Samsung waves white flag on patent wars

Samsung waves white flag on patent wars

Summary: The Korean electronics giant said it will no longer bring rivals to court over certain patent infringement cases for the next five years.

TOPICS: Samsung, Apple
(Image: CNET)

Samsung said it will no longer bring certain patent infringement cases against rivals for the next five years, ending a long-running spat with the European Commission over the alleged abuse of the patent system.

The company, which has an ongoing major rivalry with Apple, is backing down as it faces a significant fine in the European Union, after it was accused of using patent lawsuits to get ahead of its arch-rival.

The Commission said in a statement on Thursday it hoped the move will "bring clarity" to the industry.

Under the terms of the deal, Samsung said it will not seek injunctions based on "standards-essential patents — required for interoperability between devices and necessary to the industry — against a company that agrees to a licensing framework under fair, reasonable and non-discriminatory (FRAND) terms.

Should a licensing deal fail for longer than 12 months, the courts can be involved to arbiter the dispute. 

But it's far from a done deal yet. The move is part of the latest round of concessions offered by Samsung in a bid to end a massive antitrust fine in the 28-member state bloc.

Rivals and competitors in the smartphone space will give their feedback, and based on that, the Commission will find the best course of action going forward.

The Korean smartphone maker sought lawsuits and sales injunctions in various European countries in 2011 against Apple's use of its patents. But because those patents are deemed vital to the technology industry, the EU hit back claiming the move was anti-competitive.

Samsung faces a fine of up to $18.3 billion — or 10 percent of its 2012 global annual revenue.

"Enforcing patents through injunctions can be perfectly legitimate," EU Competition Commission Joaquin Almunia said in remarks. "However, when patents are standard-essential, abuses must be prevented so that standard-setting works properly and consumers do not have to suffer negative consequences from the so-called patent wars."

Topics: Samsung, Apple

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  • "EU hit back claiming the move was anti-competitive" -- there is no need ..

    ... for EU to "claim" anything.

    Samsung voluntary *signed* limitation on its patent IP rights when those patents were negotiated to be included in standards. This is absolute condition, FRAND terms are obligatory.

    Samsung has breached its obligations, abused law, and EU tries to force them abide their own obligations (because standard bodies do not have enforcing power).

    By the way, this is not really "waving flag", since there are legal disputes that include regular patents. So Apple products could be banned, and rightfully so, if in the end of all proceeding it will be decided that there was patent infringement.
    • FRAND

      Your point is very valid, unfortunately when FRAND was created many years ago the aggressive US IPR policy was known mostly via anecdotal evidence. At least I am not aware of anybody enforcing FRAND on this scale until now, so this might be an eye opener for anybody loyally contributing to radio standars.
    • FRAND

      Now that the US government has decided that companies do not have to pay FRAND terms for SEPs, there's not much point in fighting it. Apple was found guilty of patent infringement by the ITC, penalties were set, and then Apple was given a pass. It is going to be a lot harder now to get companies to contribute to standards, since they won't be getting paid for the contributions.
      • No "Pass" for Apple

        Apple wasn't given a complete pass. They still owe FRAND patent rates on Samsung's SEPs and Samsung can go to Federal court to get them. What the Administration said is that they won't allow the ITC to let a company obtain an import ban on cell phones based on SEPs. If Apple had an SEP patent on Samsung, the Administration would do the same thing.
      • Bull...

        None of what you state bears any relation to the truth of the matter.
        On the contrary, the USPTO decision veto specifically stated that the proper course of action was for infringement monetary compensation to be persued through the courts in addition to stating that product exclusions should not be available for SEP infringement at the ITC. Apple has never stated that it is unwilling to pay FRAND fees...just not the grossly inflated demands that Samsung sought. It also makes no difference to SSI technology inclusion since the legality of FRAND licensing was not questioned by the ITC, the US govt or Apple.
        If it turns out that Samsung used Apple's contractual information illegality at the ITC to gain the initial favourable determination(later overruled), then not only has Samsung failed at the ITC but may well face sanctions at the ITC for its egregious behaviour.
        This is not a failure of the courts, the presidential veto, the ITC or Apple, but a failure by Quinn Emmanuel and Samsung to adhere to strict legal procedure.
        • Re: Bull...

