Samsung Electronics Co. (005930) should post a bond equal to 88 percent of the value of smartphones found to infringe Apple Inc. (AAPL:US) patents if it loses a U.S. trade ruling and wants to keep selling the devices, a judge said.
U.S. International Trade Commission Judge Thomas Pender in October found that more than a dozen models of Samsung mobile phones, media players and tablet computers infringed patents on the iPhone and other Apple products.
Pender, in a recommendation posted Dec. 28 on the agency’s website, said Samsung should face a ban on imports of the infringing products. Pender also specified bonds Samsung is to post if the full commission accepts his decision to ban imports and the company wants to keep selling the products during a 60- day period when President Barack Obama could overturn the ban.
In his Dec. 28 order, Pender said Samsung should pay bonds of 32.5 percent on sales of media players and 37.6 percent for tablet computers. Samsung argued for lower payments based on a royalty rate of 4.9 percent, Pender said in his order. The judge accepted Apple’s suggested rates.
“That’s a high rate,” Christopher Marlett, founder of MDB Capital, an intellectual-property consultancy, said in an interview. “With those economics, it will be difficult for Samsung to decide whether to sell the products at all.”
The six-member trade commission is to finish its investigation by Feb. 25.
Samsung could try to avoid the bonds by changing product designs to address the dispute, and Apple could ask the commission to decide whether the new equipment still infringes its patents, said Rodney Sweetland III, a lawyer with Duane Morris LLP in Washington who specializes in ITC cases.
Even if the commission ordered an import ban, it would probably give Samsung time to work around the patents to ensure there is no disruption to consumers and carriers, Sweetland said in an interview.
The products involved in the ITC case include models of the Galaxy Tab tablet, and the Galaxy Nexus and Galaxy S II smartphones. Not included are some popular products including the Galaxy S III smartphone and Galaxy Note II pen-equipped phone.
Samsung “will continue to take all appropriate measures to ensure the availability of our innovative products for American consumers,” Adam Yates, a company spokesman, said in an e- mailed statement on Dec. 31.
“We remain confident that the full commission will ultimately reach a final determination that affirms our position,” Yates said. “Patent law must not be manipulated to give one company a monopoly over rectangles with rounded corners, or technology that is being improved every day by Samsung and other companies.”
Kristin Huguet, a spokeswoman for Apple, didn’t immediately respond to an e-mail seeking comment.
Brandywine Files More than 50 Suits in Multiple District Courts
Brandywine Communications Inc., a maker of GPS and time- code time-and-frequency products, filed more than 50 patent infringement cases in the last week of December.
The suits were filed in a number of districts, including courts in Los Angeles; Boise, Idaho; Wilmington, Delaware; Tyler, Texas; and Portland, Oregon.
Defendants are accused of infringing six patents related to cellular communication. Defendants are largely providers of cellular and Internet products and services.
Some of the patents at issue in this case have changed hands multiple times. Patent 5,206,854 has had nine different assignments, according to a database of the U.S. Patent and Trademark Office.
Unlike many patent-holders who filed multiple infringement cases, Tustin, California-based Brandywine actually manufactures products related to the patents. According to the company website, Brandywine produces GPS-synchronized clocks, network synchronization equipment, and time and message displays used in placed like airports and hospitals.
The company didn’t request an order barring further use of its technology. Brandywine asked the various courts for awards of money damages, including an ongoing royalty.
One of the many new cases is Brandywine v. O.T.T. Communications Inc., 1:12-cv-01768-UNA, U.S. District Court, District of Delaware (Wilmington).
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Pinterest Sued, Intellectual Property Misappropriation Claimed
Pinterest Inc., the Palo Alto, California-based operator of a social-media website, was sued for intellectual property misappropriation by a New Jersey resident.
In a complaint filed Dec. 27 in federal court in Manhattan, Theodore F. Schroeder claims that Pinterest is based on ideas and intellectual property he developed when he was a student at Columbia Law School, beginning in 2005.
He said he was eventually frozen out of the deal that gave birth to Pinterest, even though he was assured by investors that there was no interest in profiting from his design work on a project that was the antecedent to Pinterest.
The suit doesn’t specifically accuse Pinterest of copyright infringement. Instead, Schroeder claims his skills and intellectual property were misappropriated and that promises made to him were broken.
In a Dec. 31 e-mail, Barry Schnitt, a spokesman for Pinterest, said the lawsuit is baseless and that the company will fight it.
The case is Theodore F. Schroeder V. Brian S. Cohen, 1:12- cv-09413, U.S. District Court, Southern District of New York (Manhattan).
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Website Operator Responds to United’s Trademark Complaint
The operator of a website that criticizes United Air Lines and compiles consumer complaints has responded to a trademark lawsuit by United Continental Holdings Inc. (UAL:US), operator of the airline.
According to a statement on his Untied.com website, the founder of that site asked a Canadian federal court to dismiss the suit that was filed in November 2012.
Jeremy Cooperstock, the engineer and McGill University professor who started the site, told the Canadian court that the suit has no legal merit.
A hearing is set for Feb. 13 in Montreal, according to Untied.com.
In a Nov. 28 story, United Press International reported that United claimed in its court filing that the site infringed its United and Continental-related trademarks and causes customer confusion.
Ramsay Backs Down, Says U.K. ‘Spotted Pig’ Application a Mistake
Celebrity chef Gordon Ramsay, who applied for the U.K. trademark on The Spotted Pig, has now said the application was an innocent mistake and that he regrets the resulting brouhaha, the U.K.’s Daily Mail newspaper reported.
Ramsay, known for his appearance on the cooking shows on both U.S. and U.K. television, told the Daily Mail that he was annoyed by the critical comments about the registration from other chefs, including Mario Batali.
He denied that he filed the U.K. application in efforts to block the possible opening of an overseas branch of New York’s Spotted Pig restaurant, the Daily Mail reported.
University of Georgia Seeks Cancellation of Regent Trademark
The University of Georgia has responded to an infringement suit brought by a Virginia private college founded by evangelist Pat Robertson.
Regent University of Virginia Beach, Virginia, filed suit in federal court in Georgia in September 2012, claiming the use of “Georgia Regents University” infringed its trademark. The new school is to result from a merger of Augusta State University and Georgia Health Sciences University, according to court papers.
In a response filed Dec. 21, the regents of the University System of Georgia said they filed papers seeking cancellation of the Virginia school’s “Regent University” trademarks.
The Georgia regents also claimed that the suit is barred under the doctrine of sovereign immunity, and that they hadn’t waived that immunity or consented to the suit.
The Virginia school’s mark is generic, functional and contestable, and there is no likelihood of consumer confusion between the name of Regent University and Georgia Regents University, the Georgia regents said in the court filing.
In addition to seeking dismissal of the suit and cancellation of the Virginia school’s trademarks, the Georgia regents asked for awards of attorney fees and litigation costs.
The case is Regent University v. C. Dean Alford, 1:12- cv-00131-JRH-WLB, U.S. District Court, Southern District of Georgia (Augusta).
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