Patents play a significant role in industry, defending new ideas and helping technology progress. Major patent disputes from the last decade have affected the legal rules shaping the technology landscape.
This article discusses at a high level, disagreements involving big tech companies including Apple, Samsung, and Google that have shaped the direction and evolution of patent law. Each dispute has brought about changes in the way patent law is interpreted in the face of advances in technology.
These controversies demonstrate how technology majors protect their new ideas and shape the laws surrounding intellectual property.
Controversy 1: Apple vs. Samsung
Apple Inc. squared off against Samsung Electronics Co. in 2012 in a legal battle (Apple Inc. v. Samsung Electronics Co., Ltd., 2012 WL 1595784, (N.D. Cal. 2012) ) that started in early 2011.
Pivotal patents and innovations were central to the dispute, with a principal focus on the iOS user interface. Apple maintained that Samsung had infringed on its software patents, design patents, and trade dress.
A 13-day jury trial took place from July to August 2012. After meticulous deliberation, the jury concluded that Samsung had violated Apple’s patents. Apple emerged as the victor, securing a remarkable $1.049 billion. The jury rejected Samsung’s counterclaims against Apple.
Post-verdict, there was more legal exploration and reexamination of the case. A critical question arose around the definition of the “article of manufacture” for calculating damages. Questions were asked whether the entire smartphone or only parts of it to which the design patents were related constituted the “article of manufacture.”
In December 2016, the Supreme Court reversed the initial decision (Samsung Electronics Co., Ltd. v. Apple Inc., 580 U.S. 53 (2016) ). It mandated a return to the Federal Circuit Court to articulate a clearer legal standard definition. The court emphasized that the “article of manufacture” might encompass specific components such as the case and screen rather than the entire smartphone.
This conflict between Apple and Samsung is one of the most significant patent disputes in recent decades. It changed market dynamics and provided valuable insight into design patents and intellectual property protection.
Controversy 2: Alice Corp. vs. CLS Bank International
The dispute between Alice Corporation and CLS ( Alice Corporation Pty. Ltd. vs. CLS Bank International, et al., 573 U.S. 208 (2014))became a pivotal point in the discourse on patent law, especially in relation to software patents.
Alice Corporation owned patents that described a method for reducing “settlement risk” in money exchanges. However, CLS, a network facilitating currency transactions worldwide, challenged the patents. CLS argued that the patents were invalid, unenforceable, and not infringed.
Drawing from the previous Supreme Court ruling on the Bilski case (Bilski vs. Kappos, 561 U.S. 593 (2010)), the court held that the Alice Corporation patent claims were ineligible under 35 U.S.C. 101, as the claims were directed to a basic idea about handling financial transactions.
Using a computer to implement this idea wasn’t enough to make it special or new, and therefore, not patent eligible. The Federal Circuit and the Supreme Court both agreed on this decision.
The Alice controversy led to many discussions about patent eligibility and the validity of software-related inventions, leading to what is now known as the “Alice test.”
First, the question was asked if the idea was abstract. Second, it was then asked if the patent added something extra, a practical application, that transformed the abstract idea into something more.
Controversy 3: Waymo vs. Uber
In 2017, a benchmark legal confrontation arose in the evolving self-driving car sector (Waymo LLC vs. Uber Technologies, Inc., No. 17-2235 (Fed. Cir. 2017))
Waymo, which is part of Google and specializes in making autonomous vehicles, started a lawsuit against Uber in February 2017. They accused Uber of wrongly obtaining secret business information and breaking patent rules related to Lidar systems, which are essential for self-driving cars to understand their environment.
The core of the conflict was around Anthony Levandowski, who was a high-ranking engineer at Waymo. He was accused of taking more than 14,000 files filled with confidential information about Waymo’s self-driving car technology and sharing them outside the company.
After this, Levandowski left Waymo and started a new company, Otto, which Uber soon bought. Levandowski oversaw Uber’s self-driving car projects during this legal mess but had to step down.
Despite all the back-and-forth in court and arguments over whether certain documents could be used as evidence, the Federal Circuit Court did not give Levandowski and others involved any relief. This case had significant effects on the autonomous vehicle field, setting new examples and creating new rules around ownership of ideas and competing in this fast-growing industry.
This case has raised a lot of questions and created discussions about how companies protect their ideas and innovations, especially in fields where technology is advancing quickly.
Controversy 4: Qualcomm vs. Apple
Another controversy unfolded over issues surrounding a licensing agreement involving patents for modem chips. Qualcomm, a company that makes these chips, moved to exclude the opinions of several experts put forth by Apple, which uses the chips in its iPhones, iPads and similar products, regarding “technological comparability” factors related to damages calculations, noninfringement opinions and other damages-related opinions (Qualcomm Inc. v. Apple Inc., Case No.: 17cv1375 DMS(MDD) (S.D. Cal. Jan. 18, 2019)). This case had multiple dimensions and reached courts around the world, affecting the broader field of FRAND licensing for smartphone technology.
The root of the conflict goes back to around 2013 when Qualcomm and Apple signed an agreement. Qualcomm would provide modem chips to the companies that manufacture Apple’s devices.
