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Frustrated judge takes issue with parties inability to agree, unwillingness to license

Both Apple, Inc. (AAPL) and Android operating system maker Google Inc. (GOOG) subsidiary Motorola Mobility saw a potentially precedent setting ruling, in which both parties cases were dismissed by an irate federal judge.

I. Dismissed With Prejudice

Judge Richard A. Posner, a Seventh Circuit Court of Appeals judge who moonlighted in the U.S. District Court, Northern District of Illinois (Chicago) for this critical case, seemed to imply that both companies were trying to abuse the legal system, wasting its time with unclear arguments.

Both companies agreed that money would fix the alleged wrongs caused by the other's infringement.  But Judge Posner was frustrated by the fact that neither company could reasonably justify the exorbitant sums they were claiming their patents were worth.

Judge Richard Posner
Judge Richard Posner was frustrated with what he viewed as ridiculous arguments from Motorola Mobility's and Apple's legion of lawyers. [Image Source: Abel Uribe, Chicago Tribune]

Also, Judge Posner complained about Apple's lawyers filing a mired myriad of motions.  In this regard, Apple's insistence at objecting to every ruling of Judge Posner's may have hurt it in court.  

Notably, Judge Posner had stated in a preliminary ruling that some features in Google/Motorola Mobility's Android operating system infringed on Apple's intellectual property.  Apple complained about its victory, with its legal team essentially bellyaching about the fact that the Judge didn't find in their favor for every single claim, even though he had found in their favor for most of them.

Judge Posner's decision to dismiss the case was quite resolute, in that he dismissed it "with prejudice", writing, "I have tentatively decided that the case should be dismissed with prejudice because neither party can establish a right to relief."

II. Appeal? Unlikely

Either company will have a tough road ahead appealing that decision as Judge Posner is a senior member of the Appeals court which would hear their case.  In short Apple versus Motorola is probably over in the U.S. with no damages awarded to either company, on account of their legal teams' inability to be reasonable (according to Judge Posner).

The only possible alternative route would be to file further complaints to the U.S. International Trade Commission.  But such complaints may not be taken seriously given the prestige Judge Posner holds among federal judges nationwide, in part thanks to his service for years as an esteemed faculty at the University of Chicago.

Apple gavel
Apple's options to appeal or complain to the ITC are scarce. [Image Source: ArsTechnica]

Other than the ITC or an appeal, both companies will likely be banned from filing lawsuits against each other until 2014.  It's important to note that Motorola Mobility was already found innocent by the ITC of Apple's accusations of infringement on several patents.

III. Good News for Customers; Bad News for Lawyers

Arguably this is a big win for consumers in that there will (likely) be no product bans, and the pair will be forced to compete on the market.  Of course some Apple and Android fans may fantasize about banning each other’s products, but to the average consumer, such bans would at best be an annoyance.

On the other hand, it's a blow to both companies' legal efforts.  For Google, it loses the ability to use Motorola Mobility as a club to beat Apple back from suing other Android handset makers, such as HTC Corp. (TPE:2498).  It was Motorola Mobility that filed the first lawsuit against Apple on Oct. 6, 2010.

For Apple, who filed countersuit against Motorola Mobility on Oct. 29, 2010, it is also a blow.  While Apple did not necessarily start this fight explicitly, its former CEO Steve Jobs long implied Motorola Mobility (and Google) were in infringement and that he would eventually "destroy" them with bans.

Indeed, bans could have destroyed Motorola or at least have forced its new owner Google to reach deep into its pockets, given that the smartphone maker is already struggling mightily with profitability.  Now Motorola's lawyers will be free to focus on their court battle with Microsoft Corp. (MSFT).

iPhone 4S
Apple and Motorola Mobility will be forced to begrudgingly compete on the market.
[Image Source: Obama Pacman]

A diluted market is a dangerous market for Apple, as it learned in the 1980s.  It is in Apple's best interest to keep the smartphone market a two-company race with Samsung Electronics Comp., Ltd. (KSC:005930), should its efforts to ban Samsung's product line fail.  Having a host of smaller alternatives like Motorola and HTC could eventually hurt Apple in the long run, as Apple would be fighting a one-man sales battle against a crowd of rivals.

