Motorola Files Reply Brief in Appeal of Judge Posner's FRAND Decision in Apple v. Motorola-~pj
Motorola defends the value of its patents and then tells the Federal Circuit that RAND patent holders have to be able to seek injunctions against "intransigent" licensees like Apple. Otherwise, they'll take advantage, delaying by litigation any reckoning for years while benefiting from the technology without paying for it.
What exactly should happen to a company that refuses to pay and won't accept an offered rate or a court-set rate? The RAND patent holder *still* can't do a thing? No injunction? Nothing? Apple began its infringement, Motorola points out, in 2007. It's now 2013, and it still hasn't paid a dime. "Motorola should have the opportunity to seek an injunction to stop Apple's six years of ill-gotten gains from stretching into a decade or more," Motorola says.
Happy 10th Anniversary, Dear Groklaw! Happy 10th Anniversary to Us! ~pj
Not I.
When I started, I thought I'd do a little fiddling around for a couple of months to learn how to blog. But then all you guys showed up and taught me some important things that I didn't know, and vice versa I hope, and here we are, on our 10th anniversary, still going strong, together on a very different path than I originally imagined. The important moment for me was when I realized the potential we had as a group and decided to try to surf this incredible wave all of you created by contributing your skills and time. I saw we could work as a group, explain technology to the legal world so lawyers and judges could make better decisions, and explain the legal process to techies, so they could avoid troubles and also could be enabled to work effectively to defend Free and Open Source Software from cynical "Intellectual Property" attacks from the proprietary world.
And it worked! That's the amazing part. It actually worked. So far, so good.
If I take three things away from our experience, it's this: 1.) Education is never a waste,
2.) All of us together are smarter and more powerful than any one of us alone, and
3) FUD withers in sunlight. It only works when people lack accurate information. Group dynamics are awesome. Whenever there is a new need, somehow the right people show up and fill it. Whether it was meticulously demolishing SCO's claims, one by one, or doing patent prior art searching, or explaining that software is mathematics and hence unpatentable subject matter, or noticing what the real game is in the patent smartphone wars, you came through with competence, donating your knowledge, research, and skills to the group effort. And you did it entirely as volunteers, as a free gift to the world.
Groklaw was attacked with venom, of course. But here we are, ten years later, still standing.
Hackathon Trademarked in Germany? Now What? ~pj
It's a word that OpenBSD and Sun each came up with independently at the same time back in the '90s, for heavens sake, and it surely can't belong to any one company now that it's in the dictionary and everyone has freely used it for years now.
Anyway, as soon as I read about it, I wrote the the German equivalent of the USPTO, DPMA, the German Patent and Trademark Office, and I've learned some things that can still be done. I'll share them with you, so the community knows how to go forward if it proves necessary.
Federal Circuit, en banc, rules in CLS Bank ~pj
_____
1 While Chief Judge Rader is correct to note that no single opinion issued today commands a majority, seven of the ten members, a majority, of this en banc court have agreed that the method and computer-readable medium claims before us fail to recite patent-eligible subject matter. In addition, eight judges, a majority, have concluded that the particular method, medium, and system claims at issue in this case should rise or fall together in the § 101 analysis. The Federal Circuit. OMG. We've
worked hard for so many years to get to this point, I almost can't believe it. And I suppose it's possible it could be appealed, but this is proof of what I've always told you, that education is never a waste. Judge Rader is very upset, I gather. He has written a dissent. But he didn't prevail. And I'm sure he gave it his best effort. OMG. This is a new day.
I knew you'd want to know *that* immediately. We can read and analyze it later in more detail, so stop back by. After I read it again, I'll be sure to post it and we can discuss.
I remember the first time we wrote on Groklaw that software and patents need to get a divorce. Remember? So long ago, and how everybody laughed at us. I remember that too. I am thinking about Apple and Microsoft and all the software patent bullies. Well, let's not get ahead of ourselves. I'll read it more carefully now.
