Samsung affirmatively says U.S. import ban would affect only older iPhones and iPads

In the previous post I discussed a revelation contained in Apple's response to the United States International Trade Commission's questions relating to remedies and the public interest in the investigation of Samsung's complaint. A ruling is due on May 31 (unless postponed again), and it's pretty clear that the ITC is inclined to hold Apple to have infringed one or more claims of U.S. Patent No. 7,706,348, an allegedly UMTS-essential patent. One of the questions raised by the Commission in March relates to the scope of an import ban, should one be ordered:

"4. With respect to the '348 patent, Samsung’s infringement case before the Commission relied upon accused third and fourth generation Apple products that operate on the AT&T wireless network. If the Commission were to issue remedial orders covering articles covered by the asserted claims of the ’348 patent, would such an order cover (a) Apple products that operate on other wireless networks in the United States, and (b) later generation Apple products (e.g., iPhone 5, later iPad versions)?"

In the proceedings before the ALJ Samsung accused only older Apple products of infringement of the '348 patent: the AT&T models of the iPhone 4 (but not the 4S or 5), 3GS and 3, and of the iPad 3G and iPad 2 3G.

Apple's response was written without knowing what position Samsung would take. Apple felt that Samsung couldn't enforce an exclusion order against newer Apple products, arguing that those don't infringe for technical reasons and that, in any event, the components in those products that implement the relevant invention are Qualcomm baseband chips, resulting in patent exhaustion as Qualcomm is licensed. The Office of Unfair Import Investigations ("ITC staff") acknowledged that there is no evidence in the record concerning other networks or newer Apple products, and "agreed with Apple that any exclusion order issued in this investigation should include a certification provision to assist in enforcing the order", presumably designed to avoid that customs officers mistakenly hold shipments of current-generation iPhones and iPads. But the ITC staff argued that "Apple could have presented evidence at the hearing concerning unaccused products in an effort to demonstrate that they do not infringe", pointing to the fact that Samsung did the same in the investigation of Apple's complaint (with a view to the problems this course of actions raises, let me refer you to a post I wrote a few months ago).

Furthermore, the ITC staff wouldn't want the exclusion order itself to be limited to particular model numbers and wrote that taking a position on devices not at issue in the investigation "would be tantamount to issuing a pre-exclusion order 'advisory opinion,' for which the Commission Rules do not provide". Instead, "the question of whether such products would be within the scope of a remedial order based on the '348 patent would have to be determined in the future on a case-by-case basis, either by the U.S. Bureau of Customs and Border Protection through a certification process or scope ruling, or by the Commission in an advisory or enforcement proceeding". This is inconsistent with the ITC staff limiting its whole public interest argument to the specifically-accused AT&T versions of older iPhones and iPads: the analysis would be different, and potentially lead to a different result, if the scope of the import ban goes beyond the exemplary infringing devices. would not be acceptable to Apple given the commercial uncertainty it causes at the enforcement stage. Apple, before it knew what Samsung would say, wanted to achieve that the Commission would at least remand the investigation to the Administrative Law Judge in order to clarify these infringement issues.

Samsung has now taken the position that not only the AT&T versions of the accused iPhones and iPads but also versions sold by other carriers infringe and should fall within the scope of an import ban -- but newer products incorporating Qualcomm chips (the mentioning of Qualcomm is redacted, but having watched this dispute for a while, I can figure) would clearly fall outside its scope:

"At the time the complaint was filed, Apple's iPhones and iPads with UMTS connectivity were only available through AT&T. Since then, Apple has expanded its sales to other UMTS carriers. Because all iPhone 4 (UMTS version) and iPad 2 (UMTS version) devices infringe the asserted claims of the '348 patent, regardless of carrier customer, they would be subject to the Commission's remedial orders. However, AT&T remains the largest UMTS iPhone 4 carrier by volume. [...].

Based on Samsung's understanding, the current configurations of the iPhone 4 (CDMA version), iPhone 4S, iPhone 5, iPad 2 (CDMA version), iPad (third and fourth generations) and iPad mini contain [REDACTED]. Accordingly, unless these devices are altered to incorporate [REDACTED], they would not be subject to an exclusion order or cease and desist order. Similarly, future devices incorporating [REDACTED] would not be subject to an exclusion order or cease and desist order."

In commercial terms the second part -- where Samsung confirms that Apple products incorporating Qualcomm baseband chips are fine -- is far more important than the first one (other carriers). Should there be an import ban of older iPhones and iPads, Apple will only be affected at the low end and in the repair business. The problem could be solved for the most part by a delay before an import ban takes effect. In the meantime, there will be another generation of devices, and the oldest devices currently still on sale will then be replaced as entry-level devices by the second-oldest ones. I still don't believe the ITC will actually ban any Apple products, given that courts and regulators have concluded that Samsung failed to comply with its FRAND licensing obligations, but if it happens nevertheless, its impact will be very limited.

If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or follow me on Twitter @FOSSpatents and Google+.

Follow @FOSSpatents

Share with other professionals via LinkedIn:

Share|

Google to Miami court: Apple is withholding iPhone 5, iPad mini source code

Samsung hast just added the iPhone 5 and iPad mini to its list of accused products (court approval is a mere formality), and wholly-owned Google subsidiary Motorola Mobility wants to do the same in its litigation against Apple in the Southern District of Florida. In that lawsuit, none of the patents-in-suit appears to be standard-essential.

But prior to adding the iPhone 5, iPad mini and possibly other new Apple widgetry to the Miami action, Google's litigators want to perform some infringement analysis. For this purpose, they need to look at the source code of iOS 6, the latest release of Apple's smartphone/tablet operating system, which powers the iPhone 5 and iPad mini. Now Google complaints that Apple has not provided the iOS 6 source code despite a general request for source code production made on May 30 and iOS-6-specific requests on August 7, October 25, and November 6. The last one of those requests was that Apple at least provide a "date certain". Motorola is running out of time because the court set a December 14 deadline for accusations against new products.