Sources: U.S. District Court, Northern District of Illinois via SBNation [PDF], Bloomberg

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By herrdoktor330 on 6/8/2012 11:56:07 AM , Rating: 5
Common sense in action. Maybe Apple will knock it off and focus their energy on making a competitive product rather than try to hucklebuck the competition so that they're the only smartphone manufacturer in town.

By amanojaku on 6/8/2012 12:16:06 PM , Rating: 4
I doubt it. With the death of Jobs, I thought Apple would become more friendly. Instead, Tim Cook appears to be Jobs 2.0. I guess the apple doesn't fall far from the tree.

By AssBall on 6/8/2012 1:33:46 PM , Rating: 3
To be fair, Jobs was still CEO when most of this BS litigation started.

By sprockkets on 6/9/2012 3:17:33 PM , Rating: 4
Judging by the new motions in the ITC cases against HTC and Samsung, Tim Cook's words about hating lawsuits are BS.

By Strunf on 6/11/2012 7:40:51 AM , Rating: 2
Why changing a strategy that works, I sure don't like how Apple is fighting it off in courts but hey if I was in their position I would also use any trick possible and available to hinder my adversaries, any company would do so. Blame the system not the players.

By bug77 on 6/11/2012 9:08:19 AM , Rating: 2
Oh this is a clear-cut case of "hate the player". The system definitely wasn't designed to be used like this, what we see here is a lot of abuse.

By ratbert1 on 6/8/2012 4:54:31 PM , Rating: 2
no damages awarded to either company, on account of their legal teams' inability to be reasonable (according to Judge Posner).

Imagine that! A legal team not being reasonable? This must me a first!

By robinthakur on 6/8/12, Rating: -1
By bodar on 6/8/2012 11:37:50 PM , Rating: 5
Oh, you mean Apple's design patent for a thin wedge with the thick end missing, since they omitted pretty much everything else from consideration for infringement? Think about that for a second and recall your elementary math class: they got a patent for an acute angle.

While I agree that Samsung's previous habit of trying really hard to make the Galaxy S and Tab look like Apple products was shameless, I think Apple is going too far to claim that a geometric shape is novel, when it was mostly made possible by things like SSDs and ultrathin displays, which Apple did not create.


By jms102285 on 6/8/2012 11:57:41 PM , Rating: 5
How else is Samsung innovating?

Transparent LCD screens?

Foldable, durable LCD screens?

Apple invents NOTHING of use to the technology, they poach, package, and then market it as if they were the first game in town.

All that being said... GO ASUS! =)

By jms102285 on 6/8/2012 11:59:28 PM , Rating: 2
By robinthakur on 6/9/12, Rating: -1
By Microsapper on 6/10/2012 1:23:02 PM , Rating: 2
Couldn't have said it better!!! Even Microsoft knew better than to use iSue against competition. Although "Embrace Extend Extinguish" is hardly a better tactic, at least it's not overt Anti-competitive actions that blast your anti-competitive behavior in the face of the court system.

I hold nothing against Motorola for preemptively going after Apple in the first place though. There is no question they were in the phone business well before Apple and that just emphasizes that point. But they will still no doubt press ahead on Apple's belligerent indifference to the Billions they've invested in Standards Based R&D to come up with the technology everyone who pays the license fees is afforded today. To try and escape paying after now 6yrs of having been given notice by Moto is outrageous. No doubt even not getting their due compensation here in this court, they'll get in a court somewhere, where Standards contributors are treated justly. Otherwise we'll have no one willing to invest in Standards based technology in the first place if Apple was allowed to get away with this!

The erroneously named FOSS Patents Blog of Florian Mueller blatantly misleads mass media with extreme mis-information about FRAND/RAND protection in the first place. FRAND Standards were not meant to protect just those buying a license w/o having the expense of developing those patented technologies in the first place. FRAND Standards Protections came about to protect Companies willing to spend the R&D and time to make technology available to all and make sure they got a return on their investment.

