Source: http://www.fosspatents.com/2018/02/
Timestamp: 2019-04-19 08:23:07+00:00

Document:
G. Nagesh Rao, a former patent examiner and policy advisor.
A video recording of the event is available on YouTube.
An Apple v. Samsung--far from the first, to put it that way--will be held in three months. The Engine panel discussion was not exactly a trial preview. The perspective was very high-level, including an outlook (by Matt Levy) as to what might happen after the trial. Mr. Levy believes the Federal Circuit will again take an exceedingly patentee-friendly position, and the Supreme Court will have to correct it again.
Nobody on the panel appeared to believe that the 19th-century unapportioned-disgorgement rule in 35 U.S.C. § 289 is appropriate with respect to today's multifaceted technology products. However, the focus of the panel wasn't on advocating new legislation, though the subject did come up. It was more about the high degree of uncertainty surrounding not just the Apple v. Samsung re-retrial but presenting an issue to the industry at large.
All speakers made good points, and a particularly important issue was raised by Mr. Levy: one of the three design patents-in-suit covers a screen layout, which apart from and beyond the question of damages is problematic. Admittedly, I'd have liked that question to be reviewed by the Supreme Court, but the emphasis there was on damages and, above all else, the "article of manufacture" question.
There is so much uncertainty that no one can really predict what the jury will make of the above factors. The outcome could hardly be less predictable.
As I look at those factors, I feel that the first factor favors Samsung (the patents-in-suit cover certain aspects of a phone, not an entire phone) but the other three factors could go either way. The jury will be free to attach different weight to each factor, and Samsung's best chance here is that the jury (which won't have to explain its reasoning in any way) might look at the devastating consequences of an unapportioned disgorgement of infringer's profits (not devastating in Samsung's particular case as it is a huge organization, but in other cases it would be) and just conclude that a decision in Samsung's favor is the lesser evil.
Mr. Duan explained that design patent litigation isn't nearly as widespread as software patent litigation, but depending on what happens in Apple v. Samsung and other design patent damages cases, design patents could give rise to many lawsuits by patent trolls in the not too distant future.
Without a doubt, industry groups are concerned about the lack of legal certainty. One of the questions from the audience (toward the end of the YouTube video) came from the Software & Information Industry Association (SIIA).
At the end of the previous post (relating to the vacatur of a discovery sanctions order agaqinst Apple) I mentioned today's Qualcomm v. Apple patent infringement hearing by the Munich I Regional Court, relating to European Patent EP2724461 on a low-voltage power-efficient envelope tracker. I attended the hearing (the last one--or one of the last few--prior to leaving Germany).
The underlying reason is that Qualcomm's infringement allegations relate to a Qorvo RF (radio frequency) chip found in the iPhones 7 and the larger iPhone 7 Plus. It appears that Apple's phones--or, more precisely, the Intel chipset in the accused devices, which controls the Qorvo chip--don't even make use of the power-saving feature the patent-in-suit relates to. However, the asserted claims (1-5) are "apparatus" claims. Therefore, unless Apple could make a claim that it would be technically impossible (mere economic counterproductivity wouldn't suffice) to put that feature of the Qorvo chip to use, such as by dismantling or reprogramming the device, an apparatus claim can be infringed based on capability as opposed to actual use of a functionality.
So far, whatever Qualcomm alleges is based on reverse engineering, and in order to obtain further clarity on some of the issues, Presiding Judge Dr. Matthias Zigann proposed that the court appoint an expert with a view to the November 8 trial just in case he'll be needed. For his panel of judges (the 7th "civil chamber" of the Munich I Regional Court) this would be the first case since 2012 in which a court-appointed expert would be needed. In Germany, patent disputes are typically decided based on pleadings and oral argument. Parties can bring experts, but their weight is nowhere near the one they have in U.S. proceedings--it's like just another representation made by the party itself.
The case is a huge chunk of work for the court to resolve not only because of its technical aspects. Apple is represented by about ten lawyers today, most notably including Hoyng Rokh Monegier's Klaus Haft (lead counsel), patent attorney F.R. von Samson, Freshfields Bruckhaus Deringer's Frank-Erich Hufnagel and Wolrad Prince of Waldeck--has raised a huge number of defenses against the onslaught led by Quinn Emanuel's Marcus Grosch and his team. Besides denying infringement, those defenses include, but aren't limited to, an antitrust accusation: Qualcomm, by specifically targeting devices that come with Intel chips, is allegedly trying to force its only major competitor in the baseband chipset market, Intel, out of the market. Apple is already suing Qualcomm on this (and not only this) basis in the United Kingdom, and asks the German court to stay its proceedings (unless the complaint would be rejected on other grounds) pending resolution of the UK case. Judge Dr. Zigann noted that a UK ruling would, under applicable EU rules, have to be taken into consideration by the Munich court, but wouldn't be binding on it.
Apple is also leveraging Qualcomm's EU antitrust worries. Depending on what the European Commission's detailed decision (which is undergoing redactions) says, Apple might proposed that the court ask the Commission certain questions in writings. A referral of certain issues to the Court of Justice of the EU is another one of Apple's proposals.