Google's motion says that Apple "has, at various times, promised to produce iOS source code by or "shortly after" September 21st, by November 9th, and by November 30th", but two months have passed now since the release of iOS 6 "and almost four months after Apple released its most recent OSX software", whose source code Google also wants to evaluate.

If Apple kept its promise to provide source code by November 30, Motorola would have two weeks to update its infringement contentions on time. But since Apple allegedly didn't produce source code on time, Google is probably concerned that it may at some point have to little time left to add those products to the list of accused technologies. While it's possible that Google makes much ado about nothing here, its concern may be valid. Apple would certainly like the deadline for infringement contentions to pass before Google has taken a detailed look at the iOS 6 source code.

I report on discovery disputes like this one only when they raise some particularly important issues or provide indications of what's going to happen at the substantive level. In this case, with Samsung's attack on the iPhone 5 and iPad mini having received quite some attention, I thought it was worth highlighting that Google's Motorola Mobility has the same new Apple products in its crosshairs.

By the way, the two parties met today at the Oberlandesgericht München (Munich Higher Regional Court) for the world's first Apple-Google appeals hearing. At issue was the photo gallery page-flipping patent over which Apple won a German injunction against Motorola Mobility on March 1, 2012, and a Dutch preliminary injunction against Samsung in August 2011. I took detailed notes of the three-hour court session and will report in more detail later today or tomorrow.

If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or follow me on Twitter @FOSSpatents and Google+.

Follow @FOSSpatents

Share with other professionals via LinkedIn:

Share|

Court doesn't allow sweeping inclusion of Android 4.1 ('Jelly Bean') in Apple-Samsung lawsuit

A few weeks ago there was a lot of media coverage of a court hearing at which Apple and Samsung were discussing with Magistrate Judge Paul S. Grewal the proposed addition of newer products, such as the iPhone 5 and Galaxy Note 10.1, to their second California lawsuit (not the one that went to trial this summer). However, that desire was old news: I already reported on it on September 20 when the parties filed their proposals that gave rise to the recent hearing.

Late on Thursday, Judge Grewal ruled on the parties' motions to amend their infringement discloures. With one important exception -- Android 4.1 aka "Jelly Bean" -- he took a rather permissive approach that is consistent with the applicable local rules for patent litigation in the Northern District of California, which set a relatively low hurdle for post-deadline amendments to infringement contentions, merely requiring that good cause be shown. So the iPhone 5, Galaxy Note 10.1 and Galaxy S III are "in". They don't raise any new technical issues anyway -- where this really makes a difference is in connection with damages should any infringements be identified. Products that are not accused in one lawsuit require a new, additional lawsuit to collect damages.

It also makes a formal but not substantial difference with respect to possible injunctions. Judge Koh, who is presiding over this lawsuit and being assisted by Judge Grewal on discovery matters, has previously granted injunctions of the "no more than colorably different" kind, which are not limited to a few specifically-named products but relate to all products having substantially the same infringement pattern. By the time any injunction comes down at the end of this lawsuit (the current trial date is in 2014), successors to the products just added to the list will have been launched anyway, placing the emphasis on the question of whether or not a newer product will or won't be more than colorably different from today's technologies as far as the alleged infringements are concerned. If, for example, the iPhone 5 has the same alleged infringement pattern as the iPhone 4, then Samsung's enforcement of a hypothetical injunctions against an iPhone 6 or iPhone 7 would require a "colorably different" analysis starting from the same basis. And even if the iPhone 5 is still on sale at the time, the fact that it was just named won't make it subject to the enforcement of an injunction after software changes that relate to an injunction patent (workarounds etc.).

By adding Android 4.1 ("Jelly Bean"), first released in July 2012 and therefore after the mid-June deadline for regular infringement contentions in this case, Apple would have created a situation in which a slew of later product releases coming with that version of Google's mobile operating system would have been targeted in this lawsuit without the actual products being named. This would have resulted in a potentially open-ended definition of products on which Apple could have later tried to collect damages. A blanket attack on Jelly Bean would also have created a situation in which Google would have made itself totally ridiculous if it had not done everything in its power to join the case as a co-defendant (or at the very least as a formal intervenor).

Judge Grewal agreed with Samsung that "such an[] amendment would be overbroad and may sweep any number of Samsung devices using the Jelly Bean operating system into this suit" and that "Samsung also does not have any design control over the content of Jelly Bean as it is a Google Android product that Samsung itself did not develop". Moreover, "[t]he court will not permit a sweeping amendment that might apply to devices other than those properly tied to Samsung".

In a formal sense, Apple's motion was also granted with respect to Jelly Bean, "but only as to the Jelly Bean product Apple has specified: the Galaxy Nexus". Apple definitely wanted a more inclusive infringement contention to be allowed. The Galaxy Nexus has been targeted in this lawsuit from the beginning. What Apple just achieved is that the updated version of the Galaxy Nexus running Jelly Bean will also be adjudged by the court. In connection with other products than a Nexus gadget, it might also be useful to Apple if it could later claim that the court determined (if it so did) that the infringing component of the accused product is the Android operating system -- but if a court finds a Nexus device to infringe a software patent, everyone in the industry knows that "stock Android" (Android as made available by Google, without vendor-specific enhancements) is at issue. Of course, the court order may nevertheless trigger Google's formal intervention.

If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or follow me on Twitter @FOSSpatents and Google+.

Follow @FOSSpatents

Share with other professionals via LinkedIn:

Share|

Samsung gets Galaxy Tab 10.1 ban lifted, files infringement contentions against iPhone 5

At close of business on Monday, Judge Lucy Koh granted Samsung's request to dissolve the preliminary injunction against the Galaxy Tab 10.1, following a limited remand by the Court of Appeals for the Federal Circuit. But after a hearing scheduled for December 6, Apple can still win a permanent injunction over the D'889 tablet design patent if it prevails on the related part of its Rule 50 ("overrule-the-jury") motion.

In fact, that possibility is part of the reasoning Judge Koh provides for her decision to dissolve the preliminary injunction without previously adjudicating Apple's Rule 50 motion: she dissolved the preliminary injunction that was in place because she would never have granted one if she had expected the jury to find in Samsung's favor on the D'889 infringement issue. And in footnote 2, she stresses once again that "[t]he Court is not in any way commenting on the merits of any of the parties' post-trial motions".

