In the ongoing silly patent fight between Apple and Samsung, the judge has ordered Samsung to give Apple some pre-release products (found via Copycense). While we've seen similar things before, this kind of order always bothers me, as it just seems wrong to order a competitor to hand over pre-release versions of competitive products. What if it turns out there's no infringement? Apple still gets to play with Samsung's products before they even hit the market? Why is this kind of thing allowed? Apple's -- and the court's -- argument is that this allows Apple to stop any possible infringement before it hits the market, but it also seems like there can be significant harm in sharing still secret info with a direct competitor. Even more bizarre is the basis for the judge's claim: that news reports quoted Samsung execs saying they wanted to change the Galaxy Tab to compete with the iPad 2. So what? In what way is it wrong for a competitor to shift gears once a new product hits the market? That's competition. What doesn't seem fair is Apple getting pre-release access to Samsung's products.

With Lodsys providing an excellent case study in the patent system run amuck with its plan to sue a bunch of independent iOS developers for offering Apple's official in-app payment offering, one of the big questions was how Apple would respond. Lodsys insisted that Apple had a license, but that it only applied to Apple, not to any Apple developers. Apple has now publicly disagreed and claimed that it would defend developers against any such claims.

I was wondering if Apple would even contest the validity of the Lodsys patent or whether the in-app payment offerings were infringing, but the company didn't even bother. Instead, it notes that Apple has indeed licensed the patent, and any of the developers using the in-app payment solutions aren't doing their own thing, but are using the already licensed Apple technology, and under the famous Supreme Court ruling in the Quanta case, if a patent holder licenses a product to one player in the supply chain, it can't then go after others down the stream. While some are claiming that this will still involve a fight between Apple and Lodsys over the exact terms of Apple's license, I don't actually think that's the case. Apple's not arguing the nature of the license, but is claiming that since these developers are using Apple technology, the patent has been exhausted in this case. In fact, it seems like a pretty direct parallel to the Quanta case, which is going to make it difficult for Lodsys to get very far.

Following last week's news of patent troll Lodsys going after a bunch of independent or individual iOS (iPhone/iPad) developers who were making use of Apple's in-app payment offerings (as required by Apple if you want to sell within an app), the company has put up a blog FAQ where it seeks to answer a bunch of questions that people have been asking.

It's basically a compendium of ridiculous, silly and debunked arguments for why patent trolling is awesome (while also denying that Lodsys is a patent troll). There were some weakly-sourced rumors over the weekend that Lodsys was a front company for Intellectual Ventures, but there wasn't much significant evidence to support that, and Lodsys denies it. It is true that the patents in question were once owned by IV, who sold them (and it's not clear if IV still has an economic interest in the patents -- something it allegedly keeps with some of its patent sales, though it's notoriously secretive in such deals). However, Lodsys insists that IV sold all of its rights to Lodsys.

Of course, the key question is what does Lodsys want. There was some speculation that it was pushing for a license from Apple, but it notes that Apple already has a license (though, it's almost certainly from when the patents were held by IV). It also notes that Microsoft and Google hold licenses (again, potentially via IV), so it may be going after developers on other devices soon too. Of course, Lodsys pretends that the licenses from Apple, Google and Microsoft show that the patents are legit, but that's being deceptive yet again. From the details, it's almost entirely certain that all three companies got the license as a part of a blanket license from IV, and had no idea about this specific patent, nor took any interest in the details of this particular patent. For Lodsys to pretend this legitimizes their patent is yet another example of patent trolls being misleading. This patent was not considered important by Apple, Google or Microsoft. It was almost certainly included in a bulk licensing deal.

Finally, Lodsys points out that it has no interest in receiving a single lump sum from big companies, claiming that it's likely to get "the best return" by shaking down developers one-by-one-by-one. So, what does Lodsys want? Well, it appears to want at least 0.575% of the entire in-app payment market:

In the case of an Application doing an in-application upgrade (and only this scenario), Lodsys is seeking 0.575% of US revenue over for the period of the notice letter to the expiration of the patent, plus applicable past usage.

Of course, since the power of in-app payments is that it lets you do a lot more than just app upgrades, you have to imagine Lodsys is asking for a lot more in those other cases.

