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Apple gets support from Microsoft and Intel in CAFC appeal of Motorola patent case

post #1 of 19
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In two separate filings on Wednesday, Microsoft and Intel voiced their support of Apple in an appeal before the U.S. Federal Court of Appeals regarding the dismissal of a patent suit involving Google's Motorola.

While the amicus briefs are currently sealed, both companies throw support behind Apple, which is arguing that the FRAND-related section of Judge Richard A. Posner's June 2012 ruling stands despite having the case dismissed with prejudice.

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Google entered its initial filing with the CAFC last week, saying that Apple is an "unwilling licensee" and that Judge Posner's decision to "categorically" bar injunctive relief over standard essential patents was incorrect. The company went further, arguing that the ruling devalues SEPs as a whole by basing the FRAND value on the intrinsic value of the claimed inventions rather than post-standardization hold-up value, notes FOSS Patent's Florian Mueller.

As for Microsoft's amicus filing, the company's motion for leave to file claims particular issues Google is asserting to the court are "not properly before it":

Certain of the issues that Motorola asks this Court to address--including the proper method for valuing standard-essential patents and the availability of injunctive relief for infringement of such patents--although presented in other cases involving Motorola patents, including cases involving Microsoft, are not in fact presented in this appeal. Beyond that, the positions Motorola asks this Court to adopt are contrary to law and inimical to sound public policy. Microsoft, therefore, has a direct interest in ensuring that this Court not accept Motorola's invitation both to address matters not properly before it and to do so in a misguided, and potentially harmful, manner.


Finally, Research in Motion, now known as BlackBerry, filed an amicus brief in support of neither party. Instead, the company looked for consensus regarding the court's position on SEPs, posing the question, "Can injunctive relief ever be available to holders of standard-essential patents as a remedy for infringement?"

post #2 of 19
The enemy of my enemy is my friend, indeed.

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post #3 of 19

Has anyone EVER written an amicus brief supporting Google/Motorola or Samsung?

 

Only ones I can think is when cell providers didn't want Apple to get injunctions on Samsung or HTC phones as it would harm their business (limiting their potential sales by having fewer devices to sell).

 

But those were purely for $$$ and had nothing to do with policy. Everyone speaking on behalf of Apple are doing so because they are against Googles abuse of patents.

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post #4 of 19
I had to Bing the net to find out that CAFC stands for 'Court of Appeals for the Federal Circuit.'
post #5 of 19
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Originally Posted by SolipsismX View Post

The enemy of my enemy is my friend, indeed.

Normally the courts are the enemy of MSFT. How can MSFT file a "friend of the court brief"? Interesting twist on the ancient proverb. Good thing this isn't an EU court, eh?
post #6 of 19
Well, anyone that Microsoft sides with is automatically evil, everyone on this board knows that 1tongue.gif

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post #7 of 19
Quote:
Originally Posted by DaveN View Post

I had to Bing the net to find out that CAFC stands for 'Court of Appeals for the Federal Circuit.'

Reckon that massive seal that said "Court of Appeals for the Federal Circuit" AI put in the article wasn't a clue, eh? Bada-BING!
post #8 of 19

doh... I just saw the United States, the crest, and stopped there.

post #9 of 19
I think Research in motions amicus brief actually asks the most important position. Is there ever a case where a SEP can be used to get injunctive relief. I expect the court to answer that question in the positive. I am not sure the court would want to list exactly what an example of this "enforceable" SEP would look like. My guess is the problem for Motorola/Google is simple greed. If the SEP's were being offered in equal terms to all parties then it is hard to see how the infringement would not be enforceable. Asking a larger percentage from one vendor because they are making more money does not seem to be acceptable SEP behavior.