While I believe that it would have been problematic to keep the Galaxy Tab 10.1 injunction in place under the current set of circumstances, I'm not sure that this approach of simply not assessing the likelihood of success of Apple's meanwhile-filed Rule 50 motion at all was correct. In late June, Judge Koh ordered the now-dissolved preliminary injunction and cited to a 2008 Supreme Court decision, Winter v. Natural Res. Def. Council, which is frequently cited by U.S. courts to lay out the circumstances under which a preliminary injunction may issue. The entire Winter opinion does not mention the words "trial", "jury" or "verdict" even once. It merely refers to "likelihood of success on the merits", which means that if Apple was sufficiently likely to prevail on its Rule 50 motion, it would satisfy that requirement. You have success on the merits if you win when all is said and done. In a totally hypothetical scenario, if a court knew (in terms of "if we knew then what we know now") that a jury would find in favor of a claim but that the defendant would subsequently succeed under Rule 50 and be cleared of infringement, it would have to deny a preliminary injunction -- a jury verdict is not "success on the merits" since it's an interim step, albeit an important one.

About an hour before Judge Koh's order on the Galaxy Tab 10.1, Samsung formally filed a request with the court in a parallel Apple v. Samsung two-way litigation (which started in February 2012) to add the iPhone 5 to the list of products accused of infringing eight Samsung patents (click on the image to enlarge or read the text below the image):

RELIEF REQUESTED

Samsung seeks an order granting it leave to amend its infringement contentions pursuant to Patent L.R. [Local Rules] 3-6 to allege infringement by the iPhone 5.

Samsung had already informed the court of its intent to attack the iPhone 5 in a September 20 filing, the day before the product started shipping. The October 1 filing now says that "as soon as [the] iPhone 5 was available for purchase, Samsung began its investigation of the product and within a week "determined that the iPhone 5 practiced its patented technologies".

Samsung tells the court that it would be more efficient to address the iPhone 5 in that second California litigation between the two parties than to file a new one over the same eight Samsung patents only to target the iPhone 5. Samsung says that "[t]he iPhone 5 has the same accused functionality as the previously accused versions of the iPhone, so the proof of infringement of the patents-in-suit by the iPhone 5 is the same as for other Apple devices already accused of infringement in this litigation".

If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or follow me on Twitter @FOSSpatents and Google+.

Follow @FOSSpatents

Share with other professionals via LinkedIn:

Share|

Samsung tells U.S. court it will soon attack the iPhone 5 with eight patents for a starter

In a case management statement filed late on Wednesday with the United States District Court for the Northern District of California, Samsung expressed its belief "the iPhone 5 will infringe [the eight patents that Samsung is already asserting in a California lawsuit against Apple, two of which have been declared standard-essential] in the same way as the other accused iPhone models", and that it "plans to file a motion to amend its infringement contentions to address the iPhone 5 as soon as it has had a reasonable opportunity to analyze the device".

Here's the relevant passage (click on the image to enlarge or read the text below the image):

"Samsung anticipates that it will file, in the near future, a motion to amend its infringement contentions to add the iPhone 5 as an accused product. On September 12, 2012, Apple announced that it will release the iPhone 5 on September 21, 2012. Based on information currently available, Samsung expects that the iPhone 5 will infringe the asserted Samsung patents-in-suit in the same way as the other accused iPhone models. Samsung plans to file a motion to amend its infringement contentions to address the iPhone 5 as soon as it has had a reasonable opportunity to analyze the device. Because Samsung believes the accused functionality of the iPhone 5 will be similar to the accused functionality of other accused Apple products, Samsung does not believe that amendment of its infringement contentions should affect the case schedule."

The filing was jointly made by Apple and Samsung in their second California litigation, which started this year and is currently scheduled to go to trial in March 2014.

After bringing formal infringement contentions, Samsung could ask for a preliminary injunction against the iPhone 5. It does not mention that possiblity, but it's a procedural fact that a preliminary injunction can only be requested in connection with a lawsuit that will result in either the dissolution of the preliminary injunction or its conversion into a permanent one.

Last year, Samsung sought preliminary injunctions against Apple in other jurisdictions (including France, Italy and the Netherlands), but it has not yet done so in the United States. After its recent trial loss it may want to show that it keeps fighting back.

Apple has also continued to add new products to the list of devices accused in that lawsuit. Three weeks ago, Apple added the Galaxy S III, Note and Note 10.1. It appears that Apple has already served its detailed infringement contentions concerning the S III and Note, but still needs to do so for the Note 10.1. Apple furthermore notes that "the Android 4.1 Jelly Bean operating system" will become one of the accused technologies. That is interesting in light of Google's recent statement on the jury verdict in the first Apple v. Samsung litigation, where Google claimed that "[m]ost of these [patent claims] don't relate to the core Android operating system". I commented on the "core Android" question in a recent post.

Judge Koh will hold a hearing on Wednesday (September 26) to discuss the further management of the second Apple v. Samsung lawsuit she is presiding over. In the meantime, Apple and Samsung will file various post-trial motions in the first one. According to the Korea Times, Apple will seek triple damages: $3 billion. That amount would exceed the total cost of the Curiosity Rover, while the jury's damages award fell short of the cost of reconstructing the Golden Gate Bridge.

If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or follow me on Twitter @FOSSpatents and Google+.

Follow @FOSSpatents

Share with other professionals via LinkedIn:

Share|

Patent-based disruption of iPhone 5 sales highly unlikely for at least the remainder of the year

On the occasion of today's iPhone 5 presentation, I'm now going to explain why it's highly unlikely that sales of Apple's new smartphone will be disrupted by any patent holder in the coming months. There may be preliminary or even seemingly-final rulings during that period, but in practical terms, Apple is almost certainly safe from any actual, material impact on its iPhone 5 sales for the important Christmas selling season. There's huge pent-up demand for the iPhone 5 (despite the fact that there are also some disappointed fans), and those who've been impatiently awaiting it will mostly buy it over the next few months.