Blackberry Tells the Federal Circuit Judge Posner Got It Wrong Re No Injunctions for FRAND Patents in Apple v. Motorola ~pj
But that is not how folks understood their rights back when they volunteered their patents for use in standards; it's a change in the rules midstream. And Blackberry tells the Federal Circuit exactly that. This is a change, and it isn't fair, or in the public interest. SEP owners might behave badly, but so can prospective licensees. Here's how attorney Matt Rizzolo at the Essential Patent Blog sums up the Blackberry argument:Just as it has argued in prior submissions to agencies such as the Federal Trade Commission and the U.S. International Trade Commission, BlackBerry asserts here that a categorical rule against injunctions for FRAND-encumbered standard-essential patents is wrong - both as a matter of policy and as a matter of violating Supreme Court precedent. BlackBerry alleges that industry participants have "never understood FRAND to absolutely preclude a patent holder from seeking injunctions." The misunderstanding by one and all, if that is what it is, stems from accepting Apple's argument that a FRAND agreement is a contract, as Motorola's brief points out, but if it's a contract, then contract law should apply. Motorola never waived its right to injunctions, and since that is a right under law, it would have to have specifically waived its rights to lose them. Not even judges can just waive their hands and remove legal rights. Why, indeed, would they want to?
Google, Red Hat, HTC, SAP and Rackspace Seek to File Amicus in Apple v. Samsung Appeal ~ pj
SCO: But waitaminnit, yer Honor ~pj
You knew they would: SCO submits that reconsideration is appropriate because the Bankruptcy Court overseeing SCO's bankruptcy proceedings lifted the stay of IBM's counterclaims in February 2012 and IBM agreed to the reopening of the case should that stay be lifted. The Bankruptcy Court order lifting the stay was previously submitted to the Court with SCO's Request to Submit for Decision, on June 14, 2012. (Exs. A and B.) Accordingly, SCO respectfully asks the Court to reconsider its decision and grant the Motion to Reopen the Case forthwith. They are right about the Bankruptcy Court lifting the stay. So unless the judge is much more clever than I am, which is likely actually, I suspect he'll have to grant the motion to reopen, and then we'll see IBM make its moves. But of course, SCO wants more.
The Novell v. Microsoft Hearing at the 10th Circuit - Eyewitness Report ~pj
To help you follow along, here are some resources:
- Novell's opening appeal brief
- Microsoft's brief
- Novell's reply
- Microsoft's renewed motion, asking the judge to rule as a matter of law
- Novell's opposition
- Microsoft's reply
- Judge Frederick Motz's Decision, the one being appealed
- Trial transcripts
His general impression is that Microsoft will prevail, as the judges seemed more positive toward its arguments. But keep in mind that you can't always tell what judges are thinking from their questions.
MS v. Motorola Appellate Jurisdiction - Another Appeal Issue ~pj
Brace yourselves - this will take a couple thousand words. It's worth it.
Newegg Tells the FTC and DOJ How Patent Trolls Are Damaging Retailers ~pj
Bridge trolls have one thing to offer-a right of way. The trolls have the ability to stop passers by unless they fight their way across or pay the fee demanded by the troll. It matters not to the troll why one requires passage, nor does the troll care that one's passage causes no actual harm to the troll or the bridge. All that matters to the troll is that this is their bridge and you should pay to cross it or prepare for a fight that could cost you dearly. So it is with patent trolls. A patent is essentially no more than a right of way. As a mere patent owner, a patent troll has nothing to offer or license except the right not to be sued under the patent. Newegg describes what it and other retailers are going through, being sued for using internet commerce software they merely license from other companies, like Microsoft, Oracle, and Citrix. Rather than sue those companies, trolls go after users of their software, like Newegg, claiming that some minor detail of the software is the reason for Newegg's success and seeking damages, even though the troll isn't in business and isn't hurt at all by Newegg using the software. This, Newegg concludes, promotes opportunism rather than innovation. And the impact on Newegg of the constant flood of lawsuits is that it can't create new jobs, despite its success because patent trolls are skimming of the top of retailers' already "razor-thin profit margins".
Let's Hear From the Trolls For a Change ~pj
Wait. It seems their feelings get hurt if you call them trolls. IPNav tells the FTC it's "pejorative". Barnes & Noble in its comments said the word is a perfect fit, absolutely descriptive of how they act. The FTC calls them PAEs. I'll stick with Barnes & Noble on this one, if you don't mind.
We'll be reading the comments from IPNav [PDF], which claims to be a "white hat" troll, as well as a snip from MOSAID [PDF], which also claims to be one of the good guys. They feel they are misunderstood. It is in a deal with Nokia and Microsoft to go after people with their sorta donated patents, so you might wonder what Microsoft has to say. In a nutshell, it says [PDF] it wouldn't want the PAE business model shut down. *That's* not the problem. Noooo.
Judge Koh's Order in Apple v Samsung: No Stay on Damages Retrial, Unless... ~pj
There is one proviso. If the USPTO does not reopen the reexaminations on the two Apple patents that so far it has found invalid, then Samsung can submit a new motion asking for a stay, but that's only meaningful if the USPTO acts faster than the trial. If not, the damages issues will include the currently invalided patents. No, I can't explain the logic. I'm like Alice in WonderLand watching this.
