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10.14.18

Let’s Hope Apple Defeats All the Abstract Patents That Are Leveraged Against It

Posted in America, Apple, Courtroom, Patents at 7:56 am by Dr. Roy Schestowitz

Software patents disguised as “network provisioning” now?

Apple

Summary: Apple can be viewed as a strategic ‘ally’ against patents that threaten Android/Linux if one ignores all the patent battles the company started (and has since then settled) against Android OEMs

THE USPTO still grants patents far too easily, only for courts to repeatedly correct it by invalidating granted patents. Sometimes there’s a lot of money at stake, like Apple’s $234 million patent dispute with a university.

Last weekend we wrote about Apple‘s success in appealing the case [1, 2] for the Federal Circuit to deal with rather than the district court, which tends to be more lenient in terms of patent quality, much like the USPTO even in the post-Alice era. As one writer put it a fortnight ago:

A federal appeals court has ruled in Apple’s favor in a patent dispute with the University of Wisconsin-Madison. The court ruling, initially spotted by Reuters, said that that Apple didn’t infringe on one of the university’s patents, overturning a prior ruling in the university’s favor that had fined Apple $234 million. Another $272 million was later added to that fine to account for Apple’s continued use of the patent, but that will presumably be thrown out now that the underlying judgment has been reversed.

We expect this case to be “DOA”, but at what cost (legal bills)? Meanwhile, the patent troll Uniloc strikes again, still focused on the same target, Apple, after Microsoft paid Uniloc. As a pro-Apple site put it last week, this is a new case:

Apple is again in the crosshairs of Uniloc, with the patent aggregator alleging the process by which iPhone and cellular-connected iPad and Apple Watch models infringes on owned intellectual property.

[...]

The ’616 patent changed hands to Uniloc’s main Luxembourg arm in 2017 and was duly assigned to Uniloc 2017 LLC in May of this year.

Uniloc alleges all iPhone models from iPhone 5 through iPhone XS Max and cellular connected iPads including fourth- and fifth-generation iPad models, all iPad mini versions, iPad Pro, first- and second-generation iPad Air models and Apple Watch Series 1 through 3 infringe on multiple patent claims.

Uniloc seeks unspecified damages, reimbursement of legal fees and other relief deemed fit by the court.

It would be a stretch to call Uniloc a Microsoft proxy because the two entities had lengthy and expensive court battles. The real danger here is that this troll, ‘fattened’ by Microsoft cash, may soon go after Android/Linux players. Unless Apple manages to squash the underlying patents and drive Uniloc to bankruptcy (out of funds). Uniloc isn’t a real company and there’s a reason why it operates through Luxembourg.

10.06.18

Wisconsin Alumni Research Foundation (WARF) is Not Getting Money From Apple and VirnetX Might Not Get Any, Either

Posted in Apple, Patents at 11:04 pm by Dr. Roy Schestowitz

Only the lawyers are receiving money (lots of it!)

German euro coin

Summary: The notorious patent assertion ‘firm’ from Wisconsin and the infamous patent troll that sues in Texas might soon find out that the Court of Appeals for the Federal Circuit (CAFC) isn’t tolerating their patents and their behaviour

TECHRIGHTS is far from a friend of Apple; in fact, we called for boycotts several times in the past, we criticised Apple’s bogus European Patents (which EPO insiders tell us are bogus), and we regularly ridicule some of the patents that the USPTO gives to Apple. To set the record straight, Apple is a very evil company, it is a patent aggressor, and we generally encourage people to never buy anything from Apple (there’s a new scandal with practical reasons to avoid Apple).

“Remember that 35 U.S.C. § 101 at the U.S. Patent and Trademark Office (USPTO), for example, helps squash almost all software patents and Apple sometimes fights back against FRAND, which is inherently incompatible with Free/libre software.”No matter our opinion/views on Apple, merely going after (or against) Apple does not make a company virtuous. We’ve repeatedly explained, for example, why we hope Apple will beat Qualcomm (there’s a new article today about the case, “Apple and manufacturers: Qualcomm can’t demand “billions in royalties” while ducking patent-specific claims“). There are even worse things than Apple and there are situations where Apple winning a legal case can inadvertently be helpful to GNU/Linux. Remember that 35 U.S.C. § 101 at the U.S. Patent and Trademark Office (USPTO), for example, helps squash almost all software patents and Apple sometimes fights back against FRAND, which is inherently incompatible with Free/libre software.

