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Company defends its actions, pointing to Microsoft and Apple's strategy: buy other companies' IP; sue with it

Today Samsung Electronics Comp., Ltd.'s (KSC:005930) smartphones are threatened with bans thanks to Apple, Inc.'s (AAPL) ambiguous patents from a decade ago.  And Samsung pays an estimated $15 USD per handset to Microsoft Corp. (MSFT) for its war chest of patents.  In other words, the world's best-selling smartphone maker has received a cold hard crash course on the twisted state of the U.S. intellectual property system.

Now it's looking to apply those hard-earned lessons and do some patent harassment of its own.

Samsung Electronics' sister-firm Samsung Display announced this week that in March it spent $25M USD to buy up patents on LCD, LED, and OLED display technologies from Japan's struggling Seiko Epson Corp. (TYO:6724) and launch a shell company, Intellectual Keystone Technology (IKT).

Based out of Washington, D.C., the new firm isn't exactly bashful about its objectiveness, which are the same as those of most shell companies: find corporate targets, demand they license, and sue if they don't comply.

Samsung TV
Samsung Display is looking to play the patent litigation game.  [Image Source: Flickr]
An unnamed Samsung spokesperson told The Korea Times, "Companies should be paying licensing fees for patents. We are paying to platform providers such as Microsoft in return for using their patents. IKT will be tasked to find out which patents are helpful and valued for Samsung."

Samsung Display was the world's largest LCD TV shipper in Q1 2013 according to Display Search.

The patents from Epson include a number of patents on organic light-emitting diodes (OLEDs), a new form of display technology that's expected to dominate the television and mobile device display industry over the next few years.  The patents also cover ultra-high definition display technologies, such as the "4K" display format that debuted commercially this year.

In other words, the Samsung Group -- having played the victim in the U.S. -- appears to be embracing the patent industry's dark side, with lots of juicy targets to sue.

Source: The Korea Times

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Line the lawyers up against a brick wall...
By Amiga500 on 5/27/2013 1:20:57 PM , Rating: 4
Shoot the f**king lot of them and let the rest of us get on with our (relatively extremely productive) lives.
</disgusted engineer>

How long does this have to go on before there is a case in the courts for this patent-litigation culture detrimentally affecting consumers? Who would take it on anyway? The FTC? Unlikely.

It definitely is a major, major influence on companies' R&D, with many fearful of "wasting" money developing "new" technology independently that has been patented by someone else. This stifling of R&D results in a poorer product for consumers.

The 5 line Amiga500 reform of the patent system would be:
- Cannot patent software algorithms.
- Cannot patent natural phenomena (such as gene sequences).
- If you do not bring a product to market, or show verifiable and serious development of a product which uses the patent within 3 years of applying for the patent, you lose the patent.
- If you buy a company, that company's patents becomes open to everyone. [i.e. trading of patents is void.]
- Subtle iterations to previous technology or products is not patentable and is considered natural product evolution.

By FishTankX on 5/27/2013 7:41:44 PM , Rating: 2
how would your patent rules work with licensing? as normal?

By TheEinstein on 5/27/2013 11:15:43 PM , Rating: 2
I am not sure how the purchasing of companies would pan out. I might be in favor of a reduced time span rather than an outright 'end'

By Strunf on 5/28/2013 7:38:35 AM , Rating: 2
A good start would be to limit patents to 5 years tops, regardless of what you do with it.

Another thing is that you shouldn't be able to patent concepts that exist in other forms, example your rectangular phone with round corners is still a rectangle with round corners which is a known shape since the dawn of times, the same with interactions it's not cause you use 2 fingers to zoom in and out that you made something new, the zoom in zoom out exists since a long time and it's logical that the way to do it will keep changing and adapt to people.

By ssnova703 on 5/29/2013 12:36:03 PM , Rating: 2

The saying goes, "don't hate the player, hate the game"

Lawyers use the law/legal system to get what their clients want. Name of the game, as they play for money. As many would argue, perhaps our system needs to be re-examined/re-vamped a little...

"Well, there may be a reason why they call them 'Mac' trucks! Windows machines will not be trucks." -- Microsoft CEO Steve Ballmer

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