It's mostly tilting Apple's way at the moment, with a Hail Mary pass possible for Samsung, if certain milestones at the USPTO happen quickly enough. As I've told you many times, US patent law favors patent holders, not defendants. That's one reason trolls can do what they do, bully victims into paying up rather than risking the uncertain outcomes of expensive trials that can illogically go against you even when the trial centers on stupid patents that shouldn't have issued in the first place, because once issued there is a presumption the patent is valid. Even if you win at trial and the patent is invalidated or the jury decides you didn't infringe, nobody pays you back all the millions you've spent defending yourself. Your US patent law at work. How do you like it?
The Microsoft v. Motorola Order on RAND, as text, plus Some Appeal Issues ~pj Updated
I'm getting the impression that the judge is just guessing at a rate in places, and from the wrong starting point too, and if you look at the footnotes, you'll see what I mean. Whenever he has insufficient evidence, instead of saying, "Well, I guess I can't figure that out on this record," he says, "I have insufficient evidence, so I'll just set the lowest rate." Here's just one example, footnote 24: 24 Motorola contends that Microsoft products other than Windows and the Xbox use the H.264 Standard. Motorola lists at least the Windows Phone 7 and 7.5, Windows Embedded, Silverlight, the Zune, Lync, and Skype, as Microsoft products that use the H.264 Standard. (Motorola Pr. FC ¶ 535.) Motorola, however, did not provide sufficient evidence for the court to ascertain the functionality ofthese products, making it impossible for the court to determine the importance of Motorola's H.264 SEPs to these products. Indeed, the little trial evidence regarding functionality of these additional products demonstrates that Motorola's SEPs would have little value to them. (See 11/14/12 Tr. at 150 (Orchard Testimony).) Without such evidence, the court is left to conclude that the low bound of RAND is the appropriate royalty rate for all Microsoft products -- Windows, the Xbox, and all others. But Microsoft is the one asking that the court set a RAND rate, not Motorola, so it has the burden of proving what a RAND rate should be on the other products. So presenting sufficient evidence to support a decision is not, as I understand it, Motorola's burden. So why didn't the judge say, I can't set the rate on these others products because *Microsoft* didn't provide enough evidence? Or, if he insisted on setting a royalty, set it at the highest rate, or even at an average? That's where the pro-Microsoft bias shows through, to me. That's only one place where I see an appeal issue that favors Motorola, if it chooses to appeal.
I'm most of the way doing a text version for you of the order itself, but it's 207 pages, and I'm very interested in you guys quickly taking a look at the way the judge writes about the tech and also his math in figuring out the royalty. You'll find that mostly in the footnotes, which are done. I'll keep working on the grunt work of cleaning up the text version, which is still OCR-messy, while you do that part. You have the PDF, and the text is understandable at least, while I work to perfect it. So, let's each get to work.
In a First, Seattle Judge Sets RAND Rate in MS v. Motorola ~pj
SCO's Motion To Reopen the Case Is Denied with a Bonk on the Head ~pj
Surely SCO's "We Own Linux" scam must be in the top ten scams in history, not just in Utah.
What? You thought the law was dry and boring? Ha!
Barnes and Noble's Common Sense Suggestions to the FTC and DOJ on Patent Trolls ~pj
Its submission begins: "The patent system is broken," having "lost its true north", adding that the AIA did not fix the troll problem. And so it suggests five common-sense solutions to fix the problems. One suggestion is that trolls should not be allowed to file with the ITC at all, because that agency is about protecting trade, and trolls are not in business. And it points out that the Constitution requires a change. Yes. The Constitution: The Patent and Copyright Clause grants Congress the power "[t]o...promote the Progress of Science and useful Arts," not science fiction and litigious arts. (Article 1, Section 8, Clause 8 (emphasis added)). But the current system allows trolls to pursue fantastic allegations-claims that would be laughed out of the room in actual scientific or technical circles-in endless litigation that taxes and taxes true innovators while making no meaningful contribution to society. If you enjoyed Barnes & Noble's revelations in court and to the ITC about what it called Microsoft's anticompetitive patent scheme against Android, you'll enjoy reading this new comment on trolls. They don't sugar coat. One of the claims it had to deal with was for using HTML. Wait. I'll let Barnes & Noble tell it: Even the most plainly baseless lawsuits are expensive and can take years to defeat. In at least four cases, Barnes & Noble has faced litigation by patentees asserting the same theories on which they previously lost. In one case, for example, Barnes & Noble is alleged to infringe patents because BN.com uses the HTML language and returns search results other than exact matches. The patentee asserted these allegations against Barnes & Noble despite having tried and lost a case against other ecommerce retailers based on the same functional allegations levied against their websites....Barnes & Noble and other technology companies see countless lawsuits in which the asserted patents purport to cover products and technologies common to the entire industry. We face repeated allegations that anyone using Wi-Fi, anyone using 3G, anyone using MP3, anyone with an e-commerce website, anyone using Ethernet, and, recently, anyone using InfiniBand technology, to name a few, is infringing and must pay a hefty price to license purportedly essential patents. The allegations sweep far beyond specific innovations to which a patent might legitimately lay claim. I guess I shouldn't be surprised that lawyers for a book company know how to write. Lawyers can be excellent lawyers without that skill, but when they've got that ability too, what a pleasure it is.