That's were Fair and Reasonable comes in. All a company has to do is show what they spent in making those patents and it would be proved time after time that they rarely recoup those investments in less than 10yrs of receiving license fees. That's why I believe Injunctive Relief in the face of Companies like Apple and Microsoft, who held few Standards Based Patents to begin with should be held accountable with injunctions.

By the same token, any company that merely bought Standards Based Patents like in the Nortel deal shouldn't be allowed Injunctions, because they didn't make those Billions of Dollars of expenditures to write them in the first place. Standards Based Patent Injunctions should be reserved for the original patent holder and thereby eliminate many Patent Trolls from who don't actually even use the technology in the first place. Original Patent Holders should always be afforded greater protection than assignees always!

By retrospooty on 6/8/2012 12:41:13 PM , Rating: 2
Yup.... I never doubted it for a minute. Ridiculous lawsuits always get thrown out at some point. The problem with these things is there is no system in place to effectively determine what is full of crap and what is valid until it gets its day in court.

My hope is that the precedent sticks and sticks hard.

By JasonMick on 6/8/2012 12:44:57 PM , Rating: 5
Common sense in action. Maybe Apple will knock it off and focus their energy on making a competitive product rather than try to hucklebuck the competition so that they're the only smartphone manufacturer in town.
Yup, remarkably similar to the jury's findings in the Oracle v. Google case. Basically, yes Android violates some Apple/Oracle/Microsoft patents and yes Apple/Oracle/Microsoft violate some Google/Samsung/HTC patents.

But overall I don't really see any phone manufacturers outside of China trying to "copy" each other -- they're trying to produce distinctive designs with unique features.

Thus if the court is even to consider these kinds of claims, it should require damages be reasonable and properly justified.

"I want billions in damages" is not alone an appropriate reason to waste court time and taxpayer dollars.

You better have a darn good explanation of how this particularly feature is really worth a large chunk of your product's revenue.

Hopefully these rulings have a restrictive effect on the amount of smartphone litigation.

By tayb on 6/8/2012 12:56:18 PM , Rating: 3
Maybe EVERYONE will knock it off. It wasn't just the Apple lawsuit that was thrown out but the lawsuit by Motorola as well. Motorola certainly isn't any more innocent here than Apple. Both compares are filing frivolous lawsuits that are wastes of court time.

Now we need the exact same thing to happen with the Samsung/Apple legal battle and across the globe.

By sigmatau on 6/9/2012 3:10:38 PM , Rating: 4
Really? It's not like Apple didn't start all the junk lawsuits and other companies were forced to defend themselves with similar tactics. What did you expect for Motorola to not show up in court and allow for a summary judgment?

Apple should be punished for starting this crap. The only reason Apple became so rabid in the courts is that their products are noticably inferior and this is the only tactic they can use to delay the competition.

Apple doesn't compete. They steal, cheat, and lie better than any of them.

3.99" screen in the iphone 5? Total fail by a long shot.

By Microsapper on 6/10/2012 1:37:04 PM , Rating: 2
Hip hip hurrahs are due that comment!!! I've seen a company that relies on the "Poor Me" claims as much as Apple. Especially in light of the fact that they have never brought anything that hadn't been done before ever. They always relied on other's technology to build theirs on top of. To ignore that fact is so disingenuous as to fly in the face of true justice!

One has to wonder why it's always the biggest Liars and Thieves who cry the loudest when something is taken from them or it's them being hurt the most by their own deceptive business practices in the first place. Apple is the King of that lot by a long shot!!!

By Microsapper on 6/10/2012 1:38:05 PM , Rating: 2
Hip hip hurrahs are due that comment!!! I've never seen a company that relies on the "Poor Me" claims as much as Apple. Especially in light of the fact that they have never brought anything that hadn't been done before ever. They always relied on other's technology to build theirs on top of. To ignore that fact is so disingenuous as to fly in the face of true justice!

One has to wonder why it's always the biggest Liars and Thieves who cry the loudest when something is taken from them or it's them being hurt the most by their own deceptive business practices in the first place. Apple is the King of that lot by a long shot!!!

By tayb on 6/10/2012 3:56:06 PM , Rating: 1
Apple didn't fire the first shot, Nokia did. Motorola didn't have to file a counter suit, they choose to. Two wrongs make a right?? I wouldn't want to let facts intrude upon on your anti-Apple drivel though.