As expected, the Federal Circuit (CAFC) throws aside decisions on patent cases from notorious courts in Texas and elsewhere (a software patent case of a patent troll called VirnetX is in Texas, another one from the Wisconsin Alumni Research Foundation (WARF) comes from elsewhere). As patent maximalists reported a few days ago, “Federal Circuit sets aside $234 jury verdict against Apple” and will decide on its own:

WARF’s 2015 patent damages win, bumped up to $506m by a judge last year, has been vacated by the Federal Circuit because “no reasonable juror could have found infringement based on the evidence presented during the liability phase of trial”

We expect to see this also in Texas, as Apple is expected to appeal (or to have already appealed) the VirnetX verdict.

“Patent maximalists keep cheering for parasites like VirnetX, merely reaffirming the view that they aren’t proponents of technology but only proponents of litigation.”Watchtroll came up with a bizarre headline four days ago: “Apple to pay VirnetX $93.4 million in costs and interest for patent infringement” (no, this is what VirnetX wants, but it doesn’t mean that it will get it).

Well, there will almost certainly be an appeal to CAFC and maybe even higher up (the Supreme Court (SCOTUS) might get involved one day), but facts don’t suit Watchtroll (Steve Brachmann in this case).

Patent maximalists keep cheering for parasites like VirnetX, merely reaffirming the view that they aren’t proponents of technology but only proponents of litigation.

09.25.18

Patent Trolls Roundup: Microsoft’s Patent Troll Collapses, Samsung Fuels Patent Troll Sisvel, and Patent Troll VirnetX Wants Apple’s Cash

Posted in America, Apple, Microsoft, Patents, Samsung at 5:22 am by Dr. Roy Schestowitz

Submerged under the bridge

Submerged

Summary: Microsoft’s largest patent troll continues to experience a mass exodus (in addition to all the layoffs), Sisvel receives armament from Samsung, and VirnetX carries on pretending — to shareholders at least — that it will get a lot of money out of Apple (albeit an appeal will likely prevent that altogether)

SEEING the trend in US patent courts (which unlike the USPTO reject abstract patents en masse), patent trolls are utterly demoralised. Microsoft’s patent troll Intellectual Ventures keeps imploding based on the patent trolls’ lobby (IAM). Here’s the latest:

Cory Van Arsdale, chief revenue office at Intellectual Ventures and one of the driving forces behind its recent monetisation efforts is leaving the giant NPE. He is set to keep some ties to IV advising the business on a consultancy basis for at least the next year, but his departure effectively hands control of the company’s patent sales and licensing to Mathen Ganesan, executive vice president of the Invention Investment Funds.

Van Arsdale joined IV in 2010 from a consulting business which he co-founded and before that did stints at the likes of Microsoft, Apple and Sun Microsystems. He has taken an active role as the company has ramped up its rate of sales in recent years including the disposals of around 4,000 former Kodak patents and almost 1,000 former American Express grants to Dominion Harbor.

The patent trolls’ lobby has also taken note of Sisvel’s latest activity in “More details emerge of Samsung patent transfer to Sisvel,” but it’s behind a payall and the outline says:

Deal between the two came as Korean tech giant agreed to royalty bearing licence to NPE’s Wi-Fi portfolio

This will certainly be used for extortion and blackmail purposes (which is what Sisvel does). Unlike Apple, Samsung does not engage in patent aggression, at least not directly.

The patent troll VirnetX wants money out of nothing in Eastern Texas, where Apple became its latest high-profile target. It issued the following press release yesterday:

VirnetX™ Holding Corporation (NYSE:VHC), an Internet security software and technology company, announced today that on September 20, 2018, pursuant to a Court’s order, attorneys from VirnetX and Apple have conferred and agree without dispute amounts for Bill of Costs and Prejudgment Interest totaling $93,351,141 to be added to the $502,567,709 jury verdict for VirnetX in the ongoing patent infringement action between VirnetX Inc. (“VirnetX”) and Apple Inc (“Apple”).

“Apple’s versus VirnetX patent infringement case payment balloons to $595.9M,” AppleInsider‘s headline said and there’s also
“VirnetX Holding Corporation: VirnetX Files Notice Regarding Agreed Bill of Costs and Prejudgment Interest of $93.3 Million in Apple Suit” in last night’s headlines.

But this decision will almost certainly be appealed and reach the Federal Circuit, which has a rather different track record than courts in Eastern Texas.

09.23.18

A Lot of US Patents Are Entirely Bogus, But Apple Was Willing to Pay for Them

Posted in Apple, Patents at 9:27 pm by Dr. Roy Schestowitz

Steve Jobs gave today’s richest person (whose firm’s valuation is at $1 trillion, just like Apple) $1 million for a bogus patent on ’1-click’ shopping

Jeff Bezos
Photo credit: AP

Summary: Apple’s resistance to Qualcomm’s patent aggression was preceded by very heavy (“thermonuclear” by Steve Jobs’ description/words) patent wars against Android and even legitimisation of clearly bogus software patents from Amazon

W

HEN Qualcomm leveraged its questionable USPTO-granted patents against Apple (Qualcomm is getting desperate and trying the same in Europe now) it didn’t foresee the full impact. As IDG makes clear and San Diego Union-Tribune does too, Qualcomm assumed it would get an injunction; instead it drove away its biggest clients, which effectively ‘ban’ (or boycott) Qualcomm. That’s just the cost of being a patent bully — a fact that Qualcomm underestimated. Qualcomm now buys back its own shares at an incredible rate (to avoid/save the stock from completely collapsing like its attempted — albeit failed — takeover bid).

