Originally Posted by Frood
But isn't this the patent where Apple said "We'll pay you a dollar tops per phone take it or leave it, ...
No sir, that was the one between Motorola and Apple where Judge Crabb dismissed the case with prejudice. Even Foss Patents, who is usually anti-Motorola and pro-Apple, said that Apple blew a great chance to have a totally fair judge decide the rate.
Originally Posted by sambira
Given that the patents in question are FRAND, this should be easy. Look at what Samsung is charging other licensees for the patents and apply that.
As far as I can tell from reading through the 800 pages of evidence, and 700 page ruling, one problem is that nobody had ever paid a flat cash rate. Everyone else engaged in cross-licensing and paid little or nothing.
Thus Samsung had to make up a starting cash rate, and it was then expected for Apple to negotiate it down. While Samsung made other offers, Apple refused to negotiate and that's why they got the ban. See the ITC statement at end of this post.
(Personally, I think that Apple should've still been given a last chance to resume negotiations or to enter abitration.)
Also, as was stated earlier in this thread, how is Apple responsible for this if the patented areas are included in a component built by another company which probably already has the license and if they don't they would be the ones to violate the patent, unless it IS Apple who is building the component, of course.
The problem is that Infineon didn't have a Samsung license. That's why this only affects devices built before Apple switched to Qualcomm.
Originally Posted by TBell
Companies like Samsung and Motorola are using the ITC has an offensive weapon.
As does Apple. Remember that Apple got an ITC ban on certain HTC phones, which forced the latter into making a deal with Apple. It's been guessed that HTC now pays Apple $6-$8 per phone, along with having to license some of their patents.
Originally Posted by TBell
You are right on both accounts. Apple is claiming the patents are exhausted and the license is already paid, but the ITC is not looking at that argument because that involves an agreement with a third party.
No sir, see above about Infineon. After the ITC ruled that Apple's devices infringed, Apple did not dispute that they owed Samsung a royalty.
However, Apple wanted it to be based only on a tiny percentage of the broadband chip price.
While that makes some sense, one problem was that ETSI royalties are not usually done that way. Secondly, using the physical chip price makes no sense, as that can go down over time, and has nothing to do with the continued value of related IP.
Ultimately, the ITC said the price was not up to Apple alone to decide, nor could they simply refuse to negotiate, nor could they claim as a defense that Samsung didn't follow ETSI FRAND rules when they themselves did not do so.
"The Administrative Law Judge concludes that the evidence does not support Apple’s allegation that Sarnsung failed to offer Apple licenses to Samsung’s declared-essential patents on FRAND terms. Patents have the attributes of personal property. 35 U.S.C. § 261. Their value, in terms of licensing, varies according to a myriad of factors, and it is not enough for Apple to say that Samsung’s license offer was unreasonable based on Apple’s rationale.
"Remarkably, even though Apple complains that Samsung’s license offer was not FRAND, Apple has not shown that, as a member to ETSI, it ever availed itself of the process and procedures of the ETSI under Clause 4.3 of the ETSI Guide on IPRs, which provides for mediation by ETSI Members or the Secretariat. (RX-0713 at Clause 4.3.)
"It is not enough for Apple to complain that Samsung’s license offer of 2.4 percent of the selling prices of Apple’s devices, is unreasonable, since there is insufficient evidence of customs and practices of industry participants showing that Samsung’s demand is invidious with respect to Apple.
"Furthermore, negotiations often involve a process of offer and counteroffer before the parties arrive at an agreed price, but Apple’s evidence does not demonstrate that Apple put forth a sincere, bona tide effort to bargain with Samsung. Rather, it appears that Apple and Samsung both decided to negotiate licensing terms between each other through the tortuous, and expensive, process of litigation.
"More than what has been cited by Apple is necessary in order to establish that Samsung violated its obligations under Clause 6.1 of Annex 6: ETSI Intellectual Property Rights Policy. More than that, Apple needs to establish a legal basis for foreclosing enforcement under Section 337 in this investigation, which Apple has not done."
- ITC case 337-794
Again, I think a ban was too strong, but that's the only power the ITC has. Therefore it was an easy prediction that they would continue to use them in FRAND cases, no matter what the FTC had suggested.
If the Executive Branch does not override the ruling, the next step will be Apple filing with the Court of Appeals for the Federal Circuit, which they've already indicated they will do.
Edited by KDarling - 7/31/13 at 7:56pm