The real problem that Apple has brought out is the patent system has become a good old boys club without walls to keep out the riff-raff. Cell phone patents as they were used before the iPhone were civilized and quiet negotiations among a relatively exclusive club of known parties. When Apple jumped into the cell phone game and disrupted the party, the resulting lack of civility is killing the old order. What are we going to do to make a new system that will replace the old one? How are the players in this game going to keep from being poisoned by all the patents controlled by entities that are not taking the huge expensive gamble to build actual cell phones?

If I were in this game I would be looking to end the patent wars between producers and to create a baseline for all patents outside of the ones held by actual producers to be divided up by the non practicing entities. I would want legislation that capped patent costs from non practicing entities to cell phone producers at 5- 10% of revenues and made all the patent holders fight each other for their share of this standard pie. This industry is producing so much money that even 5% of revenues would be an amount in the dozens of billions of $ per year. If someone had a patent or set of patents that was so fundamental that it would change the industry, they would need to either build their own phones or partner with one of the existing producers to capitalize on their invention.
post #10 of 19
Quote:
Originally Posted by Macnewsjunkie View Post

I think Research in motions amicus brief actually asks the most important position. Is there ever a case where a SEP can be used to get injunctive relief. I expect the court to answer that question in the positive. I am not sure the court would want to list exactly what an example of this "enforceable" SEP would look like. My guess is the problem for Motorola/Google is simple greed. If the SEP's were being offered in equal terms to all parties then it is hard to see how the infringement would not be enforceable. Asking a larger percentage from one vendor because they are making more money does not seem to be acceptable SEP behavior.

<...>

If I were in this game I would be looking to end the patent wars between producers and to create a baseline for all patents outside of the ones held by actual producers to be divided up by the non practicing entities. I would want legislation that capped patent costs from non practicing entities to cell phone producers at 5- 10% of revenues and made all the patent holders fight each other for their share of this standard pie. This industry is producing so much money that even 5% of revenues would be an amount in the dozens of billions of $ per year. If someone had a patent or set of patents that was so fundamental that it would change the industry, they would need to either build their own phones or partner with one of the existing producers to capitalize on their invention.

 

The biggest question in all of the FRAND / SEP cases with Apple has been 5% of what.  The chip that actually uses the patent ($5.00) or the whole phone ($600).  Apple's arguments have been falling into 1 of 2 positions depending on the case.  

1) The patent is already licensed by the chip manufacturer and included with the price of the chip (ie this was in response to invalidate a license on any chips sold to Apple only.  Definitely misses the F in FRAND).  

2) The percentage should be on the cost of the component, not the final assembled item.  The extreme example is paying 2.25$ of the cost of a car because it has OnStar and uses a cellular patent.

 

Also with the 5-10% is that per product, per patent owner, or per patent.  Unless that 5-10% cap is per product, You can easily see where those 5% will quickly add up to eat up most if not all of the profit (Or even where the company owes money on each item it makes). 

 

This is one question where there is no easy answer.  

post #11 of 19
Quote:
Originally Posted by AJMonline View Post

The biggest question in all of the FRAND / SEP cases with Apple has been 5% of what.  The chip that actually uses the patent ($5.00) or the whole phone ($600).  Apple's arguments have been falling into 1 of 2 positions depending on the case.  
1) The patent is already licensed by the chip manufacturer and included with the price of the chip (ie this was in response to invalidate a license on any chips sold to Apple only.  Definitely misses the F in FRAND).  
2) The percentage should be on the cost of the component, not the final assembled item.  The extreme example is paying 2.25$ of the cost of a car because it has OnStar and uses a cellular patent.

Also with the 5-10% is that per product, per patent owner, or per patent.  Unless that 5-10% cap is per product, You can easily see where those 5% will quickly add up to eat up most if not all of the profit (Or even where the company owes money on each item it makes). 

This is one question where there is no easy answer.  