Qualcomm was also mentioned on Sunday by Watchtroll. It’s about a case from 10 days ago:

The United States Court of Appeals for the Federal Circuit recently issued a ruling discussing the differences between obviousness determinations of apparatus and method claims. According to the Federal Circuit, an apparatus that is “capable of” performing certain functions may be anticipated by or made obvious by the prior art, whereas, a method claim requires a person of ordinary skill to be motivated to operate the apparatus in a manner that would satisfy a limitation. See ParkerVision Inc. v. Qualcomm, Inc., Nos. 17-2012, 2013, 2014, 2074 (Fed. Cir. Sept. 13, 2018) (Before O’Malley, Reyna, and Taranto, Circuit Judges) (Opinion for the court, O’Malley, Circuit Judge).

Qualcomm gradually finds out, for it has started to attack with patents, that many of its patents are bogus. They should never have been granted in the first place. We certainly hope that Apple will challenge all of these patents; failing to do so may mean that Qualcomm would later leverage these against Android/Linux OEMs.

Days ago we also saw creepy new Amazon patents being reported on [1, 2]. These seemed rather shallow, not just creepy, and even the patent microcosm joked about/ridiculed Amazon’s patents (“Amazon one-click patent is no doubt DRT under rationale of SCOTUS case Alice Corp. v. CLS Bank.”), citing this new report titled “Steve Jobs licensed Amazon’s one-click patent for $1 million in one phone call” (about something which happened a long time ago, almost two decades ago). To quote:

In 1999, Amazon—then merely “Earth’s biggest bookstore” rather than a corporate beast that shall soon devour everything in its path—introduced and patented one-click payments. This was in the early days of e-commerce when people were fearful of sending their credit-card details online. One-click processing allowed the startup to keep customers’ billing details on file so that they could make instant purchases.

That feature quickly came to Apple in 2000 in one of the earliest versions of its online store. “Licensing Amazon.com’s 1-Click patent and trademark will allow us to offer our customers an even easier and faster online buying experience,” Steve Jobs said at the time.

[...]

When Apple licensed Amazon’s patent in September 2000, Apple had a market cap of $8.4 billion and Amazon had one of $13.7 billion. Recently, Apple became the first US company to reach $1 trillion—followed soon after by Amazon.

So Apple’s Steve ‘patent blackmail’ Jobs (he used patents against GNU/Linux as well) legitimised bogus software patents. Instead of challenging them he gave them perceived legitimacy. What a ‘genius’!

09.22.18

Bogus Patents Which Oughtn’t Have Been Granted Make Products Deliberately Worse, Reducing Innovation and Worsening Customers’ Experience

Posted in Apple, Europe, Patents, RAND at 12:07 pm by Dr. Roy Schestowitz

Marco Cassia patent
EP2460270 by Marco Cassia (warning: epo.org link)

Summary: How shallow patents — or patent applications that no patent office should be accepting — turn out to be at the core of multi-billion-dollar cases/lawsuits, with potentially a billion people impacted (their products made worse to work around such questionable patents)

IN OUR previous post we mentioned how the EPO had begun feeding patent trolls in the same way the USPTO did for a number of decades. Qualcomm is a poorly-managed aging company in a state of decadence, so it nowadays resorts to patents more than anything, even dubious European Patents (EPs), granted by the EPO.

Florian Müller has been keeping a close eye on legal filings from Qualcomm, especially earlier this year. He more or less understands the underlying issues, having spoken to some of the people involved and also glanced at the underlying patents. “Very long (by local standards) Qualcomm v. Apple patent trial just finished,” he wrote some days ago. “Stuff for more than one blog post: infringement, validity, antitrust, licenses to contract manufacturers… By far their most interesting court fight to date.”

The CCIA‘s (Computer & Communications Industry Association) Joshua Landau weighed in by saying: “The FRAND obligation means you negotiate a license with *anyone* who asks, not “anyone but your competitors.” This shouldn’t be controversial-even Qualcomm has argued that when they were in the position of wanting a license.”

“Qualcomm [is] presently asserting 13 patents against Apple in Germany,” Müller noted. “Until today‘s trial, „only“ 10 were known, including the one the court in Munich told me about yesterday.”

