ITC finally determined that Apple’s products infringed
Samsung’s 3G mobile standard essential patent (SEP) US7706348 (for an infringement analysis, please refer http://techipm-innovationfrontline.blogspot.com/2013/06/samsungs-us7706348-patent-proves-apples.html). ITC’s determination was
rather surprise because its decision was contrary to recent decisions in the federal
district courts banning injunctive relief for SEPs.
When
Apple accused Samsung of infringement of its user interface software and design
patents, Samsung counter-attacked utilizing its SEPs. SEPs encompass intellectual
property rights (IPRs) for an essential aspect of standardized technologies. Usually,
all the essential aspects of standardized technologies are specified in standard
specifications. Thus, SEPs can be defined as patents that include one or more
claims that are infringed by the implementation of certain standard
specifications. Consequently, Apple’s
standard-compatible products that implement the standard specifications for
mobile communications may infringe SEPs of Samsung. As incumbents in mobile
communication industry and holders of strong mobile patent portfolios, SEPs
were a natural choice for Samsung to counter-attack Apple, which is the
computer industry incumbent, and thus, lacks in SEPs for mobile communications.
The outcomes, however, were different than expected.
Standards
are often developed and set-up through the standardization process by the
standard setting organizations (SSOs). A majority of SSOs require that the members participating in the
standardization process to agree to license their SEPs under fair, reasonable,
and nondiscriminatory (FRAND) terms to
any implementers of the standard. The
members’ agreements to license their SEPs under FRAND terms and conditions are
usually called FRAND commitments. In
general, FRAND commitments are interpreted as enforceable contractual
obligations between a member and an SSO.
In
Apple, Inc. v. Motorola, Inc., No. 1:11-cv-08540 (N.D. Ill.), the court
interpreted FRAND commitments such that the patentee “implicitly acknowledged
that a royalty is an adequate compensation for a patent license.” Thus the patentee of SEPs is not entitled to
an injunctive relief because “the inadequacy of monetary relief” is required
for the entitlement of the injunctive relief and FRAND royalty would provide
the adequate remedy. In Microsoft, Co., v. Motorola, Inc., No.
2:10-cv-01823-JLR (W.D. WA), the court also ruled that FRAND royalty provide an
adequate compensation because a patentee “has always been required to grant a
license” to an implementer at FRAND royalty for its SEPs and the patentee has
never irreparably harmed.
In
Motorola v. Apple, Inv. No. 337-TA-745 (International Trade Commission), however,
the Administrative Law Judge ruled that FRAND commitments do not preclude the
exclusion order for SEPs in ITC. ITC
reasoned that its investigations to determine exclusion order banning
importation of infringing product for violations of section 337 of the Tariff Act
of 1930 (19 U.S.C. § 1337) have a wider scope because its interests include
public interest in addition to private interest.
In
response to ITC’s ruling of availability of exclusion order for SEPs two US
government agencies- Department of Justice (DOJ) and Patent & Trademark
Office (PTO) -jointly announced that in some instances the remedy of an exclusion order may be
inconsistent with the public interest. The
agencies insisted that SPEs cannot be used for block sales or imports of
infringed products in
cases that the patentee tries to exploit the SEPs’ market power through
exclusion order for pressuring an implementer to accept unreasonably high royalty
against its FREND commitments. The agencies reasoned that such activity and resulting exclusion order
may be anti-competitive, and thus, harm consumers. Recently some leaders of the
US Congress intellectual property and antitrust subcommittees submitted a
letter to the ITC expressing similar concerns regarding exclusion order for
SEPs.
Having
understood the background and issues surrounding injunctive
relief for SEPs, let’s think about the implications of this ITC’s determination
to Samsung itself. Symbolically, this is a victory to Samsung because it was
the only win in patent battles against Apple. This can show to consumers that
Samsung is a innovator in mobile communications and Apple is a copycat. Economically,
the gain to Samsung from this ITC’s decision will be limited because all the
affected Apple’s products are old models, and thus, have diminishing market
share. On this other hand it could adversely
affect to Samsung.
This ITC’s decision affirms
that FRAND commitments do not preclude the
exclusion order for SEPs in ITC. So what to Samsung? Samsung itself could be subject
to banning importation of its products – in this case its flagship smartphones,
Galaxy S3 and S4. Samsung Galaxy S3 and S4 all support
LTE communications. In other ITC pending cases Ericsson (337-TA-862) and InterDigital (337-TA-868) claimed that Samsung
Galaxy S3 infringed their LTE SEPs (for details about LTE SEPs, please refer http://techipm-innovationfrontline.blogspot.com/2013/05/4g-lte-standard-essential-patent.html).
Actually, TechIPm’s essentiality analysis confirms that three
patents claimed in the ITC lawsuits are LTE SEPs:
US6445917 (Mobile station measurements with event-based
reporting): this patent provides a perfect mapping between the claims at issue
and the LTE standard specification. It relates to measurements in the process
of handover operation as described in TS 36.331 Sec. 5 and TS 36.300 Sec.
10.1.3.
US8169992 (Uplink scrambling during random
access): this patent relates to contention based random access procedure
utilizing CRC scrambling for RNTI as described in TS 36.213 Sec. 6, TS 36.300
Sec. 10.1.5, TS 36.321 Sec. 5.1, and TS 36.212 Sec 5.3.
US7941151 (Method and system for providing channel assignment
information used to support uplink and downlink channels): this patent relates
to providing channel assignment information to support uplink and downlink
transmissions utilizing the DCI and CRC scrambling for RNTI as described in TS
36.213 Sec. 7 & 8, TS 36.300 Sec. 11.1, and TS 36.212 Sec 5.3.3.1.
As the
market share of Galaxy S4 increases,
it also could be included in the list of infringing products.
Posts
No comments:
Post a Comment