Ten days ago I already looked at the chances of Samsung enforcing 4G LTE patents against the iPhone 5 in different jurisdictions. But I didn't address timing and, what's more important, Samsung has non-LTE patents in action against Apple, and there are also various Google (i.e., Motorola Mobility) and HTC lawsuits. So this post has a focus on timing and, in terms of the relevant patents and their holders, a broader perspective than the September 2 post, but it does not adddress the likelihood of success on the merits of these cases -- the underlying assumption here is, just for the sake of the argument and totally unrelated to what I expect the outcome will be, that Samsung, Motorola and HTC will win their pending as well as potential new cases they may bring now. And even then, some of those lawsuits wouldn't have business impact before the successor to the iPhone 5 ships, and others could still hit the iPhone 5 while it's the current-generation iPhone, but not before Apple will already have sold tens of millions of units.

This analysis has three parts:

1. enforceability of already-issued patent injunctions against Apple in connection with the iPhone 5

2. timelines of infringement actions that are already pending against Apple but have not yet been adjudicated

3. timelines of preliminary injunction requests that may be brought against the iPhone 5 post-launch

There is one limitation here: I focus entirely on patent lawsuits brought by Apple's three large rivals: Samsung, Google's Motorola Mobility, and HTC. I won't elaborate on "troll" lawsuits, and while there are dozens of them, I'm not aware of any such action that could change the picture in the coming months. Even if a non-practicing entity prevailed, Apple could solve the problem with small amounts of money, while the Android camp is, more than anything else, interested in a free pass for infringement of Apple's patents.

Anyway, the bottom line is what the headline stated: even if anything happened, there's no serious dark cloud hanging above the iPhone 5 in any jurisdictions for at least the remainder of the year (if the question is when there will be business impact, not just interim steps that may lead to such impact later on).

1. Enforceability of already-issued patent injunctions against Apple in connection with the iPhone 5

First off, reporters and analysts frequently fail to understand that injunctions granted based on past infringement by older products may very well apply, in different jurisdictions (particularly the United States and Germany, the two primary battlegrounds), to new products that infringe the same patent (especially if they infringe the same patent claims) in any way or, under the "colorable difference" standard applied in the U.S., in more or less the same way. The law is not as stupid as some people think. End-runs based on new products rarely ever work.

But so far the Android camp hasn't won much against Apple (and Apple also has miles to go, but it's been more successful than its adversaries and now has a lot of momentum after the California verdict).

1.1 Samsung's existing injunctions

Samsung has won a ruling that it's entitled to damages (at a FRAND level), but was categorically denied injunctive relief, over a 3G-essential patent in the Netherlands. In Korea, it won a couple of injunctions over 3G-essential patents against the iPhone 4 (not even the 4S) and the iPad 2 (and it's now being investigated by the local antitrust authority over this conduct). Also, local observers expect the appeals court to stay enforcement. According to leading South Korean news agency Yonhapnews, Apple has requested such stay.

1.2 Google's (Motorola Mobility's) existing injunctions

Motorola Mobility has won two German injunctions, one over a standard-essential patent (that patent is 2G-related, but due to backwards compatibility requirements would also affect 3G and 4G devices) and one over a non-standard-essential patent on push notifications. The first injunction doesn't matter anymore because Motorola recently felt forced to accept an offer by Apple (which is not even based on a particular amount of money since the royalty rate will have to be set by a court of law) for taking a license to Motorola's wireless SEPs. In other words, they're still suing each other over this matter, but only for the money, and whatever Motorola will get, it won't hurt Apple. The push email injunction is still being enforced, but Apple's devices themselves are sold in a non-infringing form. This matter is on appeal, and Apple is challenging the validity of that patent in a separate nullity action, but Germany-based Apple users probably won't get push email back for about another year or more, unless Apple and Google settle in the meantime.

Motorola was trying to win even a third German injunction against Apple, and a trial in Mannheim had been scheduled for the summer but was canceled, presumably because the Google subsidiary's lawyers determined they couldn't prove infringement.

1.3 HTC: no injunctions in place

HTC has not (yet) won any offensive case against Apple anywhere. Nor have its subsidiary S3 Graphics and its affiliate Via Technologies.

2. Timelines of infringement actions that are already pending against Apple but have not yet been adjudicated

Patent litigation is slow, and while Apple suffers from that fact more than anyone else, it is also, in some situations, a beneficiary of delays.

2.1 Samsung's pending actions

Apple and Samsung have more than 50 litigations pending against each other in ten countries on four continents. The list I just linked to include some that were adjudicated, but both of them routinely appeal everything.

The California jury cleared Apple of infringement of Samsung's five patents-in-suit. This finding can be overruled by Judge Koh "as a matter of law". A hearing on the parties' Rule 50 (overrule-the-jury) motions will take place on December 6. At that point, the court will also hear Apple's request for a permanent injunction, but Samsung will only be allowed to request injunctive relief if its Rule 50 motion succeeds on any of its own offensive claims. I'm not even sure that the Rule 50 decisions will come down before the Holiday Season, but even if they do, Samsung will only then get a schedule for requesting an injunction, and we're well beyond the turn of the year for the earliest date on which it could get any.

On Friday, an ITC judge is scheduled to hand down his preliminary ruling on Samsung's request for a U.S. import ban against Apple. But the target date for the actual decision is always four months after the decision (in this case, that's already January), and even if the final decision was an import ban, there would be a 60-day Presidential Review period before it takes effect.

In Germany, there are four Samsung v. Apple trials coming up, all of them at the Mannheim Regional Court, and the first one of them this Friday (needless to say I'll be there). Samsung asserted those four patents latst December, and I listed them at the time. Judge Andreas Voss ("Voß" in German) typically announces his panel's decisions about two months after trial, adopting faster schedules only if there's an unusual sense of urgency, for example, because of a patent approaching its expiration. So the trials taking place between mid-September and mid-October will result in decisions between mid-November and mid-December. If injunctions are granted, they will be permanent injunctions (not just preliminary ones entered at the end of fast-track proceedings) but appealable, so they will be only "preliminarily enforceable". This means Samsung would have to post a bond and formally demand compliance, a process that always takes a few weeks. Apple would ask the appeals court (the Karlsruhe Higher Regional Court) for a stay. If there's no stay and if Samsung then enforces, we'll be close to or after Christmas, and resellers will have plenty of iPhone 5 units in their warehouses, so actual business impact would take until next year.

