Google and Apple agree to drop all global patent litigation between them

By Nicole Daniel

On 16 May, 2014 Google and Apple announced that they agreed to drop all global patent litigation between them; this includes litigation in the United States, Germany and other countries. They also announced to cooperate on patent reform. They jointly asked the Court of Appeals to dismiss the pending litigation between Apple and Google’s Motorola Mobility (“Motorola”). In the next few days they are expected to jointly ask further US court filings and court filings in other countries to be dismissed.

This significant de-escalation move of their global patent litigation over smartphone technology comes after an US appeals court revived an Apple patent suit against Google’s Motorola on 25 April, 2014 which had been dismissed shortly before the trial. The appeals court also revived a patent claim Motorola made against Apple where it had ruled that the former could not seek a sales ban of its own.

The Court of Appeal had been hearing two cases: In one case Apple accused Motorola of infringing fifteen (initially three patents, then Apple amended its complaint) of its patents. In the second one Motorola accused Apple of infringing six of its patents, including an SEP for ensuring that smartphones are interoperable. These two cases were then consolidated at the District Court for the Northern District of Illinois and Judge Posner dismissed the case in 2012 before trial stating that the parties did not have sufficient evidence to prove their case.

Apple and Motorola appealed on a number of issues, for example whether sales bans should be put on infringing products or whether monetary damages were sufficient compensation for infringement.

The appeals court then decided on six patents in these two cases, i.e. three patents for each party to the lawsuit, and overturned parts of Judge Posner’s decision.

This decision is especially interesting regarding the SEP in question. According to the majority opinion Judge Posner was wrong in applying a per se rule that injunctions are not available for such patens. However, the majority opinion affirmed his decision to deny the injunction since, among other things; Motorola’s FRAND commitments suggest that monetary damages are adequate to compensate Motorola for any infringement.

Judge Rader dissented since the ruling went too far for him. He saw evidence that Apple was an unwilling licensee and SEP holders are only able to obtain an injunction if there is a refusal to pay which is as disruptive and as likely as excessive demands. However, a FRAND royalty has to be identified first before making such a determination.

Judge Prost also dissented since the ruling did not go far enough for her. Even though she supported the affirmance of the denial of injunctive relief she disagreed with some parts of the reasoning. The undertakings implementing a standard should have the right to defend themselves against allegations of infringement before an agreement to pay for a license is made. There is no reason why pre-litigation conduct in license negotiation should then affect the availability of an injunctive relief. She stated than an injunction may be appropriate when the patentee is unable to collect the monetary damages it is entitled to.