Apple, Motorola Both Denied Injunctions

Circuit Court Judge Richard Posner, arguably the most brilliant mind on the American bench, threw out the Android infringement litigation between Apple and Motorola Mobility late Friday with prejudice, denying Apple its hoped-for injunction against the Google satellite and its smartphones.

That goes for Motorola too.

“Neither party is entitled to an injunction,” Posner said. “Neither has shown that damages would not be an adequate remedy” to an injunction – (which is usually reserved for cases of imminent irreversible harm) – but both sides “failed to make a responsible calculation” of damages.

“They had an adequate legal remedy,” he said, “but failed to make a prima facie case of how much money, by way of such remedy, they are entitled to. That was a simple failure of proof.”

Apple has the stronger case but “By failing to present a minimally adequate damages case, Apple has disabled itself from arguing that damages would not provide a complete remedy, going forward in the form of running royalties, as well as backward.”

With prejudice means the cross-litigation can’t be re-filed, giving Apple, which claims Motorola copied its technology, a powerful thumping.

There is of course always the probability of appeal or they could go venue shopping. Otherwise, Judge Posner, whose patience was tried more than a little by the case, blasted the strategy of using patents to bar a rival from the market in his 38-page decision.

After tossing nearly all of Motorola’s patent claims against Apple and leaving Apple with more, the judge cancelled a jury trial that was supposed to start on June 11 on their two-year-old cross-complaints and heard arguments last Wednesday on the possibility of injunctions determined to decide the issue himself.

He found that Apple had dicey grounds for a ban in the light of possible workarounds and said enjoining Motorola’s phones would be “catastrophic” for the company.

It didn’t have a tight enough case. “Apple wanted me to allow into evidence,” the judge said, “media reports attesting to what a terrific product the iPhone is. I said I would not permit this because the quality of the iPhone (and of related Apple products, primarily the iPad) and consumers’ regard for it have, so far as the record shows, nothing to do with the handful of patent claims that I had ruled presented triable issues of infringement. Apple’s ‘feel good’ theory does not indicate that infringement of these claims (if they were infringed) reduced Apple’s sales or market share, or impaired consumer goodwill toward Apple products.”

There’s “danger,” he said, “that Apple’s goal in obtaining an injunction is harassment of its bitter rival…The notion that these minor-seeming infringements have cost Apple market share and consumer goodwill is implausible, has virtually no support in the record, and so fails to indicate that the benefits to Apple from an injunction would exceed the costs to Motorola.”

“smallerAn injunction,” he said, “that imposes greater costs on the defendant than it confers benefits on the plaintiff reduces net social welfare.”

Meanwhile, Posner had left Motorola with one FRAND-pledged wireless patent to sue on after weeding out the others.

He said Motorola’s FRAND pledges barred it from seeking an injunction and that Motorola offered “no reasonable evidence for calculating a reasonable royalty” in light of its gargantuan licensing demands for 2.25% of Apple’s device sales.

“I don’t see how,” he wrote, “given FRAND, I would be justified in enjoining Apple from infringing the ‘898 unless Apple refuses to pay a royalty that meets the FRAND requirement. By committing to license its patents on FRAND terms, Motorola committed to license the ‘898 to anyone willing to pay a FRAND royalty and thus implicitly acknowledged that a royalty is adequate compensation for a license to use that patent. How could it do otherwise? How could it be permitted to enjoin Apple from using an invention that it contends Apple must use if it wants to make a cell phone with UMTS telecommunications capability – without which it would not be a cell phone.”

Judge Posner also quashed Apple’s proposal to limit the injunction and force Motorola to remove Apple-patented features from its phones within three months of launch. He said it would be too hard and too costly to administer for both Motorola and the court, and forcing Motorola to sell inferior technology would serve no social good and create the unhappy prospect of Apple then filing more lawsuits claiming Motorola still infringed à la Apple and HTC.

He suggested Apple license the relevant patents to Motorola.

FOSS Patents says the only thing that’s going to stop the worldwide patent disputes that Judge Posner loathes is a global settlement and the only way to achieve a settlement is either through an injunction that endangers sales or draconian damages.

According to Gartner Android owns 47% of the market and iOS has 23%.

The Apple-Google relationship is expected to deteriorate further if Google puts out its own branded phone, as widely reported

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