Judge Dr. Zigann noted that this was the first time in his court for a defendant to raise an antitrust defense against a non-standard-essential patent, but didn't reach that issue in detail today.
At some point, Judge Dr. Zigann described the inventive step in extremely simple terms. Qualcomm's lead counsel obviously tried to agree with the court along "You're right, your honor" lines, but tried to thread the needle so the invention wouldn't be oversimplified such as simply using one power source in two ways. When I heard the judge's summary, I thought to myself: if that is it, then this patent is at a high risk of invalidation. It's so young (it was actually published only after Qualcomm filed the complaint) that it could still be revoked by the European Patent Office, and a validity decision might come down in early 2019 (which decision the infringement court would then be inclined to awake, as Judge Dr. Zigann indicated).
Qualcomm is asserting independent claim 1 and dependent claims 2-5. It could still prevail even after the patent is narrowed, but at some point it would either fail to win or, before that one, a victory would be less meaningful because a workaround might be easy.
If Apple's non-infringement contentions contradict its antitrust defenses (as Qualcomm alleges), Qualcomm, too, might be at risk of contradicting itself--and, as I just explained, Apple just needs one defense to succeed while Qualcomm is forced to overcome every single one of them.
Qualcomm is suing Apple over EP2954737 on a "power tracker for multiple transmit signals sent simultaneously" in Mannheim. That case will go to trial on June 5 (other Mainnheim trials are scheduled for September and October, and apparently Qualcomm has meanwhile also asserted additional patents in Munich, as Judge Dr. Zigann noted amendments to the original complaint that were, as is standard procedure in Germany, separated from the original case).
Apple argues that Qualcomm is estopped from asserting the Munich patent because the infringement theory is based on the very same act as the one in Munich. To be clear, this doesn't mean that only because certain iPhones are at issue in both cases, Qualcomm would have had to assert both patents together. On Apple's behalf, Dr. Hufnagel insisted that one patent cannot be infringed without infringing the other.
While Judge Dr. Zigann appeared very skeptical of this estoppel theory (at the outset of the hearing as well as after Apple's insistence), he was interested in factoring the Mannheim ruling, as it might bring useful substantive clarification, into the schedule of his own case. Qualcomm's lead counsel, Dr. Grosch, exuded a great deal of confidence when saying that "an injunction" would come down, "probably in September due to the summer holiday season, but maybe already in August."
I've watched Dr. Hufnagel, the attorney who argued estoppel for Apple, at many trials and tend to place more faith in him when he expresses a strong belief in a theory. In fact, the moment he impressed me the most was when he conceded, in a Samsung v. Apple case in Mannheim, that the court could decide an infringement question either way, while most lawyers always claim that only their position is a reasonable one to take. Despite Judge Dr. Zigann's current, merely preliminary skepticism, I wouldn't be too surprised if the Munich court viewed the estoppel theory more favorably after a Mannheim decision. It could be that Qualcomm wouldn't care too much if the Munich case failed after prevailing in Mannheim: it wants leverage, and it wants it sooner rather than later. I wouldn't put it past Qualcomm that it decided to sail close to the estoppel wind in order to get two bites at Apple. And the risk for Qualcomm is that the Mannheim court might reject the complaint, but provide a rationale that would lead the Munich court to throw out the other case based on estoppel.
In May there will be another Qualcomm v. Apple hearing in Munich, relating to what Dr. Grosch called "spotlights," which may or may not be related to an image-enhancing technique over which Qualcomm is suing Apple in the United States.
The matter is remanded to Magistrate Judge Cousins because Judge Koh found it legally erroneous that he based his sanctions order on Apple on a procedural rule that applies to parties, while Apple is technically a non-party to the FTC-Qualcomm case. As Judge Koh notes, Apple has its own antitrust litigation against Qualcomm pending, but that's a different case (even in a different district, though that's not a requirement for Apple to be a non-party to FTC v. Qualcomm).
Apple could still be sanctioned, but in order to do so, Magistrate Judge Cousins would have to come up with a legal theory that applies to non-parties. He could now just find that there is no legal basis to treat a non-party so harshly, in which case Apple's appeal to Judge Koh would have succeeded (though Qualcomm might still pursue sanctions in that case, but with a greatly diminished likelihood of success). There's a good chance that things will end that way. In the event Magistrate Judge Cousins bases a new sanctions order on a different statute, the amount of sanctions would likely be lower, and in any event, Apple could take this matter back to Judge Koh, who after finding legal error didn't have to reach the propriety and amount of the sanctions imposed--and, more likely than not, won't have to anymore.
Apple is indeed a party to other Qualcomm cases. For example, the Munich I Regional Court will hold a Qualcomm v. Apple patent infringement hearing--not yet a trial, but a discussion of key outcome-determinative issues--in a few hours. Presiding Judge Dr. Matthias Zigann, one of Germany's leading patent judges, will hear the parties' arguments, with Qualcomm claiming that Apple's iPhones using Intel chips (at least that's what Qualcomm's public statements and its litigation strategy for the United States International Trade Commission indicate) infringe European Patent EP2724461 on a low-voltage power-efficient envelope tracker. This is just one of various cases pending in Germany. The Mannheim Regional Court informed me of hearings scheduled for June, September, and October, over three different European patents--and it's unclear whether today's patent-in-suit is the only one Qualcomm is asserting in Munich (Qualcomm originally announced one Mannheim lawsuit and now I'm aware of three).
