Obama faces high stakes dilemma in Apple-Samsung battle

“Over the next 60 days, Barack Obama faces a dilemma in a dispute pitting two of the world’s biggest companies against each other and carrying far-reaching implications about the ownership of intellectual property in the technology sector,” Tim Bradshaw reports for The Financial Times.

“Mr Obama could use his presidential powers to overturn a ruling by the International Trade Commission, a Washington agency, that on Tuesday banned Apple from selling certain iPhones and iPads in the US,” Bradshaw reports. “Alternatively, he could follow the example of most of his predecessors in such cases and stand by the ITC ruling. This would favour South Korea’s Samsung, Apple’s bitter rival that was found in an earlier case to be copying the iPhone’s designs… Tuesday’s sudden reversal of last autumn’s preliminary ITC ruling, which had also cleared Apple of infringing Samsung’s patents, came as a surprise to many US observers.”

Bradshaw reports, “Mr Obama’s quandary comes as his administration has put renewed focus on patent reform. The last US president to use his veto in an ITC case was Ronald Reagan… While a US jury might be expected to support the ‘home team’ over a Korean competitor, the precedent for a president to do the same is weak… However, Mr Obama may have teed up such a dramatic move by announcing a package of proposed patent reforms only hours before Tuesday’s ruling.”

Read more in the full article here.

MacDailyNews Take: If Obama fails to correct the ITC’s mistake, Apple can simply appeal this ruling, get a stay on the ITC’s idiotic injunction, let the system’s abject slothfulness work in their favor for a change, release the next-gen iPhone and iPad as scheduled and, as usual, drop the affected products (iPhone 4 and iPad 2) off the market. Done. The ITC ruling is, in effect, meaningless.

Related article:
U.S. ITC rules for Samsung, bans Apple iPhone 4 imports into U.S. – June 4, 2013

28 Comments

  1. How can the ITC allow Samsung to renege on it’s FRAND licensing pledges? I’m sure even Samsung is gratefully dumbfounded by this idiotic and dangerous precedent on standards patents. How can any FRAND then be worth anything if those patent holders can willy-nilly sue over them with competitors with no basic protection? Frankly people who come up with stadards patents need to be held under greater scrutiny and those patents not allowed to become standards if the offending company has a rickety past in this area as Samsung now has. Samsung should no longer be able to set standards and lose the privilege.

    1. for all you said, the most salient point was:

      Frankly people who come up with stadards patents need to be held under greater scrutiny

      and even then, you mucked it up pretty badly. I have one question, who are Frankly people?

      1. The problem with this site is the inability to correct grammar or spelling after the fact and you should now that and not play the disingenuous card. How about this:

        “Frankly people who come up with standards patents need to be held under greater scrutiny. Those kind of important patents meant for wide acceptance and licensed at a fair fee to all comers should not be allowed to become standards or FRANDs if the offending company has a rickety past in this area, as Samsung now has.”

        Better? I think you understood what I was trying to say. (“Frankly people” is what it is, go back to English class if you need to figure it out.) If you’re just joking, which I hope, my apologies.

        1. If you want to make some heads really spin around here, just point out that the term “frankly” is the adverb form of “Frank” which originally meant “freeman” as the Franks were the upper class in France, or back then, Gaul. Frankly, they will find it galling…

          😆

      2. The problem with FRAND is the Agreement contributors sign when their IP becomes part of the Standard. What is deemed “Fair and Reasonable” is left open to negotiations between the IP holder and the licensee. This quirk in the Agreement leaves the door wide open for abuses like those attempted by Motorola and Samsung.

        Fix that and prolonged litigation will come to an end as the copycats will lose litigation as a negotiating tool.

  2. Obama: “Gentlemen, welcome to high stakes poker. Introducing on my left, the venerable computer company, Apple, and on my right, the pretender, Samsung. Let me remind you of the rules. This is a game of high stakes poker. I will deal five cards to each of you. The minimum bet is $50 million. After the flop, you are permitted to raise the stakes. This is a one round, winner takes all game.”

    “And gentlemen, let me remind you that no matter who loses, I win. The pot goes to my campaign contribution fund. Thank you for playing.”

  3. So he gets it wrong in the second sentence, claiming this is a ban on sales. Nine paragraphs later he just mentions it’s an import ban.

    And then you gotta love this well-crafted obfuscation and dig all in another one-sentence paragraph: “The dispute also presents a risk to Apple’s reputation as the US’s foremost innovator, when it is already facing stiff criticism in Washington for its tax contributions.”

    What the heck does the secondary clause have to do with the first part? And what would SEP issues have to do with being an innovator? That Apple didn’t invent that which has declared a SEP doesn’t mean Apple doesn’t use that invention in innovative ways.

    But it is Wednesday and he has to file some kind of story to please his editors, doesn’t he?

  4. Ther is no dispute of “carrying far-reaching implications about the ownership of intellectual property” the ownership here what is in dispute is if Samsung is abusing it’s SEP patents. This could easily be fixed. When a Patent is put forward to be a standard, the price for the use of that patent should be set and every one who uses it pays the same. or it is rejected for use in the standard.

  5. Doesn’t it seem rottenly ironic that Apple won a major case against Samsung and can’t get an import ban on their patents (which they are not abusing), while Samsung DOES get a ban on standard-essential patents (which they are abusing)? Just another day in upside-down land.

  6. The problem is that Apple went to the courts, which have mostly held that the proper remedy for patent infringement is money damages, while Samsung went to the ITC… which used to say the same thing, but suddenly reversed course to provide injunctive relief. As a general rule, nobody can get an injunction unless there is no other adequate legal remedy. That MAY apply in a case involving patents that are not necessary to an industry standard, because the patent holder has the right to bar any outside use of his invention, and will be harmed if there is any infringement of that right. It cannot apply if the patent is an industry standard, because the inventor does not have the right to shut down everybody else in the business by refusing to license the only means possible for performing an essential task. He can, however, demand compensation on a fair and nondiscriminatory (FRAND) basis.

    The only issue in a FRAND infringement case is whether the compensation offered by the infringer is adequate to provide fair and nondiscriminatory compensation to the patent holder. That means that there is a clear and adequate legal remedy–an award of monetary damages (the difference between what the infringer paid and what the holder was owed). That is, quite properly, what Apple got against Samsung. The only issue for the ITC (or the courts) should be the amount of damages. So, if the courts stick to their guns, the Apple appeal should succeed.

    If the President gets in the habit of short-circuiting the legal process, we will all be subject to his essentially untrammeled discretion. I gather that most of my fellow Republicans would be uncomfortable with that state of affairs.

  7. It’ll be intersting to see if ITC bans Samsungs imports when the Apple ITC complaint results are announced on Aug 1, i believe. Apple won against HTC, but ITC did not block imports.

    I would not expect any favors from President Obama/ He like to “kow tow” to the Asians. Basedon waht has been happening with the IRS, I would place my faith in the courts, as slow as they are. DOJ should take a hint from Europe and look at this FRAND abuse as an antitrust issue.

    I challenge SS to publish the FRAND fees being paid by their other licensors.

    Apple has spent $billions with the SS mafia only to have its technology stolen and turned against them.

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