Nokia, Qualcomm, Ericsson and several others would say the royalty basis is the completed device price rather than a chip or even set of chips. Motorola falls in that camp too, with the (recently?) added inclusion of a cap offer on total royalties. Apple would of course benefit from the smallest royalty basis they can get as they are not currently a significant licensor of SEP's. New entrants to the industry would also much prefer that royalties are based on the smallest identifiable components making use of the patents.

Even getting past that there's a whole lot of other details and stipulations with little agreement. Here's a timely example:

Motorola successfully asserted their IP rights against Microsoft in a case heard in Germany last year. The court ordered an injunction on infringing MS products. A US judge put that injunction on hold while it's under appeal. In the meantime the FTC proposed that Google, now the owner of Moto, be enjoined from seeking SEP injunctions from a willing licensee.

So what to do with the on-going MIcrosoft injunction request? Motorola signed Microsoft's last royalty offer and sent it to them along with a letter noting their acceptance of Microsoft's terms for licensing the infringed IP, thus putting an end in sight for the case and the dismissal of the injunction.

Now Microsoft is crying foul over Motorola accepting their offer, saying they really didn't intend for that contract to be accepted by Motorola and used by the German Court for determining damages for their past unlicensed use of Moto's IP.
https://docs.google.com/viewer?url=http://essentialpatentblog.com/wp-content/uploads/2013/02/13.02.22-D.E.-655-1-MS-Moto-License-Agreement.pdf

There's a lot of gamesmanship under way, and no clear right or wrong parties.

EDIT: I don't see where Mueller at FOSSPatents ever did a blog article on Motorola's acceptance of Microsoft's royalty offer, and for good reason. It certainly doesn't benefit some of the arguments he's made.
Edited by Gatorguy - 3/21/13 at 6:54am
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post #12 of 19

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Edited by MacRulez - 7/23/13 at 9:36am
post #13 of 19

GG, so full of it as usual.

 

There's no clear right or wrong? Even for you that's way over the top. There is absolutely a clear right/wrong to this issue. You bringing up a very specific case to support your narrow view won't change things. Motorola/Google and Samsung have lost so many cases over SEP's I've lost count. They have had so few victories (or partial victories) I have trouble counting to my middle finger. Which is appropriate.

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post #14 of 19
Quote:
Originally Posted by EricTheHalfBee View Post

GG, so full of it as usual.

There's no clear right or wrong? Even for you that's way over the top. There is absolutely a clear right/wrong to this issue. You bringing up a very specific case to support your narrow view won't change things. Motorola/Google and Samsung have lost so many cases over SEP's I've lost count. They have had so few victories (or partial victories) I have trouble counting to my middle finger. Which is appropriate.

Which cases have Motorola lost over SEP infringement claims? You say there's several, and so emphatically you must be able to cite them right off the top of your head.

Question two: Who do you see as clearly right or wrong in the Microsoft case concerning SEP infringement I mentioned? Motorola signed and sent back MS royalty counter-offer contract. Now that's not OK with MS either? It was their contract!

Now do I expect you to answer either question? Based on recent history I do not, but there's always hope.
Edited by Gatorguy - 3/21/13 at 7:11am
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post #15 of 19
Quote:
Originally Posted by EricTheHalfBee View Post

Has anyone EVER written an amicus brief supporting Google/Motorola or Samsung?

Qualcomm immediately comes to mind.

If you meant to extend this question to any Google lawsuits, in the Google Books case and appeals there were several filed in support of Google's position. If you're intending for Amicus Brief filings to be evidence of being in the right, does that put Google in the clear regarding books? In your view it won't. They're Google, and that makes it different.
Edited by Gatorguy - 3/21/13 at 7:33am
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post #16 of 19

Ah, so now Qualcomm and Blackberry have sided with Google. As I predicted many months ago the companies who favor abuse of SEP's are the same ones who have found themselves reduced to an insignificant portion of the market (Ericsson, Nokia, Blackberry). Qualcomm, who makes most broadband chips, has likely found a way to line their pockets with even more money so their position is again, related to $$$ and not to policy.