Two of those Mannheim lawsuits are over standard-essential patents, while two are not. Apple could work around the non-essential ones, such as a smiley input patent. No one can work around truly standard-essential patents, but Apple could make Samsung the kind of offer that it made to Motorola, and the appeals court would probably grant another stay on that basis anyway, but I explained why even without a stay, Apple's resellers would have enough supply for the remainder of the year.

It's likely that Samsung will formally accuse the iPhone 5 of infringement at some or all of those near-term Mannheim trials. In Germany, infringement accusations can still be amended at trial, though this can result in a need for post-trial briefings and some delay. Based on today's announcement, Samsung's lawyers could claim at the trial on Friday that the iPhone 5 will infringe the standard-essential patent at issue in that action. If an infringement accusation is based on the specifications of an industry standard (as opposed to a reverse-engineering-based analysis of what the actual product does), an announcement can be a basis for an infringement accusation. Apple would likely point to some German case law that sets a rather high bar for patent infringement complaints prior to the release of a product, but Samsung could try. And some of those trials will take place after the product becomes available. Also, even if Samsung did not formally accuse the iPhone 5, German patent injunctions typically recite the infringed patent claims as opposed to naming particular devices (even though there must be at least one exemplary accused device to have a case) -- a fairly broad kind of injunction called "obey-the-law injunction" that is rather problematic in the United States.

All in all, the timing of those German trials is Samsung's best shot at winning at least a ruling (even if it won't have immediate business impact) that relates to the iPhone 5.

I'm not aware of upcoming Samsung v. Apple decisions in other jurisdictions in the next few months. (A trial in Australia started even shortly before the U.S. trial but no decision is expected before next spring.)

2.2 Google's (Motorola Mobility's) pending actions

Motorola has a lawsuit pending against Apple in the Southern District of Florida that is currently scheduled to go to trial in March 2014. Motorola wanted a faster schedule but very recently it stipulated to a 60-day extension of certain deadlines in order to be able to include the iPhone 5 in its infringement contentions. Still, this litigation will take a lot of time.

Motorola was hoping to win an ITC import ban against Apple this year, but the Commission, the six-member decision-making body at the top of the ITC, cleared Apple of infringement of three of the four patents-in-suit and remanded the invesigation, as far as the fourth patent is concerned, to an Administrative Law Judge. No new schedule has been set. Even if a new initial determination came down very quickly (which I doubt), it would again take the usual four months between the preliminary ruling and the final one, and subsequently there would be the 60-day Presidential Review period. By the way, ITC import bans work almost like "obey-the-law injunctions" with respect to the particular patent claims found violated, except that the ITC will in case of doubt (over whether new products really infringe) launch an enforcement proceeding that can easily take a year, as Apple just experienced in its own enforcement efforts against HTC.

Motorola recently brought a second ITC complaint against Apple, and the investigation has not even begun yet. It will probably begin within less than a week, but then it will take something between 16 and 18 months based on the schedules that are usually set.

The Düsseldorf Regional Court will hold Motorola v. Apple trials in late January. The legal entity defending itself in those actions is Apple Retail Germany GmbH, the company operating the German Apple Stores. In Germany, Motorola tends to sue in Mannheim for the most part, and as far as I know, there won't be any Motorola v. Apple trial in Mannheim between now and early December, and therefore no related decision this year.

1.3 HTC's pending actions

HTC primarily wants to stall Apple's enforcement, and it's really very good at that. That's why it requested -- and won -- a sweeping stay from the United States District Court for the District of Delaware. One Delaware HTC v. Apple infringement action is progressing. In that one, HTC is asserting patents it borrowed from Google, and Apple is trying to have those loan patents thrown out the way it worked for Apple at the ITC. Otherwise the trial is currently scheduled for early 2014.

A trial of HTC's second ITC complaint against Apple started last week, and the remaining patents-in-suit are allegedly 4G/LTE-essential patents. Apple has requested sanctions because an HTC witness said he didn't know what inventions, if any, his patents cover. Anyway, the preliminary ruling is scheduled for November 30, 2012, and the final decision for April 1, 2013.

HTC subsidiary S3 Graphics also has a second ITC complaint going against Apple. The hearing will start in late November, the preliminary ruling is due on February 20, 2013, and the target date for the final decision is June 20, 2013. There's also an ITC investigation of a complaint by VIA Technologies, a chipset maker that is part of the same corporate family as HTC. A trial took place this summer, a preliminary ruling is due on November 9, 2012, and the target date for the final decision is March 14, 2013.

HTC and S3G also brought German lawsuits against Apple. So far they have not shown up on my local radar screen, making it rather unlikely that they'll go to trial this year.

3. Timelines of preliminary injunction requests that may be brought against the iPhone 5 post-launch

With so few existing injunctions that could be leveaged against the iPhone 5 in place, and with so few rulings coming up in the near term, Apple's rivals might file preliminary injunction motions in the next weeks, claiming that the iPhone 5 violates their rights. Courts decide preliminary injunction requests on the fast track, but even in Germany, where full-blown main proceedings (with trial and everything) can be adjudged within nine months by some courts, preliminary injunction decisions on technical patents take about three months.

Based on how Samsung's preliminary injunction requests against the iPhone 4S were handled, it looks like other European jurisdictions also need a few months to make such decisions. And in the U.S. it tends to take even longer.

