Bloomberg News

HTC, Merck, Apple, Oprah, Hyundai: Intellectual Property

November 13, 2012

Apple Inc. (AAPL:US) settled all global lawsuits with HTC Corp. (2498), signaling a new willingness to resolve patent disputes without resorting to the “thermonuclear war” stance favored by co-founder Steve Jobs.

Apple, which had accused HTC of copying features that made its iPhone unique, “will continue to stay laser-focused on product innovation,” Chief Executive Officer Tim Cook said in a statement yesterday with HTC, which surged as the companies announced a 10-year licensing deal. HTC had claimed the maker of iPads and MacBooks infringed wireless patents.

The settlement with HTC, the first company Apple sued for violating iPhone patents, suggests Cook will take a softer line than Jobs, who vowed before his death last year to wage all-out war against smartphones powered by Google Inc. (GOOG:US)’s Android software. The agreement may also serve as a blueprint for Apple to negotiate patent accords with Samsung (005930) Electronics Co. and Google’s Motorola Mobility business, said Shaw Wu, an analyst at Sterne Agee & Leach Inc.

“For as long as Tim Cook has been CEO, Apple has been less interested in pursuing legal assaults against competitors, choosing increasingly to find ways to settle differences out of court,” said Carl Howe, an analyst at Yankee Group in Boston. “This settlement indicates a softening of Apple’s legal thrusts.”

HTC and Apple declined to provide settlement details. Apple will probably receive $6 to $8 per phone, or $180 million to $280 million a year from HTC, Wu wrote in a research report yesterday. That’s more than the roughly $5 per phone HTC pays Microsoft Corp., and reflects the relative strength of Apple’s patent defenses, Wu said.

“We think it is fair that Apple will get some licensing revenue for the intellectual property it has developed -- in particular multitouch gestures -- in making the modern smartphone and tablet with touchscreens,” Wu said. “Prior to the iPhone and iPad, there were arguably no products that were close in functionality and appearance.”

Settling with HTC may allow the world’s most-valuable company to focus its legal efforts on Samsung, the Suwon, South Korea-based maker of Galaxy handsets that’s now the world’s largest smartphone maker.

“Samsung is still going hard and has become an even bigger threat” since being sued by Apple, said Lee Seung Woo, a Seoul- based analyst at IBK Securities Co. Apple may have decided it achieved what it wanted by going after HTC because the Taiwanese company’s share of the smartphone market has weakened, Lee said.

James Chung, a Seoul-based spokesman for Samsung, declined to comment.

Merck, Takeda Unit Sue Fresenius Over Snake-Venom Drug

Merck & Co. (MRK:US) and Takeda Pharmaceutical Co. (4502)’s Millennium unit sued subsidiaries of Fresenius SE (FRE) for infringing three U.S. patents for a human blood-thinner made from rattlesnake venom.

U.S. units of Fresenius, based in Bad Homburg, Germany, plan to market a generic version of anti-clotting Integrilin before the patents expire in 2015, according to a complaint filed Nov. 9 in federal court in Wilmington, Delaware.

In applying to the U.S. Food and Drug Administration for permission to sell the drug, Fresenius “acted without a reasonable basis for believing that it would not be liable for infringing,” the drugmakers said in the complaint. The sales would cause “irreparable injury,” the companies said.

In dispute are patents 5,807,825; 5,747,447; and 5,968,902.

Integrilin can be used to prevent clots when doctors perform artery-clearing angioplasty procedures on heart-attack patients and install coronary stents to prop open clogged blood vessels.

Matthias Link, a Fresenius spokesman, didn’t immediately reply to an e-mail seeking comment on the lawsuit after regular business hours in Germany.

Merck is based in Whitehouse Station, New Jersey. Takeda is based in Osaka, Japan.

The case is Merck v. Fresenius, 12-cv-1410, U.S. District Court, District of Delaware (Wilmington).

For more patent news, click here.

Trademarks

Apple’s Use of Swiss Clock Face Design to Cost $21 Million

Apple Inc., maker of the iPhone and iPad, is paying 13 million British pounds ($21 million) in settlement of a trademark dispute involving the image of a clock, the U.K.’s Daily Mail newspaper reported.

The payment, to the operator of Switzerland’s national rail system, is for the use of the image of a station clock face on the Cupertino, California-based company’s mobile devices, according to the newspaper.