"Samsung's Motion to Enjoin Huawei from Enforcing the Injunction Issued by the Intermediate People's Court of Shenzhen"
Professor Thomas Cotter, on his Comparative Patent Remedies blog, provided multiple links to reports on the injunction decision.
An antisuit--or, more precisely, anti-enforcement--injunction relating to the enforcement of a foreign standard-essential patent injunction is not unheard of, much less in the Ninth Circuit. Indeed, Samsung's motion against Huawei is, by and large, a sequel: Microsoft v. Motorola Reloaded. The only noteworthy difference is that this involves two Asian companies, not a negotiation between two U.S. companies as in the Microsoft case.
The irony of fate here is that either of the two firms that represented Microsoft (Sidley) and Motorola (Quinn Emanuel) now has the shoe on the other foot. It happens all the time that firms have to take different positions in different cases, but a role reversal like this rarely occurs. Quinn Emanuel, which unsuccessfully opposed the "Robart injunction" almost six years ago, has now brought that kind of motion on Samsung's behalf, while Sidley, which had a spectacular success in the patent litigation arena when it barred Motorola from taking some key Microsoft products (most notably Windows and the XBox) off the German market, is now--on Huawei's behalf--on the opposing side. Thanks to my independence as an app developer who quit consulting in 2014, I can and will take positions on the current case that are simply consistent with the ones I had back in 2012.
Huawei itself made the first filing in the Northern District of California, and it included infringement as well as FRAND rate-setting issues, though Huawei sought an immediate stay of the former, which looked a bit like procedural gamesmanship. Samsung responded with FRAND and patent infringement/validity claims. By contrast, in Microsoft v. Motorola it was Microsoft (the SEP defendant) who won the race to the courthouse and brought a FRAND case in the Western District of Washington prior to any SEP infringement claim by Motorola in any jurisdiction whatsoever.
The fact that Huawei itself--the enforcing party--wanted the U.S. court to make a FRAND determination is a strong argument for saying it should now let the U.S. court do its job and not seek decisive leverage in China before. Otherwise the FRAND issues in the U.S. will be--in a problematic sense--"mooted" by a settlement at the threat of a Chinese injunction, which (as Samsung's motion points out) would even affect the U.S. market because of Samsung manufacturing devices for the whole world in China. Those two differences from Microsoft v. Motorola--that the enforcer himself brought the FRAND case and that the U.S. market will be affected by a foreign injunction--appear more important to me, at least for the time being, than the fact that this is not a U.S.-U.S. dispute like Microsoft v. Motorola.
It surprises me that, according to a sworn declaration attached to Samsung's motion, Huawei filed its Chinese cases the day after the U.S. filing. Due to the time difference, the filings may have been more or less simultaneous, but calendar dates can play a role, and seeking an antisuit injunction in an earlier-filed case is more likely to succeed than in a later-filed one.
Footnote 8 of the motion clarifies that Samsung's motion is distinguishable from last year's denial of an antisuit injunction sought by Qualcomm against Apple in the Southern District of California. Clearly, Samsung's motion against Huawei is the closest thing so far to Microsoft v. Motorola, while Qualcomm's motion was all about precluding Apple from pursuing antitrust cases (not from enforcing patent injunctions) in multiple jurisdictions. Qualcomm's motion was broader, and the nature of the issues and other factor were totally different.
Samsung accuses Huawei of "making trivial concessions over the parties' long history of negotiations" and then filing various cases, including the ones that led to two Chinese SEP injunctions. Based on what I read on the Comparative Patent Remedies blog, Huawei alleges that Samsung was slow-rolling the negotiations. Since I have no idea what exactly happened, it could be that there is truth in either party's historic account. Whether someone is constructive in negotiations is a question of both substance and timing. The hurdle for claiming that someone is an "unwilling licensee" must be reasonably high, however, and at this juncture, Samsung clearly meets that definition by the standards of all jurisdictions except the Chinese district in which Huawei won its injunctions. Samsung appears to be fine with the U.S. district court resolving the FRAND issues. That makes it a willing licensee, unless and until it refuses to take a license even after such a determination and a liability finding. If Samsung did that, then even Judge Posner, the FRANDliest judge I could think of, would potentially deem a patent injunction warranted. But there is no indication right now that this would ever be an issue in this dispute.
How will Huawei respond to that motion? Is Sidley going to downplay the importance of Microsoft v. Motorola? Without totally understating or outright misrepresenting what the appeals court had decided back then, I can't see how the two cases could be distinguished to Huawei's benefit. That's why my current prediction (subject to change if important new facts are put on the table or major new decisions come down) is that Judge Orrick will grant Samsung's motion and that Huawei will try but fail to get Judge Orrick reversed by the Ninth Circuit. Maybe this will go all the way up to the Supreme Court then.

References: v. 
 § 289
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v.