges will have a strong incentive to make their preliminary opinions, which in the past were very often consistent with the final judgments, more of an "agenda-setting" procedural step: instead of taking a position on whether the patent is valid or not, those opinions may become more like a list of items that counsel should address.

That, in turn, will not help the infringement courts with their summary determination as to whether or not a case should be stayed.

Defendants will benefit if patents are clearly anticipated by the prior art. Some patents are really ridiculous. However, if there are novelty issues, then the infringement courts are reasonably willing to stay a case, with or without a preliminary opinion by the Federal Patent Court.

Whenever a patent has a certain degree of complexity, and one has to combine prior art references in order to disprove the presence of a sufficient inventive step, there is now even a risk of the Federal Patent Court's preliminary opinions being more skeptical of the prospects of a nullity action.

Under severe time constraints, the Federal Patent Court may often be reluctant to indicate, even on a preliminary basis, a "thumbs down" on a patent that a patent office granted after examination. In case of doubt, it might just indicate in a preliminary opinion that certain questions need to be addressed in the further process--it is legitimate to want to err on the side of caution.

So are we going to see more stays on the bottom line?

Most of the people I talk to believe that there will be more. I'm not sure. My range of expectations goes from "no significant change" to "a slightly higher likelihood of stays." And while it's the least likely outcome, I seriously wouldn't rule out that this statutory change could even hurt defendants on the bottom line, with preliminary opinions that help defendants coming down on a timely basis mostly in cases in which the infringement courts would likely have stayed the proceedings anyway, and with a significant number of complex cases now leading to preliminary opinions that favor patentees just because the court will want to err on the side of caution and would need a lot more time (and further briefing) before it would really have the confidence to express the opinion that a patent is likely invalid. Those "agenda-setting" preliminary opinions may very well dissuade the infringement courts from stays they'd have granted if there simply had been no preliminary opinion available at decision time.

The one who will not be to blame are the judges serving on the Federal Patent Court's nullity panels. Those judges know what kinds of companies lobbied for this bill. Their professional ethics will not allow them to intentionally disadvantage the automotive sector or Deutsche Telekom, nor do they have any reason to devalue any patents asserted against such companies by prematurely declaring them to be likely invalid. The six-month target is an utter stupidity.

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Thursday, August 19, 2021

Munich I Regional Court's third patent litigation division commenced its operation on Monday, first administrative decisions are already known

As the Landgericht München I (Munich I Regional Court) announced in late June, its new patent litigation division started its work on Monday (August 16, 2021). It's the court's 44. Zivilkammer (44th Civil Chamber).

The new civil chamber's Presiding Judge--Judge Dr. Georg Werner--was already known at the time. Today I learned that his deputy will be Judge Dr. Anne-Kristin Fricke, who joined the 21st Civil Chamber (Presiding Judge: Judge Tobias Pichlmaier) a couple of years ago and was available to help out the 7th Civil Chamber (Presiding Judge: Judge Dr. Matthias Zigann) as well with her background in antitrust law. Presiding Judge Dr. Werner's second side judge will be Judge Dr. Franziska Greiner-Wittner. According to the web page of a book she wrote, she studied in Munich and clerkships also took her to Hamburg and Jakarta. In 2015, Judge Dr. Greiner-Wittner was a visiting researcher at George Washington University.

With a view to intradistrict assignment, one needs to consider that the new division is initially operating at 50% of the regular capacity. From this one can infer that the 44th Civil Chamber will get approximately 20% of the total patent caseload in Munich, while either of the other two divisions will handle 40% of cases.

What wasn't clear before--but has been decided by now--is that the new division will not only be assigned cases filed from here on out but some cases already pending with other divisions will be reassigned to the 44th Civil Chamber.

At this stage, no hearings or trials before the new division have been scheduled yet. The current operating assumption is that the new division will be in session on Wednesdays (like the 21st Civil Chamber).

I'm coming from the assumption that Presiding Judge Dr. Zigann will soon be promoted to the Munich Higher Regional Court. In that case, one of the lower court's current deputy presiding judges will be promoted as well. The Munich court has several patent-specialized judges who could be promoted, or maybe a side judge from the appeals court will become a presiding judge on the lower court.

According to an announcement made by the Preparatory Committee of the Unified Patent Court (UPC), the new court with the authority to enter judgments with effect in a multiplicity of European countries, "will start operations around mid-2022." Munich is going to be a key UPC venue, and we're going to see some of the well-known Munich patent judges dividing their time between the courts run by the Free State of Bavaria and the UPC. The percentage of their time that they spend on UPC cases will increase as more and more patentees decide to avail themselves of UPC jurisdiction. Initially, many cases will still be filed with national courts where the case law is pretty settled and plaintiffs know what to expect. During a long transitional period, plaintiffs can choose where to bring their complaints.