The clock face, created in 1944, has been in continuous used by the railway system since 1844, and has also been licensed to Swiss watchmaker Mondaine Watch Ltd., the Daily Mail reported.

The amount of the settlement was originally reported by Tages-Anzeiger, a Swiss newspaper, according to the Daily Mail.

Winfrey’s Trademark Applications May Mean New Food Venture

Oprah Winfrey, daytime talk-show celebrity and founder of the Oprah Winfrey Network LLC, is moving into a new commercial venture, if recent trademark filings are any indication.

According to the database of the U.S. Patent and Trademark Office, Winfrey filed five applications Oct. 28 to register “Oprah’s Farm” for a variety of products and services. They include skin-care and cosmetics, catering services, and organic beverages, salad dressings and frozen foods.

The actual name under which the application was filed -- Oprah’s Farm LLC Hawaii -- indicates that the products may be not be sourced from the mainland.

Pacific Business News reported in April that Winfrey had registered “Oprah’s Farm LLC” with the Hawaii Department of Commerce & Consumer Affairs.

For more trademark news, click here.

Copyright

JibJab Sues Hyundai, Claims Dealers’ Commercials Infringe

JibJab Media Inc., the online entertainment company famous for its political satire videos, sued Korean automaker Hyundai Motor Co. (005380)’s Hyundai Motor America unit for copyright infringement.

The suit, filed Nov. 8 in federal court in Los Angeles, claims some U.S. Hyundai dealers are running commercials that “incorporate key elements of the JibJab copyrighted works.” JibJab said the commercials, which can be viewed on Google Inc.’s YouTube video-sharing site, even incorporate the words “Jib Jab” into their title descriptions, which the Santa Monica, California-based company says causes consumer confusion.

The accused commercials “feature animation that is substantially similar” to the JibJab works, the company says. They make unauthorized use of “concrete elements” of its work, resulting in videos that are “strikingly similar” to the ones the California company creates, according to court papers.

JibJab claims the alleged infringement is deliberate and has damaged the company. The defendants are also accused of infringing JibJab’s trademarks by using the name without permission, according to the complaint.

Hyundai didn’t immediately respond to an e-mailed request for comment on the suit.

JibJab asked the court to bar further infringement of its copyrights, and for awards for money damages, profits the defendants derived from their alleged infringement, extra damages to punish them for their conduct, and attorney fees and litigation costs.

The case is JibJab Media Inc. v. Hyundai Motor America, 2:12-cv-09591-CAS-MAN, U.S. District Court, Central District of California (Los Angeles).

For more copyright news, click here.

Trade Secrets/Industrial Espionage

TransAct Defeats Avery Dennison Motion in Trade Secrets Case

Avery Dennison Corp., the maker of labels and other pressure-sensitive products, filed in its attempt to get a court order barring the use of its allegedly purloined trade secrets, according to court papers.

The Pasadena, California-based company filed suit against TransAct Technologies Inc. (TACT:US), of Hamden, Connecticut, in June, claiming TransAct had misappropriated trade secrets related to the design of the company’s Food Safety Terminals.

According to TransAct’s website, these are devices used to create labels used in commercial food preparation and food labeling.

In a Nov. 8 filing in Ohio’s Lake County Court of Common Pleas, the court denied Avery Dennison’s request for a court order against TransAct. The court did partially grant a court order against a former Avery Dennison employee.

A status conference in the case is set for Dec. 12, according to the docket.

The case is Avery Dennison Corp. (AVY:US) v. TransAct Technologies Inc., 12cv001586, Ohio Court of Common Pleas, Lake County.

IP Moves

Squire Sanders Expands IP Practice With Hire From Benesch Firm

Squire Sanders LLP hired Steven M. Auvil for its IP group, the Cleveland-based firm said in an e-mailed statement.

Auvil, a litigator, joins from Cleveland’s Benesch, Friedlander, Coplan & Aronoff LLP.

There he represented clients in IP disputes in federal district and appellate courts and before the U.S. International Trade Commission and the U.S. Patent and Trademark Office’s Patent Trial and Appeals Board. His clients’ technologies have included power electronics, communication systems, complex mechanical systems and software.

Auvil has an undergraduate degree in mechanical engineering from Ohio State University, a law degree from Cleveland State University and a master’s degree in trade regulation law from New York University.

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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