Müller, Landau said, “beat me to it (and beat our press release as well), but yeah, FRAND means FRAND – you have to be willing to license anyone who asks for a license. Qualcomm even agrees with this principle—when they’re the ones who want a license.”

Müller already wrote a number of posts about it — ones that we took stock of last week. He separately took note of another FRAND case: “Huawei v. Samsung: no deal. Minute Entry for proceedings held before Magistrate Judge Kandis A. Westmore: Case did not settle. Settlement Conference held on 9/17/2018. Total Time in Court: 4 hours 17 minutes…”

But focusing on the main case in question (one which impacts Android/Linux as well), Müller said that “[i]ndustry bodies @actonline and @ccianet support @FTC’s motion to require #Qualcomm to license SEPs to rival chipset makers,” basically citing a disgraced Microsoft front group which pretends to represent small businesses. He wrote a blog post about it and assured me that “I never said they represented me. I just agree selectively…”

Here’s what’s happening in a nutshell:

It’s a busy September on the FRAND front…

As I reported on the first of the month, the Federal Trade Commission brought a motion for partial summary judgment that may open up the wireless chipset market–by reminding Qualcomm of its self-imposed obligation to license rival chipset makers–even prior to the big antitrust trial in the Northern District of California.

It’s odd that a mere reminder would be a potential game-changer, but that’s the way it is because of Qualcomm’s refusal to live up to the FRAND promise.

Disturbing it was to then see CCIA liaising with a Microsoft AstroTurfing group:

Yesterday, CCIA and ACT filed an amicus brief in the FTC’s case against Qualcomm in the Northern District of California. As explained in the brief, the FRAND obligation which patent owners voluntarily agree to when they participate in the development of a standard requires the owners of standard-essential patents to license their patents on “fair, reasonable, and non-discriminatory terms.” And the “non-discriminatory” portion of that obligation means precisely what it states—that the patent owner may not discriminate amongst willing licensees, but has to license anyone who wants a license.

Why would CCIA wish to associate with ACT? We could expect this perhaps 7 years ago when CCIA did all sorts of questionable things, but why now? Why again?

“Trolling with junk patents works best in Germany,” Müller wrote later. “With respect to injunctions, worse than the Eastern District of Texas.”

Something like the UPC would put that ‘on steroids’ if it was ever to materialise, further broadening scope of injunctions. The patent maximalists deny that a problem even exists in that regard.

As it turns out, the European Patent in question may in fact be bunk: [via]

Yesterday’s Qualcomm v. Apple trial took twice as long as the average Mannheim patent trial. In fact, the ventilation system was switched off in the late afternoon, so for the last hour, two doors had to be kept open. The courtrooms at the Mannheim Regional Court, Europe’s leading venue for wireless patents, are famously windowless.

Presiding Judge Dr. Holger Kircher forthcomingly stated at the outset that this case was, in my words, too close to call (unlike the one that Qualcomm agreed to stay in June), thus the court had to elaborate on all our of Apple’s defenses: non-infringement, invalidity (which German district courts don’t determine, but they can and often do stay cases pending a parallel nullity or revocation proceeding in another forum), abusive conduct (antitrust), and licensing (through one or more contract manufacturers). I’ll address the first two–the traditional defenses to patent infringement–in this post, and the affirmative defenses (the remaining two) in a subsequent post since there’s an abundance of interesting things to report and comment on.

The patent-in-suit, EP2460270 on a “switch with improved biasing” (“biasing” in this context basically meaning that one voltage gets to control another), is not standard-essential. Essentiality hasn’t been alleged by any party to the German Qualcomm v. Apple cases that have been heard so far. Nor is it related to wireless baseband processors: it’s a general circuity patent covering a type of switch. It was mentioned during yesterday’s trial that the chip allegedly infringing on the patent is supplied to Apple by Avago/Broadcom. But all of the accused devices come with an Intel baseband chip, a fact that will be relevant to the antitrust part of the next post.

Another sore eye for patent quality at the EPO? As Landau put it: “An Expert Opinion from the Swedish Patent Office says that Qualcomm’s Patent used to Sue Apple Should be Invalidated…”

It cites an Apple proponents’ site, which in turn cites Müller and says: “Yesterday’s Qualcomm v. Apple trial took place in the Mannheim Regional Court, Europe’s leading venue for wireless patents. The trial took twice as long as the average Mannheim patent trial, reports Florian Mueller. Mueller described the Apple v. Qualcomm case the commercially biggest patent-related dispute ever and could be truly seen as the World Series of IP cases. Apple is trying to invalidate Qualcomm’s patent titled “Switch with Improved Biasing” in this Mannheim case based on an expert opinion from Sweden.”