Meanwhile, Germany's patent injunction "reform" has entered into force. It was signed into law by the Federal President and published in the Bundesgesetzblatt (Federal Law Gazette) last week. The following day, renowned patent litigation and prosecution firm Bardehle Pagenberg published a YouTube video discussing the potential ramifications for the pursuit of injunctive relief:

As Professor Dr. Tilman Mueller-Stoy ("Müller-Stoy" in German) explains, there may be some new types of discussion in connection with third-party interests affected by the enforcement of patent injunctions. Professor Mueller-Stoy gives two examples: "vital drugs when patients' lives are at risk" and critical infrastructure such as public telecommunications networks. As for the latter, I still don't expect any injunction against a network operator actually to be denied in a case in which the patent holder makes a licensing offer that is not facially absurd. The same Bardehle lawyers published an analysis of the reform bill in late June in which they noted the following, with which I concur:

"It may be advisable, as the case may be, to make a reasonable license offer to the infringer that has carefully been thought out before or when filing the complaint. If the infringer has the possibility of averting a claim for injunctive relief by accepting such a license offer, hardly any German court will limit the claim for injunctive relief based on disproportionality."

As for essential medications, just before the reform bill formally took effect the Munich I Regional Court's 21st Civil Chamber granted Bayer multiple preliminary injunctions over a cancer drug patent, as Juve Patent reported this week. Those PIs are more like temporary restraining orders as they'll only be in effect until a Federal Patent Court ruling next month. The availability of PIs over patents of doubtful validity is a tricky subject that gave rise earlier this year to a preliminary reference by the Munich court to the European Court of Justice. There has also been some back-and-forth lately between the lower and higher Munich courts in some other PI case.

While the new German patent bill with its explicit reference to third-party interests wasn't in effect when those PIs came down, the official position of the government and the parliamentary majority was that it was merely meant to draw the lower courts' attention to the possibility of denying injunctions on (dis)proportionality grounds. Passing a bill into law, even if it hasn't been formally signed or published, would be a sufficient means to the end of creating awareness, and at least the companies sued by Bayer apparently didn't get any benefit from third-party interests.

I'm pretty sure that automotive companies, smartphone makers, and telecommunications carriers will be enjoined just like it was 2020. Of course, this presupposes that counsel for plaintiffs won't blunder. In those kinds of cases, it's extremely rare that someone truly wants to force another company out of the market. It's virtually always about money, and with the availability of a license working just the opposite way in Germany from the United States (under eBay, a willingness to grant a license strongly weighs against injunctive relief as it's antithetical to the notion of "inadequacy of monetary relief"), patentees will normally make an offer. That offer doesn't have to be "cheap." It just has to be close enough to reasonable that the courts will, in case of doubt, order an injunction.

In the pharmaceutical context, licensing offers are far less common. It's typically about market share, not royalties. I believe the courts will ultimately also enjoin pharma infringers like before, but there's a bit of a risk. Should a pharmaceutical innovator like Bayer at some point be denied an injunction due to this year's reform bill, it would be a total disaster for the Federal Ministry of Justice and the Federal Parliament, as no one intended any collateral damage to the research-intensive pharma sector. It was all about automotive and telecommunications companies complaining about extortionate patent enforcement. But the process simply went in the wrong direction because neither the statutory language drafted by the Federal Ministry of Justice nor any of the proposals put forward by trade associations (like the VDA, which is Germany's automotive industry association, or ip2innovate) were any good. As a result, those who started it will have no tangible benefits (unless plaintiffs make mistakes), but others may (or may not) be adversely affected. That would be like a COVID vaccine that provides next to zero immunity while coming with severe, at times fatal, side effects. And everyone, regardless of industry sector, will waste money on expert reports and legal argument related to proportionality. Those costs will mostly hit defendants, though. They're going to have to give it a shot, but it won't save them license fees on the bottom line. So stupid.

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Friday, August 13, 2021

Today is the first anniversary of app developers' D-Day: #FreeFortnite -- Apple will lose if it doesn't change course and present real solutions

August 13, 2020. One year ago, to the day. At 2 AM local time, Epic Games CEO Tim Sweeney threw down the gauntlet to Apple by email, telling Tim Cook that Epic would from there on out refuse to comply with Apple's in-app payment rule and expressing "the firm belief that history and law are on [the Fortnite maker's] side."

The timing of the email was deliberate. This way, it was going to take a few hours before Apple would see this (and the fact that Epic activated a "hotfix" that presuambly was just a simple server-side value) and made an alternative payment system available in Fortnite. Apple kicked out Fortnite. So did Google, where Epic did the same thing. Epic filed its private antitrust complaints in the Northern District of California that day.

