another laymen´s introduction into the ongoing patent wars.
Germany is today´s battlefield again so it´s important to follow up. Germany has an economy the size of New York and California together so a ban on all Apple phones would really hurt. Round 2 was a devastating blow for Apple.
The German court in Mannheim was scheduled to hear the case between Motorola and Apple about the violation by Apple of basic 3G (UMTS) telephone technology. Motorola wants Apple to stop distributing all 3G capable products including Iphones in Germany. They also want Apple to withdraw them actively from the sales channel. After a first round where Motorola Inc. won they decided not to follow up as they only won because Apple didn´t show up. Demanding a full sales stop in Germany based on that fragile decision was risky as you have to pay if you get your competitor of the market and you´re proven wrong. In that case you have to pay for damages done in lost sales for starters and that could have been substantial.
Today the case got a new verdict: this came after Apple came up with a defense and the Mannsheim court turned them down again. This time they lost on their legal position instead of a no show.
We all knew this request was coming. There is no doubt Motorola owns these patents and Apple has not licensed them. The discussion is not about these basic facts but about if maybe Apple was not aware of it as their key component supplier could have held a license. I can´t see a judge really going with Apple just ´trusting a supplier´ as they are well known for their tight control of the supply chain so that seemed a silly line of defense.
What Apple wants (and you will see these words a lot in the discussions today) is to get a license on so called FRAND (or RAND) terms, meaning that Fair, Reasonable and Non Discrimanatory. Meaning if they have to pay, they don´t want to pay more than other competitors hence the term FRAND.
Apple has argued that this Motorola technology has become parts of the 3G and UMTS mobile phone standards and all patents which become part of an official standard have to be offered on these FRAND terms to all interested parties.
Makes sense as otherwise you could at random get one competitor out of the game and that can never be the result of an official standard. Otherwise one company could block someone from entering the mobile market at all or at a price much higher than all others in the market and that´s everything the acronym FRAND tries to prevent. In one word: Apple can not be excluded from the UMTS standard so should be allowed to license it.
However the judge today basically said this was all nice and dandy but that the first step for everyone who wants to use a license from another company is to ask for it. More specifically: make the owner of the patent a binding offer for his licenses. What Apple however did was just use the technology ignoring the proper way to do these things. The Germ court has decided that this was the most important issue: failing to try to obtain make you a patent infringer and so the rest of Apple´s arguments were put aside. If you tried to escape your obligations to at least ask for a patent and be prepared to pay for it it does no longer matter that Motorola would have been obliged to accept a reasonable (FRAND) offer.
This look surprisingly similar to the Nokia-Apple case where Apple was accused of violating Nokia´s old patents on elementary phone technology. This was settled out of court but Apple ´agreed´ to pay a huge amount for the infringement on Nokia´s patents rumoured to be around 750 million dollar. Apart from this ´freely agreed to´ fine for the violation of Nokia´s patents Apple also made a deal to pay license fees from now on to Nokia.
Very similar to what transpired today. The German court found the infringement by Apple much more important than the possible refusals of Motorola to license the technology.
The verdict: Motorola is allowed to ban all Apple iPhones and 3G capable iPads with this technology (every model ever made) if they don´t remedy this violation. As that will be impossible for Apple as the patent (EP 1010336B1) is quite fundamental Motorola can now enforce that sales ban. There is one but, there is a 100 million bond in the verdict which Motorola will have to pay if they prove to be wrong in the end when all the legal dust has settled. However Apple also has to pay Motorola for all damages since the first violation.
No doubt Apple will appeal this decision but meawhile it´s German future is in the hands of Motorola.
Motorola reacted: “We have been negotiating with Apple and offering them reasonable licensing terms and conditions since 2007, and will continue our efforts to resolve our global patent dispute as soon as practicable.
#Patents
sorry for two patent posts in one day but the courts have been busy today. Reading the German text was not easy so that took a bit longer to post than the Australian update.
Thanks for the update!
Patent lawyers should be paid peanuts then all these legal proceedings wouldn't be taking place. Nobody wins other than them.
