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Jury finds iPhone infringes Nokia, Sony patents owned by “troll”




Mobile Media Of Jury

When MobileMedia Ideas formed in 2010, it was probably the biggest sign yet that the idea of “patent-trolling” had gone corporate. The company exists solely to get licensing fees from essentially the entire cell phone industry—it acquired about 300 patents from Sony and Nokia. It’s headed up by Larry Horn, the same CEO who runs the MPEG-LA licensing pool.

In March 2010, MobileMedia sued Apple, HTC, and Research in Motion in separate lawsuits. The Apple case was first to head to trial. This morning, following a one-week trial and several hours of deliberation spread over three days, a Delaware jury returned a verdict that found Apple’s iPhone 3 and iPhone 4 both infringe three patents that cover widely used smartphone features. The trial was only on infringement; a separate damages trial is still unscheduled.

Horn refers to the MobileMedia model as simply good licensing practice. But the model is the same one that has been criticized for a decade now in tech circles—create a shell company without any actual business, get patents, file lawsuits. Defendants are left with big legal bills and little leverage since they can’t file an effective counter-suit against a plaintiff with no operations.

The three patents at issue cover very basic smartphone technologies: integrating a camera into a phone, call handling, and features like sending a call to voicemail. The patents infringed are numbers6,070,068 (call handling); 6,253,075 (rejecting a call and putting it to voicemail); and 6,427,078(integrating a camera into a smartphone.)

MobileMedia is closely connected to MPEG-LA. In addition to having the same CEO, MobileMedia is majority-owned by an MPEG-LA subsidiary. Nokia and Sony own a minority share of the company, which means they stand to profit from this court win against Apple.

Working Of Jury

The strategy of working with MobileMedia effectively lets Nokia and Sony go after their competitors without getting hit back. It’s a full-scale embrace of the “patent troll” model by companies that have historically been the biggest targets of such suits.

It’s an interesting week for a jury to find that iPhones infringe Nokia patents held by a shell company. On Monday, Nokia’s chief of intellectual property voiced a full-throated defense of the patent trolling model at an FTC event. The company’s unusual stance puts it squarely at odds with other corporate panelists, including HP, Cisco, and Rackspace.

The MobileMedia case is a clear sign of the times. There’s so much money to be made from the model of “pure” patent enforcement through patent-licensing companies that it’s practically irresistible. That’s the case even to companies that have had to make repeated payouts under that model.

“Obviously, we’re pleased, and we believe it was a very well thought out and justified verdict,” said MobileMedia Ideas CEO Horn this morning in an interview with Ars. “Our real wish is that Apple will take a license. We’re prepared to offer them one on reasonable terms.”

The MobileMedia Ideas lawsuit against Apple originally had 10 patents in it, but the judge narrowed it down to three before trial. Horn declined to comment on MobileMedia’s other ongoing lawsuits against HTC and RIM. He did say at least one patent from the Apple lawsuit is being used in those cases as well.

[ Source :- Arstechnica ]