By TakinYourPoints on 6/11/2012 6:28:13 AM , Rating: 1
The posters here are fueled by anti-Apple drivel, what else would they talk about if they didn't have it?

By sigmatau on 6/11/2012 12:11:33 PM , Rating: 2
LOL! What facts? Nokia did not rabidly sue its competitors like Apple. And Moto should have not countersued? That's insane. That's like someone shooting at you and you are holding a gun and you throw it on the floor. Maybe you want to curl up and die, but I don't think that Motorola wants that.

But hey, don't drown in the kool-aid as Steve Jobs can revive you anymore buddy. It's over.

By Jaybus on 6/8/2012 12:55:57 PM , Rating: 5
Yes. This is how it is supposed to work. The PTO is just a rough screening. It has always been up to the courts to determine a patent's validity and worth. Judge P did not have to rule on validity, because both parties agreed that money was suitable compensation for any infringement. Nobody cares whether their screen is unlocked with a horizontal swipe or a vertical swipe. All of the contested patents are pretty much this inane, so while both companies insisted these inane patents were worth hundreds of millions, Judge P, very logically, determined that they were essentially worthless and therefore it was a frivolous case. Hooray for Judge P!

By AMDftw on 6/8/12, Rating: 0
By msheredy on 6/8/12, Rating: -1
By topkill on 6/8/2012 6:39:34 PM , Rating: 2
I totally disagree. Protecting "what's theirs" means making better products and competing! It does NOT mean that you sue somebody for doing the same thing you did with two lines of code out of the two MILLION lines it took to create a product.

They are looking for monopoly license over some minor features that are similar. That is total bullshit and anti-competitive in the extreme.

By msheredy on 6/8/12, Rating: 0
By topkill on 6/9/2012 12:36:03 AM , Rating: 2
That's the best you can do to defend your position?


By Adam M on 6/8/2012 3:04:17 PM , Rating: 3
Finally is right! I hope this ruling sets a good precedent for future patent troll cases in general but for Apple specifically. While they are certainly not the only company to participate in the process of stifling innovation and crushing legitimate competition, they are the most notorious in recent memory.

By piroroadkill on 6/9/2012 10:53:09 AM , Rating: 1
Christ, I agree. They need to be told to knock this patent trolling shit off and simply make products people want, and let the market sort things out. SHOCK, HORROR!

An Open Letter to All Patent Trolls
By WalksTheWalk on 6/8/2012 12:20:03 PM , Rating: 5
Go fuck yourselves!

-Judge Posner

RE: An Open Letter to All Patent Trolls
By zozzlhandler on 6/8/2012 1:30:46 PM , Rating: 2
A judge is not so nyekulturny. What he *really* said is "Go and indulge in self-impregnation".

Problems with Jason Mick's analysis in this article
By avanst on 6/8/2012 11:45:53 PM , Rating: 2
I'm a lawyer, and frankly Jason Mick doesn't know what he is talking about.

First of all, this "tentative" ruling doesn't set precedent. It is a District court, meaning it is only persuasive to other courts, not controlling. In other words, ANY other court in the ENTIRE country and chose to ignore this ruling.

Second, the reason Posner made this ruling was NOT because "neither company could reasonably justify the exorbitant sums they were claiming their patents were worth." It was because Apple didn't have enough evidence to prove damages to survive a summary judgment. Posner then determined injunctive relief, meaning forcing Motorola to stop infringing, would be too costly for the court to implement and therefore not a reasonable option.

Courts only have two options for plaintiffs in civil cases, damages, meaning money, or injunctive relief, meaning an order by the court to get the defendant to do something.

Posner decided that since Apple couldn't prove damages and injunctive relief is too costly, there was nothing for him to do except dismiss the case.

Please Jason Mick, if you are going to comment on law in some sort of article, please understand what you are writing about before publishing. To do otherwise leads to the spread of inaccurate and misleading information. Not to mention it is lazy reporting and reveals your incompetence.