Apple too has been granted bogus European Patents, based on reliable sources of ours. It’s somewhat of a crisis. Another new post from Müller says: [via]

This is my second post on the Qualcomm v. Apple patent infringement trial held by the Mannheim Regional Court yesterday. In the previous post I reported on the alleged (non-)infringement and (in)validity of the patent-in-suit, EP2460270 on a “switch with improved biasing”. While the case is too close to call, this patent assertion may fail on the merits just like the first one that went to trial in Mannheim. But the court might also, contrary to what the non-asserted independent claim 16 implies for claim construction purposes and despite a finding by the Swedish patent office that the patent lacks a sufficient inventive step over prior art presented by Apple, hold Apple liable for infringement and decline to stay the case pending a parallel nullity action. In that case, Apple’s affirmative defenses–antitrust and licensing–will be outcome-determinative at least with respect to the availability of injunctive relief.

For a long time, it was hard to fend off even standard-essential patent injunctions in Germany on antitrust grounds (with or without a FRAND commitment, which German courts wouldn’t deem enforceable by third-party beneficiaries anyway). It was arguably hardest in Presiding Judge Dr. Kircher’s court. The situation improved after the Court of Justice of the EU ruling in Huawei v. ZTE; in a way, it already got a little bit better after the European Commission took action against Samsung and Motorola. But very regrettably, the thinking of German patent judges is still, by and large, that antitrust defenses are just part of a throw-in-the-kitchen-sink tactic of infringers.

The patents Qualcomm is asserting in Germany–at least the ones that have been discussed in hearings or trials–aren’t standard-essential, which ups the ante for Apple’s antitrust defense. However, the fact that Qualcomm’s conduct has been deemed anticompetitive by competition enforcers in multiple jurisdictions (“Antitrust Grand Slam”).

Last but not least is this post about Apple’s workaround (around the patents):

Yesterday the Munich I Regional Court held a six-hour (including breaks, though) trial on Qualcomm’s eight lawsuits asserting four different search user interface patents against Apple’s Spotlight search, with two lawsuits per patents targeting a total of three different Apple entities. A first hearing had been held in early May.

That part of the wide-ranging, earth-spanning, multifaceted Apple-Qualcomm dispute is, however, strategically so unimportant that it’s not worth multiple posts or anything. That set of eight cases is a total waste of court and party resources–sort of a tempest in a teacup–as these Munich Spotlight cases have been defanged in three important ways…

This is no doubt useful for patent law firms, especially German or Germany-based ones, but who else does that serve? All these ruinous lawsuits already contribute to deliberate exacerbations in product development. And based on what? Bogus patents that should never have been granted in the first place?

09.18.18

Qualcomm’s Escalating Patent Wars Have Already Caused Massive Buybacks (Loss of Reserves) and Loss of Massive Clients

Posted in Apple, Courtroom, Patents at 3:57 am by Dr. Roy Schestowitz

Yesterday: Qualcomm’s Patent Aggression Threatens Rationality of Patent Scope in Europe and Elsewhere

Qualcomm loses Apple’s business and drops NXP deal. What’s next?
Reference: Qualcomm loses Apple’s business and drops NXP deal. What’s next?

Summary: Qualcomm’s multi-continental patent battles are an effort to ‘shock and awe’ everyone into its protection racket; but the unintended effect seems to be a move further and further away from ‘Qualcomm territories’

ARMED with patents, including software patents from the EPO and USPTO, Qualcomm embarked on a misguided crusade which was bound to drive away clients and reduce interest in its patent pool. A few hours ago it was noted that “Apple Moves Away From Qualcomm” (even further than before) and according to Florian Müller, who followed the respective cases closely, there’s a new lawsuit in Germany, based on a European Patent:

With a view to a Qualcomm v. Apple patent infringement trial in Munich on Thursday I contacted the Munich I Regional Court to check on the time. As for the biggest issue in that case, may I refer you to my recent post on how thin air can “practice” claim limitations unless the name of the game is the claim.

On the same occasion, I inquired about any Qualcomm v. Apple first hearings that might come up in the near term. Unlike other German courts, the Munich court holds a first hearing, not as formally focused on claim construction as a U.S. Markman hearing, prior to patent trials. A spokeswoman for the court kindly informed me that a first hearing in two parallel cases, targeting different Apple entities, has been scheduled for March 28, 2019.

The patent-in-suit in both cases is EP1988602 on a “mobile terminal with a monopole[-]like antenna.”

Knowing the usual Munich timelines, it appears that the new complaints have only been filed recently. I guess just before the main summer vacation season here, or at least not long before.