But this agreement soon got complicated due to concerns about FRAND (Fair, Reasonable, and Non-Discriminatory) licensing terms. FRAND terms aim to make essential patents available to anyone at a fair price, and disputes arose over whether Qualcomm was abiding by these guidelines.
The dispute reached a turning point in 2019 when they decided to settle their differences out of court. The settlement brought an end to all ongoing legal battles. It also led to a six-year global patent license agreement between the companies, along with a separate agreement for Qualcomm to supply chips to Apple for multiple years.
This long and complex legal struggle clarified the rules and practices surrounding patents, licensing agreements, and technological development. It established new standards for tech companies, particularly in intellectual property and fair competition.
Controversy 5: Epic Games vs. Apple
A dispute arose in 2020 between Epic Games and Apple (Epic Games, Inc. v. Apple Inc., 559 F. Supp. 3d 898 (N.D. Cal. 2021)), centered on the removal of the Fortnite game from Apple’s App Store. While the case heavily involved state and federal antitrust and unfair competition law claims, patent issues were raised by Apple regarding the use of Apple’s proprietary SDK environment.
Apple kicked the game out of the App Store because Epic Games added a feature that allowed users to make in-app purchases without giving Apple its standard 30% cut. Epic Games then sued Apple, challenging what they described as “illegal restraints” on competition enforced by Apple.
The trial took place in the state of California in May 2021. In the subsequent ruling, Apple was not found to have violated antitrust laws and thus basically won the case.
The judge, however, did find that Apple’s practices, specifically its rules against directing users to other payment methods, also known as “anti-steering” policies were anticompetitive. The court considered this a violation under California’s unfair competition law.
The outcome of the case was quite straightforward. Epic Games failed to prove that Apple was unfairly dominating the submarket for mobile gaming transactions. As a result, the court ordered Epic Games to pay the commissions owed to Apple.
In addition, Epic Games was ordered to oay Apple 30% of the revenues generated from direct in-game payments in the Fortnite app on Apple devices in response to breaking their contract with Apple that involved a wholesale license to its patents, copyright and trademarks.
On appeal to the 9th Circuit, the initial decision was upheld in 2023 except that the issue of attorney’s fees was reversed and remanded.
Controversy 6: Supreme Court Ruling On Google vs. Oracle
The dispute involving Google and Oracle (Google LLC vs. Oracle America, Inc., 141 S.Ct. 1183 (2021)), drew extensive attention due to its focus on copyright and fair use, and was of particular interest due to the parties involved.
The core of the dispute involved Google’s use of elements from the Java APIs in Google’s early versions of the Android operating system. Oracle, which owned the Java API elements, took issue with Google’s actions.
Google admitted using the APIs but asserted the affirmative defense of fair use. Oracle, on the other hand, demanded a massive $8.8 billion in damages, arguing that the APIs were an unauthorized commercial use of their copyright.
The legal journey of this case was marked by a series of ups and downs. Initially, two District Court-level jury trials leaned in favor of Google. However, later decisions from the Federal Circuit Court overturned these verdicts, asserting that the APIs were indeed subject to copyright.
After several delays, the case eventually reached the Supreme Court. In April 2021, the Court in a 6-2 decision held that Google’s use of the Java APIs fell under the category of fair use.
Specifically, the Court held that Google’s copying of the Java SE API, which included only those lines of code that were needed to allow programmers to put their accrued talents to work in a new and transformative program, was a fair use of that material as a matter of law under the “purpose and character” doctrine (citing Cambell, aka Skywalker et al. v. Acuff-Rose Music, Inc. 114 S.Ct. 1164 (1994)).
The Supreme Court’s ruling in this case has had a profound effect on how the tech industry perceives software development. It delved into complex issues surrounding the use of APIs, software copyright laws, and what constitutes fair use.
It is worth noting that Justices Thomas and Alito penned a vigorous dissent challenging the majority’s holding despite the huge commercial gain realized by Google, and criticizing the majority for bypassing the question of whether the software code (i.e. the API code) is protected by the Copyright Act, and proceeding to a “distorted” fair use analysis.
Looking Forward: Future Challenges & Opportunities
Adapting patent laws to fast-changing technology is a continuing challenge. Laws must evolve to protect new innovations without stifling future advancements creating a complex interplay between emerging tech and existing legal frameworks. For a balanced approach, lawmakers and tech innovators need to engage in ongoing dialogue.
Flexibility is essential. Laws must be able to accommodate unforeseen types of inventions, while inventors should understand how these laws impact their work.
Responsible planning by decision-makers can help foresee future challenges, ensuring a smooth path for tech advances while protecting intellectual contributions. This balanced focus can pave the way for a future where legal frameworks and technological progress coexist effectively.
When we look back at the landmark lawsuits of Apple vs. Samsung and Google vs. Oracle, it’s clear that these court battles have made waves in both technology and law. These cases shed light on the complex relationship between creating new technologies and owning the rights to those ideas.
Because laws around patents are changing, it’s essential to keep learning to understand the full impact of these shifts.
For those dealing with this problematic combination of innovation and legal rules, METROLEX IP LAW GROUP provides top-notch expertise. We’ll help you secure your creative work while making sense of the detailed world of intellectual property law. Contact METROLEX IP LAW GROUP today to ensure your innovations are legally protected.