For more than a decade, Sony's patent applications have been disparaging Microsoft and Nintendo as 'inferior manufacturer[s]' of video game consoles: gratuitous, childish, unprofessional

Since last year I've been observing that Sony is an unreasonable--or, to use a word with which Sony was threatening the UK CMA with an appeal and which a journalist thought might describe Sony itself: irrational--complainant over Microsoft's acquisition of Activision Blizzard King. Today I learned that Sony's conduct as a patent applicant also raises serious psychiatric questions.

It was actually not another patent blog but GameRant that drew my attention to it:

Sony Throws Shade at Microsoft and Nintendo in Newly Published Patent

A newly published Sony patent oddly refers to Microsoft and Nintendo home entertainment consoles as 'inferior' to its products.

Hat tip to GameRant, but this is NOT NEW. It's long-standing Sony practice. They've been doing this since at least 2011!

Sony has incorporated that side swipe at Microsoft's Xbox and at Nintendo's consoles like the Switch for a dozen years in dozens of different patent applications.

It's amazing that no one has discovered this "tradition" before, and that no patent office told them a long time ago to stop doing that once and for all. Patent applications are not meant to be propaganda instruments for console warriors.

Here's the relevant language from the patent application GameRant discusses (WO 2023/055447, PCT/US2022(034277)):

"For example, an end user device may be a personal computer, a home entertainment system (e.g., Sony PlayStation2(R) or Sony PlayStation3(R) or Sony PlayStation4(R)), a portable gaming device (e.g., Soy PSP(R) or Sony Vita (R)), or a home entertainment system of a different albeit inferior manufacturer." (emphasis added)

GameRant is correct that "home entertainment system" is clearly defined by Sony's patent applications as video game consoles (or hypothetically multifunctional devices that come with video game console functionality). A patent is always its own dictionary. Therefore, saying that other home entertainment systems come from "different albeit inferior manufacturer[s]" is--as GameRant correctly notes --"obviously targeted at Microsoft and Nintendo."

GameRant is furthermore right that it's "strange for this language to appear in a patent." What is common and legit in patent applications is to explain why the claimed invention is superior over the state of the art (i.e., over technology existing at the time a patent application is filed). In that context, there is nothing wrong with discussing specific technical drawbacks (such as inferior performance, higher power consumption, greater memory footprint) of particular prior art (earlier inventions).

But calling competitors generally "inferior" is gratuitous, stupid, childish, and unprofessional. Even if those manufacturers were inferior, it would not mean that whatever invention a given Sony patent purports to describe--here, a "universal controller"--is by definition innovative and deserving of patent protection.

Sony is obviously the kind of client many patent attorneys want. If a small company went to the same patent attorneys and wanted them to file patent specifications that contain such an outrageous passage, most patent attorneys would decline to attach their names to it.

If Sony wants to engage in comparative advertising, it can do so elsewhere. Gamers are not going to make purchasing decisions based on the language Sony uses in its patent applications.

In November, Video Games Chronicle (VGC) quoted the same language from a different Sony patent application (PlayStation has been working on NFTs and blockchain technology, Sony patent reveals).

I've run some searches of patent databases--after almost 13 years of commenting on high-stakes patent litigation, that's obviously a routine activity for me--and found dozens of Sony patent applications that use the same idiotic language. I believe the oldest one of them--unless I missed an even older one, which can happen--is this one (PDF):

Redeemable Content Specific to Groups

Assignee: Sony Computer Entertainment America LLC

Filed: August 29, 2011

Appl. No.: 13/220,315

Don't get confused by the fact that the publication number is US 2013/0054689: that's the publication date. For the first 18 months, patent applications are in "stealth mode": they're in the database, but not publicly available. Then they get published and are assigned a date. But the filing date was August 29, 2011, and the following image shows the same idiocy as in the much more recent patent application that GameRant discovered (click on the image to enlarge):

Here's just a sample of other Sony patent applications that contain the words "different albeit inferior manufacturer" with (dis)respect to competing video game consoles:

• U.S. Patent Application No. 2013/0297393 A1 on "dynamic redemption codes" (filed July 9, 2013)

• U.S. Patent No. 10,245,505 B2 on "generating custom recordings of skeletal animations" (filed March 13, 2014)

• U.S. Patent No. 10,377,484 B2 on "UAV positional anchors" (filed December 29, 2016)

• U.S. Patent No. 10,999,391 B2 on "dynamic filtering and amelioration of content stream manifests" (filed October 30, 2017)

• European Patent Application No. EP3710122A1 on "synchronizing session content to external content" (filed October 31, 2018)

• U.S. Patent No. 11,080,748 B2 on "targeted gaming news and content feeds" (filed December 14, 2018)