“These sorts of multi-continental patent battles aren’t particularly new, but they serve to highlight the sort of thing that the EPO in Germany probably looks to facilitate, even if that would mean a lot more patent trolls, attacks on generics and so on.”In a later post Müller wrote that ITC “staff raises public-interest concerns over ban of Intel-powered iPhones sought by Qualcomm” and “staff says none of the 3 remaining patents-in-suit (from Qualcomm’s 2nd ITC complaint against Apple) is infringed. Apple [is] on [a] winning track.”

“CCIA raised these concerns in our public interest filings,” Josh from the CCIA said, so “I’m glad the ITC staff sees the same issues with exclusion in this case. (Not to mention infringement.)”

Quoting Müller, who was busy writing more than usual yesterday:

This morning, opening statements were delivered at the start of the evidentiary hearing in the investigation of Qualcomm’s second ITC complaint (request for U.S. import ban). The complaint was filed last December. An earlier complaint by Qualcomm against Apple is at a more advanced procedural stage: a final initial determination (a preliminary ruling by an Administrative Law Judge, which is however subject to Commission review) was originally due last Friday, but after the ALJ originally in charge retired, Chief ALJ Bullock took over and extended the deadline by two weeks. In that earlier case, the Office of Unfair Import Investigations (OUII, commonly referred to as “the ITC staff”) recommended an infringement finding with respect to one patent. Staff recommendations are not binding on ALJs, and even ALJs don’t make the final decision: the Commission itself does. But what the staff says is often adopted.

We have been critical of ALJs who ignored rulings from the Patent Trial and Appeal Board (PTAB). The Federal Circuit later dealt with the inter partes review (IPR) in question. The matter of fact is, Qualcomm is trying to increase pressure and improve its chances of “winning” by filing actions in several courts and in several continents — not so unusual a trick. Apple did that the Samsung and Huawei too is trying it against Samsung right now. But as Müller pointed out, the judge in the US is well aware that Chinese patent law is different and in some sense harsher than American law. Müller compares this to the case of Microsoft v Motorola — one which we covered at the time. To quote:

With respect to China, let’s face one thing: every U.S. judge knows that the rule of law, just like democracy, works differently in China. Huawei’s lawyers portray the Chinese proceedings at 100% fair and comprehensive. Samsung’s counsel obviously didn’t suggest that the proceedings were unfair, nor did Judge Orrick say so in his order. The Federal Circuit will be diplomatic, too. But that doesn’t mean that the appellate judges won’t have their private and unspoken opinion anyway.

The strategic issue here is the one I mentioned in the headline: coerced FRAND rate-setting arbitration. In order to distinguish Huawei v. Samsung from Microsoft v. Motorola (with Samsung being the new Microsoft and Huawei being the new Motorola), Huawei points out that Microsoft said it would accept a court-determined FRAND rate without insisting on adjucation of all the defenses that Samsung is pursuing (though Judge Robart actually did hold some Motorola patents invalid anyway). But beyond differences between Huawei and Microsoft regarding the preconditions for rate-settings (which I simply attribute to the fact that the standards at issue in Microsoft v. Motorola were not nearly as critical to Microsoft’s business as the ones in Huawei v. Samsung are to Samsung’s core business, thus Microsoft was prepared to pay for invalid and non-infringed patents and exclusively concerned about injunctive relief), Huawei must deny that it is an unwilling licensor (not in the sense of unwillingness to extend a license, but to do so on FRAND terms) engaging in hold-up and instead argue that Samsung is an unwilling licensee engaging in hold-out.

These sorts of multi-continental (or cross-continental) patent battles aren’t particularly new, but they serve to highlight the sort of thing that the EPO in Germany probably looks to facilitate, even if that would mean a lot more patent trolls, attacks on generics and so on.

09.09.18

On Virnetx, Intellectual Ventures, Interval Licensing and Other Microsoft-Connected Patent Trolls That Microsoft Leverages to Attack Its Competition

Posted in Apple, Microsoft, Patents at 11:04 am by Dr. Roy Schestowitz

Chess board

Summary: Microsoft’s biggest patent troll Intellectual Ventures, as well as smaller patent trolls that it created or has funded, faces a hard time in the higher patent courts; the chilling effect, however, can be exploited by Microsoft to market Azure ‘IP’ ‘Advantage’

THE firm known as Virnetx (or VirnetX) generally produces just lawsuits. Many sites characterise it as a patent troll and it matches the definition. It’s nowadays known for little more than its lawsuit/battle against Apple, which relies on controversial jury trials in Texas.

“Our view is that Virnetx is a patent troll which was emboldened by payments from Microsoft and then targeted Apple.”There has been plenty of coverage about this case's latest twist (because it’s about Apple). Our view is that Virnetx is a patent troll which was emboldened by payments from Microsoft and then targeted Apple. We wrote about the actions against Microsoft in about a dozen past articles.