 

Meanwhile, law professors, government officials and numerous software associations and companies who have nothing to profit from the Apple/MS/Google/Samsung patent war are also siding with Apple.

 

Seems pretty damn clear who is right and who is wrong (unless you're a troll/shill).

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post #17 of 19
Quote:
Originally Posted by EricTheHalfBee View Post

Ah, so now Qualcomm and Blackberry have sided with Google. As I predicted many months ago the companies who favor abuse of SEP's are the same ones who have found themselves reduced to an insignificant portion of the market (Ericsson, Nokia, Blackberry). Qualcomm, who makes most broadband chips, has likely found a way to line their pockets with even more money so their position is again, related to $$$ and not to policy.

Meanwhile, law professors, government officials and numerous software associations and companies who have nothing to profit from the Apple/MS/Google/Samsung patent war are also siding with Apple.

Seems pretty damn clear who is right and who is wrong (unless you're a troll/shill).

So just to be certain on your position on question 2, you're saying Microsoft is plainly wrong to complain about Motorola accepting the SEP royalty offer MS made, which would allow the injunction won by Moto in Germany to be dismissed. You're not a shill to the best of my knowledge so I did get that right. . . right?

As far as the the first question asked in post 14 I guess you had no answer at all for that one?

You were the one who felt he had to jump in to say "There's no clear right or wrong? .... There is absolutely a clear right/wrong to this issue. Motorola/Google... have lost so many cases over SEP's I've lost count. " If you're going to claim someone else is full of it back up your argument or admit you were wrong rather than just running away from it..
Edited by Gatorguy - 3/21/13 at 3:46pm
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post #18 of 19
Quote:
Originally Posted by EricTheHalfBee View Post

Ah, so now Qualcomm and Blackberry have sided with Google. As I predicted many months ago the companies who favor abuse of SEP's are the same ones who have found themselves reduced to an insignificant portion of the market (Ericsson, Nokia, Blackberry). Qualcomm, who makes most broadband chips, has likely found a way to line their pockets with even more money so their position is again, related to $$$ and not to policy.

 

Meanwhile, law professors, government officials and numerous software associations and companies who have nothing to profit from the Apple/MS/Google/Samsung patent war are also siding with Apple.

 

Seems pretty damn clear who is right and who is wrong (unless you're a troll/shill).

 

It comes down to incumbants vs. disruptive technology.  Intel, Apple and Microsoft are the old guard.  They've been around for decades.  Now Google, Qualcomm, and the ARM/Android ecosystem is looking to replace the 'old guard'.  So the big incumbants are simply trying to guard their position. 

post #19 of 19
I hadn't taken the time to look at the joint brief from Cisco, HP, Garmin, etc that was purportedly supporting Apple's position (according to Mueller) until a few minutes ago. Reading indicates they don't necessarily support Apple either.

What the group proposes is that ALL patents, not just SEP's, be valued in a more consistent and fair manner by courts instead of leaving it up to each individual jury in each separate lawsuit.

"...reasonable royalty damages should be capped at the incremental value of the patented invention over the next best existing alternative technology at the time of incorporation into the design of the product (or standard); (2) apportionment — a determination of the value the patented invention provides to the overall accused product — should be used as a starting point in calculating a reasonable royalty; and (3) evidence of an established royalty may be relevant, but only in certain circumstances (such as where hold-up value or litigation avoidance was not a factor in increasing the royalty paid)."

IMO their position is perfectly reasonable.

https://docs.google.com/viewer?url=http://essentialpatentblog.com/wp-content/uploads/2013/01/12.12.06-Doc.-93-Brief-of-Amici-Curiae-Altera-Corp.-Cisco-Systems-CME-Group-Inc.-Garmin-et.-al.-Regarding-Standards-on-Damages-in-Support-of-Neither-Party-CORRECTED-Non-Confidential-Version-Only.pdf
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