Linked by Thom Holwerda on Mon 13th Feb 2012 19:26 UTC
In the News The first big hurdle has been taken by Google and Motorola Mobility. The European Union has given the green light for Google to proceed with its acquisition of Motorola Mobility. The EU will, however, monitor the deal and its outcome for potential patent abuse. Update: And there we go, the US DoJ has approved the deal as well. Update II: The just-linked DoJ report also approves the Nortel patent sale to Apple, Microsoft, and RIM. I'm hoping for lots of fireworks here so the patent system blows up in Google's, Microsoft's and Apple's faces, so we can point and laugh about all the money they wasted.
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RE[6]: Huh?
by jared_wilkes on Tue 14th Feb 2012 03:01 UTC in reply to "RE[5]: Huh?"
jared_wilkes
Member since:
2011-04-25

"Yes it does, that's what your initial question was about. "

No, it doesn't. Whether a non-essential patent is of extremely high-quality, novelty, and invention or not does not change the fact that I think using standard-essential patents as weapons (either proactive or in "self-defense") is far, far worse. So attempting to disparage one or more bad patents doesn't change my logic in the least.

You seem to be misunderstanding me: you are making a value judgement based on the quality of the patent itself (a standard essential patent must have some utility, must have required some research vs. a "joke" patent that you think anyone could have come up with with zero effort or intelligence). I am making a distinction solely between using standard-essential patents as a weapon versus using the non-essential patent as a weapon. No matter the quality of either, I would think using the standard-essential patent as a weapon would be far worse (and again, whether it is proactive or "defensive"). So... by my thinking the standard-essential patent could be a "joke" and the non-standard-essential patent could show great novelty, utility, and invention (or vice versa or both being equally obvious or both being equally inventive) and using the former as a weapon would be worse -- because it would be destructive to the entire notion of a worldwide, agreed-upon standard. In other words, the quality of the patent is far less relevant to me because it pales in the shadow of whether or not it is standard-essential or not.

"My point is: arguing about licencing terms and whether they're FRAND is easier than arguing about patents themselves and establishing whether they're valid or not and whether you violate them or not."

This seems closer to my point: whether or not you think a patent is of poor quality or not, invalid or not, denying access to FRAND standards-essential patents is certainly a much easier topic to discuss: it is always worse or at least definitely bad.

Moreover, I don't think anyone would be able to make the argument that Apple isn't willing to license standard-essential patents as long as they are offered on FRAND terms.

"The scale of the latter is just that much bigger because you have to repeat the process for every single joke patent you're getting sued over, therefore it is more damaging."

While it's true that the subset of patents deemed essential to a standard is certainly smaller than the superset of all patents, good or bad, essential or not -- it is a very real threat that you could have to argue standard-essential patents over and over again. In fact, that is the case: Motorola is demanding 2.5% on the overall sales price of "infringing" products FOR 4 PATENTS ONLY, but they have many more standard-essential patents that they can drag Apple or anyone else back into court again for, for ANOTHER 2.5%!! And new patents can be added to the standard at any time...

Edited 2012-02-14 03:16 UTC

Reply Parent Score: 1

RE[7]: Huh?
by jared_wilkes on Tue 14th Feb 2012 03:34 in reply to "RE[6]: Huh?"
jared_wilkes Member since:
2011-04-25

That should be 2.25%, not 2.5%, for accuracy.

Reply Parent Score: 1

RE[7]: Huh?
by cfgr on Tue 14th Feb 2012 04:14 in reply to "RE[6]: Huh?"
cfgr Member since:
2009-07-18

We think the same but reach a different conclusion.

You are right that these are two separate issues, however, a non-essential patent is always about the patent itself. It can never be about terms being FRAND because it's non-essential, so there is a correlation between essential vs non-essential and quality vs joke.

The outcome of a FRAND case is simple:
1- the patent is found essential and terms are FRAND: Apple follows the FRAND terms - which are Fair and Reasonable.
2- the patent is found essential and terms are non-FRAND: terms are made FRAND and Apple follows the new FRAND terms - which are Fair and Reasonable.
3- the patent is found non-essential: it's not a FRAND case at all but a case about quality vs joke. The terms may be completely unfair and unreasonable here (read: blocking competitors, demanding disproportional fees.)

