Mobile Phone Patent Wars!

March 29, 2012

Apple sues Samsung. Samsung sues Apple. Motorola sues Apple. It seems that the mobile phone companies are acting in a particularly litigious manner at the moment. What will happen next? Can they force each other out of the marketplace with their patents?

Patents are undoubtedly very strong commercial tools. In many circumstances the victor in patent litigation can not only obtain damages from the loser, but also obtain an injunction to prevent the loser from continuing to infringe the patent in question. Many mobile phone companies participate in organizations that set standards for the mobile telecoms industry which enable interoperability between equipment made by different manufacturers. These standards cover a variety of technical areas such as, for example, how data is exchanged between a mobile phone and a base station of a mobile phone network. Many standard-setting organizations in the mobile telecoms industry require members that own patents relating to their standards to licence the patents to others on fair, reasonable and non-discriminatory (FRAND) terms. This means that the patent proprietor cannot refuse to licence such patents to others and then use them to force competitors out of the marketplace with an injunction. In a sense, standards-related patents can be considered to be a means of generating an income rather than a true monopoly right. That’s not to say that it’s all plain sailing with FRAND patents. Disputes often occur because there is a disagreement as to whether the terms being offered by a patent proprietor are in keeping with its FRAND obligations. If the two sides cannot agree, the court may be asked to determine an appropriate level of FRAND compensation for the patents in question. If a patent is not part of a standard then it’s a different story. One manufacturer could force the other out of the marketplace with its patents, or force it to remove a particular technology from its products. However, in many circumstances this does not happen because each side infringes a number of the other side’s patents. It may then come down to agreeing a cross licensing agreement where the main issues to be resolved are who pays who, and how much. Please contact Scott Harrison for more details [email protected] or your usual contact at Swindell & Pearson Ltd.

Swindell & Pearson has been helping businesses and individuals protect and defend their ideas, innovations and brands for over 130 years. With its head office in Derby, the firm also has offices in Stoke, Wolverhampton, Stafford, Sheffield and Burton. To find out how Swindell & Pearson can help you with any intellectual property requirements please get in touch via [email protected] or by telephone on 01332 367 051.