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.
The deal has been in the making for a while now, and the EU is the fist large regulatory body to give the official green light. “We have approved the acquisition […] because upon careful examination, this transaction does not itself raise competition issues,” EU competition commissioner Joaquin Almunia said in a statement.
However, the potential for patent abuse is here, especially regarding the FRAND (standards essential) patents. There’s the danger that Google will use FRAND patents in its defence against Apple’s and Microsoft’s aggressive patent trolling. While not every use of FRAND patents in lawsuits is anti-competitive (if valid FRAND licensing offers are denied, FRAND patent holders have the right to sue), this concern is still very much valid. The EU agrees.
“This merger decision should not and will not mean that we are not concerned by the possibility that, once Google is the owner of this portfolio, Google can abuse these patents, linking some patents with its Android devices. This is our worry,” Almunia said, “We might be obliged to open some cases in the future. This is not enough to block the merger but we will be vigilant.”
While I personally believe Alumnia should be more concerned about software patent abuse (Apple) and mafia protection money schemes (Microsoft) and how these practices negatively affect the market and consumers, it’s still good know the EU is at least on top of this potential future abuse.
The acquisition is not complete yet – China, the US, and several others have to approve the deal too.
Why should regulatory bodies need to approve the merger, anyway? It should be no business of governments whether companies merge, collapse, or split, just in what they do with their market position. If Google goes completely mad with power after acquiring Motorola, then the governments of the countries they operate in should sanction them, but I don’t see the point in potentially blocking the acquisition.
why wait until after they merge before taking action? that is surely to late!
Edited 2012-02-13 20:38 UTC
But corporations can do things that aren’t “fair” like good pricing for exclusivity. /s
Because there are antitrust regulations to prevent sick monopolies.
Well, the US Government has already proven that they’re worthless at regulating established abusive monopolies–see Microsoft, and where they’re standing today. Just finally starting to see their monopoly fade away after all these years of disgusting use of their powers.
We’ll see if this idea of stepping in *before* a major acquisition means anything at all sooner or later.
Honestly, I think it’s pointless; by the time a company has already abused its monopoly, it’s too late, the slow court process and an eventual slap on the wrist, like what Microsoft got, won’t do any good. It doesn’t matter whether the government regulates before an acquisition or after conviction; it’s all the same in the end.
I guess the general feeling is that we have enough historical experience to say with relative certainty that elimination of all competition in an industry generally turns out badly for consumers. A market without competition is not really a “free market” and it is almost impossible for competitors to enter some markets once they are dominated by one or even just a few players.
Also, given how slow governments are to respond to after the fact consequences, you might argue that waiting until after companies start to behave egregiously is not effective in practice.
From a more cynical point of view, given the level of government influence that large companies seem to exert on political bodies, I am not sure how realistic it is to count on the government to sanction misbehaving companies anyway. I for one would rather get in front of the problem.
So, while I am normally a bit on an anti-regulatory guy, I think that this kind of scrutiny makes sense.
That said, sometimes there are just “natural” monopolies. For example, the break-ups of Standard Oil and AT&T have almost reversed themselves through natural market forces.
Perhaps technology changes fast enough that things would correct themselves more quickly in these industries. Still, in general, it seems like a good idea to scrutinize such things.
I’m confused: why would non-standards patent abuse be more concerning than standards patent abuse?
Because actual non-standards patent abuse is more concerning than potential standards patent abuse. Don’t leave out the details.
The first is already happening, the latter may happen but is not yet the case – at least when talking about Google/Motorola, Samsung’s actions against Apple is another case but that’s up for the courts to decide.
Edited 2012-02-13 21:36 UTC
That seems to be a matter of your opinion. I would say that both Samsung and Motorola are abusing FRAND-mandatory standards patents now. In fact, one IS being investigated right now actively for antitrust abuse of FRAND standards patents. The other probably would be if not for the potential merger stalling the matter.
Edited 2012-02-13 21:56 UTC
Motorola did get an injunction for a FRAND patent in Germany and they actually did use it to block iPhone sales. Apple has appealed then and the injunction has been put on hold, but abuse over FRAND patents by Motorola is happening right now.
Apple also get some injunctions agains Samsung for non-standard patents and Samsung just had to modify slightly the design of their tablet and their UI layer to work around the patent.
Abuse of standards patents are clearly more concerning because they are unavoidable and there’s is no workaround.
Oh, BTW, the EU commission is only in charge of anti-trust issues and only standards patents are subject to anti-trust law.
Edited 2012-02-13 23:11 UTC
Well, assuming the courts are right (always debatable), it would appear that Motorola’s patent was NOT abuse – else an injunction would never have been granted AND upheld.
The German Courts do permit preliminary injunctions in FRAND cases because of their oddball Orange-Book-Standard. Unlike most of Europe. It has been pointed out that the Orange-Book-Standard is inconsistent and needs to be reconciled with ETSI standards being governed by French law.
Sorry, you might have missed that Motorola won a permanent injunction on 2 counts.
I don’t know what you think I’m missing. The “permanent” injunctions have been suspended and they are preliminary in that they are awarded to any legal decision.
EDIT: “they are preliminary in that they are awarded PRIOR to any legal decision.”
If I’m not mistaken only one is suspended pending appeal, but it is still very much a permanent injunction. It’s a legal definition, just because you wish to redefine it doesn’t change it’s name.
To clarify, there was a legally binding decision and there is an appeal. Appeal process does not nullify court decisions, per se.
Also, since when are you on the side of the Courts? Apple has gotten preliminary injunctions too — yet in those cases you have called it ABUSE! What is your logic here?
Your desire to attack me has clouded your reading abilities. Let me help you.
“Well, assuming the courts are right (always debatable), it would appear that Motorola’s patent was NOT abuse – else an injunction would never have been granted AND upheld.”
I read it just fine. And I don’t see how I’m remotely approaching attacking you. In one case, you are willing to assume the courts are right and in the other you are willing to assume they got it wrong.
When you argue patent “abuse” and “mob racket”, what you are actually arguing for is reform of the underlying national or regional laws of nations and states governing IP. But to those who disagree with you, you come off as the one who is trolling.
There is little evidence of extralegal activity from Microsoft or Apple. There is substantial evidence of it from both Samsung and Motorola.
Laws aren’t always right or just. I have my own brain and opinion, and I see no reason to regard the law as some sort of divine revelation of the truth. Virtually every developer I’ve EVER talked to finds software patents and the companies that abuse them to be a massive threat to the industry – whether it’s technically legal or not.
I have found very, very few people who actually think what Microsoft and Apple are doing is just – despite it being legal. In fact, those people are mostly confined to Apple websites, surprisingly.
Which is fine; it’s your opinion. But it also makes your citation of a German legal decision (whether or not right or wrong, debatable or not) completely illogical as a justification for it not being abusive.
It’s not illogical. I’m just saying: the German courts decided Abc – do with it as you please, since it’s just a court decision. It’s not a de facto justification for me, but it may be a justification for other people.
This really isn’t rocket science.
When Apple is legally granted a preliminary injunction and has it upheld you call it abusive patent trolling.
When Motorola is legally granted a preliminary injunction and has it upheld you call it NOT abusive — with the caveat that the court may have been right or wrong.
I find that the definition of hypocrisy. Claiming this isn’t necessarily what you think, you are just putting it “out there” is a further copout.
Since they’re employing crappy software and design patents – yeah, I find that abusive patent trolling. No matter how many courts say it’s legal, I, and with me most developers out there, think it should not be legal, because we don’t believe software patents, in the same way we do not believe Grisham should be able to patent the “court thriller”.
Software patents are pure evil, and the biggest threat to the technology industry. Apple and Microsoft are validating this threat and feeding it. This makes them evil, and in my opinion, criminals. They are actively destroying the technology industry, and for that, any sane society with laws not dictated by corporations but by the people, would have them punished for it.
On top of that, your premise if false to begin with – most of Apple’s cases have been thrown out – Australia, The Netherlands. Only in Germany has it been upheld, but in a limited form.
I called it not abusive? I don’t think I have. Again – you really seem to be failing at reading here. I said the court has decided – twice – that it was not illegal abuse of FRAND patents. That’s it.
Personally – I don’t know, since I haven’t spent a lot of time looking at Motorola. I believe they started suing (unlike Samsung, which is merely defending itself against Apple’s aggression), which is a point against them. However, if these are hardware patents and Apple is refusing to accept a valid FRAND offer… Well, then it’s pretty obvious Apple is being naughty. Implementing patented hardware while not having a valid license would be abuse, would it not?
Whether or not Motorola’s offer was FRAND, I honestly wouldn’t know. I have not devoted any of my time to the Motorola cases (my energy went into Samsung, mostly, since those play in The Netherlands as well), so I’m not as well versed in the matter, and as such, don’t have a clear-cut opinion ready.
I have, however, invested a lot of time into Apple attacking Samsung and Samsung defending itself, so I do have a clear conclusion there.
Edited 2012-02-14 00:05 UTC
I’ve heard your rants before; I know your views. The question is: by what measure can you now make a LEGAL argument that something is not abusive — I see no ground to stand on. Your entire premise is based on the premise that IP laws, and all software patents — most of the 3G/4G and other telecom standards patents are still software patents, not hardware — are bad.
“On top of that, your premise if false to begin with – most of Apple’s cases have been thrown out – Australia, The Netherlands. Only in Germany has it been upheld, but in a limited form.”
What about the ITC and HTC? Also, the preliminary injunctions in Germany against Apple have been suspended in the same way that Apple’s actions have been suspended in Australia.
“Again – you really seem to be failing at reading here. I said the court has decided – twice – that it was not illegal abuse of FRAND patents.”
The German Courts have ZERO STANDING on whether it is abuse of FRAND patents. They are only weighing in on the validity of the patents themselves. The issue of abuse of standards patents is governed, via ETSI, by French and EU law.
“However, if these are hardware patents and Apple is refusing to accept a valid FRAND offer… Well, then it’s pretty obvious Apple is being naughty. Implementing patented hardware while not having a valid license would be abuse, would it not?”
Odd how you always get around to Apple being naughty. Motorola retroactively removed Infineon’s and Qualcomm’s rights to extend patent coverage to chip purchasers to Apple EXCLUSIVELY. Clearly abuse of FRAND and standards practices.
“Whether or not Motorola’s offer was FRAND, I honestly wouldn’t know. I have not devoted any of my time to the Motorola cases (my energy went into Samsung, mostly, since those play in The Netherlands as well), so I’m not as well versed in the matter, and as such, don’t have a clear-cut opinion ready.”
Maybe it’s time you should educate yourself on the EU’s investigation of Samsung’s antitrust abuse of standards patents and the soon to be launched invesitgation of Google in both the EU and the states when the merger is completed.
Edited 2012-02-14 00:17 UTC
“The German Courts have ZERO STANDING on whether it is abuse of FRAND patents. They are only weighing in on the validity of the patents themselves.”
I should add: “,and whether or not Appple is using those patents without proper license.”
It’s really quite simple:
Software patents = bad. Always. Not a single exception.
From the above:
Using software patents to attack/threaten competitors [Apple/Microsoft] = bad. Always. Not a single exception.
Using software patents to defend against attacks = “good” (i.e., understandable given the circumstances, like knocking out a burglar).
Using FRAND patents to defend against software patent abuse = not good (but still understandable given the circumstances, like having a gun in the house and shooting the burglar).
Using FRAND patents to attack competitors = bad.
All these things are related to one another. Apple and Microsoft started this patent war, and if it takes FRAND patents to stop them, then so fcuking be it. I’d rather we have sane laws so that it wouldn’t be necessary, but alas, sanity and law are two very different concepts when it comes to IP law.
Again: Apple and Microsoft started this. The blood is on their hands.
Edited 2012-02-14 00:37 UTC
Again, the point is you implicitly defended Motorola based on a LEGAL decision, not this Holwerda moral calculus of patent law, which many of us can easily disagree with.
Edited 2012-02-14 00:42 UTC
I would also add: FRAND standards patents, by definition, cannot be used defensively.
A separate legal attack is not justification for discrimination when a standard is at stake.
Sure they can. Take this example:
Apple and Samsung are negotiating a FRAND agreement. FRAND licensing costs are not set in stone, nor are they legally defined, so these negotiations can take a while. There’s no hurry to get things done, since everything’s peachy.
Then, Apple goes all out, guns blazing, launching several software patent lawsuits against Samsung.
In return, Samsung decides it isn’t going to negotiate any longer with Apple, makes what they believe is a FRAND offer, and wait for Apple’s answer. Apple declines.
Now, with what they believe is a declined [by Apple] valid FRAND offer in hand, Samsung takes Apple to court.
Et voilà , defensive use of FRAND patents. Now it’s up to the courts to decide if it truly was a FRAND offer. If the courts say it is, Apple could be fcuked. If the courts say it was not a valid FRAND offer, the courts send them back to the negotiation table.
Edited 2012-02-14 00:55 UTC
And this is REALLY bad logic.
Is the refusal to negotiate FRAND terms based on those FRAND terms or events external to the requirements of the standard? Clearly events external to the requirements of complying with the standard. Any decision to deny licensing outside of whether or not they are F and R is D.
So let’s change your hypothetical: Company A makes an offer for FRAND patents to another Company B. Company B accepts at the SAME time as, or even AFTER, it launches what it thinks is a well-reasoned, “moral,” and legal patent suit against Company A. Company A withdraws its FRAND offer and/or agreement. This is discrimination. The other legal attack is outside the pledged support of a required standard. The FRAND offer is being reneged based on competition, not liking the competitor, thinking the other is a bully, revenge (or, if you prefer, “defensively” in a non-standards-related legal matter). Not at all on whether or not a FRAND offer was made and if the offer was willing to be accepted. This is discrimination, the D in FRAND.
Your hypothetical even completely stops short of whether or not its FRAND — saying, at that point, it’s up to the court to decide (again, odd of you to fall back on the law in this case) while ignoring that the withdrawal of the FRAND offer is DISCRIMINATORY.
Edited 2012-02-14 01:10 UTC
If that happens, then yeah, that’s not good. It’s still understandable, though, in the face of a legal assault.
No, it is neither understandable or legally acceptable.
Even more simply, I can break down your logic with your last statement:
“Et voilà , defensive use of FRAND patents. Now it’s up to the courts to decide if it truly was a FRAND offer. If the courts say it is, Apple could be fcuked. If the courts say it was not a valid FRAND offer, the courts send them back to the negotiation table.”
Let’s assume the Courts determine the offer, prior to withdrawal, was a valid FRAND offer: what is the basis for withdrawing the offer then at that point?
Edited 2012-02-14 01:17 UTC
My example has no withdrawal. It has a REFUSAL from Apple.
Which is why your hypothetical situation isn’t addressing the question: if standards related patents are offered on free and/or reasonable terms can the owner still choose to discriminate based on other legal threats or competition issues?
All your hypothetical says is: Company A may make an offer on terms which may or may not be free and/or reasonable and then they can still not provide them to competitors with no logical basis for such a conclusion in the hypothetical.
Here’s another hypothetical: Company A, the owner of standards-essential patents, and Company B already have a FRAND agreement in place. Company B then goes and definitively and legally violates a non-standards-essential of Company A (let’s even make it a very novel hardware patent to make it very easy). Does Company A now have the right to deny Company B access to standard essential patents?
My apology: I see the distinction you are making, and I had a slight misunderstanding. But this makes an already useless hypothetical even more useless. Company A is not doing ANYTHING whatsoever to be defensive other than make the very same offer they were making before needing to be “defensive.” Which does not show me how standards-essential patents can be used defensively, it’s only avoiding the question.
Edited 2012-02-14 01:33 UTC
The German court is not in charge of anti-trust regulation and did not take any position against Motorola regarding this point. Samsung did exactly the same as Motorola and now they are investigated by the EU commission.
Shows exactly how little you know about the differences between Motorola and Samsung case.
Samsung changed the licensing agreement with Qualcomm to exclude Apple from being a licensee, that is why they are being investigated.
Motorola and Apple never had a licensing agreement, but they are actually negotiating over the future. While the past is treated by both parties as they see fit. Apple wants to invalidate, Moto wants injunctions. Both violate the R in FRAND.
No, you are mistaken. Motorola retroactively changed both the Infineon and Qualcomm license. Whereas Samsung claims that Qualcomm doesn’t extend any patent rights to third parties like Apple.
Well Infineon’s license applies to Apple. Only Qualcomm’s chips are in breach. Terminated not retroactively, though.
“Shows exactly how little you know about the differences between Motorola and Samsung case.”
Shows exactly how little YOU know apparently:
http://fosspatents.blogspot.com/2012/02/apples-us-antisuit-lawsuit-…
Even reading that(first time I confess), I still stand that there are differences in both cases.
I might be proven wrong when they disclose the MMI-Qcomm contract. But so far, MMI has not cancelled the patent licensing retroactively, unlike Samsung did.
If I read something that includes the text “assuming the courts are right (always debatable)”, I do not immediately think “That guy is on the side of the Courts!!”.
And I don’t see how that comment can be read in any other way (even with its caveats and exceptions — which I completely understood, fully read, and would have presumed anyway when dealing with Thom) as: the courts said it is so; therefore, it is so.
I was not aware of the Motorola-Apple case in Germany, though I could have guessed it. That just shows how screwed up the whole patent system has become, it’s basically a free for all deathmatch with the customer as ultimate loser, due to either monopolies or licence fees.
But still, I find suing someone over some joke patent a lot more dangerous than suing someone over a FRAND patent. If Nokia/Motorola/Samsung were unfair in their requirements, then the court will decide against them, but at least there went some research in those FRAND patents. Can anyone tell me what kind of research it took to come up with some rounded rectangle design or a “slide to next photo” animation? I bet those ideas took less than 30 seconds to come up with, and the implementation about half an hour along with some parameter tweaking.
Here is how it goes in pretty much every small project/company:
Developer 1: “check this animation to go to the next photo, looks cool right?”
Developer 2: “goes a bit too fast and maybe it should be dragged a bit further before it switches, let’s fine-tune it.”
And if they’re working for a big company:
Manager: “looks nice guys, let’s patent it.”
Edited 2012-02-14 01:59 UTC
I don’t think anyone who is arguing within our legal framework(s) for IP are arguing that standard-essential patent holders don’t have a right to reasonable rates of remuneration or that the patents don’t have merit. We are arguing that it is far more damaging to withhold access to those standard-essential patents in retaliation (or “self-defense) after previously pledging to not deny access to them on any discriminatory basis when there are other recourses to “defense” other than subverting and destroying necessary standards.
The value or merit of non-essential patents doesn’t even enter into the argument from this perspective.
Yes it does, that’s what your initial question was about.
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. 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.
Edited 2012-02-14 02:41 UTC
“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
That should be 2.25%, not 2.5%, for accuracy.
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.
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
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
The outcome of (3) is most likely: (d) the patent has legal value but is completely and utterly obvious – which is the case with Apple’s photo gallery animation patent. Furthermore, Apple can make completely unreasonable demands for such a useless patent, like blocking competitors. That is the threat here.
Well that, and the fact that there are many more suits about those obvious patents that cost 30 seconds of research than about FRAND terms being violated.
I don’t find it completely unreasonable to ask competitors to pay for it or not use it. In fact, HTC claims as much and removed it.
Again, you are now moving from a legal matter to a personal opinion — you don’t like a particular patent, you don’t like the law that allows such a patent, you think it’s hugely damaging (when it is not).
Also, I agree that the best argument presented so far in this entire thread that non-standards-essential patents are a larger problem than standards-essential patents is a question of volume. I disagree that this makes it worse than standards-essential patent “abuse,” but this is the most logical and persuasive argument presented so far for such a belief.
Depends on the patents in question. Full 3G patent licensing used to drive up the cost of a high end device by 30%-50%.
Citation please?
I would be interested in your source for this affirmation.
Nokia NDA and NSN NDA prevent me.
Nokia Networks division Espoo, Karaportti campus Building TL-B. Prior to Nokia Siemens Networks and later same campus Building TEK Nokia Siemens Networks.
You are conveniently missing the R in FRAND. Setting a licensing fee of one billion dollars for a patent might just well be very reasonable, but very much discriminatory.
The patent licensing for the whole GSM/UMTS/LTE portfolio is very much discriminatory, it is also very reasonable given the costs of development.
There is also the other thing, you can’t claim that you had the right to infringe only because the patents are FRAND encumbered. That is what the German court has said one more time.
But this time, for Apple being so cocky about it’s infringement, they added an injunction.
Remember, Apple has a history of disregarding other people’s patents just to come to them later saying – “Sorry, can we make a license?”
“You are conveniently missing the R in FRAND. Setting a licensing fee of one billion dollars for a patent might just well be very reasonable, but very much discriminatory.
The patent licensing for the whole GSM/UMTS/LTE portfolio is very much discriminatory, it is also very reasonable given the costs of development.”
Citation needed. I don’t even know what you think you mean by saying that it is allowed to be discriminatory.
“There is also the other thing, you can’t claim that you had the right to infringe only because the patents are FRAND encumbered. ”
I make no such claim.
I’m not saying it’s allowed being discriminatory, I’m saying that reasonable trumps the discriminatory.
Citation of what? I can’t point you to any publicly available documents that disclose the price of GSM/UMTS/LTE patent licenses. They are all under NDA’s.
Apple did.
And Apple abused the same process the other way around, thus failed to prevent a permanent injunction. They were of the opinion that they can infringe on the patent because Motorola would have had to license it to them in any case, and got hit with an injunction for that.
That is a legal and binding court opinion, not your interpretation.
There are also reports that they want to have a non-reasonable licensing agreement.
That is not true. Patents are tools of market, therefore are subject to anti-trust law as any other tool is.
“They were of the opinion that they can infringe on the patent because Motorola would have had to license it to them in any case, and got hit with an injunction for that. ”
Apple has made no such argument.
“That is not true. Patents are tools of market, therefore are subject to anti-trust law as any other tool is.”
It is certainly true that the German courts are not weighing antitrust implications in the granting of preliminary injunctions. And it is also true that a non-standards-essential patent case would rarely ever arise to the level of an antitrust case without the patent owner already having a monopoly position whereas abuse of standards-essential patents is, per say, an antitrust violation.
It was actually their defence against an injunction, not against violation.
Per se, it’s a matter of jurisdiction.
Edited 2012-02-16 01:16 UTC
Actually Motorola is actively abusing FRAND patents to use against Apple, apparently with Google’s blessing. See here
http://fosspatents.blogspot.com/2012/02/motorola-wants-225-of-apple…
What Motorola did was submit one of it’s patents to be included in a FRAND regulated standard, then once it was in the FRAND framework licensed that patent to Qualcomm for inclusion in components it makes for third parties, agree that Qualcomm would cascading that licence to any third party purchasers of the component and then, in retrospect, turned around and withdrew the Qualcomm cascaded patent just for Apple and against the wishes of Qualcomm and demanded that Apple 2.5% of its total sales revenues for items containing that component to Motorola. This a classic case of FRAND abuse. I will be astonished if it stands up in court and if the EU don’t take action. Motorola took the action in the one legal system (German) where Apple’s refusal to pay the 2.5% could result in a product injunction.
My reading of all this is that it is a sign of how weak Motoral’s position in relation to the patent disputes with Apple and other is, it’s a sign of desperation.
Here is analysis of Google’s position on all this.
http://fosspatents.blogspot.com/2012/02/google-tells-european-commi…
http://fosspatents.blogspot.com/2012/02/two-more-huge-loopholes-ide…
You may very well be right, but you’ll need more than Mueller for that. He’s paid by Microsoft, so not to be trusted.
Three links to that shill doesn’t do your case any good, I’m afraid.
I know you don’t like Mueller but I can’t but help feel that that’s because he reports a lot of facts that are unpalatable to you. Clearly he is not particularly favourable to Google and the rest of the Android team but I think he is a useful commentator because:
He has comprehensive and detailed accounts of many of the most impotent developments in the mobile/device patent wars
He doesn’t seem to omit significant facts
He doesn’t seem to write as fact things that are falsehoods
He personally attends many of the important cases in Germany
He posts and links to full and unedited versions of original legal and court documents.
He takes time to explain a lot of the background of legal intricacies that involved.
I cannot think of any place that offers better coverage of all this. If you know of other sources of better or as good data and coverage please share as I am genuinely interested in good sources of information.
No – it’s because he’s being paid by the very parties he is reporting on. That makes him wholly untrustworthy. For almost the same reasons you’ll notice I barely place any trust in, say, Groklaw either (and have said so on many occasions).
I know you want to make it look like I’m hating him just because he’s favourable to Apple, but the fact say something else, I’m afraid. I don’t trust anyone with a horse in this race.
Any site that isn’t being paid by the parties litigating would be a good start. Do as I do: read the actual documents yourself, and quote those, instead of quoting people like Mueller.
Edited 2012-02-14 11:10 UTC
I can your position your position am just not sure I fully understand it. Anybody with a stake in a situation needs to be treated with caution but I have yet to see any substantive criticism of Mueller’s work (and would be interested to ready any that was produced). He expresses opinions which one may or may not disagree with but they are generally fairly clearly signposted as opinions. On facts he seem pretty strong in that he includes a lot of them and to the best of my knowledge he doesn’t post falsehoods and his coverage is pretty comprehensive and in depth. On the whole I would have thought that any discerning reader, even if they disagreed with Mueller’s opinions or the conclusions he came to, would find his site an unusually rich source of data about the tangled patent scene.
His makes legal comments that are ridiculous(except German legal issues)
He is a policy analyst, not a legal one – big difference
As coverage goes, he’s definitely one of the most scrupulous. His analysis leaves much desired. Especially when he makes business related analysis.
When legal issues are involved, I prefer to have a nice chat with my lawyer friends…
There is only 1 mistake there, it’s Samsung you are thinking about, not Motorola. The Qualcomm issue is exactly why EU started an investigation into Samsung’s dealings.
The 2.25% is what Motorola is asking for iPhone3Gs and iPhone4, but again it’s already in court. Numbers submitted to court are always inflated.
Apple now has a license to Moto’s FRAND patents for iPhone4s via Infineon.
There does seem a Qualcomm FRAND Motorola connection – see here
ttp://fosspatents.blogspot.com/2012/02/motorola-wants-225-of-apples-sa les-in.html
or am I reading this wrong?
Nope, now both changed the licensing. At the moment of writing that, I did not read that post.
No, you are mistaken. Samsung claimed those rights simply don’t extend to Apple which is why Apple brought the Qualcomm licenses into the case.
But Samsung retroactively changed the license for both Infineon and Qualcomm retroactively to exclude Apple specifically (while also arguing that the right never extended to Apple anyway — how’s that for talking out of both sides of your mouth?).
Oops, bad typo:
“But Samsung retroactively…” should be “But Motorola retroactively…”
They decided to invoke Defensive Suspension Provision – and there you have an explanation why they think they have the right to terminate licenses. Question is as always, is Apple subject to those terms.
You are wrong: the iPhone 4S use a Qualcomm chipset.
http://www.reuters.com/article/2011/10/13/us-apple-teardown-idUSTRE…
http://www.patentlyapple.com/patently-apple/2012/02/a-riveting-read…
“Motorola alleges that Apple infringes the ‘336 patent based on Apple’s use of a MDM 6610 baseband chip in the iPhone 4S, which is provided to Apple’s contract manufacturers by Qualcomm Inc. (“Qualcomm”). ”
“In its papers before the Higher Regional Court, Motorola has made arguments in breach of its agreement with Qualcomm that would require the German court construe the Motorola/Qualcomm agreements. For example, Motorola has argued against Apple’s claim that it is a third-party beneficiary under the Motorola/Qualcomm agreement and Motorola has argued that its termination of the Qualcomm agreement with respect to Apple sales was effective under the Motorola/Qualcomm agreement.”
Edited 2012-02-14 16:18 UTC
It looks to like both Samsung and Motorola are abusing FRAND and the Motorola case definitely involves Qualcomm and Apple. This is from The Verge.
According to a report by Reuters, Apple filed a new case in California federal court today, claiming Motorola’s patent infringement cases against Apple in Germany breach Motorola’s licensing agreement with San Diego-based Qualcomm. This matches up with Apple’s defenses against Samsung — companies can’t double dip on licensing fees under the legal principle of patent exhaustion.
Wireless baseband chips now used in iPhones are purchased from Qualcomm, and Apple argues that Qualcomm already pays Motorola (and Samsung) patent licensing fees for those components. Under the legal doctrine of patent exhaustion, Motorola can only demand one payment per use of the patented technology. Apple already paid Qualcomm for the right to use Motorola’s patented technology when it paid for the Qualcomm chips, so Motorola’s enforceable patent rights relative to those components are now all used up. This new suit in California simply brings the issue to a head by alleging that Motorola breached its agreement with Qualcomm by attempting to collect those licensing fees again.
While Apple’s FRAND defenses have received a lot of news coverage lately, this patent exhaustion defense may be equally important. Patent exhaustion is an established principle under US patent law, and it has a certain common-sense appeal for both judges and juries. To the extent the Qualcomm baseband chips are fully covered under an existing license, it’ll be difficult for Motorola to argue it deserves another bite at the Apple, so to speak.
Original is here:
http://www.theverge.com/2012/2/10/2790476/apple-stop-motorola-germa…
Sorry – I meant to add this from the Guardian.
Apple last week filed a potentially explosive lawsuit in the US, claiming that MMI is abusing its ownership of essential patents used for mobile phones, after it wrote to Apple and chipmaker Qualcomm in January. In the letter, MMI revoked Apple’s ability to use two patents embedded in Qualcomm chips used in the iPhone. Such specific revocations are not normally allowed under the terms on which “essential” patents are licensed: if Motorola is found to have breached the “FRAND” (fair, reasonable and non-discriminatory) rules around the licensing of its patents then it could face sanctions from standards bodies, and damages from Apple.
You do realise this is just an accusation, right, and not a statement of fact? I know Apple’s own words are facts to you, but not to most of the rest of the world.
Just point it out.
Thom you should enter the Olympics as a contortionist given how much you bend over backwards to defend Google (and now of course Motorola)
Apple’s complaint is here.
http://www.scribd.com/doc/81229398/Apple-vs-Motorola-over-Qualcomm-…
Short version:
1) Qualcomm licensed the patents in question and made chips using them. The terms of the license explicitly called out patent exhaustion; Qualcomm’s customers would not need to license the patents themselves.
2) Apple bought and used these chips
3) Motorola sent a letter to Qualcomm terminating Apple’s — and only Apple’s downstream license
4) Qualcomm told Motorola they couldn’t do that
5) Motorola considered the license terminated and started negotiations with Apple to license the patents that Apple believes were already licensed by virtue of buying the chips from Qualcomm. They asked for 2.5% of the total revenue from the Apple products in question.
I haven’t seen anyone claim that any of the above is anything other than the facts. Motorola hasn’t said any of that is untrue. Qualcomm hasn’t said any of that is untrue.
To me, leaving aside the blatant and destructive abuse of the FRAND system, the demand for 2.5% of the total revenue is like some company claiming that it should be paid a licence fee for the electronic controller used in the toilet light in a Airbus 380 and demanding 2.5% of the total revenue Airbus earns from selling the 380.
Thom I am quite open about my position – I am a a very big fan of Apple and have been for close on three decades. I write to defend Apple. Why don’t you stop pretending that you are neutral. You are not.
I never said I was neutral. Please point me to an instance where I said I was neutral.
I am against software patents, and especially against the abuse of software patents. That’s it.
Thom is anti-company whorship. So he challenges other people’s company whorship, and people end up thinking that he either whorship’s a different company or simply hates the company in question. Neither is the case.
For an understanding of why Thom does this, go back and look at all of the ridiculous things that SCO said. Many people took their word and invested huge sums in their legal arguments, that however, did not make them true.
There is one thing in #3 you need to add. Motorola believes that they can invoke the defensive suspension provision.
Cause my original Droid is getting old and I really want a Droid 4, only running vanilla android without that motoblur crap.
Celebration hyme, Ode to thee glorious day
Europe put the chub upon the scroll
and seal the faith
Be quick because evil trolls
at the gate.
O rise Androids march and crush
The empire of the trolls
Bring forth the scroll and read to thee
The rest of the mob turn and flee.
Edited 2012-02-13 22:26 UTC
“During the course of the division’s investigation, several of the principal competitors, including Google, Apple and Microsoft, made commitments concerning their SEP licensing policies. The division’s concerns about the potential anticompetitive use of SEPs was lessened by the clear commitments by Apple and Microsoft to license SEPs on fair, reasonable and non-discriminatory terms, as well as their commitments not to seek injunctions in disputes involving SEPs. Google’s commitments were more ambiguous and do not provide the same direct confirmation of its SEP licensing policies.”
Well, duh. Apple and Microsoft barely have any standards-essential patents (some small H264 stuff, that’s it).
Umm, this is written in the approval of the acquisition of NORTEL’s PATENTS — ONE OF THE LARGEST LIBRARIES OF TELECOM STANDARD ESSENTIAL PATENTS IN EXISTENCE.
Apple has 140 FRAND patents concerning the 3G standard.
Let me preface this by saying this is an honest question, I have no knowledge of the subject, but how did Apple get all these patents? As far as I’m aware the 3g standard was in place long before apple was making phones. None of the radios, specification or anything to do with 3g radio transmission were designed or produced by Apple. is it just because they purchased a portfolio of patents? Someone please enlighten me
Apple get them from the Nortel acquisition AFAIK.
Edited 2012-02-14 00:28 UTC
I do not think so, but I may be mistaken. Firstly, the patent pools for 3G and other standards are growing and changing daily. They were not set in stone when a 3G standard was first agreed to be a good idea. Secondly, this knowledge came to light based on these letters that the parties needed to submit to the EU and DOJ for approval. It points to a new submission to ETSI of 140 new patents that they currently own prior to approval of the Nortel deal. (Apple made its first disclosures and submissions to ETSI in 2007 upon the release of the iPhone, and this submission does not foreclose the possibility of other Apple patents already counting amoung those deemed part of the standards.) So presumably this does not yet include Nortel patents, particularly those which are already a part of the standard (they don’t need to be considered for inclusion; they already are included).
LINK: http://www.scribd.com/doc/80899178/11-11-11-Apple-Letter-to-ETSI-on…
AND RELEVANT QUOTE: “Apple’s supplemental disclosure identifies 140 Apple patents and patent applications that may be or may become essential to LTE, UMTS, EDGE, GPRS, and GSM. This collection includes newly issued Apple patents and published applications, as well as assets acquired from third parties.”