The first two outcomes are not damaging at all because the terms have to be fair, reasonable and non-discriminatory by definition. The only way you are denied access to those patents is if you don't want to follow those fair and reasonable terms.

So the worst that can happen is #3, which is exactly about the content of the patent and which leads us back to my point that the issue of patent quality has a much larger scale than the issue of essential vs non-essential, and is therefore more damaging.

Now to come back to your Motorola example: if those were essential submarine patents, Motorola will have to licence them to Apple under fair and reasonable terms, that is: the aggregate rate must not exceed a certain point. Throw in a million new essential patents and the fee will still stay more or less the same.

but they have many more standard-essential patents that they can drag Apple or anyone else back into court again for, for ANOTHER 2.5%!! And new patents can be added to the standard at any time...

So no, Motorola can't demand another 2.25% and they will lose the case unless Apple refused to accept the FRAND terms in the first place which results in #1 or #2.

Edited 2012-02-14 04:18 UTC

Reply Parent Score: 2

RE[8]: Huh?
by jared_wilkes on Tue 14th Feb 2012 06:15 in reply to "RE[7]: Huh?"
jared_wilkes Member since:
2011-04-25

I think we are far from agreement — I merely used one of your own statements at one point that I thought actually expressed my own view point better than I think it expresses your own.

I think you are very much missing worse case scenarios. I agree, in general, that all disagreements likely move towards equitable solutions (which is why I have little problem with the current legal frameworks for IP), but...

1. In Germany, the law requires that infringement be determined and remunerated PRIOR to considering the legal obligations of standards-essential commitments which eliminates your stepwise progression through your (1) and (2).
2. The patent owner does not have to cooperate with agreements it formally made. In the example, Motorola could refuse to cooperate and force competitors to either not be able to participate in the standard (at least for a time until it is properly adjudicated) and/or the standards body could be forced to re-architect the standards to eliminate the incorporated patents which aren't being offered as FRAND.

Secondly, I actually find the resolutions to your (3) quite reasonable:
a. The patent is deemed not patent worthy and is thrown out, or
b. The patent has value which the infringer determines is either valuable enough to pay for, or at least less costly than the warfare, or
c. They determine it is not needed for a successful product and they design around it, or they think it is needed for a successful product but still find a successful workaround which accomplishes the same thing.

I happen to find our systems relatively reasonable as to produce few enough problems for its destruction, but I also find the actors on the stage wholly unreasonable. And, again, I find my (2) far worse than my (a), (b), or (c).

I don't follow your final comment: my quoted statement is toward's the unreasonable actors i.e. Motorola can keep dragging Apple into court over one or more standards-essential patents until they are exhausted or the system makes them behave reasonably just as anyone else can keep taking another party to court over non-essential patents. Yes, I wholly expect the system to essentially tell them they can't do what they are trying to do; that doesn't change the fact that they can try and they can destroy standards and double-dip and keep harassing until they are made to behave reasonably. In other words, the threat of repeated lawsuits is little diminished whether or not it is standards-related or not.

Yes, in the end, I expect reasonable, workable solutions — not the destruction of our current legal system. But, again, I find the possible destruction of standards (which could easily happen while preserving our current legal system) far worse than a company needing to pay for something it deems valuable or not being able to use something that it isn't willing to pay for.

Edited 2012-02-14 06:22 UTC

Reply Parent Score: 1

RE[7]: Huh?
by JAlexoid on Tue 14th Feb 2012 10:45 in reply to "RE[6]: Huh?"
JAlexoid Member since:
2009-05-19

Motorola is demanding 2.5% on the overall sales price of "infringing" products FOR 4 PATENTS ONLY

Depends on the patents in question. Full 3G patent licensing used to drive up the cost of a high end device by 30%-50%.

Reply Parent Score: 2

RE[8]: Huh?
by jared_wilkes on Tue 14th Feb 2012 13:24 in reply to "RE[7]: Huh?"
jared_wilkes Member since:
2011-04-25

Citation please?

Reply Parent Score: 1

RE[8]: Huh?
by majipoor on Tue 14th Feb 2012 16:10 in reply to "RE[7]: Huh?"
majipoor Member since:
2009-01-22

I would be interested in your source for this affirmation.

Reply Parent Score: 1