Bloomberg News

InterDigital, Burberry, Warner: Intellectual Property

August 02, 2012

InterDigital Inc. (IDCC:US) won an appeals court ruling reviving its effort to force Nokia Oyj (NOK:US) to pay patent royalties on the third generation of mobile-phone technology. InterDigital soared as much as 25 percent on the decision.

The U.S. Court of Appeals for the Federal Circuit overturned a U.S. International Trade Commission decision yesterday that cleared Nokia of claims it infringed InterDigital patents, and sent the case back to the agency for further review. The decision was posted on the court’s website.

The commission “erred in construing certain critical claim terms in both patents,” the appeals court said. The patents in the case, first filed in 2007, cover power control and high- speed data transmission, InterDigital contends.

InterDigital has said it asked the ITC to block imports of Nokia (NOK1V)’s 3G phones because the Espoo, Finland-based company refuses to pay patent royalties on networks that allow mobile- phone users to hold videoconferences, download music and browse the Internet. Patent royalties accounted for almost all of the $301.7 million in revenue InterDigital reported last year.

In the ITC case, the trade commission sided with Nokia, saying the patents weren’t infringed. Nokia, whose sales have declined amid smartphone competition from companies including Apple Inc., had also claimed the InterDigital patents were invalid.

InterDigital filed a second complaint at the ITC against Nokia, as well as ZTE Corp. and Huawei Technologies Co., accusing the Chinese phone-equipment makers of infringing patents related to 3G wireless technology. A hearing in that case is scheduled for October in Washington.

InterDigital, based in King of Prussia, Pennsylvania, said in its annual report that it received royalties from more than half of all 3G mobile devices sold last year, including ones from Samsung Electronics Co. (005930), Apple, Research In Motion and HTC Corp. (2498)

Nokia had a license with InterDigital for second-generation and some third-generation technology that expired in 2006. Nokia paid $253 million in a settlement reached in 2006. The companies were unable to reach a new agreement, InterDigital has said.

The case is InterDigital Communications v. ITC, 2010-1093, U.S. Court of Appeals for the Federal Circuit (Washington). The ITC case is In the Matter of Certain 3G Mobile Handsets and components thereof, 337-613, U.S. International Trade Commission (Washington).

The pending ITC case is In the Matter of Wireless Devices with 3G Capabilities, 337-800, ITC in Washington.

Samsung Lawyer Fails to Undo Apple Trial Evidence Ruling

Samsung Electronics Co. again lost its bid to use evidence a lawyer for the company described as “critical” to rebutting Apple Inc. (AAPL:US)’s central allegations in a patent-infringement trial in California.

Samsung was barred by U.S. District Judge Lucy Koh in San Jose from presenting images of a smartphone that it claims to have been developing in 2006, the year before Apple introduced the iPhone. Samsung said in a filing that the images show evidence that it was developing the next generation of mobile phones with a “simple, rounded rectangular body” before Apple’s January 2007 announcement of the iPhone.

Samsung said in an e-mailed statement that Koh’s ruling means “Samsung was not allowed to tell the jury the full story and show the pre-iPhone design for that and other phones that were in development at Samsung in 2006, before the iPhone.”

Samsung’s statement included attachments of the evidence that Koh had excluded, prompting a demand from Koh for an explanation of who drafted and issued the release.

Harold McElhinny, a lawyer for Apple, told Koh the release was “on perception an intentional attempt to pollute this jury” rising to “contempt of court.”

Quinn said in a filing yesterday with the court that he authorized the statement, and that material included in the excluded exhibits was previously in the public court record.

Quinn said that distribution of the statement and attached exhibits is consistent with Koh’s rulings that the case should be “open to public view” -- a view demonstrated by the judge’s repeated denial of Samsung’s and Apple’s attempt to seal documents.

Apple’s accusations that the disclosure amounted to contempt of court “unfairly called my personal reputation into question and have resulted in media reports likewise falsely impugning me personally,” Quinn said in the filing.

In another ruling yesterday, Koh said Samsung can use some evidence from a former Apple designer to defend against the infringement allegations.

Apple, based in Cupertino, California, seeks $2.5 billion for its claims that Samsung infringed patents covering designs and technology for mobile devices.

Samsung countersued and will present claims that Apple is infringing two patents covering mobile-technology standards and three utility patents. Samsung is demanding royalties of as much as 2.4 percent for each device sold, according to a court filing.

The case is Apple Inc. v. Samsung Electronics Co. Ltd., 11- cv-01846, U.S. District Court, Northern District of California (San Jose).

For more patent news, click here.

Trademark

Burberry Drops Lawsuit Against Humphrey Bogart Heirs

Burberry Group Plc (BRBY), the U.K.’s largest luxury-goods company, dropped a U.S. lawsuit against Humphrey Bogart’s heirs over the use of an image of the late actor in advertising.

Burberry in May asked the federal court in Manhattan to declare its use of Bogart’s name and image didn’t infringe Bogart LLC’s trademark and publicity rights. The London-based company uses an image from the film “Casablanca” of the late actor wearing a Burberry trench coat.

Bogart LLC, mostly owned by Bogart’s children, responded by filing a trademark-infringement complaint in state court in California. That suit hasn’t been dropped, according to the court’s docket.

Burberry said in its complaint that it used Bogart’s image, licensed from photo provider Corbis, to show the historical influence of the brand, not to sell merchandise. The case was dismissed with prejudice, meaning Burberry can’t refile the claims against the Bogart estate.

Evan Glassman, a lawyer for Burberry, and Paul Stevens, a lawyer for Bogart LLC, didn’t immediately respond to voice-mails seeking comment on the dismissal.

The federal case is Burberry Ltd. v. Bogart LLC, 12-3491, U.S. District Court, Southern District of New York (Manhattan). The state case is Bogart LLC v. Burberry Group, BC483967, Superior Court of California, County of Los Angeles.

