Apple surely is bitter for having to pay a top Android phonemaker for its "innovation"

Today Apple, Inc. (AAPL) dodged one bullet in German court, but saw another unfavorable ruling put in place, which will presumably block Apple's iCloud in the European Union nation until Apple can successfully appeal or settles the dispute.

I. Germany Alone Promotes Android and Apple's A Two Side War

Apple late chairmanformer CEO, and co-founder, Steven P. Jobs bragged in a 1994 interview about his company's mastery of stealing ideas from others, stating [video], "Picasso had a saying - 'Good artists copy, great artists steal.' And we have always been shameless about stealing great ideas."

Yet it has been Apple's accusations that Android phonemakers have stolen its ideas from that have burned up the blogosphere over the course of the past year.  It takes two tango, and Android phonemakers have responded with equal litigious fury [1][2][3] -- particularly when it comes to Samsung Electronics, Comp., Ltd. (KS:005930) and Google Inc.'s (GOOGpending acquisition Motorola Mobility Inc. 

For the most part member states of the European Union have seemed to grow reacted to the slew of suits and countersuits with growing frustration, tossing out a mixture of outright denials to Pyrrhic victories that do not give Apple or its Android rivals their desired outcome -- the removal of "the other guy's" products from the market.

EU regulators even went as far as to probe Apple and Samsung over potential antitrust abuses.  A formal investigation is currently looking deeper into Samsung's patent use, and a future one may target Apple, as well.

Overseas the U.S. has similarly smacked down Apple's request to ban Motorola's product and Samsung's products.  U.S. courts have only agreed to tentatively ban HTC Corp.'s (TPE:2498) oldest Froyo smartphones in 2012 -- a meaningless victory for Apple as HTC can simply update (or more likely stop selling these aged models).  Even Australia, who initially banned Samsung's Android Galaxy Tab 10.1 at Apple's bequest, saw a higher court smack down the ban stating that the judge who delivered it had grossly misinterpreted the law.

In other words, no one has seemed willing to grant one side or another a major victory and fuel the fire of Android and Apple's patent war.  Nobody, that is, except for Germany. 

German tanks
Germany has been the primary country fueling Android and Apple's world war.  It has now assigned three temporary product bans -- two in favor of Android and one in favor of Apple [Image Source: Avia Armor]

II. Apple's 3G Lineup Gets Briefly Pulled From the German (Online) Market

Germany alone has been steering a different course.  

It gained attention for banning Samsung's Galaxy Tab 10.1 for being too "minimalist" (the German Judge's term) and thus violated Apple's design patent.  That verdict was viewed as Apple's first (and only) real major legal victory over Android. 

Conversely on Dec. 9 Germany's Mannheim court delivered a pro-Android ruling, when it sided with Motorola in a 3G patent case.

It decided to ban online sales and imports of Apple's iPhone 4, iPad (3G), and iPad 2 (3G) for violating Motorola's EP (European Patent) 1010336 (B1)  (U.S. counterpart: U.S. Patent No. 6,359,898) on " a method for performing a countdown function during a mobile-originated transfer for a packet radio system."  The iPhone 4S was exempt because unlike the earlier models, which used chips from Intel Corp. (INTC) subsidiary Infineon (whom Motorola doesn't license the patent to), the latest iPhone uses a Qualcomm Inc. (QCOM) baseband processor.  As Qualcomm is a Motorola licensee, Apple's latest iPhone was spared from the banfest.

11-12-09 Mannheim Ruling for MMI Against Apple

Also unlike the Galaxy Tab 10.1 sales ban, the suspension did not occur immediately, but was staggered to take effect this week.  Today Apple pulled the products from its store, with Deutsche Presse-Agentur quoting an Apple source as saying the decision was in compliance with Dec. Mannheim, Germany court ruling.

The interesting thing is that the patent involved was part of a 3G standard and thus was subject to "fair, reasonable, and non-discriminatory" (FRAND) license terms.  Unlike Samsung, Motorola wasn't disallowing Apple to pay it  -- Apple was reportedly the one denying to pay the FRAND patent holder.  

Apple appeared content to ride out the ban and trying to invalidate the patent or appeal the ruling to the Karlsruhe Higher Regional Court.  Apple rebukes the claim that it was unwilling to pay a license fee, instead arguing that Motorola's proposed licensing offers weren't "fair" or "reasonable".

Motorola called Apple's bluff, paying the 100M € bond that it needed to ensure that if Apple prevailed, it would receive compensation for pushing an unjust ban (but if Motorola prevailed it would get its bond back, and have successfully banned the Apple products).