One factor that is highly important when seeking preliminary injunctions anywhere is that there must be an unusual sense of urgency. If a right holder waits too long, the court wonders why it should be rushed to a decision after precious time was wasted. In the United States, this analysis is very case-specific. In Germany, depending on the part of the country, the courts have general rules (like unwritten local rules) that preclude the pursuit of preliminary injunctions after a month or, at the most, two months. I don't think any such hard or soft timelines would be a problem in a formal sense: if anyone wants to attack the iPhone 5, it will happen very, very soon. But such attacks will probably be based on patents that earlier Apple products would already have infringed if the iPhone 5 infringed them now. For example, 4G patents could already have been asserted against the 4G version of the "new iPad" (iPad 3). In my observation, the argument that previously-released products would already have infringed does not usually result in an outright denial of a preliminary injunction, but it does nevertheless make judges skeptical of the need for a fast-track sales ban.

In jurisdictions in which injunctive relief is equitable relief (meaning the courts have some discretion), a balance-of-hardships and public-interest analysis would also make it harder to win and enforce an injunction during the Christmas selling season.

Also, if Apple's adversaries really wanted to maximize chances of immediate impact, they'd probably have to sue resellers (especially major carriers) directly -- but those are their own customers as well, and while legally possible, this would also be viewed unfavorably by the courts.

So there may be some preliminary injunction requests in different jurisdictions, most likely from Samsung and potentially also from Google's Motorola Mobility, and maybe some hearings or even some decisions, but actual disruption in the coming months is nevertheless very unlikely. Of course, if there are any such developments, I'll follow them closely.

If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or follow me on Twitter @FOSSpatents and Google+.

Follow @FOSSpatents

Share with other professionals via LinkedIn:

Share|

Where on Earth could Samsung get the iPhone 5 banned over 4G/LTE patents?

In the context of Friday's dismissal of a Japanese Apple lawsuit against Samsung, I mentioned (as I previously did on other occasions) that the problem of the Android camp in general and Samsung in particular is that they can't score meaningful offensive wins against Apple. Fending off patent lawsuits is not enough when facing a company with a fast and large-growing portfolio of relevant patents. Defensive wins merely delay the inevitable.

What Samsung needs are enforceable injunctions over impactful non-standard-essential patents. Thus far, Samsung hasn't won any injunction of that kind. It previously relied largely on standard-essential patents (SEPs), and a Korea Times report published on Friday suggests that Samsung is once again contemplating a multijurisdictional push for preliminary injunctions against a new iPhone (or iPad 4G):

"Samsung confirmed that it will immediately sue Apple if the latter releases products using advanced long-term evolution (LTE) mobile technology."

It tried this trick last year with 3G patent assertions against the iPhone 4S, with a hit rate of zero. I would strongly discourage Samsung from trying to use 4G/LTE-essential patents to shut down the iPhone 5. It won't improve Samsung's position. It will only make things worse, especially with antitrust regulators. In my view, the reasonable approach for Samsung would be to sue for FRAND royalties over its SEPs, not injunctions.

The Korea Times article cites research according to which Samsung owns the world's third-largest 4G/LTE portfolio. But the size of a portfolio related to a given standard is only indirectly relevant if someone seeks injunctions over SEPs. As an expert report filed with different courts by now-Google-subsidiary Motorola Mobility noted, "it only takes one bullet to kill".

Obviously, the larger a portfolio is, the more likely it is to contain truly essential patents, as opposed to merely declared-essential patents. But Samsung's unsuccessful 3G enforcement campaign against the iPhone 4S failed primarily because of licensing issues. The other respect in which a large portfolio of patents specific to a given standard can help is that a larger portfolio typically (unless there are serious validity or essentiality issues) entitles a patent holder to a higher royalty rate. The reasonable royalty rate is a factor to some courts who look at whether the implementer of the standard was made a FRAND offer. But even with 12% of all 4G/LTE patents, Samsung can't claim a 2.4% royalty on Apple's products. If you extrapolate this percentage to the entirety of 4G/LTE patents, Apple would have to pay 20% of its sales -- tens of billions of dollars a year -- to the collective owners of 4G/LTE patents. That's still far out of the FRAND ballpark.

It's not just the percentage Samsung asks for but, especially, the royalty base. I explained that issue on previous occasions, such as this post on one of Apple's pre-trial filings with Judge Koh's court. The proper royalty base would be a fully-licensed baseband chipset, or at the most a cheap feature phone, just like a jalopy and a sports car pay the same highway toll, as Apple noted in a letter to U.S. lawmakers. Also, Samsung won't get 2.4% of the price of an airplane if it comes with on-board 4G/LTE functionality.

Patent exhaustion is also going to be a big issue. From what I heard, the iPhone 5 will come with a Qualcomm baseband chip. Qualcomm and Samsung have a patent license agreement in place. Samsung tried to terminate it with respect to Apple as a third-party beneficiary (Motorola, advised by the same lawyers, tried the same thing). But in some jurisdictions, Samsung's push for injunctions against Apple devices incorporating Qualcomm baseband chips failed just because that termination theory was rejected, especially in light of Samsung's promise to grant irrevocable FRAND licenses to its SEPs. I don't know the Samsung-Qualcomm agreement but most likely it won't make a distinction between 3G and 4G patents as far as termination is concerned -- and participants in 4G/LTE standard-setting also had to promise to grant irrevocable FRAND licenses.

Should Samsung really try to get the iPhone 5 banned over 4G/LTE SEPs, it will have to find at least one jurisdiction of economic relevance in which it can surmount all of the following hurdles in addition to the usual requirements for patent enforcement (validity, infringement) and potential claims that it failed to disclose its patents and patent applications on a timely basis:

1. the contractual implications of its own FRAND pledge

2. Qualcomm-related patent exhaustion-like issues

3. antitrust issues (in court as well as blowback from regulators -- the European Commission is already investigating Samsung's related conduct)

Let's now look at the situation in different jurisdictions. It's clear that the only country in which Samsung is reasonably likely to succeed is Korea. Other countries are, at best, a gamble.