At the end of closing argument in Epic Games v. Apple (in late May), Judge Yvonne Gonzalez Rogers jokingly said she'd try to hand down her judgment by today. She later clarified that she just said so because of the first anniversary of the dispute, but cautioned that this important decision might take time given the complexity of the case.

Looking at the landscape a year after the launch of the #FreeFortnite campaign, it really does seem that the days of Apple's App Store monopoly abuse are numbered.

That's the way it should be according to common sense. Just imagine how totally absurd the current situation is: developers may spend what is a lot of money for them (even if not for the richest company in the world) on the development of an app, and they won't know whether they may actually publish it on iOS until it's done and they submit it to Apple's app review department. Apple's app review is intransparent, and some of the rules are neither fair nor reasonable, and they are not even clear, which results in an inconsistent application all the time.

Apple's abusive conduct is by far the worst that any company has ever done in the history of the technology industry to innovation and creativity. Forget about the IBM mainframe monopoply or the peripheral issues over which the EU imposed a huge fine (by the standards of the 2000s) on Microsoft. No company has ever shown as much disdain for the software developer community as Apple, which is closely followed by Google, though Android is the lesser evil than iOS, and Google is still nerdier, which I like despite everything that I criticize them for.

I wonder what must be going on in the minds of the people who make their company a tyrannical version of "Judge Dredd" (prosecutor, judge, and executioner) over developers' investment of time, energy, and money. Is it just hubris? Do they really believe they know better than everyone only because the late Steve Jobs did the right things at the right time, and because they've built an unprecedent tech empire on that basis, which is of course a huge achievement?

Even the brilliant Tim Cook was checkmated by Judge Gonzalez Rogers when she examined him in May. The facts forced him to acknowledge that the only reason for Apple's 15% cut (small business program) was little more than a response to antitrust pressures. The most important admission was that he, as Apple's CEO, doesn't even get reports on how satisfied developers are with how Apple is treating them. The judge mentioned a survey according to which 39% of developers are dissatisfied, and that's actually flattering for Apple because one could easily ask questions that would lead 99% of developers to confirm that there are real issues.

Let that sink in. The CEO of one of the two companies that have like 1,000 times more power over developers than even Microsoft ever had doesn't even care to know whether developers feel they're being treated fairly. The court knows why: because Apple has to compete with other phone makers for users, but then there's the app aftermarket in which Apple doesn't have to compete for developers. It's a two-sided market in which there's practically no competition at all on one side.

Epic is one of the largest and most profitable game makers. They knew that they weren't necessarily going to be "sympathetic" at the time they launched their #FreeFortnite campaign. I wasn't totally sold in the beginning, but what I immediately liked about Epic's initiative was that they were raising a broader issue than Spotify, which I feared was just going to improve the situation for those who compete with Apple's subscription services (i.e., just a very few players). Still, I do have to give credit to Spotify's Horacio Gutierrez, a former Microsoft IP chief. He had been fighting against Apple's abusive behavior for years, and raised awareness for the issue in important circles. Arguably, Epic was standing on the shoulders of this giant when it launched its fight for app developers' essential freedoms a year ago--and just on the last business day before the Epic Games v. Apple trial, the European Commission handed down its Statement of Objections based on Spotify's complaint.

Shortly after Epic's complaints, Epic, Spotify and others (with the most significant third player being Match Group, which is known for the Tinder app) founded the Coalition for App Fairness. Again, I wasn't initially sold, but I watched the further developments with an open mind and less than a year later I think--in light of the recent announcement by three United States Senators--that the CAF may go down in history as one of the most impactful and important policy efforts in the history of the tech industry.

The tide has turned. Apple may be losing this war much more quickly now than it would have considered realistic when this started a year ago. Legislative, regulatory and judicial developments reinforce each other. Apple and its army of loyalists (though I sometimes wonder how many of those Apple apologists on Twitter are simply Apple employees) can't explain away that the current situation is unsustainable and has to be brought to an end. The sooner, the better for the world in economic and other terms.

I noted on Twitter today that Apple may already have had more negative news cycles--not just in a quantitative but also a qualitative sense--in 2021 than in the decade(s) before. It becomes clearer and clearer that Apple is doing harm now that does not constitute the kind of "creative destruction" under Steve Jobs. Now it's just destruction for Apple's economic gain, with zero benefit to innovation. Ad tracking is an example. Apple has done and continues to do enormous harm to both advertisers and app developers selling their inventory, but third-party app stores can also remedy that problem.

Privacy is a mix of a policy pretext, marketing mantra and PR stunt for Apple. If it's about Apple selling you music, you should consent to GPS tracking. If it's about governments containing the COVID pandemic, Apple doesn't even allow that an app asks users to scan a QR code at the entrance of a venue. Applying such double standards is the "best" way for a company to lose its credibility with decision makers and opinion leaders.