III. Ban Lifted

But in the eleventh hour Apple managed to convince the appeals court to lift the ban.  DPA reporter Christoph Dernbach was the first to report the news, taking to Twitter.  Apple in statement commented, "All iPad and iPhone models will be back on sale through Apple's online store in Germany shortly. Apple appealed this ruling because Motorola repeatedly refuses to license this patent to Apple on reasonable terms, despite having declared it an industry standard patent seven years ago."

The reason for the suspension is a bit confusing.  Florian Mueller claims that it's due to the lower court not giving Apple the appropriate chance to pay a bond to avoid the injunction, pending the appeal.  He writes that Motorola's bond was likely returned and Apple likely posted a 120M € bond to the higher court to block the sales ban.

But BBC News is reporting that Apple has actually made an offer to pay Motorola for the patent, which also may have swayed the court.  

Either way, the BBC News report appears to carry the long term outcome -- Apple will likely be forced to make payments to Motorola for the year or two duration of its 3G sales, to avoid a ban.

IV. Now iCloud/MobileMe Ban (or Push Email Removal) is Pending 

Adding to the confusion, Motorola in Mannheim court today scored a second ruling -- this one against the Apple iCloud and MobileMe.  Many erroneously reported/believed that the iCloud ruling was the result of the brief sales suspension, when it fact the suspension appears to be attributed to the earlier December ruling.

iCloud ban
The iCloud may soon be banned in Germany. [Image Source: 9 to 5 Mac]

Today's victory for Motorola over Apple saw the iPhone maker being found in violation of EP (European Patent) 0847654 (B1) (U.S. counterpart: U.S. Patent No. 5,754,119), which covers a "multiple pager status synchronization system and method".  

The trial regarding the patent began in November and was just adjudicated today.

The terms were not immediately announced, but its presumed that Apple will be given the chance to pay a bond and prevent the injunction, while Motorola will have to pay a bond if it wants to enforce the injunction.  

Judge Andreas Voss made the ruling, which, if it passes the bonding stage, will likely force Apple to kill push-email functionality in order to keep the iCloud and MobileMe services active in Germany.  This means that i-devices with 3G modems would have to return to pulling emails from the server at regular intervals, a slight setback which means you may not be updated as quickly with an important email.

Apple reportedly did not contend in the trial that the patent was covered under FRAND.  Instead it tried to narrow the scope of the patent to allow iCloud to appear sufficiently different so as not to infringe.  This approach basically failed in the lower court.

The ruling hearkens back to NTP, an infamous "patent troll" who for years dogged smartphone makers and computer makers trying to milk exorbitant licensing payouts or block their access to push email.  Now Motorola is trying to do the same thing to Apple.

V. What's Next?

Again, Germany, by far, has appeared the most willing to ban both Android and Apple products.  Due to that, both sides have focused their efforts on German court. Apple has at least two suits against Motorola.  

And Microsoft Corp. (MSFT), who Motorola alone (of the top Android phonemakers) denied to pay licensing fees, will meet the Android phonemaker in court next Tuesday (Feb. 7).  Motorola has countersued Microsoft; the German court will hear four separate complaints against Microsoft on Tuesday.  Motorola also is waiting on a third complaint against Apple, which will be ruled on next Friday (Feb. 10).  Motorola already lost a complaint from Microsoft in the U.S., but again the victory was largely hollow as it only mandated minor app modification.

The German court is also preparing to hear new suits and countersuits between Apple and Samsung.  Apple vs. HTC suits are also pending.

The situation in Germany has devolved under a bewildering mess, but as far as the available information indicates, the only thing that remains officially banned at this point is the original Samsung Galaxy Tab 10.1 -- although the iCloud/MobileMe could soon join it.

Apple v. Samsung
Apple and its Android rivals are working diligently to bury international courts under an ever-growing pile of suits and countersuits.  The bewildering mess of litigation has thus-far produced little results. [Image Source: Gizmodo]

The German court did soften its blow against Samsung, declining to ban smaller tablets that did not match the iPad's ~10 in. (9.7 in.) screen diagonal footprint.  It also declined to ban Samsung's replacement design, which it specially crafted to escape the local ban.  

Apple's attorneys argued that Apple should be the only one allowed to produce modern tablets in Germany.  They made arguments similar to those made in a failed Australian ban bid, in which Apple's lawyers said, "Samsung says Galaxy Tab 10.1, we say any tablet device."

In related news to the case, EU regulators on Feb. 13 (two Mondays from now) will decide whether to allow Google's purchase of Motorola Mobility.  As part of its antitrust procedure in authorizing the purchase, it may examine whether Motorola unfairly denied Apple FRAND licensing in the two of its three Mannheim Court lawsuits that were based on 3G patents.

In the U.S. Google's acquisition has already been approved.

Sources: Twitter [DPA -- ban lifted], DPA, BBC News, Foss Patents

"And boy have we patented it!" -- Steve Jobs, Macworld 2007

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