The shares of Virnetx soared after a recent ruling. “This case will certainly be appealed,” Patently-O asserts, concurring or overlapping our analysis from the time of the ruling. With new standards/bars, as well as SCOTUS precedents, we expect the Federal Circuit (CAFC) to squash the underlying patents. Here is what Patently-O wrote, being a patent maximalist: (there were perhaps hundreds of English articles about that, but not from specialist sites)

The Virnetx v. Apple patent battle has been running since 2010. Virnetx won its first verdict against Apple in 2012. The court in that case required two more jury trials — but Virtnetx won all three and the $300 million damage award is pending appeal before the Federal Circuit.

Apple redesigned its FaceTime and VPNOnDemand products back in 2012. Rather than adding the redesigns to the original case, Virnetx filed a new lawsuit (2012). In April 2018, a jury awarded an additional $500 million in damages and found that Apple’s infringement was willful.

The whole purpose of this firm is lawsuits such as this. It is a patent troll. The payments from Microsoft certainly helped fuel it, just like Microsoft’s payments to Intellectual Ventures helped propel this much bigger troll (connected very closely to Microsoft) to “top legal nuisance” status. In Intellectual Ventures I LLC v T-Mobile USA, Inc. (according to this new analysis from Patently-O) there’s a reference to Interval Licensing (Paul Allen, Microsoft’s co-founder). This troll’s history includes attacks on Android. Microsoft’s patent trolls are, in general, helping Microsoft market its ‘protection’ racket [1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20]. In this particular CAFC case the troll fortunately lost its patent (as it typically does at CAFC):

The district court found the claimed function indefinite. In particular, the court noted that specification’s description of QoS as “subjective” according to a user’s “individual preferences” and that description lacked “adequate guidance as to the meaning of ‘optimize.’”

On appeal, the Federal Circuit presumably performed a de novo review, but affirmed — particular zeroing in on its precedent requiring “objective boundaries.” Interval Licensing LLC v. AOL, Inc., 766 F.3d 1364, 1371 (Fed. Cir. 2014) (“The claims, when read in light of the specification and the prosecution history, must provide objective boundaries for those of skill in the art.”). Here, the court interpreted “optimizing QoS” as akin to the invalid “aesthetically pleasing” limitation of Datamize, LLC v. Plumtree Software, Inc., 417 F.3d 1342 (Fed. Cir. 2005). According to the court, both elements are “purely subjective” and depend wholly upon each user’s personal opinions.

[...]

Invalidity Affirmed.

Microsoft still loves and lobbies for patents. It still defends trolls and sells ‘defense’ from trolls (for a fee), presumably in an effort to market Azure as the “safe” option (over AWS).

“Microsoft still loves and lobbies for patents. It still defends trolls and sells ‘defense’ from trolls (for a fee), presumably in an effort to market Azure as the “safe” option (over AWS).”The Bill Gates-funded Seattle Times (which understandably does reputation laundering for Bill Gates and Paul Allen), has just published this article titled “Amazon has patented a system that would put workers in a cage, on top of a robot”. This isn’t the first oppressive (towards Amazon’s workers) patent and Amazon is said to be a top litigation target. Microsoft would want to make it more so (e.g. lawsuits against AWS clients, too) in an effort to sell Azure as a form of ‘protection’ from trolls (which Microsoft itself is controlling). Is this even legal?

09.03.18

Apple Suffers From Patent Trolls in the Eastern District of Texas Where Microsoft Uses Its Trolls (Connected to Intellectual Ventures) to Bully Apple, Linux/Android and Other Microsoft Rivals

Posted in America, Apple, Microsoft, Patents at 3:12 am by Dr. Roy Schestowitz

Hublink, LLC, a Dominion Harbor subsidiary

Summary: A quick look at misguided sites which celebrate new patents of infamous patent bullies and the latest actions from patent trolls, including Microsoft’s own (Intellectual Ventures)

The connections between Dominion Harbor and Microsoft aren’t as blurry as Microsoft might have hoped. It’s not hard to see where this patent troll is receiving the lion’s share of its patents from. Microsoft uses trolls such as this to sell its ‘protection’ racket [1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20]. We offered a new example of it only several days ago.

Microsoft’s new patents are being celebrated in Apple and Microsoft advocacy sites [1, 2, 3], where people like Christian de Looper and Apple fans (that celebrate Apple patents) take note of new Apple patents and/or patent applications [1, 2] never mind if Microsoft and Apple are both notorious for their patent aggression. Brand loyalty can blind some people.

To be fair to both, they are also on the receiving end of troll lawsuits. We hope that many such lawsuits can eventually compel them to rethink their stance on patents and their patent strategy.