• U.S. Patent No. 10,540,746 B2 on "course profiling and sharing" (filed July 30, 2019)

• U.S. Patent No. 11,420,130 B2 on "media-object binding for dynamic generation and displaying of data associated with media (filed May 28, 2020)

• U.S. Patent No. 11,364,437 B2 on "establishing and managing multiplayer sessions" (filed June 30, 2020)

• U.S. Patent No. 11,524,240 B1 on "virtual dojo" (filed August 17, 2021)

• U.S. Patent Application No. 2023/0021350 A1 on "health and wellness gamification" (filed August 25, 2021)

• U.S. Patent Application No. 2022/0193546 A1 on "content streaming with gameplay launch" (filed December 31, 2021)

GameRant was wondering whether "the offhanded remark" was related to Microsoft's acquisition of Activision Blizzard King, given that the filing GameRant discusses was made in June 2022, "about six months after Microsoft announced" that deal. The above list shows Sony has been doing this systematically for more than a decade. This is not attributable to pride in inventorship. It's just insane.

Share|

LG subsidiary Zenith files new ITC complaint and lawsuit against Sony in wider dispute involving 50 patents

Compared to Apple's huge patent wars with Nokia and more recently with Samsung, the ever-widening Korean-Japanese dispute between LG and Sony gets less attention except on a few occasions such as Sony's ITC complaint over a host of LG smartphones, LG's ITC complaint over the PlayStation 3, and the temporary seizure of 300,000 PS3s by Dutch authorities. More recently, Sony made headline news mostly with PlayStation Network security issues.

The patent dispute between LG and Sony is nevertheless a huge conflict in which the parties have brought against each other more than a dozen complaints and asserted a total of 50 US patents (31 from LG including its Zenith Electronics subsidiary, and 19 from Sony) plus the European counterparts of some of those. The products at issue are diverse: they include Blu-ray Disc players, digital television sets, smartphones, and video game consoles.

The latest development is that Zenith Electronics, a wholly-owned LG subsidiary, filed two parallel complaints against Sony on Friday (April 29, 2011). Both relate to Sony Bravia HTDV (high-definition television) sets implementing the ATSC digital television standard, but relate to different patents. One complaint over three patents (previously asserted against Sony in the Eastern District of Texas) was lodged with the ITC, requesting an import ban of the accused products, while the other complaint, over two patents (not previously asserted against Sony), was filed with the US District Court for the Northern District of Illinois.

The ATSC digital television standard for HDTV

The short version is that the ATSC digital TV standard is now synonymous with HDTV in the US market. Another important set of digital TV specifications was developed by the EBU (European Broadcasting Union).

The Federal Communications Commission (FCC) of the United States encouraged a group of US-based TV companies to form in 1993 the so-called Grand Alliance (GA) in order to develop a US standard for digital television. According to Wikipedia, the GA "consisted of AT&T, General Instrument Corporation [Motorola], Massachusetts Institute of Technology, Philips Consumer Electronics, David Sarnoff Research Center, Thomson Consumer Electronics, and Zenith Electronics Corporation [the LG subsidiary that brought the two complaints discussed in this post]."

The Advanced Television Systems Committee (ATSC) website lists the ATSC digital television standard on this page. You can find different revisions of the standard there. Since a 2008 revision, the AVC/H.264 codec is also supported; previously, ATSC only supported its predecessor, MPEG 2.

The new ITC complaint

There are already three ongoing ITC investigations of four complaints the parties lodged against each other (investigations no. 337-TA-758, no. 337-TA-764, and no. 337-TA-765). Two of those investigations (no. 337-TA-758 and no. 337-TA-765) relate to complaints lodged by Sony. The third one of those ITC investigations (no. 337-TA-764) simultaneously looks into two LG complaints, one over the PS3 and one over the Bravia TV sets. While the products and patents at issue in those two complaints are unrelated, the ITC decided to combine them because they involve basically the same parties.

If the latest complaint also gives rise to an investigation (which I would except to happen), there will either be a fourth investigation or, since the aforementioned one just started about two months ago, the ITC might order consolidation of the new complaint into that existing investigation (no. 337-TA-764). The fact that the latest complaint is brought by Zenith, not LG itself, may represent an impediment to consolidation because LG and Zenith are formally different legal entities.

