A U.S. federal judge threw out a $506.2 million patent damages award against Apple after ruling the company should have been able to argue that the owner of the patent, Optis Wireless Technology, was making unfair royalty demands, although the judge refused to throw out the liability finding.
Susan Decker and Laurel Brubaker Calkins for Bloomberg News:
Optis and its partners in the case, PanOptis Patent Management and Unwired Planet LLC, claimed that Apple’s smartphones, watches, and tablets that operate over the LTE cellular standard were using its patented technology.
U.S. District Court Judge Rodney Gilstrap said the jury should have been allowed to consider whether the royalty demand was consistent with a requirement that standard-essential patents be licensed on “fair, reasonable and non-discriminatory,” or FRAND, terms.
After hearing post-trial arguments, Gilstrap said he’s “persuaded that the FRAND-compliance of the damages awarded by the jury has legitimately been called into question.” …Gilstrap, however, said a trial on liability “is neither necessary nor warranted.”
MacDailyNews Take: The judge made the right decision to toss the patent damages award against Apple as the jury never heard, much less considered FRAND, the crux of Apple’s argument.
The case is Optis Wireless Technology v. Apple Inc., 19-66, U.S. District Court for the Eastern District of Texas (Marshall).
If it was licensed under FRAND for incorporation into the standard, why wasn’t the suit thrown out from the beginning.
FRAND is not something one can just claim.
Wondering the same. FRAND is a voluntary commitment by the patent holder to a standards organization. If the patent holder did not make that commitment there are no FRAND terms to argue.
What seems to have happened is that when Apple raised the issue of FRAND compliance (the patent is part of the 5G standard, or so the judge held), the plaintiff objected that it would prejudice their case if the judge allowed the jury to know that Apple was an “involuntary licensee.” It might make the jury more sympathetic than if they thought Apple had a choice about using the patent in a 5G phone and simply chose to steal the patent out of greed.
The judge bought the argument, so Apple was forced to try the case before a jury that was deliberately kept ignorant of the notion that the fees the plaintiff was demanding needed to be fair, reasonable, and nondiscriminatory. As the plaintiff intended, that resulted in a hefty damages verdict.
After the trial, the judge came to his senses, realized that not even the Fifth Circuit was going to upheld the verdict, and ordered a new trial on damages.