North America

In the United States, earlier disputes over SEPs were settled before any precedent that could be useful to Samsung was set. Recent decisions by judges in four different federal districts strengthened the rights of good-faith implementers of standards. The most notable one is also the one that most specifically addresses injunctive relief: the FRAND-related part of Judge Posner's dismissal of a two-way Apple-Motorola lawsuit in Chicago. While not specific to injunctive relief, summary judgment decisions in Wisconsin and Washington (state) strongly support a FRAND-related contract-based defense. In the Northern District of California, Judge Koh allowed Apple to take most of its FRAND counterclaims to trial against Samsung. The jury verdict didn't support Apple's counterclaims, but juries don't make law and have at the most an advisory role in connection with equitable defenses which are decided by judges. The jury dismissed Samsung's SEP assertions on two grounds, either one of which would have been sufficient on its own. The patents were not demeed infringed, and if they had been deemed infringed, the jury sided with Apple on patent exhaustion (interestingly, only Intel chips were at issue, and from the outside it appears that Apple's patent exhaustion argument is stronger in connection with Qualcomm than with Intel).

Furthermore, U.S. antitrust regulators don't take FRAND abuse lightly. Officials from the Federal Trade Commission and the Department of Justice spoke out on injunctive relief (particularly in the form of import bans) over SEPs at a recent Senate hearing. Also, the FTC filed a pretty clear statement with the ITC.

I'm unaware of similar cases in Canada. That country has a common law system, which means that principles of equity will be considered before injunctive relief is granted. This is speculative, but Judge Posner's reasoning on FRAND (which is very general in nature and not specific to U.S. law) could be quite persuasive in all English-speaking common law jurisdictions.

Europe

With the ongoing European Commission investigations, Europe is the last continent on which it would make sense for Samsung to sue. All of Western Europe's large economies are EU member states. But there are rumors that Samsung is nevertheless looking at Europe as a priority region for 4G/LTE SEP enforcement against the iPhone 5.

In Mannheim, Germany, Samsung has a couple of trials over 3G/UMTS SEPs coming up this month. Theoretically, their outcome could also have an impact on the iPhone 5 (at the trials I hope to learn about the scope of the injunction Samsung is seeking). Its previous three Mannheim lawsuits against Apple all failed because Samsung couldn't prove actual infringement. Motorola was more successful on the infringement side, but it turned out last month that the Google subsidiary ultimately felt forced to grant Apple a wireless SEP license, the financial terms of which have to be sorted out in court (they just agreed on an unspecified FRAND rate). If Apple was able to deal with Motorola's SEP assertions in Germany, it will also find a way to deal with Samsung's attacks within the Orange-Book-Standard framework. Apple never has a problem with paying FRAND rates, as long as FRAND really means FRAND.

In some parts of Germany, especially in the circuits the courts in Mannheim (primary venue for SEP lawsuits) and Düsseldorf (second most popular venue for this) belong to, preliminary (as opposed to permanent) injunctions are generally unavailable over patents that have not been defended in a contentious proceeding (reexamination or nulity action). In Munich, such untested patents can result in preliminary injunctions, but it doesn't take too much doubt over the validity of a patent to fend off a preliminary injunction motion. Also, SEP holders generally don't sue in Munich, presumably because they feel the FRAND defense is weaker in Mannheim and Düsseldorf.

In the Netherlands, Samsung's 2.4% royalty demand was considered to be far outside of the FRAND ballpark. As a result, injunctive relief was ruled out even before the court looked at infringement and validity. One Samsung 3G/UMTS SEP was actually deemed valid and infringed, but Samsung is only entitled to what will be a modest sum, and the same ruling indicated that Apple is fine as far as its products incorporate Qualcomm baseband chips.

In France and Italy, Samsung's preliminary injunction requests against the iPhone 4S were turned down by courts in Paris and Milan. In both cases, the decision was primarily based on Qualcomm-related exhaustion issues, but both courts also had a fairly FRAND-friendly inclination.

In the UK, it's generally very hard to win patent injunctions. Most patent assertions don't even result in a finding of liability because the High Court of England and Wales tends to consider more patents invalid than its counterparts in other European countries and also takes a conservative position on infringement questions. Even if there is liability, there still isn't necessarily an injunction. A few months ago, SEP assertion entity IPCom received a clear indication from the court that it wouldn't be able to win an injunction against Nokia. Even prior to that, trying to get products banned in the UK over SEPs would have been a long-shot proposition. And now, even more so.

Last year, Huawei filed a lawsuit in (among other countries) Hungary against ZTE, apparently also involving 4G patents, but no outcome is known.

Apple and Samsung already have some design rights matters pending in Alicante, Spain, where the EU agency administering Community designs (EU-wide design patent equivalents) is based. If Samsung brought a SEP infringement action in Spain, it would probably alienate European Commission Vice President (and competition commissioner) Joaquín Almunia, a Spaniard who is personally very concerned about the overall FRAND abuse situation.

There are literally dozens of other Europan countries, and while none of them represents a huge market, some of them have affluent populations. We'll see if Samsung is going to enter unchartered SEP litigation territory. Even if it won an injunction in some smaller European country, it's likely that Apple wouldn't lose much of its sales opportunity because the resellers based there would just simply purchase the iPhone 5 in other EU member states (no customs duties within the EU's single market). Samsung could try to put pressure on retailers, but that's difficult to do and could affect its own sales.

Asia

South Korea is the only country in the world in which Samsung has been able to win an injunction against Apple so far, even two of them at the same time, and to add insult to injury, both over SEPs. Those two injunctions appear likely to be stayed for the time being and relate to products that do not come with Qualcomm chips. What is known about the ruling was markedly sympathetic to Samsung's arguments, but Samsung also has to think about the political implications of turning its country into a FRAND rogue state.

I don't know about SEP injunctions in Japan. Last year the Wall Street Journal reported on a Samsung announcement of a motion for a preliminary injunction against the iPhone 4S in that country, but I never heard about the iPhone 4S actually being banned there.

China is probably the most interesting country worldwide in which Apple and Samsung are not yet known to be suing each other. But there are various reasons to doubt that Samsung would succeed there. China has traditionally limited the exclusionary use of patents through compulsory patent licenses. I understand that the Chinese patent office has some authority in this regard. Also, the Chinese Ministry of Commerce (MOFCOM) was genuinely concerned about Motorola's use of SEPs in its protracted merger review. And Apple's gadgets are built there.

