Patent Engineering,Smartphone and Wireless

Technologies,The Smartphone Patent War

Dr. Tal Lavianhttp://cs.berkeley.edu/~tlavian

tlavian@cs.berkeley.eduUC Berkeley Engineering, CET

Recognizing Intellectual Property

Trademarks Logos & symbols

Copyrights Right to reproduce an

idea or information Includes software

Patents Invention that is new and useful

Trade Secrets Non-disclosed information that is valuable

Patents—US Constitution

US constitution, Article 1, section 8 granting congress the power to promote the

progress of science and useful arts by securing for a limited time to authors and inventors the exclusive rights to their respective writings and discoveries

What is a Patent?

Right to Exclude the Making, Using, Selling , Offering for Sale or Importation of a Specified Invention Limited Time (Typically 20 Years from date of

filing with USPTO) Limited Geographic Territory (issuing country)

Monopoly awarded by the Government forsharing the Invention with the public

How Patents Are Used

Corporate Product protection Corporate value Defensive portfolio Licensing

Consultant Entrepreneurial Professional credibility

How Patents Are Used (cont.)

Product protection Traditional use for patents Blocks competitors from using invention

Corporate value Part of the “book value” of a company Return on R&D investment Some small companies are acquired just for their patents

Defensive portfolio (war chest) Have patents to “trade” (i.e., cross-license) if a competitor

accuses company of infringing their patents.Licensing

License to customers or for non-competitive applications Cross-license with other companies

Recognizing Intellectual Property

Learn to view things within an IP framework:Recognize inventions in your own workBe able to detect and avoid infringementDistinguish confidential information from general

knowledgePreserve confidentiality

Trademarks

What is a mark?A word, name, symbol or device used to identify the

source of a product or service

Trade Secrets

Trade secrets are generally any info that is confidential and valuable, such as: Customer lists Sales or profit data Product weaknesses Internal designs, processes and procedures Formula for Coke or processing algorithms

Is “supposed” to be marked or identified as confidential, but does not necessarily need to be

Can be generally known and used by others – the factthat the company uses it also may also be a trade secret

A trade secret is anything a company says it is. Musthave some benefit (i.e. competitive advantage)

Trade Secrets

Example trade secrets: Products

Formulation, algorithms, database schema Data (e.g., translation tables) Manufacturing processes

Business Practices: Schedules Suppliers & partners

Engineering processes: Tools and how they are used Development cycles Testing processes and results

Smartphones – what are they? 11

• Small size, light weight, easily fitting in palm and pocket

• Display screen with touch input and small virtual key board

• Also known as portable handheld device or handheld device (e.g. Smartphone, PDAs etc.)

How they are different from traditional computation?

Mainframe computer: Large, expensive, capable of supporting hundreds or even thousands of users simultaneously. Single mainframe can replace dozens or even hundreds of smaller servers

Minicomputer: Power of minicomputers lie between a PC and a mainframe. Supports 4 to 200 users simultaneously.

PC: PC contains a central processing unit (CPU) on a microchip (the microprocessor), a memory, a bus system and I/O ports. Processing power is less than a Minicomputer.

Mobile device: Less functionality than a PC and may require specific operating system software to operate.

A smartphone today has more computation power than a mainframe when you were born

Device Architecture13

Smartphones - History14

Company/Vendor

Model Released Operating System (OS)

IBM Simon 1993 -

Nokia, Hewlett-Packard

Nokia 9600 1996 -

Palm Kyocera 6035 2001 Palm-based OS

RIM BlackBerry 2002 BlackBerry OS

Apple iPhone 2007 iOS

Samsung, Sony, HT, Motorola

Different models

2008 Google’s Android

Samsung Own model 2009 Bada

Smartphone Patent War

We will take an in-depth look at the many different skirmishes comprising the patent war, including Who’s suing who Over what technology And for what possible reasons

We will also discuss alternatives to litigation, such as licensing IP

Smartphone Patent War

Initial understanding of the Smartphone Patent war:

• Smartphone is a radical technology change with a lot of money at stake and growing.

• Patent war is a major tool to slow down the competition and get better market share• Very large business…and growing• Apple, Google, Motorola, LG, HTC, Microsoft,

Nokia….• Extremely expansive litigation, with a lot of risk• Time is critical - slowing down the competitors

Smartphone Patent War Overview

Similar to the GSM patent war of the 1990s, there is currently a patent war stirring up the mobile telecommunications market

Major actors include Apple, Microsoft, Google, HTC, LG, Samsung, Motorola, Nokia, (Oracle,) and others

Great example of companies leveraging their IP to obtain a competitive edge

Smartphone Patent War –Relevant Technologies

Smartphone designs e.g., Apple Samsung over the Galaxy Tab

German judge ruled that the Tab infringed the iPad 2 with its “smooth, simple areas”

Smartphone Patent War –Relevant Technologies (cont.)

