One of the most controversial aspects of Apple’s patents war against the Android players has been its use of design patents, rather than just technology innovations. These are taken with varying levels of seriousness in different parts of the world, and many believe elements like the shape of a device should not be patentable. Nonetheless, this kind of IPR has taken center stage in several of Apple’s battles, especially those with Samsung, perhaps because the iPhone maker has more obvious strengths in design than in wireless patents.
Now that Apple has notched up a couple of victories over Samsung in fights over design patents, the device industry is newly wary. The Ministry of Economic Affairs in Taiwan, the main base for electronics manufacturing, has warned that Apple’s eyes may alight next on the emerging ultrabook category.
The Ministry has warned the manufacturing community to be careful to avoid designing ultrabooks which resemble Apple’s own mini-laptop, the MacBook Air. Intel has high hopes that its ultrabook platform will reinvent the PC form factor and slow its erosion at the hands of tablets. But if these devices do take off, Apple may perceive the same kind of threat to the Air that the Samsung Galaxy Tab posed to the iPad.
The use of design patents, which relate to shape and form factor, is controversial, and critics have accused Apple of suing Samsung just for making a rectangular tablet with curved corners. Yet the iPad maker has won cases in Germany and, last week, the US, forcing its rival to stop sales of the Galaxy Tab 10.1 and rework the product.
Now the Taiwanese government department is warning local manufacturers such as Asus and Acer, which are supporting the ultrabook format, that their products could be at risk from Apple’s lawyers. The US form gained a US design patent for the MacBook Air last month. As reported by ComputerWorld, the ministry’s intellectual property office is urging vendors to steer away from designs that echo the ‘wedge and teardrop’ shape of the Air, as cited in the design patent.
Xue Shuhua, a staff member with the office, said: “We are recommending that PC vendors be careful. Companies that manufacture ultrabooks should avoid the Apple patent when producing their products.” Acer insisted that ‘Apple’s patent on the teardrop profile design is different to Acer’s ultrabook design. Hence, currently, the patent has no impact on Acer.”
Last year, the Taiwanese government said it would set up an intellectual property bank under the auspices of the national hi-tech R&D agency, ITRI. This body has set aside NT$50m ($1.73m) to help defend the industry against a wave of lawsuits. Other government technology agencies round the world are likely to follow suit, even as individual vendors also spend heavily to shore up their IPR defences. The latest rumoured to be on the quest for patents is Amazon, as it expands its device business and becomes ever more threatening to Apple and others. The retailer has hired Matt Gordon, formerly senior director of acquisitions at patent aggregator Intellectual Ventures Management, which owns more than 35,000 intellectual property assets. Gordon will be general manager for patent acquisitions and investments at Amazon.
The design patent debates have mainly been highlighted by cases against Samsung’s Galaxy Tab, and this slate has had mixed fortunes in the law courts in the past week or so. In the US, the Tab 10.1 was subject to a preliminary injunction on the basis of iPad design patents, though with the product near the end of its life, it is uncertain whether Samsung will bother to introduce the amended version it created after a similar decision in Germany.
Meanwhile, it had better results in the UK, in a High Court case which could have affected most of the Galaxy Tab family. It might be a case of damning with faint praise, but a UK High Court judge awarded the Korean vendor a victory over Apple on the basis that the Galaxy Tab was ‘not as cool’ as the iPad.
Based on that opinion, Judge Colin Birss said, Samsung’s tablets had not infringed Apple’s design patents, which are at issue in a string of lawsuits round the world. Apple recently won a temporary injunction against the Galaxy Tab 10.1, in a California court, based on the judge’s estimate that Samsung probably did infringe design patents. That will come to trial later in the year.
Birss wrote in his judgement that the Galaxy tablets belonged ‘to the same family’ as the iPad when viewed from the front, but from other angles were “very thin, almost insubstantial members of that family with unusual details on the back”. He added: ‘They do not have the same understated and extreme simplicity which is possessed by the Apple design. They are not as cool. The overall impression produced is different.”
Samsung used its statement on the judgement to draw attention to the design patent controversy, saying: ‘Should Apple continue to make excessive legal claims in other countries based on such generic designs, innovation in the industry could be harmed and consumer choice unduly limited.”