As the mainstream media noted a few days ago, Apple might need to pay over half a billion dollars to just one patent troll. The Eastern District of Texas supports this particularly notorious patent troll, VirnetX, which targets large companies. Time to appeal for the Federal Circuit (or even SCOTUS perhaps) to step in?

There has been lots of media coverage such as “VirnetX +35.6% after judge denies Apple a new trial”, “VirnetX Receives District Court’s Final Judgment Affirming Jury’s Verdict of $502.6 Million”, and “VirnetX Holding Corporation: VirnetX Receives District Court’s Final Judgment Affirming Jury’s Verdict of $502.6 Million”. Here’s a portion from “Court Sides With VirnetX, Affirms $506 Million Judgment Against Apple” (there’s so much more about this news because it’s about Apple, which means the media can get ‘hits’):

VirnetX Holding Corp. (NYSEAMERICAN: VHC) announced Friday morning that the U.S. District Court for the Eastern District of Texas has affirmed an April 2018 jury verdict granting the company a $506.2 million award in a patent infringement case against Apple Inc. (NASDAQ: AAPL). The court denied Apple’s request for a new trial in the case, and it also includes supplemental damages, a sunset royalty (paid when infringing products are phased out) and interest and costs.

What the media failed to pay as much attention to is a case that does not involve ‘famous’ Apple. It’s about fairly new patent which is abstract and was also asserted in the Eastern District of Texas. As Watchtroll put it:

The ‘748 patent itself is titled “System and Method for Data Management” and, according to the complaints, it “addresses the need to collect location-specific information on a variety of hardware and software platforms without the need to create separate and individualized software for each of the numerous manufacturers of remote computing devices.”

[...]

Additionally, the complaints preemptively make certain allegations regarding the patentability of the ‘748 patent, apparently assuming a validity challenge in this wonderful world of Alice in which we are all forced to live. The patentability allegations list technical problems ostensibly addressed by the ‘748 patent, possibly to frame the ‘748 patent as an improvement to computer functionality for future reliance on the Federal Circuit’s guidance in Enfish, LLC v. Microsoft Corp., 822 F.3d 1327 (Fed. Cir. 2016) that such improvements may be found non-abstract at step one of the U.S. Supreme Court’s two-step Alice framework for determining patent eligibility. The allegations regarding patentability found in Fall Line’s complaints also include statements that certain claim elements are not well-understood, routine, or conventional, apparently in case the ‘748 patent is held to be abstract and thus necessitating reliance on step two of the two-step Alice framework.

[...]

It’s also worth noting that even though the terminal disclaimer issue might be a fatal blow to Fall Line’s ability to enforce the ‘748 patent, Fall Line’s problems do not end there. The ‘748 patent has also had an inter partes review (IPR) instituted against it as of April 5, 2018, though the IPR was not instituted against Claim 1. Furthermore, petitioner Unified Patents did not challenge the validity of Claim 1 and so even after the U.S. Supreme Court’s decision in SAS Institute v. Iancu back in April that the Patent Trial and Appeal Board does not have the authority to partially institute a petition for IPR against some but not all requested claims, Claim 1 looks like it will survive. But that’s not to say any of the defendants accused of infringement by Fall Line will refrain from filing their own IPRs to challenge Claim 1.

The inter partes review (IPR) would likely put this lawsuit to rest, but how much money will have been spent on lawyers by then?

It is meanwhile being reported in an article by Arthur W. Coviello, Richard Goldenberg and William G. McElwain from WilmerHale that Microsoft’s largest patent troll, Intellectual Ventures, suffers yet another CAFC setback:

Reyna, J. Vacating and remanding the PTAB’s IPR decision because the PTAB erred in not considering portions of the petitioner’s reply brief. Specifically, the PTAB erred in determining that certain reply arguments were improper new arguments under 37 C.F.R. § 42.23(b). The Court held that the petitioner’s reply arguments should have been considered because they cited “no new evidence and merely expand[ed] on a previously argued rationale as to why the prior art disclosures are insubstantially distinct from the challenged claims.”

Intellectual Ventures was also mentioned by Watchtroll’s Steve Brachmann a few days ago because CAFC was “remanding the case to the PTAB for further proceedings.” It happened last week, but the media mostly ignored it:

On Monday, August 27th, the Court of Appeals for the Federal Circuit issued a precedential opinion in Ericsson Inc. v. Intellectual Ventures I which vacated a previous decision by the Patent Trial and Appeal Board (PTAB) to uphold patent claims owned by Intellectual Ventures in light of an obviousness challenge from Ericsson.

The case (Ericsson Inc. v Intellectual Ventures) isn’t a new one; we’ve covered it before. It does show that Microsoft’s patent troll is still very much active; it’s a shame that almost no investigative journalists are left out there to properly cover it. All they seem to care about is traffic, so they focus on companies such as Apple.

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