And for what? For coming up with an insanely abstract idea that was a natural and obvious evolution of such apps. No one -- no one -- came up with the concept or implementation of in-app payments for mobile device apps because of this patent. And, of course, this assumes (incorrectly, of course) that this will be the only patent that someone digs up that appears to (broadly defined) cover things like in-app payments. If all such patent holders start demanding 0.575% (or more) this will put a huge burden on developers.

Lodsys talks high and mighty about "property rights" and paying those who are owed money in its blog, but those claims are laughable. First, it claims that it's Lodsys patents that are responsible for in-app payments:

The economic gains provided by the Lodsys inventions (increase in revenue through additional sales, or decrease in costs to service the customer) are being enjoyed by the business that provides the product or service that interacts with the user. Since Lodsys patent rights are of value to that overall solution, it is only fair to get paid by the party that is accountable for the entire solution and which captures the value (rather than a technology supplier or a retailer).

But that assumes, totally incorrectly, that Lodsys or even the original patent was instrumental in making this happen. It was not. This is the natural evolution of app development. But Lodsys can't let up and gets ridiculous:

As a comparative example, it is the owner of the hotel who is responsible for the overall service (value proposition) that guests pay for, not the owner of the land that the hotel may be leasing, not the travel agent that sold the reservation, not the manufacturer of tools such as hammers, nor the provider of materials such as nails or steel beams, which may be used in building the hotel; nor is it the outsourced linen washing service or the architect of the building who is responsible. Lodsys’ patent portfolio is being used as a part of an overall solution and we are seeking to be paid for the use of patent rights by the accountable party.

Except that whole first part disagrees with the conclusion Lodsys is shooting for. Yes, the owner of a hotel is responsible for its overall service, but if you went to the owner of a hotel and said "hey, I came up with the idea of putting bathrooms in hotel rooms, pay me," the owner of the hotel would laugh at you. Because that's just a basic implementation that's an obvious advance as a result of indoor plumbing. Ditto for in-app payments. That's an obvious advance in the evolution of mobile apps. Again, no one is doing in-app payments because they suddenly discovered this Lodsys patent and its vague and useless descriptions.

There's also the myth of the brilliant inventor shining the light on this concept via this patent for the rest of the world to learn from:

Dan Abelow is an independent inventor who visualized/created metaphors, documented for the world to see (in exchange for exclusivity) and created value for doing so. This ideation, as expressed in the patent, enabled a building block for others to build on and create more value.

That assumes that the people being sued actually built off of this patent. Lodsys presents absolutely no evidence to support such claims, because it almost certainly has none. Of course, Lodsys defends patent trolling and insists that people who don't like this are just freeloaders:

In aggregate, this cycle of patent licensing means that more invention can happen and it means that the economic profit pie is distributed more efficiently to suppliers of building blocks that are incorporated in the products or services.

This is false. And it's been shown false over and over and over again by various economic studies. It's based on the very false assumption that any economic activity is good economic efficiency. When the economic activity involves artificial protectionist barriers to innovation (which is what's happening here), then nearly every serious economist will point out the serious costs involved in hindering economics. To claim that this means more invention can happen is simply not supported by the evidence at all, which suggests more optimal results are found without patents getting in the way.

There are lots of bills in life that it would be preferable to not pay if one didn’t have to. Lodsys is just trying to get value for assets that it owns, just like each and every company selling products or services is, trying to do business and make a profit. Its odd that some of the companies that received notices had such a visceral reaction. Some of these companies have our favorite apps, for which we paid the asking price. We realize you have to get paid for your work and so do we.

It's not that people don't want to pay these bills. It's that they think it's ridiculous that some company that no one's ever heard of, holding some piece of paper that includes nothing of value or relevant to these developers, is suddenly demanding a cut for doing absolutely nothing. That's incredibly different than someone paying for an app that they liked.

While there's been plenty of concern in the past couple weeks about Apple's iPhone/iPad location data, followed by Google's Android location data, plenty of people pointed out from the beginning that what both companies have done completely pales in comparison to the sort of data that mobile phone operators regularly collect on you. Even as lawsuits have been filed against both Apple and Google, few of the people who are really upset about those two companies seem to recognize that what the operators have is much, much more complete. The mobile operators, apparently fearing that people may start to realize this, have become a bit proactive and are trying to convince everyone that the real problems are elsewhere -- specifically with apps on phones, not with the service providers. You see, don't worry about all the data we collect. Just look at what those apps are doing:

AT&T noted it “plays no role” in what kind of information smartphone apps collect, while T-Mobile pointed out the ways in which that data can be used.

