Apple vs Motorola: Judge Posner dismisses case with prejudice

June 23, 2012

motorola razr vs apple iphone 4s

Earlier this week, the Apple vs Motorola patent-based case was again brought to our attention as Federal Judge Richard Posner allowed the two parties to appear before him in a new hearing and argue their case one more time. This happened only days after he dismissed Apple’s case altogether, only to have a change of heart and allow the two parties to make a final effort in their independent quests of obtaining an injunction against the other’s products.

Late on Friday, Judge Posner filed a 38-page ruling (embedded below) dismissing the case with prejudice. That means neither party can refile the lawsuit in federal court, although the judge left the door open to appeals. And we can certainly expect Apple to file one in the foreseeable future.

The iPhone maker had the upper hand in this case, as it attacked Motorola with four patents, one of which was the same patent that got Apple a win against HTC at the International Trade Commission – an import ban on infringing HTC products. Also worth mentioning is that Apple is using the same winning patent in other cases against Android device makers, namely Samsung.

On the other hand, Motorola only had one patent to counterattack with, and that was a FRAND patent or a standards patent, which wouldn’t have gotten Motorola very far. Both parties started the battle with more patents but all the other claims were shot down since the trial started back in 2010.

In his earlier discussion with Apple and Motorola, Judge Posner made it clear that he does not appreciate the escalading Apple vs Android conflict in general, and that he’d rather see the two parties reach some sort of settlement, something Apple’s counsel was not likely to consider. At the same time he said that Motorola’s FRAND patent can’t really be used to obtain an injunction against certain products from the competition, and this ruling may harm Motorola in other international legal clashes with Apple. In fact, just like Samsung, Motorola is also investigated by the European Union for its FRAND patent use in such lawsuits.

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But what seems to have been an important factor in his decision to dismiss the trial with prejudice was Apple’s and Motorola’s inability to quantify damages for the infringement of either party’s patents. Therefore, an injunction against the products of either party could not be awarded.

Even though Apple will surely appeal the decision, Motorola seems to be the real winner here – or better said Google, the company that finalized the $12.5 billion purchase of the Android maker in late May. Nevertheless, the legal battle between the two companies is not finished as Motorola and Apple are also fighting it out in international courts, with the German lawsuits between the two giants also worth following.

Here’s Motorola’s comment on yesterday’s ruling:

We are pleased that Judge Posner formally dismissed the case against Motorola Mobility. Apple’s litigation campaign began with their attempt to assert 15 patents against us. As it relates to Apple’s violation of our patents, we will continue our efforts to defend our own innovation.

Apple is yet to comment on the matter, but we’re certainly interested to see whether this particular ruling will have any affect on other patent-based lawsuits initiated by Apple and targeting other Android device makers

6.22 Opinion

Comments

  • AppleFUD

    Funny reading iFans’ reaction to this on the web. They seem to think that Posner is saying anyone can use anyone’s IP freely and that he’s just anti-apple and this decision will be over-turned. Of course it’s clear that non of these iFans have read the decision.

    No, he’s anti-abuse of the courts and patents.

    1. A patent must have actual value in order for a company to seek “compensation/damages” — the patents apple is walking into court with have no real value because NO customer is going to buy a device because of those features thus not even apple can put a dollar amount on them.

    2. The patent system is designed to create competition not hinder it, thus companies should be cross licensing or getting a royalty for a patent that has a value and not using them to ban other company’s products. There is a reason patents are publicly available to all — so anyone can use them and innovate on them.

    Therefore, if apple has ‘valuable’ patents then they should be able to put a dollar amount on the “damages” and prove it and therefore should be willing to accept either cross licensing or a royalty, and if they can’t put a dollar amount on the “damages” then there is absolutely NO point in the case moving forward because, even if Moto infringed the award would be $1 and that isn’t worth the court’s time to deal with.

    See, the whole catch is this, Judge Posner knows that patents are a defensive tool to ensure that the inventor is compensated. They are NOT a tool to be used to ban competing products.

    Never though I would say that I admire a lawyer/judge. . . but I do admire Judge Posner and his wisdom when it comes to patent law. A+ Job!

    • SamsaraGuru

      Well put AppleFUD! You have gotten to the heart of the issue. Apple doesn’t care about losing money, what it cares about is discouraging any and all competition that is going to cause people to wake up and smell the roses and realizes that Apple’s products are not the be all and the end all of the technology world. They know very well that the “mystique” of Apple that causes those who are oh so terribly self and status conscious to proudly display their phones (in the company of equally self-assured, self-actualized individuals) with chest thumping pride, is a phony, gossamer thin veneer that can’t stand the light of strong scrutiny, reason and fact.

      Once people start to use the Galaxy S III and other Android products; once they see that they work wonderfully well and all without turning you into an indentured servant of Apple, Apple knows it will not be long before the grand illusion crashes and burns and “frankly” people “won’t give a damn” about Apple.

      • AppleFUD

        Thanks!

        I highly recommend EVERYONE read Judge Posners 38 page decision. It might be a little rough for some to get through however, it will really help people understand patent law, damages for infringement, and what injunctive (banning products) relief is meant for — and maybe stop a lot of the fanboy BS about patents and patent infringement.

        Betanews is hosting a copy of the decision here:
        http://betanews.com/wp-content/uploads/2012/06/Posner-June-22-Apple-order.pdf

        Here’s some quotes that I feel really point out Apple’s unattainable position of using the courts to increase their market share:

        “If, then, Apple couldn’t exclude Motorola from the market with an injunction because of the ease of inventing around, the only thing Apple lost as a result of the alleged infringements was royalties capped at the minimum design-around cost. Its alleged loss of market share because Motorola’s smartphones do the same thing (either via license or design-around) would have occurred with or without an injunction, and so doesn’t establish the inadequacy of damages
        . . .
        The notion that these minor-seeming infringements have cost Apple market share and consumer goodwill is implausible, has virtually no support in the record, and so fails to indicate that the benefits to Apple from an injunction would exceed the costs to Motorola. An injunction that imposes greater costs on the defendant than it confers benefits on the plaintiff reduces net social welfare. That is the insight behind the “balance of hard-ships” component of the eBay standard for injunctive relief in patent cases.
        And I must not lose sight of the basic principle that injunctive relief is available only when the remedy at law is inadequate—that is, only when damages would not provide complete relief.
        . . . a patentee can’t obtain an injunction (and, by parity of reasoning, an ongoing royalty in lieu of an injunction) if either damages or an equitable substitute such as a running royalty would provide complete relief.
        . . .
        By failing to present a minimally adequate damages case, Apple has disabled itself from arguing that damages would not provide a complete remedy, going forward in the form of running royalties, as well as backward. It harps on loss of consumer goodwill and market share, as a ground for an injunction, but not only has no real evidence of such loss, but, given the nature of the patent claims, it is not a loss that an injunction would avert. Apple’s case for injunctive relief flunks the irreparable injury, balance of hardships, and public interest standards of eBay.”

        .

        .

        In other words, “apple stop using the courts and patents in an attempt to increase market share by blocking competitors’ products — that not what the courts and patent system are for.”