The patents asserted in the ITC complaint are:

• U.S. Patent No. 5,598,220 on a "digital signal with multilevel symbols and sync recognition"

• U.S. Patent No. 5,629,958 on a "data frame structure and synchronization system for digital television signal"

• U.S. Patent No. 5,636,251 on a "receiver for a trellis coded digital television signal "

Zenith previously asserted those three patents -- and seven others -- against Sony in a complaint filed with the US District Court of the Eastern District of Texas on October 29, 2010 (case no. 5:10-cv-00184). That one was the first lawsuit between LG and Sony at least in recent memory. On April 25, 2011 the Texas court agreed with Sony that the Northern District of California was a more convenient location (and equally in the interest of justice). For instance, San Francisco is closer to Korea and Japan in terms of air travel time than Texas. Assuming the ITC now votes to investigate Zenith's complaint over three of those ten patents, the California court will likely stay the related claims in that federal lawsuit but continue with respect to the other seven patents.

Interestingly, Zenith mentions in its ITC complaint that it previously sued various other companies over those three patents and, according to its own representations, succeeded either in the form of settlements (such as with Thomson, Philips, TTE and Pioneer, all of whom took a license) or favorable rulings. Zenith furthermore says that Sony used to have a license to "certain Zenith patents", which has however expired according to the complaint.

The new federal lawsuit

The case no. for the new federal lawsuit is 1:11-cv-02885, Northern District of Illinois. Previously, Zenith sued in Eastern Texas (as mentioned in the previous section), and its parent company LG Electronics filed two suits against Sony in the Southern District of California as well as in the Netherlands. Sony filed two infringement lawsuits and a declaratory judgment action (seeking the invalidation of certain patents) against LG in the Central District of California.

Zenith asserts the following patents in its federal complaint:

• U.S. Patent No. 5,406,587 on an "error tracking loop"

• U.S. Patent No. 5,565,932 on an "AGC system with pilot using digital data reference"

The federal complaint is less detailed than the ITC complaint, but it's possible that Sony also had a license to those patents in the past.

Since Zenith is based in Illinois (as is Motorola, which was also involved with the creation of that standard), the LG subsidiary may be able to keep that lawsuit in that state, unlike the one in Texas that was ordered to be transferred to California. Zenith might even try to finally move the original Texas suit to Illinois instead of California.

Next steps

This dispute started last fall and has resulted in a number of complaints especially during the last three months. The fact that LG has asserted more patents so far doesn't necessarily mean that LG is more aggressive in all respects. For example, Sony was the first of the two litigants to involve the ITC, which got LG so worked up that they tried to disrupt Sony's European PlayStation 3 sales.

While the dispute already relates to a variety of product categories, which is reflective of the level of diversification of these two consumer electronics giants, further escalation is still a possibility. For example, while Sony has asserted patents against a number of LG smartphones, LG might own patents in that field that it could assert against Sony as well. Both companies are Android adopters, which is another aspect under which this conflict could get very interesting going forward.

There's no question that this dispute will end with a cross-license deal, and so far LG appears to be very confident that Sony will end up being the net payer and that LG will generate significant income from this on the bottom line. But Sony also has a strong patent portfolio and may actually aim for a cross-license with no or very little money changing hands. There's no doubt that they both have a hard time agreeing on a deal, and this dispute may take a while.

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.

Share with other professionals via LinkedIn:

Share|

Microsoft gets another Motorola suit transferred from Wisconsin to Washington

In March I reported that the US District Court for the Western District of Wisconsin granted a Microsoft motion to transfer a Motorola lawsuit to the Western District of Washington. Microsoft has meanwhile also won the transfer of another Motorola lawsuit, in which each of the two companies asserts five patents against its rival.

Following Microsoft's initial lawsuits in Washington (and its ITC complaint), Motorola had filed (besides an ITC complaint of its own) three suits in Wisconsin and one in Florida. At this point, two of those Wisconsin suits have been transferred to Microsoft's home state of Washington, and the only one remaining in Wisconsin is stayed for the duration of an ITC investigation of the Xbox 360 and may very well also be transferred to Washington whenever it is resumed. The Southern Florida litigation is a separate story.

The current battlemap looks like this:

On Scribd you can find a PDF document containing that visualization, 12 more slides that show how the conflict has escalated step by step, and 7 pages of reference lists (all the lawsuits, all the parties, all the patents, all the products). If you are interested in always finding the latest versions of my smartphone patent battlemaps, I recommend that you follow me on Scribd (it has a Twitter-like following system) or at least bookmark my Scribd.com smartphone patents folder. I usually announce updates to that folder on my blog, but you can also go there directly whenever you need such reference material.

If you wish to share this latest Microsoft vs. Motorola visualization via Twitter, you can find it on Twitpic.

In my post on the previous transfer I mentioned that Motorola opposed the transfer of the case that was now transferred and based one of its arguments on the claim that its Android-based smartphones increasingly compete with Microsoft's Xbox game console. The judge did not seem to be impressed by that claim. In her decision she also stated that Motorola's "assertion that Xbox Live is 'implicated' in its claims is too tenuous and undeveloped to support finding any direct competition in relation with this lawsuit."