Sprint lamented “consumers no longer can look to their trusted carrier with whom they have a trusted relationship to answer all of their questions,” particularly on privacy.

And Verizon Wireless called out smartphone app makers directly on the issue, stressing “location-based applications and services (whether provided by us or third parties such as Google) should give customers clear and transparent notice” and control.

This was in response to questions from Congressional Reps. Ed Markey and Joe Barton, leading all of the operators to also admit that they collect such data as well, but really, apps. Apps are a bigger issue. Just focus on the apps. Really. Apps.

For a while, it really did seem like the patent "cold war" system was working. Big companies wouldn't sue other big companies out of fear of launching the patent nuclear war response, as the other big company would have a stack of patents of its own that it would use to countersue. Yet, recently, we're noticing more and more "nuclear" wars breaking out, with big companies suing other big companies... only to have the sued company find some patents and countersue. A lot of these patent wars seem to involve Apple. It's involved in suits and countersuits with HTC and Nokia (though, Nokia started that one). And, of course, with Apple's recent bizarre decision to sue Samsung for patent infringement, it was only a matter of time for the counterstrike.

Indeed, just days later, Samsung has countersued Apple for infringing on five of its patents. Of course, adding a bit of a twist to the usual script, Samsung has filed those lawsuits around the globe: one in South Korea, one in Japan and one in Germany. Of course, these sorts of battles should show how screwed up the patent system is today. None of these patents have anything to do with actual innovation. None of them represent something so amazing that it wouldn't have been created by someone anyway as a part of the natural progression of mobile phones. It's a bunch of basic ideas, locked up, which are now being used for big companies to sue each other... such that money can be diverted from any actual innovation to paying a bunch of lawyers.

In the past, we've pointed out how many patent holders now get two entirely separate cracks at trying to get those they accuse of patent infringement to pay up. There's the regular court system and there's an entirely separate International Trade Commission (ITC) process, as well. Basically, the ITC can make rulings preventing importing infringing works, totally outside of the court system. And, of course, since so many things are made outside the US these days, this could create an effective injunction against those products in the entire US market. One of the key problems is that the ITC uses different standards than the court system to determine if such an injunction is an appropriate step.

With the massive patent thicket on smartphones, leading to a bunch of lawsuits, many are using both the court system and the ITC to try to force the other side to give in and just pay up. However, so far, it appears that the ITC is not playing along. We recently noted that the ITC indicated it was rejecting Nokia's claims that Apple's iPhone violated some of its patents, and now the ITC has indicated that it won't side with Apple in its claims against HTC and Nokia.

In other words: keep your silly patent pissing fight out of the ITC.

If the ITC keeps rejecting these attempts to stifle competition via the patent system, then hopefully companies will stop using this little loophole to get to extra bites of the (proverbial) apple.

When we wrote about Apple's new lawsuit against Samsung over its new phones and tablets looking too much like Apple's iPhone and iPad, the full legal complaint from Apple wasn't yet public. However, it's now coming out, and the detailed list of patents and trademarks at issue make this seem ridiculous. While the initial report we saw yesterday showed only design patents, the lawsuit actually covers utility patents, design patents, trademarks and trade dress claims. Here they are in all their glory, as compiled and described by Florian Mueller:

• 7 utility (i.e., hardware and software) patents

  • U.S. Patent No. 7,812,828 on an "ellipse fitting for multi-touch surfaces" (previously asserted against Motorola in an ITC complaint and a federal lawsuit)

  • U.S. Patent No. 7,669,134 on a "method and apparatus for displaying information during an instant messaging session" (a software patent, presumably infringed by the Google Talk chat client, which I also use on my Galaxy phone and on which this patent may very well read)

  • U.S. Patent No. 6,493,002 on a "method and apparatus for displaying and accessing control and status information in a computer system" (previously asserted against Motorola in a federal lawsuit)

  • U.S. Patent No. 7,469,381 on "list scrolling and document translation, scaling, and rotation on a touch-screen display" (previously asserted against HTC in a federal lawsuit)

  • U.S. Patent No. 7,844,915 on "application programming interfaces for scrolling operations"

  • U.S. Patent No. 7,853,891 on a "method and apparatus for displaying a window for a user interface"

  • U.S. Patent No. 7,863,533 on a "cantilevered push button having multiple contacts and fulcrums" (a hardware patent)

• 3 design patents

  • U.S. Design Patent No. D627,790 on a "graphical user interface for a display screen or portion thereof"

  • U.S. Design Patent No. D602,016 on an "electronic device"

  • U.S. Design Patent No. D618,677 on an "electronic device"

  • AllThingsD displays various graphics from the complaint that relate to those design patents.

