Linked by Thom Holwerda on Sat 3rd Aug 2013 20:34 UTC
Legal The Obama administration:

After extensive consultations with the agencies of the Trade Policy Staff Committee and the Trade Policy Review Group, as well as other interested agencies and persons, I have decided to disapprove the USITC's determination to issue an exclusion order and cease and desist order in this investigation.

Lots of talk about SEPs and FRAND in Obama's decree, which means that the Obama administration contradicts everything the ITC has said. To freshen your memory, the ITC ruled that not only was the patent in question not a standard essential patent, but Samsung's offer was actually proper FRAND:

Additionally, the Commission found that there were still disputed issues concerning the patent at issue was even actually essential to the standard (and therefore whether a FRAND or disclosure obligation applied at all).


The Commission analyzed the history of negotiations between Apple and Samsung (this portion is heavily redacted) to see if Apple showed that Samsung failed to negotiate “in good faith,” and found that Apple failed to do so. Notably, the Commission dismissed Apple’s arguments that (1) Samsung’s initial offer was so high as to show bad faith, and (2) Samsung’s attempts to get a cross-license to Apple’s non-SEPs violated its FRAND commitments.

In other words, the Obama administration threw out virtually everything the ITC has said in order to protect Apple. This effectively means that American companies can infringe on non-American companies' (standard essential) patents all they want, because the president will simply step in if they try to fight back.

So, I was wrong. I expected the Obama administration to be impartial and not give such a huge slap in the face of the ITC - as cynical as I usually am, I can still be naive. Protectionism is more important to the POTUS.

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Cutting through the crap
by Tony Swash on Mon 5th Aug 2013 12:56 UTC
Tony Swash
Member since:

A minority opinion filed by Dean Pinkert, one of the ITC's six commissioners, who voted against the majority pro-Samsung decision has laid out in careful detail why his fellow commissioners were wrong to order Apple to cease and desist selling those five products -- including a version of the iPhone 4 that is one of the company's most popular -- on the strength of Samsung's complaint.

Among the reasons he cites:

The patent in question was part -- and only a tiny part -- of an international standard, and as such Samsung had agreed to make it available for licensing under terms that are fair, reasonable and nondiscriminatory (FRAND).

Samsung had made no effort to demonstrate that the licensing terms it offered Apple "satisfied an objective standard of reasonableness."

That the only time Samsung made such an offer -- in oral discussions in December 2012 -- it came with strings attached to which Apple could not agree.

What those strings were are blacked out in the document, but Pinkert adds in the next sentence: "it is neither fair nor non-discriminatory for the holder of the FRAND-encumbered patent to require licenses to non-FRAND-encumberd patents as a condition for licensing its patent" (emphasis his).

Reading between the lines, it sounds like Samsung had refused to license its standard-essential patents (SEPs) unless Apple offered its non-essential iPhone patents in return.

The issue of cross licensing is one that has often been raised here. Some argue that all demands for cross licensing should be met because somehow cross licensing is a good thing in and of itself. But cross licensing is a voluntary undertaking as is participation in a FRAND arrangement. Once a company submits it's IP to be included in a FRAND framework it is limited as to what it can ask for in terms of licesing arrangements and deals.

In this case the issue is whether the Samsung FRAND patent in question is customarily and usually licensed to other third parties with attached demands for access to obligatory cross licensing of non-FRAND IP. If it isn't, and I think it highly unlikely that it is, then clearly the demands made on Apple were unusual and were thus discriminatory.

Edited 2013-08-05 13:03 UTC

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