Microsoft and Motorola Argue About Jury or Bench Trial on Contract Claims in Seattle ~pj
Motorola's best option is an appeal down the road, from all I've seen. I'd call this a Teacher's Pet trial. And you know how it goes when you try to tell the teacher that its pet kicked you in the lunch room.
And you'll see in the docket that the judge, the Hon. James Robart, has decided the issue about how much Motorola's RAND rate should be, but we don't get to read it until the parties tell him if they want redactions. But personally, what are the odds he'll do anything but bonk Motorola on the head again? Still, if you noticed in the Apple v. Samsung litigation, post-trial action can be very effective, even when the trial itself is unfair and the result reflects mistakes or even favoritism, especially when Quinn Emanuel is representing you, because they never give up. It's not over 'til it's over. All of it.
Joint Case Management Statement Filed in Apple v. Samsung ~pj
Comments to USPTO on How to Improve Patent Applications: Red Hat's and Morrison and Foerster's ~pj
There are now comments publicly available on the USPTO's website responding to a third question also, this one about improving patent applications. It has some suggestions for consideration regarding clarifying the scope of claims and the meanings of claim terms in specifications. I thought you'd like to see what Red Hat and Morrison & Foerster [PDFs] had to say. These days Morrison & Foerster seems to find its firm representing the old guard in the smartphone patent wars, and of course Red Hat reliably upholds the interests of the new guys on the block, Open Source. Red Hat points out to the PTO, quoting Tim O'Reilly, that were it not for Open Source, there'd be no Google, Twitter, Facebook, or Amazon: As one seasoned observer has noted, many best-known brands (like Twitter, Facebook, Amazon, and Google) "were built on a foundation of open source software, and wouldn't exist without the ... [open standards and protocols of the] Internet and the world wide web, Linux, and the cornucopia of open source tools and languages that made the fertile soup from which today's tech innovation sprang." That hopefully will help the PTO to realize that catering only to the old guard would be damaging. Open Source is now mainstream, and that means the USPTO's old way of doing things with respect to patents -- particularly software patents -- needs to be adjusted to accommodate the new. Happily, the USPTO seems to realize this, and so while Red Hat thinks some changes require changes in law, it commends them for this effort, the Software Partnership: Nonetheless, we see a clear nexus between the growing thicket of software patents and abusive patent litigation, so we support and encourage the PTO's Partnership, its systematic examination of the issues identified in the Federal Register Notice, and its efforts at improving quality. Indeed, we believe the agency should accelerate and expand these important initiatives. Tactfully, it indicates that there are more problems to be addressed that the PTO has yet to identify.
Samsung Parries Apple's 7th Amendment Arguments ~pj
A waiver of a jury trial right can never be implied. Ostlund v. Bobb, 825 F.2d 1371, 1373 (9th Cir. 1987) ("A waiver of a constitutional right is not to be implied and is not lightly to be found."); see Aetna Ins. Co. v. Kennedy, 301 U.S. 389, 393 (1937) ("as the right of jury trial is fundamental, courts indulge every reasonable presumption against waiver."); California Scents v. Surco Prods., Inc., 406 F.3d 1102, 1108 (9th Cir. 2005) (same). In any event, Samsung did object to the scope of the new trial promptly as soon as the new trial Order issued and made clear that the ordered new trial would require the second jury to reexamine findings necessarily made by the first jury. Moreover, contrary to Apple's suggestion, Samsung did not request a new trial only on damages, but rather sought JMOL or a new trial "as to each and every claim and issue on which Apple prevailed before the jury," Dkt. 2013 at 1, and did not limit that broad request to particular errors, including damages errors. The parties also argue further on Apple's conditional motion for reconsideration of damages.