Competitive relationships can play a role in determining the proper venue for such a lawsuit since patent infringement cases are particularly urgent between drect competitors: an infringer might gain market share at the expense of the right holder. In this particular lawsuit, Motorola attacks the Xbox but can't successfully claim a competitive relationship with Microsoft's game consoles. So the court considered the delay possibly caused by the transfer acceptable, and ordered the transfer.

What we might see at some point is a motion to consolidate some of the Microsoft vs. Motorola lawsuits in Washington.

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.

Share with other professionals via LinkedIn:

Share|

Showdown between LG and Sony over PlayStation 3 seizures to take place tomorrow in a court in The Hague, Netherlands

From a Brussels-based intellectual property lawyer I have received a copy of a Dutch court order obtained by LG against Sony on February 28, 2011. That court order -- which is an additional legal instrument not to be confused with the customs action apparently requested by LG two weeks ago under EC Regulation 1383/2003 -- was issued by the court of Breda, Netherlands, in whose district Sony's European logistics center in the nearby city of Tilburg is based, and enabled LG to request the seizure of any PlayStation 3 units stored there. The first seizure had to take place on March 3, 2011, and up to two more seizures were authorized until March 10, 2011. The quantities seized there may be quite substantial considering that all of Sony's European PlayStation shipments used to go through the Netherlands at least until recently.

Sony had until yesterday afternoon to tell the court whether it wants to appeal this prejudgment seizure order. According to a Reuters report, Sony elected to appeal, so pursuant to the court order there will be a hearing tomorrow, March 10, 2011, in The Hague (where the higher instance court is based) at 2 PM Central European Time.

Sony was not heard before the court issued its order because the judge agreed with LG that any advance notice would have given Sony the opportunity to move its PlayStations out of that warehouse ahead of confiscation.

I have also heard from a credible source that three shipments were seized by Dutch customs officers, apparently at or near Schiphol, Amsterdam's airport. But again, it's important not to mix up the two different legal approaches. Under EU Regulation 1383/2003, products suspected of patent infringement can be seized by customs officer when they are being imported into the EU's Single Market. That's one request LG has made. But the court order I'm discussing here is strictly under Dutch patent law, and it's a preliminary injunction and seizure order, and it's specific to Sony's Tilburg warehouse.

Let me show you the court order (in Dutch) and then explain what it says. There's interesting information in it concerning the failure of negotiations between Sony and LG. This is the 48-page document -- in Dutch and with plenty of pictures:

2011 RK 11-0510 LG - Sony

On February 25, 2011, LG's lawyers (led by Armand Killan of the Bird & Bird firm) requested a prejudgment seizure order under the Dutch Patents Act of 1995.

The complaint relates to patents on the Blu-ray Disc standard and specifically asserts the following three patents:

• European Patent 1676275 on a "recording medium having data structure for managing reproduction of text subtitle and recording and reproducing methods and apparatuses"; this patent was applied for in the US (publication no. 2005/078948) and various other countries

• European Patent 1730730 on a "recording medium and method and apparatus for reproducing text subtitle stream recorded on the recording medium; the corresponding US Patent No. 7,756,398 is one of the four patents asserted by LG in its ITC complaint over the PlayStation 3

• European Patent 1884934 on a "recording medium having data structure for managing reproduction of data streams recorded thereon and recording and reproducing methods and apparatuses"; the corresponding US Patent No. 7,701,835 is also among the four patents asserted in LG's ITC complaint over the PS3

LG explains that those patents are essential to the Blu-ray Disc standard, and therefore, in LG's opinion, necessarily infringed by the PlayStation 3 since it comes with a Blu-ray player. LG claims that it was willing to grant Sony a license on FRAND (fair, reasonable and non-discriminatory) terms in accordance with the rules of the Blu-ray Disc Association (BDA), but LG says "Sony wants to [take a license] only if LGE and Sony also reach agreement on royalties in entirely different and unrelated technology areas (such as TVs, monitors and mobile phones)."

LG expresses doubts about whether that position is in line with competition law, but at any rate, LG wants to receive royalties on Sony's PlayStation 3 sales. LG says that negotiations between the parties failed in December (apparently because Sony wanted a broadbased agreement while LG wanted to treat the Blu-ray license separately from everything else), and "almost immediately thereafter" Sony lodged a complaint with the USITC to obtain an import ban against mobile phones sold by LG. LG's request for the Dutch seizure order mentions that there are several lawsuits going on between the two parties in the US.

Under the circumstances, LG believes that Sony should be treated like any other patent infringer and not be allowed to sell the PS3 in the Netherlands until it has taken a license to LG's Blu-ray patents. LG therefore asked the court for a relief that is a specialty of Dutch law: a prejudgment seizure order. LG's complaint stresses that if Sony later proved (in a full-fledged proceeding) that there isn't any infringement of valid LG patents, Sony could still collect damages from LG on the grounds of an "unjustified" seizure. In light of that, LG asked the court not to hear Sony before issuing a decision because if LG is wrong, Sony will be reimbursed later, but by involving Sony in the proceedings there would be a risk of the allegedly infringing goods being moved out of the warehouse before they can be seized.

The judge concluded that LG had substantiated its infringement assertions sufficiently well and agreed that Sony should not be heard before the decision was issued. Then the judge ordered the prejudgment seizure I explained, with LG being responsible for the cost of warehousing the seized goods, and laid out the possibility of an appeal by Sony.

So tomorrow afternoon in The Hague there will be a major showdown between LG's and Sony's lawyers. It's imperative for Sony to fight those infringement assertions because otherwise LG will be in a strong position to obtain additional injunctions in the Netherlands -- through which Sony used to route all of its European PlayStation shipments, although it may now already be going through other countries -- as well as in other countries throughout and beyond Europe.

[Update] Meanwhile the court has ruled and I have reported on the decision. Sony got the prejudgment seizure order overturned, but the case isn't over.

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.

Share with other professionals via LinkedIn:

Share|

Motorola says 'Android-based products are increasingly competing in the gaming market' with Microsoft's Xbox

On December 24, 2010 I published my last update on the patent dispute between Microsoft and Motorola over Android-based smartphones and, to a lesser degree, set-top boxes and the Xbox gaming console. At the time there were 35 patents-in-suit. Meanwhile that number has increased to 44 as Motorola asserted another two patents and Microsoft another seven. Microsoft's new assertions relate not only to Android-based phones but also to two Motorola networking products, the Mesh Wide Area Network AP 7181 and the CPEi 150 (also known as "CLEAR Home Modem").

There is not only escalation but also some consolidation: one of the three suits filed by Motorola in the Western District of Wisconsin (note that Motorola also filed one in the Southern District of Florida and lodged a complaint with the ITC) has been transferred to the Western District of Washington, which is where the dispute started with a Microsoft complaint six months ago. This is a procedural win for Microsoft, which had asked for that transfer to it home field -- Motorola opposed it unsuccessfully. After the transfer, the case might be consolidated into Microsoft's second Washington suit against Motorola, in which Microsoft alleges Motorola's failure to honor commitments to make patents available on RAND (reasonable and non-discriminatory) terms.

The fight over the proper venue for one of the suits has led Motorola to make the claim I mentioned in the headline, but before I get to that one, let me give you a graphical overview of the current battlelines:

Microsoft vs Motorola 11.03.01

It's recommended to view the document above -- which shows the escalation of the dispute in 11 steps and contains 7 reference pages that list the asserted patents and accused products -- in full-screen mode. You can also download it from Scribd, where I have set up a folder that contains such visualizations and reference lists for several major smartphone disputes.

Motorola claims smartphones compete with video game consoles

Microsoft has already succeeded in having one of Motorola's three Western Wisconsin suits transferred to its home state of Washington. Microsoft asked for such transfer in the other two cases as well. The second Wisconsin suit was stayed because with the exception of one patent it now relates only to patents that Motorola also asserted in its ITC complaint. Microsoft's motion for transfer of venue has not been turned down -- it simply won't be decided for the time being since the case is stayed anyway. And in the third Wisconsin suit, which Motorola brought just before Christmas, the battle over a possible transfer is raging, and has produced an amusing anecdote:

Arguing against Microsoft's motion for transfer of venue, Motorola claimed that such a transfer would result in a later trial date (not a strong argument anyway since the Western District of Washington isn't much slower than the Western District of Wisconsin) and that such a delay would be unacceptable because Motorola needs a decision quickly for competitive reasons.

But we're talking about a dispute in which Motorola asserted patents against the Xbox and some related products. If Sony or Nintendo claimed to compete with the Xbox, I guess many people could understand that. But Motorola? What game console do they have which would compete with the Xbox (and which would be a reason for them to ask for a quick decision)?

Here's the answer: on page 15 of its February 24, 2011 filing in opposition to a motion for transfer, there's the claim that "Motorola’s Android-based products are increasingly competing in the gaming market."

Motorola then points to a list of "thousands of games [...] available on Android phones, including Motorola's Android phones." Motorola also refers to the fact that Windows Phone 7 users can connect with Xbox Live (which is, however, something different than actually playing Xbox games on a large TV screen).