Operating systems e.g., Microsoft Barnes and Noble over Android in Nook

ebook reader Patents involved:

• #5, 778, 372 – “Remote retrieval and display management of electronic document with incorporated images.”

• #6, 339, 780 – “Loading status in a hypermedia browser having a limited available display area.”

• #5, 889, 522 – “System provided child window controls.” Microsoft also involved in many licensing deals with

OEMs Means of avoiding litigation for both parties (otherwise

Microsoft would assert software patent rights in court)

Smartphone Patent War –When Did It Begin?

Patent litigation concerning smartphone technology began in late 2009 Nokia sued Apple over 10 patents Apple countersued Nokia for infringement of 13 patents

Notice the “eye for an eye” mentality in patent litigation

Nokia-Apple litigation quickly expanded from district courts to the International Trade Commission Also opened the door for other companies to sue

competitors for smartphone patent infringement “Opening salvo”

Smartphone Patent War –Who’s Involved At This Point

•Apple vs. HTC: 20 software patents

•ELAN vs. Apple: touchscreen patents

•Oracle vs. Google: Java patents

•Qualcomm vs. Nokia: 3G tech.

•Apple vs. Nokia: data and speech coding

•Nokia vs. Apple: 2G, 3G and Wi-Fi tech.

•This list is not exhaustive

Smartphone Patent War –Who’s Involved At This Point (cont.)

Smartphone patent war also includes actors not directly involved with the smartphone industry Kodak

First attempted to assert patent rights in court in order to raise capital from licensing to smartphone manufacturers Eventually sought to sell patents to avoid bankruptcy

Some think litigation was actually a means of marketing their patent portfolio

Non-Practicing Entities (NPE) i.e., companies that assert patent rights but do not produce

or market the patented inventions they own

Non-Practicing Entity (NPE)

An individual or company that primarily licenses patents Sometimes referred to as “patent trolls”

Does not sell products based on the invention (hence “non-practicing”)

Usually very aggressive, go after many companies

Example: Ronald Katz (RAKTL) Telephony IVR related patents $1 billion in license fees

Ref: http://www.hec.unil.ch/isa/RiskMan07/KatzLetter.pdf

Smartphone Patent War –Different Actors, Different Motivations

Motivations for resorting to patent litigation are often multi-pronged: Principle – patents rights have been infringed, not

going to tolerate it e.g., Apple suing Samsung over iPad design infringement

Damages – plaintiffs in patent cases can recoup profits lost due to infringement, sometimes treble (3x) damages if judge finds willful infringement

http://phandroid.com/2012/12/03/judge-says-motorola-patent-claims-wont-score-injunction-against-microsoft/

Smartphone Patent War –Different Actors, Different Motivations

(cont.)

Injunction – if product found to infringe, court can order injunction against manufacturer Essentially, a mandate to stop producing the infringing

product e.g., Apple sued Samsung over Galaxy Tab in Germany,

won an injunction that forbade Samsung marketing it Licensing – sometimes if a competitor wants to use

your IP, you let them pay you for it This has largely been Microsoft’s strategy throughout the

patent war Arguably mutually beneficial: one side gets access to

competitor’s IP, while competitor need not manufacturer to profit from IP

Licensing

Patent owner can license patents If patent used in formulation of a standard, must be

made available to everyone on equitable terms

Licensing may be a corporate profit centerCompanies may cross-license with other

companies for access to their IP

Licensing: The Typical Sequence

The patent owner becomes aware of an (alleged) infringement

Patent owner sends an “invitation to take a license” letter to infringer

Some dialog takes place, regarding terms and conditions of license

A license is taken or litigation is started (or perhaps cross-license)

Smartphone Patent War – Jurisdictions

The smartphone patent war is a global span of litigation taking place in various courts, including: U.S. district courts

Most patent cases in the United States are heard in Eastern district of TexasDelawareNorthern district of California

European and Asian courts Most often with the aim to win an injunction in a

foreign market

Smartphone Patent War – Jurisdictions (cont.)

International Trade Commission (ITC) Quasi-legal venue where many patent cases are heard Two reasons plaintiffs often file complaints to the ITC:

While not having the ability to award damages, it can grant injunctions

Speed – proceedings are usually much faster than in district or appellate courts

http://www.macobserver.com/tmo/article/itc-judge-apple-did-not-violate-any-samsung-patents

Smartphone Patent War – Questions To Ask

Are there more mutually profitable alternatives to “patent wars”?

Cross-licensing? Patent pools?

What effect does such litigations have on consumers? the market? innovation?

When will it be “over”? Bankruptcy? Product bans?