Google

January 9, 2013, by Mandour & Associates, APC

San Diego – The deal Google struck with the Federal Trade Commission last week has received a lot of attention and many are hoping it will curtail the ongoing technology patent wars, which most agree have gotten out of control.

In the deal struck between the two entities, the FTC ruled that Google has not violated antitrust law, much to the disappointment of many of the company’s critics.  The decision came after a two-year investigation of the way Google handles licensing of its industry-standard patents to its competitors.  Google had to agree to allow its competitors access to its industry standard patents, something it had previously fought hard to prevent.

FTC chairman Jon Leibowitz said during a press conference that the patent agreement could serve as a model for other patent disputes and it could reduce patent litigation, at least in the technology sector.

As Google and Apple, two of the largest players in the technology world, spent more money on acquiring and protecting their intellectual property last year than they did on research and development, anything that can decrease those costs may benefit the companies and their customers.

At the center of the deal between the FTC and Google is the technology giant’s purchase of Motorola Mobility, which Google bought in part for Motorola’s 17,000 tech patents.  Many of these patents are standard-essential patents, which Google is required to license to its competitors on fair, reasonable, and non-discriminatory (FRAND) terms.

The FTC’s investigation began when Motorola reneged on its agreement to license its patents according to FRAND terms.  When Google acquired Motorola, it continued to refuse licensing of industry-standard patents and began seeking injunctions to prohibit competitive products that contained its patented technology from entering the country.  Conduct like this may decrease competition and increase prices, which could hurt consumers.

Google senior vice president and chief legal officer David Drummond said, “We will seek to resolve standard-essential patent disputes through a neutral third-party before seeking injunctions.  This agreement establishes clear rules of the road for standard-essential patents going forward.”

Though the FTC’s deal with Google is not binding on any other company, it is speculated that other technology companies will use the terms of the agreement as a guide for the licensing of industry-standard patents.

December 12, 2012, by Mandour & Associates, APC

San Diego – Apple and Google are reportedly working together to offer Eastman Kodak more than $500 million for its imaging patents, which are being sold as part of Kodak’s bankruptcy proceedings.

The two technology giants are bidding on an undisclosed amount of Kodak’s 1,100 patents related to capturing, manipulating and sharing digital images.  Kodak valued the patents at $2.21 billion to $2.57 billion in its court documents, claiming it has made more than $3 billion by licensing the patents to companies such as Samsung Electronics, Google’s Motorola Mobility unit, LG Electronics and other technology companies.

Bidding entities disagreed with the figure Kodak assigned to its patents, as the first round of bids were reported to be in the $150 to $250 million range, likely because the value of the patents has been diluted due to Kodak’s excessive licensing.

Kodak is unwilling to sell its patents for that low of a figure as its $850 million loan offer, which it needs to pull out of bankruptcy, is contingent upon its patents selling for no less than $500 million.

In the first round of bidding, California-based companies Apple and Google were bidding against each other.  Apple is teaming up with Microsoft and Intellectual Ventures while Google is working with RPX Corp. and Asian manufacturers of Google’s Android phones.

Though Apple and Google are major competitors in the smartphone market and have had patent disputes in the past, partnering to purchase the patents allows both companies to not only reduce the cost but also limit the likelihood of patent infringement claims in the future.

This will not be the first time Apple has teamed up with a major competitor to purchase patents.  Apple teamed up with Research in Motion, maker of the Blackberry, to buy 6,000 patents from Nortel Network’s Corp. for $4.5 billion.  The companies were able to out bid Google, who only offered $900 million.  Google and Apple refused to comment on the alleged bid, as each company said it would not comment on rumors.  New York-based company Kodak would not comment on the purchase either, due to a court ordered confidentiality agreement.

Once Kodak secures its exit financing, it plans to shrink the company and move its focus away from photography, as the company was unable to keep up with the switch to digital.  Instead, it plans to focus on commercial, packaging and functional printing services.