Another example is that Apple seeks to justify its COVID app (mis)guideline with public health concerns while selling homeopathy crap. Homeopathy is fake science, bogus medicine--but never mind as long as Apple can make money with it.

A year after #FreeFortnite and the Nineteen Eighty-Fortnite video (which has almost 8 million YouTube views by now and even understates the problem), and less than a year since the Coalition for App Fairness was founded, the noose is tightening and change is coming.

Apple can counterlobby, defend, appeal. That's what it's currently focusing on. The alternative would be for Apple to realize that

  • it can do even better if it unleashes the app developer community's creativity,

  • it can still do well even with competition in the app distribution aftermarket, though it will face challenges, and

  • if Apple decided to make amends and engage constructively, it might do better than if it just kept opposing the structural change that is inevitably needed. Apple could--if it wanted to--go from app developers' worst enemy to one of app developers' best friends. They could focus on making the cake bigger rather than just focusing on their share and their control. But such ideas as my "contribute-back" licensing proposal aren't going to get traction, realistically. Apple looks set to hold out until the bitter end, because they think it's most profitable.

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Thursday, August 12, 2021

Could a GPL-style contribute-back clause be a reasonable compromise between Apple's walled garden and the Open App Markets Act?

It is interesting to watch how legislative initiatives, antitrust investigations, and litigation reinforce each other. Yesterday's announcement of the Open App Markets Act proposal by a bipartisan group of United States Senators marks a tipping point. It now seems rather unlikely that Apple can maintain its App Store monopoly on iOS. App store diversity is coming.

Apple may still be in a state of denial, and it can hire every lobbyist in DC and Brussels and elsewhere who isn't already working for its adversaries, but the time may have come to think about whether a reasonable compromise is possible.

I'm as independent as an Apple critic and complainant can be, and have recently remigrated to Android, which is the "lesser evil" in terms of the platform maker's control. I wrote my own antitrust complaints and my replies to Apple's (and Google's) responsive filings--every single word. When it comes to patent disputes, I've been sympathetic to Apple's desire for differentiation and to a certain attitude that could be described as exceptionalism. I do, however, draw the line where Apple denies app developers like me certain liberties that I believe are essential and very much in the interest of consumers.

On the one hand, I reject any arguments by Apple that come down to saying that its customers make the choice to deprive themselves of certain choices (such as access to apps not approved by Apple) and that this kind of choice deserves to be protected to the detriment of app developes and of all those Apple users who actually want more flexibility. Among one billion iOS users worldwide, there must be a diversity of views and positions. Even if they had only 1,000 and not 1,000,000,000 users, they wouldn't all share the same values and preferences.

On the other hand, it can't be reasonably denied that the Open App Markets Act in its proposed form would make the iOS app ecosystem less distinguishable from Android. In the end there would be cross-platform app stores, which would minimize switching costs (a consumer benefit) but further blur the distinction between the operating systems.

I don't claim to have the definitive answer, but I do wish to toss out an idea now: a GP-style reciprocity ("contribute back") clause in Apple's future IP license agreements with app developers.

Let me first describe what the net effect would be from a consumer's point of view:

  • There would be more app stores than Apple's App Store.

  • It's possible that competing app stores would undercut Apple's prices and/or outperform Apple on app curation.

  • Some third-party app stores might do a better job serving a particular audience, such as gamers. That's called specialization.

  • Still, under my proposed approach those who are religious about Apple's product philosophy--or simply trust no one as much as they do Apple--would find an Apple-aligned version of every app, except for apps that provide content or functionality Apple categorically disallows, on the App Store. As long as they don't install anything from other app stores, those users could continue to live in Apple's walled garden like before. By choice.

    There are people who don't trust a lot of companies. They are the ones who'd rather buy a new battery for their radio-based car key from an official Mercedes dealership than go to the next Best Buy and get a battery of the same quality at a fraction of the cost. And there are others who subscribe to a philosophy. I want freedom for app developers and users, but I don't want to deprive people of an "all in on Apple" type of choice.

Now some people may wonder how this "best of both worlds" situation could be achieved, given that

  • competing app stores would normally have an incentive to enter into exclusive deals with app makers,

  • some makers of extremely popular apps might leverage those titles to grow their own app stores, and

  • some app developers might for whatever other reason (or just laziness) decide not to submit their apps to the App Store, but only to others (like itch.io).

The answer is a reasonable "contribute-back" obligation that Apple could impose by means of an intellectual property license.

Reciprocity clauses are found in the GPL (GNU General Public License), which is called a "copyleft" license for that reason and known for Linux (the technical basis of Android) and MySQL/MariaDB, and in the versions of the Creative Commons license that come with the "Share Alike" requirement. Those contractual structures have one key objective: whoever incorporates material into their own works under such a license should have to respect those values not only by lip service but also by contributing back to that values-based community the derivative work.

The GPL doesn't prohibit dual licensing. A long time ago I was an adviser to MySQL's CEO, and that company held all the copyrights (which no single entity does in the case of Linux), so they offered it to the whole world for free under the GPL--with the copyleft string attached--or, if you made a deal with them and paid license fees, you could incorporate it into your own products as a software component without having to publish your source code and allow free downloads.

What I'm proposing here for the iOS app ecosystem bears a strong resemblance to "copyleft" and to dual licensing:

  • App developers would be free to submit a given app to as many iOS app stores as they please.

  • Apple would not "tax" developers' revenues generated via other app stores. (A reasonable developer program fee is not what I mean by "tax.")

  • The values-centric "contribute back" clause, however, would impose an obligation on developers to simultaneously--and in good faith--submit their app to the App Store.

    The only exception would be if an app would undoubtedly be rejected by Apple (for example, certain types of adult content). In that case, a submission to Apple would just waste everyone's time.

    Note that there would be no requirement for the app to be actually approved by Apple before other app stores could carry it. It would be submitted to all stores near-simultaneously (such as on the same day). The requirement is just to submit it in good faith.

  • "In good faith" means that the App Store version of an app would have to be reasonably compliant. For example, if Apple insists on ad tracking ("ATT"), then a submission that flagrantly and unnecessarily violates that rule would have to be considered a bad-faith submission.

This way, competitive constraints would discipline Apple in many ways. If users found the App Store too expensive, or if Apple rejected too many apps that are worth publishing, or if others made themselves a name by outperforming Apple on curation quality, that could reduce Apple's app market share. The number one issue that Judge Yvonne Gonzalez Rogers raised on the last day of the recent Epic Games v. Apple trial is that Apple may compete for end users, but doesn't have to compete for developers. That's why app store diversity is needed. But a "contribute back" requirement to preserve Apple's differentiation and exceptionalism isn't antithetical to competition--and it means more choice, not less, for consumers.

I believe it would be fair to require developers not to charge more for themselves on Apple's App Store than on others. Developers should just say how much they want, and then the different app stores will add their margins on top. (When I do consulting for financial investors through expert networks, it works that way and I don't even know what the markup is.)

To the extent that Apple dissuades end users from granting that ATT permission, apps should be allowed to give users the choice to either enable ad tracking (particularly with a view to rewarded ads, which are key to ad-based games business models) or pay for certain goodies.

Then there's the question of how easy it should be for users to switch from one app store to another if they wish to use a given app on a different app store's terms. For example, they might download a game from Apple's App Store first, but later have an incentive (such as lower IAP prices) to continue playing that game, but redownload it from a rival app store. One would have to think this through, but where there is a will, there is a way. Consumers should have that choice--and app developers should have the right to inform them of the potential benefits, for the sake of having a serious competitive constraint.

Could there be functional differences? Yes. If Apple disallowed something that other app stores permit, there might be additional features once users download an app from another app store. This goes both ways, of course.

Is this going to happen? I'll be perfectly honest: I think the two sides of the debate are so entrenched that in the end there'll be a winning camp and a losing one instead of a win-win-win-win (Apple, developers, consumers who are totally Apple-aligned, and consumers who are not absolutely loyal to Apple). But at least I wanted to outline my thinking, now that Apple may really begin to think about how to mitigate the damage.

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Fortress-funded VoiceAge EVS recently won German patent injunction against HMD and apparently settled with Apple

This here is a follow-up to both yesterday's post on VLSI Technology inching closer to a final (though appealable) judgment against Intel and earlier reports on VoiceAge EVS v. Apple. Both VLSI Technology and VoiceAge EVS are funded by Fortress Investment.

The Mannheim Regional Court confirmed to me today that VoiceAge EVS won a case against HMD (which makes phones and has a license to the Nokia trademark for that purpose) on July 23 over EP2707687 on a "transform-domain codeblock in a CELP coder and decoder" (case no. 7 O 116/19; the Presiding Judge of the Seventh Civil Chamber in Mannheim is Judge Dr. Peter Tochtermann).

There are no more VoiceAge EVS v. Apple cases in Germany anymore. Since Apple's withdrawal (in June) from its joint antitrust action against Fortress and multiple Fortress-funded entities, various patent infringement cases brought by Fortress-funded companies against Apple have become known to have been withdrawn, suggesting that a global settlement was reached.

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Wednesday, August 11, 2021

VLSI inches closer to $2.2B final judgment as Judge Albright denies Intel's motion for new trial

Things are moving forward again in VLSI v. Intel. Judge Alan Albright of the United States District Court for the Western District of Texas has denied the first of several post-trial motions with which Intel is challenging the record $2.175B verdict. The following screenshot shows that a sealed order denying Intel's Rule 59 motion for a retrial has come down (click on the image to enlarge):

A new trial would have been a difficult choice for the nation's busiest patent infringement court. Presumably we will see decisions on the other post-trial motions (motions for judgment as a matter of law) in the coming days or weeks. The likelihood of a final judgment by the district court based on the March jury verdict has increased. Short of a settlement, it looks like this one is soon going to be appealed to the Federal Circuit.

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Sunday, August 8, 2021

Privacy and hypocrisy: Apple wants to know your location to sell you music, but governments must not ask you to scan QR codes to fight the pandemic

Last weekend I made an Android phone my primary mobile communications device. That was a lot of work, and I'll have to pay for some apps and content again. There are antitrust issues concerning Android, which is why Epic Games's amended complaint is worth reading, particularly the part about "sideloading" (direct installation of apps) "drastically" limiting app developers' reach. But faced with the choice, I clearly prefer Android because Apple is too heavy-handed.

The Epic Games v. Apple antitrust ruling may come down anytime now in the Northern District of California, though I wouldn't be surprised if that huge case took the judge another month or more to distill into what will hopefully be a razor-sharp ruling. Even without a major antitrust trial or decision, more and more people can figure out that Apple's defenses of its App Store monopoly abuse are pretextual.

This weekend, I had a defining moment in which I realized that Apple is fooling the world's antitrust authorities and lawmakers to a greater extent than even the epic Epic trial in May exposed. The only Apple app I'm still using after my remigration to Android is Shazam. And just yesterday, Shazam for Android--I kid you not!--asked for GPS permission so it could later tell me where I was when I "discovered" a song.

Give me a break, Apple. It's not merely hypocritical or ridiculous in the sense of dual standards. It's an utter disgrace that the very same company that obstructed the UK government's efforts to combat COVID-19 by rejecting an update to the British contact-tracing app that would have enabled users to scan QR codes of venues asks users to give them access to their GPS location data for a laughable purpose like this. Apple appears to be only about making money, not about principle. They want to sell music (iTunes), and that's why they acquired Shazam for a couple hundred million bucks. To give you another reason to use Shazam and, which is Apple's ultimate goal, to sell you more songs, Apple asks you for GPS access--but when a government facing the biggest global health crisis in about a century wants to ask (not require!) users to scan QR codes of venues in order to inform them of infection risks, Apple--like the most malevolent dictator you can imagine--prevents that app from being published on iOS.

Ask yourself this simple question: would you rather know that you might have gotten infected with COVID, or would you rather know where you first searched on Shazam for The Weeknd's Blinding Lights?

What makes Apple's double standards even worse is that an optional QR code scan compromises one's privacy to a far lesser degree than GPS access. Every location on Earth has GPS coordinates, but only a limited number of venues have QR codes at the entrance--and GPS is far more granular. And once you've granted an app GPS access, it can track you all the time, while you will always be in control when a QR code is scanned. But even if Shazam and the rejected version of the UK's contact-tracing app relied on the same method to determine your location, it's just unacceptable to have no qualms about collecting location data for music marketing purposes while prohibiting this when human lives are on the line.

The only consistency here is that Apple's leadership's approach to COVID is generally questionable, and its return-to-work plan has drawn well-founded criticism from many employees.

Today I tweeted about this Shazam v. contact tracing inconsistency (this post continues below the tweet):

I then decided to also write this blog post so as to ensure that many more of my readers, who include many decision makers and multipliers, would become aware of this.

There's a lot more that one could discuss when it comes to Apple, privacy, and hypocrisy. For now, instead of going into detail, let me just touch on a few items quickly:

  • CNBC: Apple’s privacy reputation is at risk with the changes it announced (about its identification of objectionable/illegal images on users' phones)

    This tweet sums it up nicely ("What happens on your iPhone, stays on your iPhone -- but we'll take a peek"):

  • Last month, a Bloomberg Law article on standard-essential patent (SEP) policy mentioned that "Apple and other tech companies, meanwhile, also are lobbying for state laws that could address what they view as anticompetitive behavior from some patent owners." (emphasis added)

    Hey, that's the same Apple that has been telling state legislatures in Arizona and many other states that they shouldn't legislate on mobile app stores (and I guess Apple is not exactly a fan of right-to-repair state laws either). By the way, patent law is exclusively federal law...

  • A couple of months ago, a Nokia policy officer noted on LinkedIn that Apple opposes value-based (ad valorem, percentage of sales) SEP royalties but taxes app developers at a rate of 30% (which Judge Yvonne Gonzalez Rogers accurately summed up in her examination of Apple CEO Tim Cook as "charging the gamers to subsidize Wells Fargo"). Almost a decade ago, Apple wrote a letter to the Senate Judiciary Committee's leadership (a rebuttal of patent-licensing arguments made by Google) in which Apple used an analogy and said that all car drivers pay the same highway toll, whether they own a jalopy or a new sports car. Apple's 2019 FRAND policy statement, which is Cupertino's current position on SEPs to the best of my knowledge, advocates the "use of a common royalty base and rate."

    SEPs v. apps inconsistencies are an interesting topic that I may address more specifically on some other occasion.

In closing, let me just point you to this Reuters article by Foo Yun Chee, who was told by the Euroepan Commission's antitrust chief, Executive Vice President Magrethe Vestager, that Apple should not use privacy (and security) for "a shield against competition, because [the EU competition commissioner] think[s] customers will not give up neither security nor privacy if they use another app store or if they sideload."

In my own company's antitrust complaints against Apple, I describe alternative app stores as the best remedy.

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Thursday, August 5, 2021

Intel points Judge Albright to developments in Delaware: does the chipmaker have a license defense to the $2.2B patent damages verdict?

VLSI Technologies won a patent infringement trial against Intel in the Western District of Texas in March, and lost (because it failed to establish infringement) another one in April. A third VLSI v. Intel trial has been pushed back from the summer to December.

Judge Alan Albright has not yet entered a final judgment further to the March and April jury verdicts. In the first case (the one with the $2.2B record verdict), Intel is fighting hard and has raised a number of issues in its post-trial motions, demonstrating to the trial court that it can easily be reversed on appeal if it doesn't order a retrial or make similarly impactful decisions now. In the second case, VLSI would like another chance to prevail.

In both cases, Intel filed a "notice of subsequent developments" on Monday (this post continues below the document):

21-08-02 Intel Notice of Su... by Florian Mueller

Intel's legal position is that final judgment cannot enter while a motion to amend its answers and defenses is pending. The critical part appears to be a license defense.

As Intel's notice says, the Silicon Valley company "filed a Complaint in the Delaware Court of Chancery against VLSI Technology LLC ('VLSI'), among others, for equitable and other relief relating to its license rights." That happened in January. VLSI brought a motion to dismiss in March, which was heard in May, with no decision having been entered yet by the Delaware state court.

But there is also some VLSI v. Intel patent infringement litigation pending in Delaware--in the District of Delaware, as patent law is federal law. Like in Texas, Intel also filed a motion to amend its answer and defenses in the Delaware patent infringement case. A United States Magistrate Judge held a motion hearing on July 6, 2021, and what Intel wanted to show to Judge Albright is that the Delaware judge "found that Intel's license defense is not futile."

Here's the relevant excerpt from the hearing transcript (this post continues below the document):

21-08-02 Intel Exh1 Hearing... by Florian Mueller

This here is the key passage from what Magistrate Judge Hall said:

"VLSI argues that Intel should not be granted leave to amend under Rule 15 because Intel's license defense is futile and because VLSI would be prejudiced if Intel is allowed to amend.

"Let's talk about futility first. If a proposed amendment is frivolous or advances a claim or defense that is legally insufficient on its face, the Court may deny a leave to amend.

"VLSI makes two arguments about futility. VLSI's first argument has multiple parts, but essentially it argues that Intel could not possibly have obtained a license to the asserted patents under the Finjan settlement.

"At its core of its argument VLSI points to a number of facts that according to VLSI demonstrate that the agreement did not grant Intel a license.

"However, at this stage and without the benefit of a full factual record, I'm not prepared to say as a matter of law that there was no way that Intel could have obtained a license to VLSI's patents pursuant to that agreement.

"VLSI is free to reraise its challenge to Intel's license defense at the summary judgment stage.

"Turning to VLSI's second argument about futility, it argues that Intel's license defense is futile because Intel has conceded that this Court lacks subject-matter jurisdiction over the license defense.

"I don't see a concession. Intel has maintained that it wants to litigate the license issue in the Court of Chancery, but I don't read that as a concession that this Court lacks subject-matter jurisdiction over Intel's license defense.

"In sum, VLSI has not shown that Intel's defense is frivolous or otherwise legally insufficient on its face. I therefore find that it is not futile at this stage."

If Judge Albright ordered a retrial, the license defense might be adjudicated in Delaware in the meantime. If he decides to enter final judgment, however, he will have to somehow rule on Intel's motion to amend its answer and defenses.

Since Apple's $1B trial win in 2012, which even went up to the Supreme Court (disgorgement of profits for design patent infringement), I can't remember a damages verdict having been challenged like Intel is fighting to get VLSI's $2.2B win vacated. Intel leaves no stone unturned. Meanwhile, the busiest patent court in the world (which gets about 20% of all U.S. patent infringement cases) barely finds the time to enter final judgment.

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Tuesday, August 3, 2021

InterDigital on a roll, settles with Xiaomi: patent infringement complaints and anti-antisuit injunctions in Germany and India prove decisive--license covers 5G and HEVC

The summer is treating U.S. research and patent licensing firm InterDigital well. Less than a week after netting a strategic victory in a UK patent infringement case against Lenovo, InterDigital (often referred to by its stock ticker symbol, IDCC) today announced a license deal that settles all pending litigation against Chinese smartphone giant Xiaomi. The covered patents include InterDigital's 3G/4G/5G cellular portfolio as well as its HEVC (aka H.265) video codec patents.

The amounts involved are not known, but the volume must be rather significant. Just last month, Bloomberg reported that Xiaomi had overtaken Apple to become the world's no. 2 smartphone maker by unit sales. Xiaomi is truly an amazing entrepreneurial success story, and also has ambitious plans in the electric vehicle market. Maybe Xiaomi will once again manage to "come out of nothing" and rise to the top.

While InterDigital had greater leverage in litigation at this point, Xiaomi has so far been doing a good job demonstrating to patent holders that it is neither a soft target nor an unwilling licensee or "hold-out." Xiaomi seems to have learned the patent licensing and litigation game fast. Given its market share, I guess I'll have to pay closer attention to its future patent cases.

A little over a month ago, Xiaomi already settled with Sisvel.

Other than IDCC making money and being in a stronger position vis-à-vis other implementers, these are the key takeaways:

  • Xiaomi tried to gain leverage from a Chinese FRAND determination action, but ultimately InterDigital's anti-antisuit injunctions from the Delhi High Court and Munich I Regional Court thwarted that litigation strategy. The Munich A2SI/A4SI in that dispute is now a landmark ruling, as Presiding Judge Dr. Matthias Zigann and his panel laid out a list of criteria that may justify even pre-emptive anti-antisuit injunctions. As a result, immediate and unconditional surrender is the only safe harbor for anti-antisuit defendants in Munich.

  • InterDigital had appealed the Munich A2SI/A4SI to the Munich Higher Regional Court, but as a result of today's settlement, there won't be any review. At this stage it is questionable whether any A2SI/A4SI will be reviewed by the Munich appeals court ahead of Judge Dr. Zigann's impending promotion.

  • According to Juve Patent, InterDigital's lead counsel in the Munich A2SI/A4SI action, and possibly also in the recently-filed infringement cases, was Arnold & Ruess's Dr. Arno Risse ("Riße" in German). The key SEP holders among Arnold & Ruess's clients are Nokia, InterDigital, and Sisvel. Despite the Nokia-Daimler and InterDigital-Xiaomi settlements, they'll continue to be busy. Deservedly so.

  • I guess Lenovo is also going to settle with InterDigital rather soon, with a FRAND trial scheduled for early next year that can get very costly and likely won't save Lenovo money over taking a deal now.

  • Every settlement frees up litigation resources, so I wonder whom InterDigital will pick as the next target from its list of unlicensed implementers. Maybe an automotive company, for a change? Most of the volume is in smartphones, though.

  • Munich makes patentees money. In this case, an Indian court also played a key role. But many implementers are more vulnerable in Germany than in India.

  • Chinese policy makers and judges may already be brainstorming about how they can preserve their country's jurisdiction over cellular SEPs, considering that most smartphones are manufactured in China and the country is also a huge target market. Xiaomi had its reasons for seeking a FRAND determination in China, but in the end other jurisdictions gave InterDigital decisive leverage.

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Monday, August 2, 2021

Patent injunction 'reform' bill expected to be signed into law next week by Germany's Federal President

In late June, the Federal Council of Germany decided not to veto a patent "reform" bill that the country's Federal Parliament had adopted two weeks earlier. I have previously voiced my opinion that the practical impact is going to amount to a cost increase (particularly affecting defendants) without moving the goalposts unless a plaintiff makes an inexcusable mistake. In particular, patentees should give serious consideration to making a formal licensing offer so as to counter any claims of irreparable harm to a defendant and/or any third parties.

The measure is designed to take immediate effect, but in order to do so, it needs to be signed into law by Federal President Frank-Walter Steinmeier and, finally, published in Germany's Federal Law Gazette. The Federal President's Office informed me today that the bill is presently undergoing a routine check and slated to be signed into law next week (i.e., the week of August 9).

The latest edition of the Federal Law Gazette was published on Friday (July 30; Part I) and today (August 2; Part II). The publication data of the next edition is to be determined. The German legislature has recently been very busy enacting laws just before the September elections. As a result, the Federal Law Gazette may face a certain backlog, but assuming that the Federal President's staff doesn't identify any impediments to enactment (I'd be really surprised if they did) and the signing into law happens next week, I would assume that publication happens either later this month or early next month.

As for my planned subscription service, I still have to announce the specifics and am currently awaiting some further information, particularly--but not only--with respect to the Munich I Regional Court's third patent infringement division's schedule.

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