But Apple reiterated its oft-repeated line of argument on the iPad’s design, saying in its own statement: “This kind of blatant copying is wrong and, as we’ve said many times before, we need to protect Apple’s intellectual properties when companies steal our ideas.”
More and more different parties are taking an interest in the handset patent battles as several come to a head and as judges seem more willing to take devices off the shelves, even before final decisions are even made on whether they infringe IPR. Vendors, standards bodies, judges and carriers are all weighing in. In the last category, Sprint has filed a motion with a federal appeals court, asking it not to slap an injunction on the Samsung Galaxy Nexus handset.
The Google-backed smartphone is a flagship model at Sprint, and a showcase for the latest Android updates. It was briefly removed from the Google Play store after a California court imposed a temporary ban, pending the trial of Apple’s patents claims later this year. However, that ban was then reversed, again on a short term basis, but the fight goes on in the appeals court.
According to Foss Patents, Sprint argues that these injunctions should not become a normal competitive weapon for the industry ‘ echoing concerns expressed by a series of judges and regulators round the world, as well as the International Telecommunications Union, which plans to hold a summit on the topic this fall.
Sprint argues that the removal or delay of the Galaxy Nexus would hurt its business, ‘leaving a void’ in its portfolio. It will doubtless be backed by many carriers when it claims it is an “unwitting victim” of the handset IPR wars, urging that injunctions should not become a “staple” of those contests.
It insists it is not taking a stand on the merits of the respective cases, and would make the same argument whichever vendor was involved (no doubt keen not to antagonize its key iPhone partner). But it says it does not want an immediate ban because ‘bringing a device to market takes hundreds of people approximately 9-12 months”, and preliminary bans can be imposed too quickly to allow carriers to replace banned products with non-infringing new ones.
Apple has two days left to file its opposition to Samsung’s motion to lift the injunction until the appeals process is complete and a final verdict delivered on whether the Nexus infringes iOS patents. Google has also indicated it is working with its Korean partner on a workaround, since the patent at issue relates to its universal search. It claims the technology covered by Apple’s unified search patent is “a trivial patented aspect of a single application on the phone, with no evidence that that patented aspect influenced sales … at best, a very minor aspect of the Galaxy Nexus phone’s overall functionality”.
Meanwhile, the latest body to turn its attention to the IPR issue is the ITU (International Telecommunications Union), which is to host a high level summit between various standards bodies, plus government and industry representatives, in October.
The ITU Patent Roundtable will address the worldwide surge in litigation and what the Union says is a growing lack of adherence to standards bodies’ existing patent policies. Topics will include potential improvements to existing policy frameworks, as well as the thorny issue of when firms should be entitled to injunctions.
Discussions about the relevance of the current rules on Frand (fair, reasonable and non-discriminatory) policies for licensing standards-essential IPR will be a key focus. The ITU argues that Frand policies have so far worked well, but now the definition of ‘reasonable’ has become a major point of contention, along with the issue of whether owners of essential patents can pursue injunctions.
Dr Hamadoun Tour’, ITU secretary-general, said in a statement: “We are seeing an unwelcome trend in today’s marketplace to use standards essential patents to block markets. There needs to be an urgent review of this situation: patents are meant to encourage innovation, not stifle it. Acknowledging patent holders and user requirements, as well as market needs, is a balancing act.’
Other organizations are also having their say. Ironically enough, an Apple executive recently asked the carrier driven NGMN Alliance to formulate a policy on what constituted ‘reasonable licensing’, especially in the case of standards-essential IPR (after design patents, the most controversial aspect of the patents landscape). However, nobody should hold their breath for a clear statement of policy. ‘My opinion is settling this issue of defining reasonable licensing is something that will take another five years or more,’ said an NGMN Alliance member, despite pressure from members like ZTE, whose CTO, Donglin Shen, said: ‘When handset makers are asked to pay $4 in royalties on a featurephone that may have a $20 bill of materials cost, all the profit is gone.’
He added: ‘What’s a reasonable royalty rate is really hard to say. The industry talks about fair and reasonable terms, but this is just the intention and there’s no legal binding.’