Thursday, January 30th 2020
The Case is Patent: Apple, Broadcom Ordered to Pay $1.1 billion to CalTech
There is a lot to say regarding patent applications and their defense, and the devious ways these can be used as a way to both stifle innovation, competition, and to leech other companies' funds with what is usually described as "patent troll" behavior. Being a seat of technological innovation, The California Institute of Technology (CalTech) registers patents as results of their attachés' work - some of these see the light of day as actual products, but more often than not, the patent rights are used as a way for the institute to receive funds from those that would license their intellectual property.
After entering a legal battle with Apple and Broadcom back in 2016, CalTech has now had its accusation of patent infringement against both companies come to a close, with the jury deciding in favor of the university. The accusation was of both companies deploying WiFi chips which were based on Caltech's patent designs - WiFi chips that were then shipped within millions of iPhones, iPads and MacBooks. As a result, both Apple and Broadcom were ordered to pay a total of $1.1 billion in compensation, with Apple taking the brunt of the decision ($837.8 million) and Broadcom coming in with a thinner slice at $270.2.
Both Apple and Broadcom have come forward saying they intend to appeal against the decision, with Apple using the tactic of shirking off responsibility. According to the company, they are "an indirect downstream party" to the patent-infringing WiFi modules, which means Apple believes they have no responsibility as to any patent infringements that were included in the design of the chips it ordered from Broadcom. Stock valuation of both Apple and Broadcom declined after the jury's decision was made public.
As for CalTech, the scholl said in a statement that they are "(...) pleased the jury found that Apple and Broadcom infringed Caltech patents. As a non-profit institution of higher education, Caltech is committed to protecting its intellectual property in furtherance of its mission to expand human knowledge and benefit society through research integrated with education."
Source:
TechSpot
After entering a legal battle with Apple and Broadcom back in 2016, CalTech has now had its accusation of patent infringement against both companies come to a close, with the jury deciding in favor of the university. The accusation was of both companies deploying WiFi chips which were based on Caltech's patent designs - WiFi chips that were then shipped within millions of iPhones, iPads and MacBooks. As a result, both Apple and Broadcom were ordered to pay a total of $1.1 billion in compensation, with Apple taking the brunt of the decision ($837.8 million) and Broadcom coming in with a thinner slice at $270.2.
As for CalTech, the scholl said in a statement that they are "(...) pleased the jury found that Apple and Broadcom infringed Caltech patents. As a non-profit institution of higher education, Caltech is committed to protecting its intellectual property in furtherance of its mission to expand human knowledge and benefit society through research integrated with education."
36 Comments on The Case is Patent: Apple, Broadcom Ordered to Pay $1.1 billion to CalTech
yeah....sure they are
Now the billion dollar + "non-profit institution of higher education"
Who am I kidding, watch tuition go up. LoL
One of the more recent ones is shaped like a curved concrete cylinder, and is refered to by students as "the UFO." I have no idea what they do with it. I used to joke they enriched uranium there.Most are. None should be.
Is this community so much against IP that even Apple gets some sympathy this time? :p
"Non-profit" does NOT mean an institution can't sell stuff.
The $1.1B figure looks silly and likely will get lower over the next court case.
But universities are research facilities as well. They have to protect their work.
Patent infringement cases are not about companies earning undeserved profit. It's about patent owner losing money because he isn't being paid for his work.
The $1.1B is not a fine (you pay that to the government). It's a compensation for lost profit.
Here's an example of a situation this is designed to prevent.
Company "A" wants to buy a product that uses an IP from company "C".
Suppliers have to pay a fee X - per item made - to the license provider "C".
So I'm a company "B". I decide to make a product that uses "C"'s work, but I don't pay for the license.
I could still sell this product for as much as everyone else and make the whole stolen X, but that doesn't give me any competitive advantage.
Instead, I make my product cheaper by 0.75 * X.
As a result, I'm much cheaper than other suppliers, so I win the contract.
I still make more than every other supplier would (by 0.25 * X).
Buyer "A" earns additional 0.75 * X (compared to if he bought from a supplier that paid for IP use).
If "C" goes to court and wins this case, they should be given the whole X. "C"'s best interest has a priority.
And the real threat (going back to preventing things) is: what if "B" decided not to take any of the stolen value? They could sell a product for X less than everyone else. "A" would earn the whole X. And if "C" was only eligible to what "B" took for themselves... the whole IP idea would collapse.
How "A" and "B" settle this afterwards is of less improtance. Of course "A" can sue "B" and potentially get the 0.75*X back.Apple, being a major and serious company, should check if the product they buy is "clean". And in the next court case they'll try to prove that they did everything possible - we'll see if the court agrees.
Expecting that a supplier will voluntarily give them such information is like expecting he also gives a list of possible production faults and design mistakes.
And now the inevitable car analogy (which works for any other material product):
If you buy a stolen car and you're "cought", the car will be returned to the rightful owner.
You, as a buyer, are obliged to check if the seller has the right to sell an item (he is an owner or an agent).
If you can't prove you checked ownership, you may be accused of fencing.
If the court decides you bought a stolen car inadvertently (you did some checks, you used sources available to a private buyer etc), you're off the hook for fencing, but you still lose the car, i.e. a lot of money (possibly way more than the thief).
And now when the material ownership becomes even more strict than IP stuff.
If the rightful owner can't be found (or is dead), you still lose the car.
Apple merely licensed the infringing product. How were they to know?
The manner in which these patents are created and used is fundamentally flawed, there is no filter. Of course someone should be able to protect their designs to an extent but not like this, it's a straight up broken system.
For instance one of the many examples of a mind boggling patent shitshow is how Magnavox acquired a patent to "video game art " (you heard that right) and used it to make millions of dollars over the span of dozen of years from all sorts of companies.