I've previously seen stories about how smartphones absorb the functionality of other devices. For example, they can be used as alarm clocks, although I certainly can't recommend using my Android-based Samsung Galaxy S i9000 for that purpose (it proved unreliable). And I rarely wear a wristwatch these days because I can just look at my smartphone, which I do frequently anyway (and unlike the alarm feature, the clock is dependable).

But the notion of a tiny smartphone touchscreen being described as an alternative to gameplay on a large screen and with game control devices (including, among other things, the Kinect), renders me speechless.

In its March 3, 2011 reply to that claim, Microsoft points out that a consumer looking to buy a phone won't buy an Xbox instead: "obviously, no consumer carries an Xbox around to make mobile phone calls, which it cannot make in any case." Imagine that -- wouldn't it look funny? And how much funnier would it look after a, say, one-hour call?

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.

Share with other professionals via LinkedIn:

Share|

ITC votes to investigate LG's complaints against Sony over the PlayStation 3 game console and certain Bravia digital TV products

On February 4, 2011, LG filed two simultaneous complaints against Sony with the US International Trade Commission ("USITC", or just "ITC"), a US federal government agency with quasi-judicial powers. The two complaints asserted four different sets of four patents: the PS3 complaint alleged the infringement of four patents related to the Blu-ray Disc format, while the patents asserted in the digital TV complaint (which specifically accused various Sony "Bravia" devices) cover Web TV, HDTV and similar technologies.

The complaints asked for import bans that would effectively preclude Sony from selling those products into the all-important US market, with disastrous consequences not only for its sales production but also for its longer-term market position. Such a decision could come within 16-18 months.

The ITC just announced that it voted to look into both complaints in one consolidated investigation. The new investigation number is 337-TA-764. As the ITC pointed out, this is just the launch of an investigation -- not a decision on the merits of the complaints. The ITC previously also voted to investigate a Sony complaint against LG, as I reported a month ago. I haven't seen any case in which a complaint lodged by one major company against another would have been dismissed at this early stage.

The ITC's announcement doesn't state the reasons for a consolidated investigation of both complaints, but I can see why the ITC chose to combine them. Even though the asserted patents and accused products in both complaints don't have any overlap, both were filed on the same day, were filed by the same complainant (LG Electronics, Inc. of Korea), and named three entities as respondents (Sony Corporation of Japan, New York City-based Sony Corporation of America, and Sony Electronics, Inc. of San Diego, California). The PS3 complaint additionally named Sony Computer Entertainment, Inc. ("SCE") of Japan and Sony Computer Entertainment America, LLC ("SCEA") of Foster City, California as respondents, but the ITC has already launched other investigations in which one or more of the respondents are accused of infringing only some of the asserted patents.

For example, ITC investigation no. 337-TA-710 is another consolidated investigation: in that one, HTC and Nokia have to defend themselves against patent infringement allegations by Apple. Four of the nine patents were asserted only against HTC but not Nokia; Nokia, however, faces infringement allegations over four other Apple patents in a different investigation (no. 337-TA-704). (In December I published an overview of smartphone-related ITC investigations.)

I mentioned Sony's complaint with the ITC over various LG smartphones. That one was filed in late December 2010. Previously the two parties were already litigating against each other in US federal courts. LG's ITC complaints appeared to come in retaliation for Sony's ITC complaint, and LG brought about further escalation by requesting customs action and, apparently, a preliminary injunction against Sony in the Netherlands, the key entry point for all PS3 shipments into Europe. I commented on this a few days ago (the post was also published on The Guardian's Technology Blog) and said I expected Sony to look for ways to take advantage of Europe's fragmented patent system by shipping into the EU via other member states.

Meanwhile a Reuters report quotes an unnamed person familiar with the matter as confirming that Sony "does not expect its regional sales to be badly affected by the temporary ban." As Reuters and Bloomberg report, Sony is also evaluating its options to have the Dutch decision overturned.

In other words, no signs of giving up. At some point they'll negotiate a settlement, I'm sure -- but it may take a while.

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.

Share with other professionals via LinkedIn:

How Sony can still ship PlayStations into Europe

The Guardian reported on LG's latest patent strike against Sony in a wider patent battle over Blu-ray Discs, smartphones and video game consoles:

"European customs officers have been ordered to seize shipments of Playstation 3s after LG won a preliminary injunction against Sony [...] The ruling by the civil court of justice in the Hague means that all new PS3s have to be confiscated as they are imported into the UK and the rest of Europe for at least 10 days."

In how much trouble is Sony now? Is Europe about to run out of PS3s?

LG made a bold move that definitely ups the pressure on Sony. But it's important to understand that patent enforcement in Europe is still a country-by-country affair -- even though there is a European Patent Office -- and Sony can work around the Dutch decision by going through entry points outside of the Netherlands. That's a logistical nightmare, but it is a possibility. Sony is most likely already exploring such alternative routes.

