Wednesday, July 27, 2011

Lodsys: Response to Apple's Motion to Intervene

It is hard to find humor in the Lodsys situation. The livelihoods of good people are being threatened. Nonetheless, Lodsys is inadvertently providing a small bit of comic relief.

On June 10, 2011, Apple filed a motion to intervene in the Lodsys case against iOS developers. In essence, Apple said that Apple is licensed, and that developers were using Apple's hardware and servers that practiced the inventions, if the inventions were being practiced at all.

Today, Lodsys filed its Response in Opposition to Apple's motion. Mild comedy ensues.

As background, recall Mark Small's blog post from May 31:

On May 22nd, Apple’s chief lawyer Bruce Sewell unequivocally announced that Apple’s license to the Lodsys patents gave Apple’s 3rd party developers complete and “undisputable” freedom to use the covered inventions without paying royalties or fearing lawsuits. ...

The letter was very surprising as Apple and Lodsys were in confidential discussions and there was clearly disagreement on the interpretation of the license terms of Apple’s agreement. Before, during and after these interactions, Lodsys has carefully considered this issue and consulted several legal experts to consider Apple’s claims.  We stand firm and restate our previous position that it is the 3rd party Developers that are responsible for the infringement of Lodsys’ patents and they are responsible for securing the rights for their applications.  (emphasis added)

Well, it certainly sounded like Lodsys read Apple's license to the patents and disagreed with Apple about what the license said.

From today's filing, though:

Moreover, Apple has repeatedly refused to provide information relevant to its request for intervention. For example, Apple previously refused to provide even Lodsys's counsel with a complete copy of the License and, instead, redacted all but two paragraphs of the License. ... Subsequently, Apple filed the license under seal for attorneys' eyes only, so Lodsys could not review the actual terms of the license [REDACTED] Apple's disingenuous conduct and repeated attempts to hide the ball should not be rewarded.

Wait... Lodsys didn't have a copy of the license? Lodsys bought encumbered patent assets, sued a known licensee's partners, criticized the licensee's interpretation of the license, and they didn't even have a copy of the license? They are whining that Apple wouldn't show them a copy? I find that to be humorous.

(One theory as to how this could have happened: Apple obtained a bulk license to a long list of patents from Intellectual Ventures, including the Lodsys/Abelow patents. The license agreement contained confidentiality provisions for both parties. When IV "sold" these particular patent assets, they could not provide the full license agreements to the "buyer" due to the confidentiality agreement. Just a guess.)

Also amusing:

Third, Apple asserts that the defendants are allegedly individuals or "small entities with limited resources." ... But Apple prematurely filed its Motion before Lodsys filed its Amended Complaint [dkt. no. 26] against several large companies with substantial financial and technical resources... Accordingly, there can be no serious dispute that the defendants will more than adequately represent Apple's purported interest.

Let's review the timeline:

  1. Lodsys originally sued only small developers.
  2. Apple moved to intervene based in part on an argument that the developers lacked the means/knowledge to defend.
  3. Lodsys added some large developers to the suit.
  4. Lodsys says Apple filed "prematurely."

Right... Apple was premature. Another theory might come to the Court's mind though, like, perhaps, Lodsys added large developers to the suit specifically to counter Apple's point about developers' limited resources in an effort to improve the odds of keeping Apple out of the case.

 

There's more in the filing, but time is short. One thing is quite clear, though: Lodsys fears Apple's involvement in the case. Keep your fingers crossed that Apple's motion to intervene is granted.

Keep Calm and Carry On.

 

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