By bug77 on 6/11/2012 6:49:29 AM , Rating: 3
Dude, never start your posts with "I'm a lawyer". I almost hit "not worth reading" on impulse :-D

By Theoz on 6/11/2012 1:33:17 PM , Rating: 2
Was going to post pretty much the same thing. Also, two other errors:

1) Dismissing a case "with prejudice" is not related to the resoluteness of the decision, but rather is legally important in that it means that Apple cannot again file the same case. Whereas, a dismissal "without prejudice" would mean that Apple could clean up the case and refile it.

2) Since this is a patent case, this would likely not get appealed to Judge Posner's court at the 7th circuit, but rather to the Court of Appeals for the Federal Circuit in Washington, unless there is some special issue that I am not aware of.

Judge in appeals court too?
By Paedric on 6/8/2012 1:55:36 PM , Rating: 2
The point of an appeals court is to have new eyes look at the case.
I know that he is not the only judge in the appeals court, but isn't it unfair to have the same judge in both courts?

That technical point aside, I'm glad to finally see some common sense from a judge, I had almost lost faith.

RE: Judge in appeals court too?
By avanst on 6/8/2012 11:50:09 PM , Rating: 3
Posner would just recuse himself and let the other judges in the circuit court decide the case.

Motorola/Google FRAND abuse attacked
By Tony Swash on 6/9/2012 1:26:46 PM , Rating: 1
A large number of companies have written to the ITC attacking Motorola's/Google's FRAND abuse including HP, Nokia, Verizon, the Business Software Alliance (BSA), the Entertainment Software Association (ESA), Retail Industry Leaders Association, Association for Competitive Technology (ACT), and Cisco. No third-party public interest statements have been filed in support of Motorola's possible injunction.

Clearly these are Apple stooges :)

Read more:

By amanojaku on 6/9/2012 3:26:02 PM , Rating: 2
From your source:
Most companies supporting Microsoft and Apple have vested interest in not seeing an injunction based on a standard-essential patent.
They don't care about Apple, they're worried about their own wallets.

Of course, I don't see how this is any different from Apple seeking bans on Samsung and HTC.

And let's not even talk about the lack of validity of many of Apple's patents.

By Cheesew1z69 on 6/9/2012 4:19:49 PM , Rating: 2
Clearly I am an Apple stooge :)
Fixed that for you.

The real issue. . .
By JKflipflop98 on 6/9/2012 3:54:25 AM , Rating: 1
I can't decide which is the symptom and which is the cause.

The overwhelming majority today seems to have the idea that "oh well, they're in it to make money" and shrug off all these dirty practices and price gouging with complete apathy. This releases the corporation from it's moral shackle.

Or has the loss of corporate ethics over the years just worn people down so much that we expect to get screwed over at every turn? It's to the point now that people will actually go out of their way to defend these big, faceless entities that care nothing for anyone.

Either way, it's a shitty place to be idling. I hope we get out of here soon.

RE: The real issue. . .
By C'DaleRider on 6/11/2012 9:22:04 PM , Rating: 2
Or has the loss of corporate ethics over the years

So when exactly did corporations ever have ethics? Was it back in the 1970's when Ford decided to produce the Pinto with the gas tank that'd explode upon a rear end problem that could've been fixed for pennies per car, but Ford decided litigation was going to be cheaper than fixing the underlying problem?

Or maybe it was when Thalidomide was released in the 1950's without real proper drug testing and ended up causing horrible birth defects? Too bad, so sad the German manufacturer said.

Corps. have never had can a company have anything like that? A company is not a person.

By NellyFromMA on 6/12/2012 7:53:26 AM , Rating: 2
Failure to be reasonable at the end of the day cost both companies, seemingly particularly Apple. I guess common sense does prevail in the end? Strange.

By GotThumbs on 6/10/2012 3:39:42 PM , Rating: 1
FINALLY! We finally get a judge whose is as tired of all the BS that Apple and the other patent trolling lawyers as we are.

As noted in this story, even when Apple lawyers won...they bitched and complained about not winning it all.

Bunch of fricking kids. Screw em and the company they work for.

"Mac OS X is like living in a farmhouse in the country with no locks, and Windows is living in a house with bars on the windows in the bad part of town." -- Charlie Miller

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