• Trade dress rights

  • Apple claims to hold "trade dress protection in the design and appearance of the iPhone, the iPod touch, and the iPad, together with their distinctive user interfaces and product packaging." (yes, in Apple's view even Samsung's packaging infringes its rights)

  • Apple asserts its registered trade dresses no. 3,470,983, no. 3,457,218 and no. 3,475,327.

• Trademarks (i.e., 6 trademarked icons)

  • U.S. Trademark No. 3,886,196 on a dial icon

  • U. S. Trademark No. 3,889,642 on a chat icon

  • U.S. Trademark No. 3,886,200 on a sunflower icon (for a collection of photos)

  • U.S. Trademark No. 3,889,685 on a settings icon

  • U.S. Trademark No. 3,886,169 on a notepad icon

  • U.S. Trademark No. 3,886,197 on a contact list icon

As the article suggests, Steve Jobs would sue his own family if they made a reasonable Android device. This is a kitchen sink lawsuit, where Apple is throwing everything at Samsung, and once again, the sheer pettiness of the whole thing after looking over the really quite minor patents and trademarks being asserted here seems to scream only one thing: Samsung has apparently designed an awesome phone and tablet device that has Steve Jobs scared of competition.

We've noticed that Apple's been getting a lot more aggressive when it comes to proactive patent infringement lawsuits lately, so it's not all that surprising to see that it's now suing Samsung for patent and trade dress infringement over the design and packaging of the Samsung Galaxy phone and tablet. I haven't seen the full filing yet (for reasons unexplained AllThingsD mentions the filing, and has a screen shot, but didn't post the full filing), so perhaps there's more to this than what's described in the existing coverage. However, from the screenshot, it looks like Apple is asserting design patents, instead of utility patents. Design patents are pretty limited and a lot more like a trademark than a traditional patent. I'd be interested to see if there were utility patents included as well, and will post an update once I've seen the filing.

That said, this complaint seems pretty silly. Yes, lots of smartphones mimic the basic look and feel of the iPhone these days. But, Apple itself copied many of the design features of the iPhone from others as well... and, let's face it, Apple owes much of its history to copying the look and feel of a graphical user interface that Steve Jobs saw while touring Xerox PARC. Why can't Apple just focus on competing in the market place, rather than worrying about what competitors are doing? And, to be honest, this lawsuit actually makes me more interested in checking out those Samsung devices, because it signals to me that it may actually be getting "close" to the design quality associated with Apple's devices...

Looks like it may be time to update our patent thicket graphic. Another company that's not actually doing anything in the space is suing everyone who is. A company named H-W Technology apparently holds a patent (7,525,955) on an "Internet protocol (IP) phone with search and advertising capability" and has sued Apple, RIM, Google, Amazon, eBay, HTC, LG, Smasung, Microsoft, Nokia, Verizon and others for violating it. Because, you know, I'm sure no one possibly could have figured out how to put search and ads on a phone without this patent.

Nokia, who used to absolutely dominate the mobile phone market, has definitely seen better days. The iPhone really took it by surprise and the company really hasn't done a particularly good job reacting to the rise of the smartphone market. So, like plenty of companies who once innovated, once it started losing in the market, it shifted to litigation. Just a week after the company's first ever quarterly loss, it sued Apple for patent infringement over the iPhone. It actually took two cracks at Apple in that it also used the ITC loophole to go after the company twice.

Of course, in true patentland fashion, when a big tech company sues another big tech company for patent infringement, patent nuclear war ensues, as Apple sued back claiming that Nokia infringed on its patents. While the various lawsuits are still ongoing, it appears that Nokia's first shot via the ITC loophole has been a big failure, as the judge has ruled that Apple didn't infringe at all. It's worth noting that many consider the ITC to also have a lower bar, so this might not bode well for Nokia's lawsuit. Of course, Apple's lawsuit against Nokia remains as well... meaning that this little attack on Apple could conceivably end very, very badly for Nokia.

Probably should have focused on innovating, huh?