ITC Review Important Step in Ending Smart Phone Wars, Says Professor Daryl Lim of Chicagos John Marshall Law School

(PRWEB) November 30, 2012

Could it be that Apple, the most valuable company in history, is bulletproof when it comes to patents on its technology inventions? The U.S. International Trade Commissions ruling (No. 337-TA-794) to review the decision of one of its judges may provide the answer.

Patent cases at the International Trade Commission (ITC) have exploded since 2010 because it is significantly easier, faster and cheaper to get an exclusion order than an injunction at the district courts, said Professor Daryl Lim of The John Marshall Law School in Chicago. The ITC has become a significant player in the patent field and what it does will be watched here and abroad. It might see this case as an opportunity to correct some negative perceptions that have arisen that it favors U.S.-based companies, such as Apple, over foreign ones.

The ITC review could establish a framework for other cases and maybe even shepherd these parties towards an agreement, which certainly would be a remarkable result, he added.

The ITC is an independent, bipartisan, quasi-judicial, federal agency providing trade expertise to the President and Congress. It determines the impact of imports on U.S. industries and directs actions against unfair trade practices such as subsidies, dumping and infringement on patents, trademarks and copyrights.

The six ITC commissioners agreed to review a ruling by a federal administrative law judge (ALJ) that Apple did not infringe on Samsungs patents. In the case, Samsung had sought an import ban on nine of Apple’s devices including the iPhone 4S, iPad 2 and iTouch. Samsung has two patents in the ITC case which are said to be standards-essential. Standards help companies ensure devices are interoperable.

The ITC has taken the unusual step of asking for briefings on how it should consider standard essential patents. Lim, an intellectual property law professor said that The ITC has asked for advice. This indicates a strong desire to have its decision perceived as one that is supported by, or at least decided based upon consultation with stakeholders, even its critics.

A key question, he notes, is whether patent owners willing to license their standard essential patents on reasonable and nondiscriminatory terms can exclude someone seeking a license. The answer is difficult because the patentees willingness to license without discrimination sits uneasily beside their request for an exclusion order, which could harm competition, consumers and innovation because these give patentees leverage to obtain excessive or unreasonable royalties. The Federal Trade Commission issued a statement saying this to the ITC. Others think such obligations merely invite negotiation, and bans can be awarded if they dont violate antitrust laws. Preventing such bans might also discourage licensing in favor of settlements after suit and could lead to more secret deals like what we saw with HTC and Apple recently.

Then there is the question of what constitutes ‘reasonable and nondiscriminatory royalties. Courts around the world are facing the same question, Lim said. The issue is being fought by Microsoft and Motorola in a Seattle district court. The ITC, if it reverses the administrative judge on Apples patent liability, will need to answer this question. It is clearly a pivotal one, and will require careful consideration.

About The John Marshall Law School

The John Marshall Law School, founded in 1899, is an independent law school located in the heart of Chicagos legal, financial and commercial districts. U.S. News and World Report Americas Best Graduate Schools 2013 ranks the law schools Legal Writing Program sixth in the nation. The publication also ranked the Intellectual Property Law Program 17th. John Marshall offers the nations only graduate program in employee benefits. Its program in Information Technology and Privacy Law remains the only graduate law program in the country that emphasizes privacy as part of its core curriculum. And, The John Marshall Law School is one of three law schools in the country offering graduate programs in real estate law.

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