In order to cause greater disruption to European PlayStation sales, LG would have to obtain injunctions in more EU member states than just the Netherlands, a country that accounts for only three percent of Europe's total population size.

While LG hasn't confirmed anything and Sony's official statement doesn't say much, there's every indication that LG requested customs action against goods suspected of patent infringement in accordance with EU Council Regulation No 1383/2003 and additionally obtained a prejudgment seizure decision from a court in The Hague, Netherlands. The combination of those two measures means Sony has a serious problem in the Dutch market, but it's not the end of the world for the PlayStation in the whole of Europe.

As The Guardian reports, "Rotterdam [a Dutch seaport] and Schiphol [Amsterdam airport] are the main import points for PS3s for both the UK and continental Europe". But Sony could change that.

Other high-tech companies will be watching this with interest, and with concern. For example, Apple and Nokia are also battling each other in Europe, and other litigants can never know when their adversaries are going to seek European customs action as a way to increase the pressure on them.

Customs action against goods suspected of infringing certain intellectual property rights
(Council Regulation (EC) No. 1383/2003)

In 1994 the European Community (nowadays known as the European Union, or "EU") passed a law for the seizure of counterfeit and pirated goods, amended it in 1999, and replaced it in 2003 with Council Regulation (EC) No. 1383/2003 concerning customs action against goods suspected of infringing certain intellectual property rights and the measures to be taken against goods found to have infringed such rights.

Over time, the regulation had evolved from an anti-counterfeiting measure into a broader protection of right holders. In particular, patents were not within the scope of the regulation at the outset: while many counterfeit goods infringe patents, most patent infringers aren't pirates.

Customs authorities are usually not equipped to make the technically and legally complicated determination of infringement that usually requires multi-year lawsuits. The regulation provides the possibility that customs offices may act at their own initiative (ex officio) if they suspect infringement, but its Section 2 sets out the practically more relevant scenario of a right holder applying for customs action in writing. In that case, a right holder doesn't bear the burden of proof that there is an actual infringement. It is merely sufficient that "goods are suspected of infringing an intellectual property right", such as a patent under the law of the EU member state in which the application is filed.

Yes, being "suspected" of infringement is all it takes. Looks lopsided, doesn't it?

But right holders seeking to harm competitors must be careful. A right holder whose infringement allegations aren't confirmed by a court of law may be liable for the damage inflicted under the law of the EU member state in which the application was made.

Also, seized goods will be released after 10 days if the relevant customs office hasn't been notified of judicial proceedings under national law. Even if a lawsuit has been filed, there is still a potential way out: "the declarant, owner, importer, holder or consignee of the goods shall be able to obtain the release of the goods or an end to their detention on provision of a security" pursuant to Article 14.

"The security [...] must be sufficient to protect the interests of the right-holder", which means that Sony would have to deposit the amount of damages LG might be awarded if it prevailed in court. But in the Netherlands this doesn't seem to be an option for Sony because LG appears to have obtained a preliminary injunction by a court in The Hague, ordering prejudgment seizure. As a result, the PlayStations detained there won't be released against LG's will until the end of the lawsuit.

Courts hand down such injunctions only based on a summary judgment standard: it's a quick procedure, but the party requesting the injunction must show that it has a reasonable chance to prevail. By contrast, the application for customs action under the said EU regulation merely has to meet formal requirements without proving the infringement allegations by any standard at all.

The fragmentation of the European patent system may come in handy for Sony

While the European Patent Office (EPO) performs the centralized examination of European patent applications, EPO patents are just bundles of national patents, each of which is assigned a national patent number and can be enforced only in the one country in which it is valid. This is going to change: the EU is in the process of creating a single EU patent and patent judiciary, but this will take years to come to fruition.

The aforementioned European regulation requires a patent holder to claim an infringement only of a national patent. LG holds some Dutch patents that it apparently claims are infringed by the PS3, and didn't have to allege the infringement of patents in any other EU member state.

But the prejudgment seizure order issued by the court in The Hague is valid only in the Netherlands. Therefore, if Sony ships PlayStations directly into other EU member states, the local customs authorities there will not take that seizure order into account. They may pay attention to LG's application for customs action, but in that case Sony could bail out the detained goods on security after a maximum of ten days. Any further detention would require an injunction in the relevant country.

Prejudgment seizure appears to be a particularly Dutch phenomenon. It is also mentioned in a very interesting Managing Intellectual Property article on how customs can help patent owners.