No need to apologise, it's interesting content explained properly – not just linkbait farmed out like some of the tech blogs.
I assume people by now are sick and tired of it +Irving Drommond. I try to keep it readable without a legal background, but I guess by the time the main court cases start people will block patent news 🙂
I posted recently that Samsung has a war chest of 200 million dollar for the battle versus Apple +Steve Webb
Apple´s will be a magnitude higher I suspect.
At a 1000·$ per hour and enormous teams these bills will be huge indeed.
Thanks for the compliment +Ray Adamson I started writing about it because hardly anyone would do more than some sensationalist headlines leaving me to research it properly.
Since G+ I just share what I have to research anyway to be able to follow it.
I think Patents around technology is a minefield Max. At least thats my 100,000ft layman's view of it.
Google, Apple, Microsoft, they all sit on the shoulders of giants and they are happy to use existing idea's created usually by individuals, however they damn anyone who take their idea's and use/extend them. They should eat some humble pie and compete rather than pay lawyers. The net effect of what they are all doing is stifling competition and development.
After the industrial revolution in the UK there was a similar period in which progress came to a full stop for thirty years until patents on the first weaving machines were expired. Let´s hope it goes faster this time +Steve Webb But I have a lot more respect for the guys at Motorola who figured out who to get more bandwidth out of an existing channel to provide data on top of voice in GPRS than for some finger movement to unlock a screen.
I mostly agree max however I think they should aim to make money out of the benefits an idea brings, rather than the idea itself.
I used to work for GEC and they came up with some clever idea's but were lacking on patenting them. Looking back at that period they were trying to make money out of what they could use the idea's for. They tried to get a lead in the market, be the front runner. It worked for a while then the money men got involved. Even though it failed for them I think its the way forward.
Frankly if you can't make money out of the benefits of an idea I don't think you can really claim money on patents for it. At the moment everyone seems to be trying to make money out of patents left right and centre.
I fully agree +Steve Webb but I think a company as Motorola did make since inventions which contributed enormously not only their own products, but also the current standards like 3G/UMTS.
Motorola didn´t do well the last few years and they now got bought by Google, probably in part for their patents, but they have a long history of making innovative communications stuff well before the mobile phone was invented.
Interesting that didn´t spread through the German community on G+
+Max Huijgen, how do know it hasn't spread? Do you mean this thread or would you know from somewhere else?
I'm asking out of interest and don't mean it as a smart ass question, thanks.
Hi +Ray Adamson uh, I meant that there was hardly response from Germans in this topic. From an earlier post about the situation in Germany regarding patents I remember quite a few stopped by.
Thanks +Max Huijgen. Maybe they all use iPhone, Mac etc, and have nothing productive to add.
On a side note, the value of the Moto patents to Google seem to have become a little more clear.
Thanks for the professional sharing +Max Huijgen ! I am interested to see the endgame of this patent war.
And the search link is awesome idea, saved.
I think motorola should go thermo nuclear on apple… Ha ha..
http://www.droid-life.com/2011/12/09/german-court-rules-in-favor-of-motorola-possible-ios-device-ban-throughout-europe/
+Steve Webb that story didn´t get it. It´s definitely not a European wide injunction. Sloppy reading will have triggered this as Apple Europe is indeed hit by the verdict but the full text is very clear it´s only for the German territory.
+Ben Chow I´m following this complex fight all over the continents as it´s shaping up a complete industry. The decisions this coming year will set the tone how to proceed and what to expect for companies. With a large restriction as the final patent verdicts are not in yet, it looks like the Apple business model is not sustainable. Packaging technology and protecting it by design and software patents is under fire.
I just wish all parties could sit down, sort it out and carry on with creating world class products. All this posturing can only damage all involved.
The world is a BIG place, there is more than enough slices of cake to go around!
Sorry for yet another patents story today
Apple made deal with patent troll, but why: a possible explanation
https://plus.google.com/u/2/112352920206354603958/posts/83amneNRTVC