Apple Wants to Compete on Patent Portfolio, Not Products

(Cross-posted on DisCo)

Apple has been an odd player in the patent debate. On the one hand, it’s the company that gets sued by patent trolls more than any other. As a result, it supports most of the patent reform bill, and Apple uses the Covered Business Method (CBM) program far more than any other company. (As of today, Apple has filed 17 CBM petitions, while the next biggest user of CBM, Liberty Insurance, has filed only 10 CBM petitions.)

On the other hand, Apple is using its own software patents to go after Samsung. And Apple strongly opposed any expansion of the CBM program, apparently for fear that Samsung might use it to challenge Apple’s patents.

This schizophrenic approach to patents might explain why Apple didn’t file an amicus brief in the Alice v. CLS Bank case: Apple is victimized by software patents more than anyone, but it needs its software patents to try to crush Android.

Apple’s whole approach seems strange. In its case against Samsung, Apple is demanding around $40 per phone, even though all the accused features are part of Android. Android is free. And the software patents Apple is using are questionable at best.

For example, Apple is claiming to own the entire concept of identifying useful information in text (like a phone number) and creating a hyperlink. That particular patent was filed in 1996, and only describes an implementation on a desktop computer. Mobile devices aren’t mentioned, although the claims are so generic as to cover any implementation for any purpose. The other patents-in-suit aren’t much better.

Is this really Apple trying to compete on features? I think it seems more like what concerned Justice Breyer at the Alice v. CLS Bank argument:

[I]nstead of having competition on price, service and better production methods, we’ll have competition on who has the best patent lawyer.

Whichever phone you prefer, it seems clear that Apple has a better patent portfolio, at least for litigation purposes. Samsung has a large number of standard essential patents; these are burdened by commitments to offer relatively cheap licenses compared to the exorbitant amount that Apple is demanding. Apple has broad (probably overbroad) software patents that cover generic features.

Samsung makes great phones that many people choose over Apple’s iPhone. That’s just the reality, and it isn’t because the phones are clones of iPhones. They’re not.

Apple makes great phones that many people choose over Samsung phones, even though Apple’s products are generally more expensive.

No one chooses a product based on the company’s patents. But if Apple wins its war against Android, it will be because it had better patent lawyers, not better phones.

Matt Levy

Image of Matthew Levy

Matt Levy is Patent Counsel at the Computer and Communications Industry Association, where he handles legal, policy advocacy, and regulatory matters related to patents and is lead blogger for CCIA’s Patent Progress.

Matt joined the CCIA in 2013 from the IP boutique Cloudigy Law, PLLC. He has also been an associate at Finnegan, Henderson, Farabow, Garrett, & Dunner, LLP and at Hogan & Hartson LLP. He got first-hand experience in both patent prosecution and patent litigation, including defending clients against patent trolls.

  • Walt French

    Interesting that this post calls out Apple for having a balanced / nuanced position on patents, but doesn’t state CCIA’s policy on them.

    Unless it’s from implication that the inventions that Apple patents aren’t what make its phones better, that trying to monopolize inventions as the law provides is un-American.

    So, are the actual inventions that Apple patents, irrelevant? If so, why did Samsung copy those inventions against Apple’s express prohibition; why has the Federal Court accepted lawsuits against Samsung for potential patent infringement, and why did a jury find that Samsung had indeed improperly infringed Apple’s Constitutionally-guaranteed rights to monopolize its inventions for 20 years?

    Further, since you seem interested in the $40/phone claim in this case, do you dispute the accepted approach in patent damages cases — those so-called Georgia Pacific factors — are a valid way of computing damages? Or do you think it bad legal practice for Apple to go against what it thinks are the worst offenders first?

    So many shots at Apple, none of which seem to have any thought-out policy behind them. Surely CCIA is not just a hack mouthpiece when one of its members needs astroturf blogposts or lobbying.

    Surely?

    • John

      “So, are the actual inventions that Apple patents, irrelevant? If so, why
      did Samsung copy those inventions against Apple’s express prohibition”

      Most of the patents that apple abuses (including several in this trial) are trivial, obvious, overly broad, or a combination thereof. This doesn’t mean the associated actions are totally worthless, it means that the patent should never have been issue.

      None of the UI actions associated with these patents define the user experience, they are merely small niceties. This is why many people shake their head in wonderment at apple’s hubris and greed for asking for $40.

      Now when you ask why samsung wouldn’t remove them, as if this implies their value, well this seems presumptive. Samsung should NOT have removed them JUSt because apple cried about it. Why remove a trivial nicety – for no real reason?

      Apple has become a shameful patent aggressor, and while I otherwise disapprove of some of samsungs business practices, I salute them for not caving to a bully and removing these small features.

      • Walt French

        I’m so in awe of people such as yourself who are able to decide complex cases such as these without the thousands of hours and legal training that actually go into them.

        Sir, why are you keeping your talents out of the area where they are so valuable, and merely spinning stories on websites?

        Or perhaps your conclusions — stated as if they were facts — are based on nothing more than the outcome you favor for reasons utterly unrelated to the proper role of patents in technology.

  • Patent Progress

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