Church Officials in Custody in Trademark Dispute With Adventists

A trademark dispute involving rival religious denominations has resulted in an arrest warrant being issued for two church officials, both of whom are now in custody, according to the Redlands-Loma Linda Patch newspaper.

The General Conference of the Seventh-Day Adventists filed suit in a Tennessee federal court in 2006 in an effort to halt a Walter Mc. Gill of Guys, Tennessee from using its trademarks without authorization.

Gill, the pastor of a church known as the Creation Seventh Day Adventist Church, and was accused of using trademarks in connection with religious observances, goods and services to which he wasn’t entitled, the conference said in its pleadings.

He was also accused of using the conference’s trademarks in his Internet domain names, which confused the public, according to court papers. The conference said it could not control the quality or content of what McGill was offering under its trademarks, and that this was harmful and unlawful.

The conference had sought a court order barring further infringement of its marks, a recall of all infringing promotional material, the transfer of the objectionable domain names and awards of money damages, attorney fees and litigation costs.

McGill told the court he would not participate in settlement discussions because his religious beliefs made it impossible for him to compromise his position on the use of the name. The court ordered him to appear or face sanctions, and issued a similar order to a second church official, Lucan Chartier. When both failed to comply, the court found them in contempt and issued arrest warrants May 3.

In June, the court awarded attorney fees and litigation costs of $72,000 to the conference for the filing of two separate motions in the case, according to Bloomberg data

The Patch newspaper reported that McGill was arrested June 13, and that Chartier surrendered to authorities July 31 in Redlands, California, and that both intend to fast during their incarceration.

Lawyers identified on the court docket as representing the pair are no longer in the case.

The case is General Conference Corporation of Seventh-Day Adventists v. McGill, 1:06-cv-01207-JDB-EGB, U.S. District Court, Western District of Tennessee (Jackson).

For more trademark news, click here.

Copyright

Warner Brothers Sues Amazon Resellers Over Counterfeits Sales

Time Warner Inc. (TWX:US)’s Warner Brothers unit filed more than a dozen copyright-infringement suits in federal court in Los Angeles against Amazon.com resellers.

The complaints, all filed on July 30, are each against one named seller and other unnamed defendants. The defendants are among the 2 million Amazon.com resellers, who use the Seattle- based retail giant’s system to sell new, used and collectible items, according to court papers.

Warner Brothers said these sellers are selling infringing copies of its products. Among those listed in the various complaints are the Harry Potter films, and “Treme,” “One Tree Hill” and “The Wire” television programs.

Amazon.com itself isn’t a defendant.

The studio asked the court for orders for the seizure of the allegedly infringing products, and for awards of money damages, attorney fees and litigation costs. Additionally, it seeks an order barring further infringement of its products.

For more copyright news, click here.

Trade Secrets/Industrial Espionage

Raytheon Claims Flir Stole Trade Secrets Revived on Appeal

U.S. defense contractor Raytheon Co. (RTN:US) won an appeals court ruling that revives claims Flir Systems Inc. (FLIR:US)’s Indigo Systems unit lured away former workers to steal trade secrets related to infrared cameras.

The U.S. Court of Appeals for the Federal Circuit said yesterday that a lower court erred in dismissing the case, and sent it back for further review. It said the trial judge erred in saying that Raytheon should have known of any supposed theft before 2004, so it was too late to file the lawsuit in 2007.

“It was for the jury and not for the district court to determine when Raytheon should have first discovered the facts supporting its cause of action,” the three-judge panel wrote.

Indigo, now known as Flir Commercial Systems, was founded in 1996 by former Raytheon employees and had a consulting contract with the Waltham, Massachusetts-based defense contractor through 2000.

That year, Indigo was chosen over Raytheon for a contract to provide infrared cameras to the U.S. military, the court said. In 2003, it beat out Raytheon again, this time for a subcontract from Northrop Grumman Corp. (NOC:US) to provide the cameras for the F-35 Joint Strike Fighter program.

Raytheon said it received assurances from Indigo that its employees, including ones hired from Raytheon, weren’t using Raytheon technology.

In 2004, Raytheon obtained an Indigo camera, disassembled it and “found what it believed was evidence of patent infringement and trade secret misappropriation,” according to the ruling. The suit was filed in 2007, within the three-year statute of limitations based on that discovery and the patent claims have since settled.

Raytheon had suspicions in 2000 because of the number of employees it lost to Indigo and the contract losses, the lower court ruled. It should have acted then, the judge said.

The judge should have considered that Raytheon relied on pledges from Indigo that Raytheon intellectual property wasn’t being used, the Federal Circuit said. The court panel said the purchase of the Indigo camera was a normal competitive gambit, not out of any particular suspicion.

“The district court essentially concluded that from 2000 on, Raytheon was on permanent inquiry notice and therefore had a constant duty to investigate all acts of competition by Indigo for evidence of misappropriation,” the panel wrote.

Flir, a Wilsonville, Oregon-based maker of night-vision cameras, bought Indigo in 2004.

The case is Raytheon Co. v. Indigo Systems Corp., 2011-1245 and 2011-1246, U.S. Court of Appeals for the Federal Circuit (Washington). The lower court case is Raytheon Co. v. Indigo Systems Corp., 07cv109, U.S. District Court, Eastern District of Texas (Sherman).

To contact the reporter on this story: Victoria Slind-Flor in Oakland, California, at vslindflor@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.


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Companies Mentioned

  • IDCC
    (InterDigital Inc/PA)
    • $50.43 USD
    • 1.27
    • 2.52%
  • NOK
    (Nokia OYJ)
    • $7.78 USD
    • 0.04
    • 0.51%
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