          With that tone you must be an american lawyer. It matters, because we have seen that legal tactics a number of times, e.g. not that long ago when Qualcomm pursued the same egoistic path. Fortunately they lost in the real world, and are now a fair - as in FRAND - industry player, to my understanding rather successfull such.

          I wish Apple went through the same process.
        • You're the one spouting the BS

          As usual we have an armchair analyst pretending they know more about the situation than a full investigation by the ITC found.
          YOU are the one that clearly hasn't checked the facts or has decided to make them up. The ITC specifically found Samsung to be fair and reasonable with their demands for SEP's. Your "grossly inflated" claim fails to mention that the increased fees were in comparison to others that offered cross-licensing deals. Apple had the choice, cross-licence or pay higher fees than people that offered their own patents as a trade. This is what the ITC found and supported in Samsung's favour. So, question for everyone, who do we believe, the ITC, or the itard in his mum's basement?

          This is what people hate, the fanboys that make up facts to protect their cherished gods @ apple. People don't hate apple, people hate the itards
          Little Old Man
        • @frogspaw

          "just not the grossly inflated demands that Samsung sought"

          Please provide a link to the terms refused by Apple and the terms paid by the companies that paid for the SEPs. What, no evidence that the terms were not FRAND, other than Apple's refusal to pay? That's what I thought...
        • And another thing

          Your continued BS about the USPTO is factually incorrect. Obama had the veto, he divested the decision to one of his cronies. Said crony justified the veto on the basis that it would harm consumers. Go look it up on serious news/discussion sites instead of the usual Rainbow Does Law like you seem to normally use.
          Little Old Man
      • It's free market

        Then, if they don't want to contribute their technology to the standards, someone else will -- for example a competitor. Then, the standard will contain the competitor's technology, not that of the "smart" company that refused.

        Thing is, when you submit something to the standard, you already gain, because you (supposedly) already have developed the technology and have a leg before everyone else (whose technology is not in the standard).

        I believe, the proper handling of standard essential patents is to make these patents public domain. We will eventually get there, but it will take some time.
        • It's a cruel world

          It doesn't work entirely that way. If I am your competitor and I think you will have leg up on me then I object, or obstruct or delay. Standards mostly work by consensus - no consensus no standard. There is mostly some good alternative.

          Your vision of SEPs in public domain is good, people should make money on product not on IPRs, but we are not there and I am not sure we are getting closer either (thanks to john-whorfin for digging out the figure, it used to be the same magnitude as long as I remember; but I also remember some non-standard patents being sold for in excess of 10%).

          Finally to your other comments: you are probably right about Samsung abusing FRAND in Europe, but I bet Neelie Kroes didn't figure that out on her own, and I wish those lawyers stayed on the opposite side of the Atlantic.
  • Stole enough!

    Looks like Samsung decided they have stolen enough to keep them going for 5 years. I doubt they will honor their decree.
  • the apple legal goons should be exposed

    and this shameful coercion ended for any company fighting the good fight.
    LlNUX Geek
    • Samsung Attorneys

      The only legal "goons" are Samsung's attorneys who leaked confidential "for attorneys eyes only" documents to Samsung executives who used them in negotiations with Nokia.
    • I find it amusing

      That despite proof of your favorite companies being "evil" such as Google spying on everyone and Samsung ripping off patent that you are still defending them. I guess the kool aid has soaked into your last brain cell.
    • LlNUX Geek

      Apple is fighting the good fight. Your Empire will be over soon just like in Return of the Jedi.
  • EU will come to regret this

    You can protect the rights of FRAND patent holders properly or not have standards. You cannot have them both. I think having standards trumps all else and I am afraid EU will be sorry for that.
    • It was Samsung who was abusing FRAND by using it as a club to beat down

      competitors (namely, Apple). They got called on it in both the U.S. and the EU
      • All those competitors

        that paid, what happened to them, oh yeah, they thought the requests were fair (like the ITC did), Apple didn't refused to pay, chanced their luck in court.

        Yep, that's Samsung abusing SEP's alright. Just like the ITC said they weren't.
        Little Old Man
        • And yet

          Here we are with Samsung backing down. IF Samsung was not guilty of infringement then why are they backing down?