While other European countries may not provide prejudgment seizure, it would be possible to seek preliminary injunctions against the sale of allegedly infringing goods. This is an option in many European countries. In Germany, the largest EU member state (and home to the major seaports of Hamburg and Bremen as well as Frankfurt Airport, one of the world's 10 largest cargo hubs), it is possible to obtain preliminary injunctions in a relatively rapid procedure, but alleged infringers are usually given an opportunity to defend themselves prior to a preliminary injunction. Also, if a preliminary injunction is granted but fails to be upheld in a subsequent main proceeding, there is a considerable liability risk involved.

In order not to give LG any clues, Sony will likely not announce which alternative routes into Europe it is exploring for the PS3. This is a major logistical challenge, but Sony will probably go to extreme lengths to avoid the loss of market share in Europe. In that case, LG will have to chase the PS3 down across the EU, or at least in the largest markets. It will take much more than the surprise effect of the Dutch decision -- however impressive it may be per se -- to bring Sony to its knees.

That said, it seems that the patent wars between major industry players are ever more bitterly contested, and Europe increasingly becomes a battlefield.

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.

Share with other professionals via LinkedIn:

LG wants the PlayStation 3 banned from entry into the US market, files ITC complaint against Sony over Blu-ray patents

Yesterday LG Electronics announced that it lodged a patent infringement complaint against Sony with the US International Trade Commission on Friday (February 4, 2011). LG asks the ITC, a US government agency with quasi-judicial authority, to permanently exclude the PlayStation 3 video game console from entry into the US market because of the alleged infringement of four LG patents related to the playback of Blu-ray Discs.

The complaint broadly relates to "certain electronic devices having a Blu-Ray Disc player and components thereof", but the PlayStation 3 (Model No. CECH-2501A) is the only Sony product to be specifically named in the main document of the complaint. According to a Bloomberg report, LG simultaneously filed another complaint against Sony over its Bravia television sets. The ITC Law Blog has details on that one. I will focus on the PS3-related complaint here.

What we're seeing here is retaliation. At the end of December, Sony filed an ITC complaint against LG, seeking an import ban for a list of mobile phones. On January 27, 2011, the ITC voted to investigate that complaint, as I mentioned in my previous post. Now LG -- which boasts in its complaint that it owns 90,000 patents and patent applications on a worldwide basis -- is striking back at the PlayStation 3.

It's like "you touch my smartphones and I bomb your game console."

This pattern has a precedent: after Microsoft sued Motorola in October over its Android-based phones, Motorola filed an ITC complaint over the Xbox 360 in November, and in a new suit filed shortly before Christmas, Motorola also attacked the Kinect controller. I recently produced a visualization of the battlelines between those two companies.

Concerning retaliation, there's some confusion as to whether Sony has previously sued LG over Blu-ray Disc patents. When Sony lodged its complaint in December, several reports (all of which may have echoed the same original article) stated that Sony's complaint also tackled LG's Blu-ray Disc players. However, that claim was made before the complaint became publicly available. I looked at it later, and its paragraph 13 states that "[t]he products at issue in this investigation are certain mobile telephones and modems manufactured by [LG]." I suppose it was just someone's speculation that LG's Blu-ray Disc players were also targeted. But now that LG has opened the Blu-ray can of worms, who knows how Sony may feel compelled to respond. From what I hear, the patent situation surrounding Blu-ray is a constant challenge for the consumer electronics industry.

The video game console market is large enough on its own that a certain level of patent assertion activity is just normal. Nintendo's Wii was also the subject of an ITC investigation a couple of years ago. Hillcrest Labs complained in 2008, and the matter was settled in September 2009. But LG's action against the PlayStation 3 and Motorola's attacks on the Xbox 360 and the Kinect controller appear to have been triggered by previous suits over smartphones. In those disputes, video game consoles seem to be drawn into wider conflicts as a secondary theater of war.

[Update 1] I have now obtained a copy of a complaint filed on the same day (Friday, February 4, 2011) by LG against Sony with the US District Court of the Southern District of California. The case number is 3:11-cv-00247. In that suit, LG asserts six patents (different ones than the ones asserted in the ITC complaint). The accused products include but go well beyond the PlayStation 3. They furthermore include computers such as the Sony VAIO EA, EB and/or X series PCs; digital cameras such as the Sony Model Numbers A55 and TX9; camcorders such as the Sony HDR-XR550; and Blu-ray Discs, such as a PS3 game named "Hot Shots Golf Out of Bounds".

[Update 2] A second, parallel, complaint filed with the same court in Southern California relates to HDTV (high-definition television) products, particularly the Bravia TV sets and some Sony digital cameras. The case number is 3:11-cv-00248. As a starting point for any research into that one, I recommend the related Priorsmart page.

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.

Share with other professionals via LinkedIn: