Tuesday, June 28, 2022

Apple's tactical games in 5G patent dispute with Ericsson remain fruitless: ITC staff disagrees with new claim construction proposal

There was a time when Apple was an aggressive but mostly very reasonable litigant, while Apple's adversaries took extreme positions. It was the time when Qualcomm was seeking a preliminary injunction over standard-essential patent (SEP) royalty payments, and prior to that, when Samsung brought "me too" motions just hoping that Judge Koh (then in the Northern District of California) would grant them to avoid accusations of protectionism (though Apple's motion had far more substance), or when HTC was stalling patent cases on both sides of the Atlantic.

Times have changed. I am now watching with growing bewilderment Apple's behavior in the ongoing 5G SEP and non-SEP dispute with Ericsson--and keeping an eye on the organizations it uses to create the impression of third-party support.

Apple sought the dismissal of Ericsson's original FRAND complaint in the Eastern District of Texas and wanted to put itself into the plaintiff's position with a later-field action. Apple sought to deprive the Fifth Circuit of appellate jurisdiction by throwing in three declaratory-judgment claims. When Judge Gilstrap declined to let Apple restructure the litigation and, among other things, severed the three SEP claims from the FRAND part, Apple suddenly moved for a stay of the three-SEP case. That hot-then-cold about-face left the judge puzzled--and the case is going forward.

Over at the ITC, a similar pattern is becoming discernible, with Apple first omitting a prior art reference (likely intentionally as Ericsson believes), only to later request its admission out of time based on one demonstrably false claim (regarding Ericsson's position on a priority date) and one highly dubious one (inadvertent omission). In the meantime, new USPTO Director Kathi Vidal has narrowed the circumstances under which discretionary denials of PTAB IPR petitions can issue, and that may be a factor here.

In the SEP case (Inv. No. 337-TA-1299) among the three investigations of complaints brought by Ericsson, Apple faced a problem when the Office of Unfair Import Investigations (often referred to as "the ITC staff") disagreed with the entirety of Apple's proposed claim constructions. So what did Apple do? It asked for an additional term to be construed by the Administrative Law Judge (ALJ) at the Markman stage. The case is now before ALJ Bryan Moore, whose patent-related expertise is second-to-none among ITC judges (arguably even the strongest background of any person ever to have been appointed to this role).

In a way, it's not even "additional term" that Apple wants construed. In reality, it's a term from U.S. Patent No. 8,102,805 that appears in a longer passage that Apple would like to be deemed a means-plus-function term:

"a receiver subsystem in a spatial multiplexing Wireless communications system configured to … use the second disambiguation data to determine whether the re-transmitted transport block is scheduled for retransmission on the first data substream or the second data substream during the second transmission interval" (emphasis added)

Apple proposes that the highlighted passage be interpreted as "using the second data to resolve an ambiguity to determine." But once again, the Staff and Ericsson agree that Apple is wrong. They say the term should just be given its plain and ordinary meaning, which one of ordinary skill in the relevant art understands to be: "using the second data which signals transport-block-to substream mapping to determine ..."

Let's take a quick look at the state of play in the Eastern District of Texas. By order of June 13, Judge Rodney S. Gilstrap set an in-person motion hearing for Wednesday, July 6, regarding Ericsson's two motions to compel:

  1. a May 27 motion to compel Apple to identify witnesses with respect to certain issues (such as Apple's App Store terms), which I published toward the end of a June 4 post, and

  2. a June 10 motion t compel Apple to produce documents with respect to topics such as (again) the App Store, Apple's 5G launch, Apple's SEP devaluation efforts, Apple's acquisition of SEPs from Intel, and Apple's payments to component suppliers who also license SEPs to Apple.

Ericsson has now given notice that "on June 9, 2022, nearly two weeks after Ericsson filed its Motion, Apple made a written supplementation identifying further ESI custodians and mooting [the first of the two motions to compel]."

I guess the motion-to-compel hearing will still be necessary as Apple will likely to try to keep all--or at least some--of the topics raised by the second motion to compel out of this FRAND case.

It's hard to see what benefit Apple got out of firstly refusing to identify fact witnesses, only to do so after Ericsson brought its motion. Apple itself originally wanted that Texas FRAND case to be put on the most ambitious schedule possible, and that was pretty much the only wish Judge Gilstrap has granted Apple so far. I can't help but suspect that Apple would now rather see the Texas FRAND trial date pushed back, and should that impression be correct, the reason may very well be that Apple is worried about the potential impact of the Texas FRAND decision on its FRAND-related affirmative defenses--all but one of which the ITC Staff believes should already be thrown out at this early stage--the ITC SEP case.

Share with other professionals via LinkedIn: