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Kodak opposes Apple's efforts to block $2.6 billion sale of disputed imaging patents

post #1 of 32
Thread Starter 
Kodak is seeking to block Apple from halting its sale of $2.6 billion in imaging patents, related to claims that Apple actually owns some key patents Kodak is attempting to sell.

According to a report by the Wall Street Journal, Kodak is fighting Apple's efforts to have a federal judge promptly resolve the patent ownership question, asking instead that the matter be handled by a bankruptcy judge so the company's restructuring plan can continue.

Kodak initially sued Apple over patent claims related to digital imaging in January 2010, which was answered by Apple's claim that it actually owned the rights to the patents Kodak was trying to use against it.

Kodak subsequently filed for bankruptcy on January 19, a step which automatically halted all litigation cases being brought against it, including claims by Apple and RIM.

Kodak's chief executive Antonio Perez noted that "Chapter 11 gives us the best opportunities to maximize the value [… of] our digital capture patents, which are essential for a wide range of mobile and other consumer electronic devices that capture digital images and have generated over $3 billion of licensing revenues since 2003."

Last month, Apple sought to reopen its litigation, based on Apple's assertion that Kodak is attempting to sell off patents that actually belong to it, related to a partnership between the two companies in the early 1990s to develop the QuickTake digital camera.




"Until this ownership dispute is decided," Apple's attorneys wrote in a filing, "any such sale that includes the...patent would be inappropriate and harm Apple irreparably." Apple states that Kodak "misappropriated" its own technology to apply for the patent, something Kodak calls "baseless."

Apple's motion seeks to lift Kodak's protection from new and existing litigation initiated by its Chaper 11 filing, which Kodak said would put its restructuring plans in "substantial risk" by "opening the floodgates" to similar claims from other parties.

Kodak told the bankruptcy court that Apple is "seeking what it sees as a tactical advantage in having its ownership claims resolved outside this court," and stated, "Apple's preferred course of action—to ask another court to decide the critical issue of what constitutes property of the estate and how that property is to be used to maximize value for creditors—should be rejected," calling Apple's concerns about potential damages "crocodile tears."

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post #2 of 32
Those Kodak patents are not worth $2.6 billion. Kodak is in chapter 11 bankruptcy and is desperate for cash. CEO Perez has been hyping those patents in hopes of fetching more money but after years of patent trolling Kodak's patents are not able generate much revenue anymore. Those patents generated less than $65 million last year.

Kodak would be lucky to get even $1 billion. Even after the patents are sold Kodak will still end up being liquidated. A few units will be sold to other companies but the Kodak as we know it will be gone forever.
post #3 of 32
Quote:
Originally Posted by bunnyturd View Post

Those Kodak patents are not worth $2.6 billion. Kodak is in chapter 11 bankruptcy and is desperate for cash. CEO Perez has been hyping those patents in hopes of fetching more money but after years of patent trolling Kodak's patents are not able generate much revenue anymore. Those patents generated less than $65 million last year.

Kodak would be lucky to get even $1 billion. Even after the patents are sold Kodak will still end up being liquidated. A few units will be sold to other companies but the Kodak as we know it will be gone forever.

I'd be surprised if they sold for more than 3 years of projected net patent royalties assuming the buyer wanted them solely for that purpose.
post #4 of 32
Quote:
Originally Posted by AppleInsider View Post

Kodak told the bankruptcy court that Apple is "seeking what it sees as a tactical advantage in having its ownership claims resolved outside this court," and stated, "Apple's preferred course of actionto ask another court to decide the critical issue of what constitutes property of the estate and how that property is to be used to maximize value for creditorsshould be rejected," calling Apple's concerns about potential damages "crocodile tears."

Kodak's spewing FUD.

The issue is whether the patents are even Kodak's property. If they're not Kodak's property, then the bankruptcy court does not have jurisdiction over them and can't get involved.

This needs to be resolved in Kodak v Apple litigation, not Kodak v creditors.
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post #5 of 32
If Kodak hadn't drawn attention to these patents by trying to extort/sue Apple over them, Apple probably wouldn't ever have noticed them and they could have gone through bankruptcy without any interference. It's their own damned fault. In addition, they probably could have continued licensing out these patents (that Apple might end up owning) and collecting the money from those licensees as well.

Oops.
post #6 of 32
Kodak should be gone forever if they go bankrupt. I'm sick of these legal procedures that evaporate debt and allow the 'entities' to continue existing. You know, mortality is a good thing and if companies can be considered legal entities, they too should expire within a lifetime.
post #7 of 32
Quote:
Originally Posted by AppleInsider View Post

"Until this ownership dispute is decided," Apple's attorneys wrote in a filing, "any such sale that includes the...patent would be inappropriate and harm Apple irreparably."

They don't have a leg to stand on. No irreparable harm - if Apple is harmed, it can be corrected with money damages and restitution of ownership.

This is just Apple trying to sleaze their way into a better settlement.
post #8 of 32
Quote:
Originally Posted by bunnyturd View Post

Kodak would be lucky to get even $1 billion. .

What do you base that appraisal on? Did you see it somewhere? Or did you pull the figure out of the blue? Or what?
post #9 of 32
Apple co-developed the IP. Kodak has no exclusivity in their IP to sell them. End of story.
post #10 of 32
Quote:
Originally Posted by mdriftmeyer View Post

Apple co-developed the IP. Kodak has no exclusivity in their IP to sell them. End of story.

As if patent law, contract law and bankruptcy law are all easy and straightforward. Not.

End of story.
post #11 of 32
Quote:
Originally Posted by I am a Zither Zather Zuzz View Post

They don't have a leg to stand on. No irreparable harm - if Apple is harmed, it can be corrected with money damages and restitution of ownership.

This is just Apple trying to sleaze their way into a better settlement.

If you had a dispute with someone going into bankruptcy, wouldn't you want to settle it first? How would you know there would be money available for you to go after, after the bankruptcy proceeedings?
post #12 of 32
Quote:
Originally Posted by ltcompuser View Post

If you had a dispute with someone going into bankruptcy, wouldn't you want to settle it first? How would you know there would be money available for you to go after, after the bankruptcy proceeedings?

A reasonable point.
post #13 of 32
Quote:
Originally Posted by I am a Zither Zather Zuzz View Post

They don't have a leg to stand on. No irreparable harm - if Apple is harmed, it can be corrected with money damages and restitution of ownership.

This is just Apple trying to sleaze their way into a better settlement.

"Money damages" from whom? From the bankrupt company?

The 'leg' is that there's a question of ownership, and it's unequivocally inappropriate to try to sell someone else' property. The most logical and appropriate thing to do is to determine ownership <before> the IP is sold, and ASAP. Kodak is insinuating Apple is a creditor, trying to get them to go after a cut of the proceeds of the sale of the patent portfolio, like all the other creditors. Unfortunately for Kodak, Apple isn't a creditor (for these purposes), they're making a fundamental claim to ownership on something Kodak is trying to sell to third parties.
post #14 of 32
Quote:
Originally Posted by I am a Zither Zather Zuzz View Post

They don't have a leg to stand on. No irreparable harm - if Apple is harmed, it can be corrected with money damages and restitution of ownership.

This is just Apple trying to sleaze their way into a better settlement.

Sweet. So if I come to your house and steal your TV and sell it there is no irreparable harm to you? Awesome. What's your address?
post #15 of 32
Quote:
Originally Posted by I am a Zither Zather Zuzz View Post

As if patent law, contract law and bankruptcy law are all easy and straightforward. Not.

End of story.

So wrong... you're becoming quite the effective troll though!

Apple's counter-suit was before they went into bankruptcy protection. It relates to fundamental property rights. Kodak is equally guilty of trying to bypass the system by seeking protection after the fact.
post #16 of 32
Quote:
Originally Posted by sessamoid View Post

If Kodak hadn't drawn attention to these patents by trying to extort/sue Apple over them, Apple probably wouldn't ever have noticed them and they could have gone through bankruptcy without any interference. It's their own damned fault. In addition, they probably could have continued licensing out these patents (that Apple might end up owning) and collecting the money from those licensees as well.

You are spot on with your comments. However, now, if Apple can win their rights to the patents, they will avoid being sued by the new owner to use their own technology. PLUS, and this is where it gets juicy, Apple could refuse to let Android use the patents to include cameras in their products.

This is a great case study of what happens when two companies have management churn during economic times and the knowledge base is disrupted. Neither Kodak management knew how they got the patents they had, nor Apple management remembered what kind of contracts they once had with Kodak.
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post #17 of 32
Quote:
Originally Posted by lowededwookie View Post

Sweet. So if I come to your house and steal your TV and sell it there is no irreparable harm to you?

Correct. TVs can be replaced with money.
post #18 of 32
Quote:
Originally Posted by alienzed View Post

Kodak should be gone forever if they go bankrupt. I'm sick of these legal procedures that evaporate debt and allow the 'entities' to continue existing. You know, mortality is a good thing and if companies can be considered legal entities, they too should expire within a lifetime.

You have no idea... the Kodak name is still a valuable asset, as it Woolworth, Handi-Wrap, Victrola, American Brands, Meister Brau, Braniff International and Shearson; all are long gone names that are still owned by Racebrook, a New York-based private equity firm and auction specialist. Recebrook owns 150 such names. While other companies own such names, including Amiga, Diners Club, Tab, McCalls Magazine, General Cinema, Chiclets gum, and Pan Am.

Quote:
Originally Posted by I am a Zither Zather Zuzz View Post

What do you base that appraisal on? Did you see it somewhere? Or did you pull the figure out of the blue? Or what?

I think he pulled it out of the deep brown.
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post #19 of 32
Quote:
Originally Posted by I am a Zither Zather Zuzz View Post

They don't have a leg to stand on. No irreparable harm - if Apple is harmed, it can be corrected with money damages and restitution of ownership.

This is just Apple trying to sleaze their way into a better settlement.

Bankruptcy judges have wide latitude to handle things that are usually very hard. Such as break contracts, assign property of various kinds, etc.

Before you make a claim of "no irreparable harm" you should go to groklaw.net and read the saga of what the bankruptcy judge has done in the case of SCO. Bankruptcy courts don't work the way other courts do and if the patents are sold, to Kodak's benefit, Apple will never see a dime. I don't know, but what I think Apple wants is their IP back, rather than money.

The court record is quite length but you really do need to read all of it before making more comments like the ones you made.
post #20 of 32
Quote:
Originally Posted by I am a Zither Zather Zuzz View Post

They don't have a leg to stand on. No irreparable harm - if Apple is harmed, it can be corrected with money damages and restitution of ownership.

This is just Apple trying to sleaze their way into a better settlement.

Wow. Amazing how much time 'I am a snore (zzz)' spends proving how clueless he is.

Apple has every right to claim irreparable harm. If Kodak goes through with the bankruptcy and the patents are sold, then Kodak would not be in any position to pay Apple for their value. Kodak is bankrupt, remember?
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post #21 of 32
Quote:
Originally Posted by I am a Zither Zather Zuzz View Post

They don't have a leg to stand on. No irreparable harm - if Apple is harmed, it can be corrected with money damages and restitution of ownership.

This is just Apple trying to sleaze their way into a better settlement.

I don't usually feed the trolls, I prefer the zoo, but if you actually read anything about these patents, they cover technologies based on work apple did and then used while working with Kodak with the agreement that any further technology based on those core patents would belong to Apple..

You don't like the deal, you don't sign it seems to be the moral here and they agreed to Apple's terms all those years ago..

Kodak is the one that really doesn't have a leg to stand on here.
post #22 of 32
Quote:
Originally Posted by I am a Zither Zather Zuzz View Post

They don't have a leg to stand on. No irreparable harm - if Apple is harmed, it can be corrected with money damages and restitution of ownership.

This is just Apple trying to sleaze their way into a better settlement.

The irreparable harm is Apple's ability to exercise the patents for their own use or license them to others. The harm is irreparable because there is no way to estimate its value in the hands of Apple.
post #23 of 32
Ah, techdud...
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post #24 of 32
Damn, I want that QuickTake 100! Where can I get one of those?
post #25 of 32
Quote:
Originally Posted by I am a Zither Zather Zuzz View Post

What do you base that appraisal on? Did you see it somewhere? Or did you pull the figure out of the blue? Or what?

Quote:
Originally Posted by I am a Zither Zather Zuzz View Post

They don't have a leg to stand on. No irreparable harm - if Apple is harmed, it can be corrected with money damages and restitution of ownership.

This is just Apple trying to sleaze their way into a better settlement.

On the contrary, this is Kodak issuing a subliminal invitation to all patent trolls and Apple adversaries with an interest in monetising or cross-licensing non-FRAND patents to a grand sale of IP that could seriously hurt Apple.

This is highly reminiscent of the way Sun Microsystems openly advertised the sale of the company touting the potentially huge liability of the likes of Google's Android where Java was concerned.

It's a case of Apple's making hay while the Sun still shines...
post #26 of 32
Quote:
Originally Posted by AdamIIGS View Post

I don't usually feed the trolls, I prefer the zoo, but if you actually read anything about these patents, they cover technologies based on work apple did and then used while working with Kodak with the agreement that any further technology based on those core patents would belong to Apple..

You don't like the deal, you don't sign it seems to be the moral here and they agreed to Apple's terms all those years ago..

Kodak is the one that really doesn't have a leg to stand on here.

We don't know that.

As far as I know, the contents of the agreement between Apple and Kodak have not been made public. The ownership of the patents might well hinge on what the two parties agreed to when the started working together. The patents could be long to Apple or they could belong to Kodak.

If the agreement does not address IP ownership, then the patents belong to whoever's name is on the patent. The other party could try to have them invalidated based on publication of the improper inventor, but that's difficult to do after all these years. In extreme cases, it is possible to have an inventor added after the fact, but again, that's very difficult to do - especially after so many years have passed.
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post #27 of 32
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Originally Posted by plovell View Post

Bankruptcy judges have wide latitude to handle things that are usually very hard. Such as break contracts, assign property of various kinds, etc.

Before you make a claim of "no irreparable harm" you should go to groklaw.net and read the saga of what the bankruptcy judge has done in the case of SCO. Bankruptcy courts don't work the way other courts do and if the patents are sold, to Kodak's benefit, Apple will never see a dime. I don't know, but what I think Apple wants is their IP back, rather than money.

The court record is quite length but you really do need to read all of it before making more comments like the ones you made.

I'll take your word for it. Bankruptcy law is arcane, and the powers of the court exceed my innate sense of right and wrong.
post #28 of 32
Quote:
Originally Posted by BestKeptSecret View Post

Damn, I want that QuickTake 100! Where can I get one of those?

eBay, maybe.
post #29 of 32
Quote:
Originally Posted by jragosta View Post

We don't know that.

As far as I know, the contents of the agreement between Apple and Kodak have not been made public. The ownership of the patents might well hinge on what the two parties agreed to when the started working together. The patents could be long to Apple or they could belong to Kodak.

If the agreement does not address IP ownership, then the patents belong to whoever's name is on the patent. The other party could try to have them invalidated based on publication of the improper inventor, but that's difficult to do after all these years. In extreme cases, it is possible to have an inventor added after the fact, but again, that's very difficult to do - especially after so many years have passed.

You're absolutely right that we do not know who owns what here. But we can assess that Apple does feel that they own IP having worked with Kodak all those years ago to bring one of the first digital cameras to the consumer market. Especially since, Apple released the devices before even Kodak!? Who later came out with their own line of cameras.

But the simple truth is, Apple has already had digital cameras on the market, why is it an issue now? Is there something I'm missing? Surely Apple is covered under previous partnerships with regards to digital imaging in mobile devices? It really doesn't make sense for Kodak to try and sue a company they worked with all those years ago.
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post #30 of 32
Quote:
Originally Posted by BestKeptSecret View Post

Damn, I want that QuickTake 100! Where can I get one of those?

The come up regularly on eBay. Check the 'completed auctions' listing to get an idea of recent prices.

The Quicktake was actually a great product for its time. We used one all the time where I worked.

Quote:
Originally Posted by mjtomlin View Post

You're absolutely right that we do not know who owns what here. But we can assess that Apple does feel that they own IP having worked with Kodak all those years ago to bring one of the first digital cameras to the consumer market. Especially since, Apple released the devices before even Kodak!? Who later came out with their own line of cameras.

But the simple truth is, Apple has already had digital cameras on the market, why is it an issue now? Is there something I'm missing? Surely Apple is covered under previous partnerships with regards to digital imaging in mobile devices? It really doesn't make sense for Kodak to try and sue a company they worked with all those years ago.

It's an issue now because Kodak is trying to claim that most (if not all) digital cameras on the market violate its intellectual property and is trying to monetize the patents.
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post #31 of 32
I am a lawyer, although I am not a bankruptcy lawyer. Apple may be right on the substantive merits, that is, the patents in truth belong to them. But I think they are wrong about the procedure - bankruptcy courts have enormous power to dispose of any kind of legal claim against the debtor. The fact that intellectual property is involved does not deprive the bankruptcy court of the power to rule on the question.

The bankruptcy court has the power to amend or cancel contracts. If it finds in favor of Kodak and against Apple on Apple's claims, it could easily issue a ruling which cuts Apple out of these patents. Of course Appeal can appeal the ruling of the bankruptcy court, and should be able to do so quickly before it suffers irreparable harm.

I don't know why Kodak can't sell these patents to a third party subject to Apple's claims - let the next buyer deal with it, or defend it. Kodak gets less money, but it gets out of restructuring much quicker.

I also don't know why Apple just doesn't settle this by buying back the rights. Isn't this what $80 billion in cash is good for? Yeah, it's not "fair" but it resolves some major uncertainty and prevents further patent/IP litigation if Kodak's rights fall into hostile hands.
post #32 of 32
Quote:
Originally Posted by tullius View Post

I am a lawyer, although I am not a bankruptcy lawyer.
.....
I also don't know why Apple just doesn't settle this by buying back the rights. Isn't this what $80 billion in cash is good for? Yeah, it's not "fair" but it resolves some major uncertainty and prevents further patent/IP litigation if Kodak's rights fall into hostile hands.

I do not mean to offend you sir, but your attitude is so much why the common man really hates lawyers. You appear to be saying, "who cares what the truth is or who cares what is right or wrong. Just go for the quick path of the most gain. Just throw some money at it that will solve everything."

Most people do care about what is right and what is wrong. Most people care if their reputations are damaged. And so most people I know are disgusted by the court system and the lawyers who are only fighting to get ahead of the other side without any concern as to what the truth is or how much money they burn through. Yuck!

I think that if Apple is in the right and they are the true patent holders, they should fight for the truth. But alas, they will have to use lawyers to put up a fight.
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