India generally has a reputation of weak patent rights.

Australia

A two-way Apple-Samsung trial is sort of ongoing there, though it appears that it will take months before any kind of decision. A Bloomberg report on one of the trial sessions indicates that a federal judge called a dispute over "wireless transmission technology" (i.e., wireless SEPs, as opposed to Apple's technologies) "ridiculous" and felt that mediation (to set a royalty rate) was the appropriate next step. An injunction against Apple over wireless SEPs in Australia appears unlikely, and a preliminary injunction (or temporary restraining order) is even less likely.

Rest of the world

I previously focused mostly (even if not exclusively) on jurisdictions in which Apple and Samsung already have litigation pending. There are still some countries I didn't address. For example, two of the BRIC countries, Brazil and Russia weren't mentioned. I don't see an obvious reason why the courts in those countries would adopt the Korean stance as opposed to the European and North American line. Also, one country in which technology companies file for lots of patents, but so far don't sue, is South Africa. And since I mentioned Australia, I might also mention that New Zealand is currently reforming its patent system.

Maybe Samsung will surprise us and really find a place to sue that nobody thought of. But if it really wants to gain massive leverage over Apple, it will have to focus on the places I discussed. For the vast majority of Apple's customers on this planet, Samsung's 4G/LTE-essential patents most likely won't have an impact on the availability of the iPhone 5.

If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or follow me on Twitter @FOSSpatents and Google+.

Follow @FOSSpatents

Share with other professionals via LinkedIn:

Share|

Apple refiles contract lawsuit against Google to protect its latest 3G/4G gadgets

The judicial process rewards a healthy degree of doggedness. No plaintiff is ever beaten unless his lawsuit is dismissed with prejudice. In that spirit, Apple just made its third attempt at bringing a patent-exhaustion-based "antisuit" lawsuit against Google subsidiary Motorola Mobility in an effort to protect, on a worldwide basis, those of its products that come with a Qualcomm baseband chip (the iPhone 4S, the 4G version of the new iPad, and presumably Apple's next products such as the iPhone 5).

Apple originally brought this contract lawsuit in February 2012 in the Southern District of California, where Qualcomm is based. Apple seeks to enforce its rights as a third-party beneficiary of a Qualcomm-Motorola patent license agreement. The original lawsuit had worldwide scope and sought declaratory as well as injunctive relief.

At the time of its filing, Apple's most immediate concern was the situation in Germany, where it was temporarily forced to remove certain 3G-compatible products from its online store, and where Motorola had just started to attack the iPhone 4S. When Apple made its original filing in Southern California, it had won only a temporary stay: a stay for the time it was going to take the appeals court (the Karlsruhe Higher Regional Court) to rule on a motion to suspend enforcement of the injunction for the entire duration of the appellate proceedings. That temporary stay could have been lifted only a few weeks later, but in late February it was extended for the duration of the appeal.

Motorola wanted Apple's California lawsuit dismissed for a variety of reasons, and Apple presumably determined that it was prudent to exclude Germany from the scope of the "antisuit" lawsuit. If Apple had continued to pursue relief in the U.S. with respect to Germany, Motorola would probably have called into question Apple's commitment to the licensing offer it made under the German Orange-Book-Standard procedure. Apple's first amended complaint also laid out a legal basis for bringing a lawsuit in federal court rather than state court.

But Motorola Mobility also challenged the first amended complaint, and two weeks after a hearing that took place in early July, Judge Dana M. Sabraw dismissed Apple's first amended complaint, but allowed Apple to refile until yesterday (Friday, August 3) and provided pretty useful guidance as to how Apple could state justiciable claims that would be more likely (if not certain) to dismiss a future motion to dismiss. Apple did not decline this invitation to pursue its cause, and indeed filed a second amended complaint (its third complaint in this case) late on Friday. As far as I can tell based on the public redacted version of the complaint, Apple adopted the judge's advice.

In the previous paragraphs I linked to several earlier posts on this lawsuit, and you can find further detail on this "antisuit" action in them. There are no fundamentally new facts in the second amended complaint. What's worth noting is that Apple's second amended complaint repeatedly quotes a passage from a filing Motorola made with the Karlsruhe Higher Regional Court:

"Also the further assertions with regard to the iPhone 4S are inaccurate. There is no strategy in place not to challenge these products. The fact that the Plaintiff has not yet challenged the 4S in Wisconsin has tactical reasons of a procedural nature, which the Plaintiff naturally will not expose to the Defendant."

In light of that statement, it's clear that a 3G-related patent infringement lawsuit by Google against Apple in the United States over the iPhone 4S and other products incorporating Qualcomm chips (such as the new iPad 4G), and/or in other jurisdictions around the globe, is only a matter of time unless the Southern California action proves dispositive through a determination that Motorola does not have the right to sue Apple for its use of Qualcomm baseband chips. One of the questions that will have to be resolved in San Diego is Motorola's "termination" of its license agreement with Qualcomm with respect to Apple as a third-party beneficiary, which Apple itself calls "ineffective". A similar strategy has not worked for Samsung so far, with courts in at least three different jurisdictions (the Netherlands, France, and Italy) having determined that patent holders who made a FRAND pledge according to ETSI rules must grant irrevocable licenses.

In a recent filing with the ITC, Apple explicitly stated its willingness to take a FRAND license to Motorola's standard-essential patents:

"Over the last few years, Apple consistently maintained its willingness to enter into a [F]RAND license and has sought to persuade Motorola to accept a [sic] [F]RAND terms. That Apple has refused to accede to Motorola's unfair demands does not make Apple an 'unwilling licensee.' Apple has concluded cross-licenses with many companies in the wireless industry, and stands ready to execute an agreement with Motorola if Motorola were to comply with [F]RAND."

If Apple's Southern California action succeeds, its new 3G/4G products will be safe and Google may bring its royalty demands down to a FRAND level.

If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or follow me on Twitter @FOSSpatents and Google+.

Follow @FOSSpatents

Share with other professionals via LinkedIn:

Share|