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Samsung Offers Patent Cease-Fire in EU
dryriver sends this quote from the BBC:
"Samsung has said that it will stop taking rivals to court [in the E.U.] over certain patent infringements for the next five years. The white flag in the patent battle has been raised because the South Korean electronics firm faces a huge fine for alleged abuses of the system. The move could help end a long-running patent war between the world's largest mobile makers. The E.U. said that a resolution would bring 'clarity to the industry'. 'Samsung has offered to abstain from seeking injunctions for mobile SEPs (standard essential patents) for a period of five years against any company that agrees to a particular licensing framework,' the European Commission said in a statement. Standard essential patents refer to inventions recognised as being critical to implementing an industry standard technology. Examples of such technologies include the Universal Mobile Telecommunications System (UMTS), a cellular standard at the heart of 3G data; and H.264, a video compression format used by YouTube, Blu-ray disks and Adobe Flash Player among others. The E.U. had accused the Samsung of stifling competition by bringing a series of SEP lawsuits against Apple and other rivals."
Oh grow up.
Apple's patents can all be worked around. However Standards Essential Patents (as indicated by their very name) cannot.
This is why any company that abuses the ones they have (such as Samsung) is a big deal.
and the solution that would have been used is to invalidate the patents by the EU (nuclear option) if Samsung did not quit abusing. They've also been put on notice that any further abuse of SEP's will result in the patent being invalidated by the EU, thus ending any and all lawsuits in regards to said patents.
This has the benefit of informing the Corps that Abuse of the Courts and the System will no longer be tolerated while reducing the time and money wasted not only by the courts but the victims of the abuse. It does not impact lawyers directly other then by telling them that the gravy train has ended in the EU.
Now if the damn courts in the United States along with the congress would implement the same deal. Keeps patents valid while fixing the major problem with the system as it stands.
Mod me up/Mod me down: I wont frown as I've no crown
"We agree to stop abusing SEP patents for five years. And then, once those five years have passed, we will return to abusing them as we have which lead us to this point."
How about Samsung stop abusing SEP patents and honour their FRAND promises. Period.
They're offer appears nice, on the face of things, but it is hollow in the long run. The EU response should be simple - you've broken your FRAND promises and abused your SEP patents. You are fined an enormous amount and if it happens again, you will be fined an enormous amount again until you understand that FRAND promises are vital to the industry's ability to grow and develop and breaking those promises undermines the entire foundation of Standards Essential Patents. Stop abusing them - drop every single SEP-based lawsuit against every manufacturer and do not launch another lawsuit seeking damages nor injunctions for SEP patents ever again - or be fined. Period.
So long as manufacturers can wield SEP patents that are covered by FRAND promises as a weapon, there's serious damage being done to the industry. If you want to use your patent as a weapon against your fellow manufacturers, don't offer them up to a standards body for inclusion in an industry standard and don't promise to license them under FRAND terms. You are under no obligation to do so. This situation isn't forced upon you. There are reasons companies want their patents in an industry standard, even with the FRAND limitations, and there are reasons companies want to keep patents close to their chest. Pick one. You can't have both. Attempting to have both is an abuse of SEP patents and a breach of FRAND promises.
So they stop the abuse, once. Now change the system to stop ALL the abuse. Make mandatory generic licensing a requirement of the patent system. And set the royalty rates to prevent abuse (FRAND). This is the only way to allow the inventor to benefit but without holding back civilization by the unreasonable.
Never abused SEP patents covered by FRAND promises. No. They haven't.
What I'm wondering, is if the patents are so essential to an industry, why doesn't the government just come in and say "Hey Samsung, we're taking your patent. You are free to continue to use it without paying us any licensing fees, but we will also license it out to who ever we choose"? What is the benefit of letting Samsung keep the patent vs the method I just described?
Some people consider nationalisation of private property to be a pretty drastic measure.
-- Using the preview button since 2005
...prisoner's dilemma. Throwing your patents under FRAND means they are essentially not yours anymore; sure, you get paid something, but because of how "fair and reasonable" can be interpreted, it's probably really difficult to enforce anything. HOWEVER, if you do not do that, another company might offer a FRAND patent and turn that into an industry standard instead. And then you end up with a worthless patent.
It's good to know all our standards are only based on companies unable/unwilling to cooperate properly.
nd the solution that would have been used is to invalidate the patents by the EU (nuclear option) if Samsung did not quit abusing.
I think the threat of a 13.7 BILLION Euro fine was slightly more nuclear. Plus obviously any attempt to enforce these patents would be illegal, no matter whether the patents were valid or not.
What I'm wondering, is if the patents are so essential to an industry, why doesn't the government just come in and say "Hey Samsung, we're taking your patent. You are free to continue to use it without paying us any licensing fees, but we will also license it out to who ever we choose"? What is the benefit of letting Samsung keep the patent vs the method I just described?
No, Samsung is supposed to get a fair and reasonable license fee for these patents. And standard essential patents are not standard essential by magic. They are standard essential because a standard was created that uses the patent, and the patent holder agreed to it being included in the standard.
That's like featherweight champion telling Tyson in his prime he could kick his ass in the ring. It's not a very smart move. Especially considering that South Korea is far more reliant on exports to EU than vice versa due to economic structure of each country.
What we'll likely (not) see, but what will happen behind the closed doors is diplomatic wrangling with some member states to put pressure on European Commission. Impact of such action would be far more limited on both ends, and will give South Korean government a pretense to give Samsung that "we tried our best".
For those who don't know, large conglomerates like Samsung are basically a state within state in South Korea and they have immense power in government actions. But not so much as to sink the country in a severe diplomatic and economic row with one of the most if not the most important trading partner.
Actually the existence of SEPs itself is a sign of a broken system - if a patent is essential to entering the market in an entire industry, how the HELL is it still valid?! Patents are there to provide a head start for the inventor (or whoever owns the patent or a licence), nothing more.
This is a result of two colliding processes. The patent owners (as with all other IP) would love to have their exclusive rights last longer and will lobby for it. At the same time the world has been constantly speeding up. Design, production, even distribution are a lot faster now. This means that the power of a patent grew a lot. Unfortunately, this effect is different in different industries (*).
Consumer electronics is one field where patents should last a LOT shorter. Barrier to entry is way too high for an individual inventor to enter the market based on one patent anyway, so most patents will be used by existing companies. In this situation new technology can be brought to market quickly and sold worldwide. Why grant 10 or 20 years of exclusive rights for a technology which will be outdated in 5?
A patent should last long enough to enter the market, maybe get a significant market share... not build a new large market from scratch - that should never happen entirely without competition if the words "free market" have any meaning at all.
However, there are still industry fields where 10 years is a short period. Basically, field-invariant patent law is worthless.
(*) The same goes for copyrights. Immediate distribution. Quick printing/production/whatever. Instant access through the internet. Whether your IP-protected product is a song, a book, a movie or whatever, you can now reach a market bigger than ever almost immediately. So, why grant so many years of protection? It's a monopolistic perversion of the IP law's original intent. The protection period grows all the time, while changes in technology dictate that it should actually be reduced.
Some people consider nationalisation of private property to be a pretty drastic measure.
Sure, and that would be relevant if we were talking about private property, as opposed to patents.
On the other hand, far too many people don't seem to have a problem with nationalization of actual private property in the form of, say, taxable income, so perhaps the underlying premise is incorrect. If they can nationalize part of your income, which is your by natural right, they can certainly nationalize a few patents which only exist by their say-so in the first place.
"The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
You've actually just made the case against Samsung.
Samsung did some really good technical work, which almost everyone wanted to copy, so they agreed that the patents involved were "Standards Essential Patents" which would be licensed to everyone cheap. Changing their minds and saying "OK, everybody bat Apple can use those patents," was simply something they agreed they weren't allowed to do when they agreed to have the patents declared standards. Basically they were trying to force their #1 competitor out of their #1 market, and the legal system is not supposed to tolerate that shit. Just look at Apple and it's conviction for eBook price-fixing.
OTOH Apple did a bunch of decent technical work, and some truly mind-blowing design work. Then they sued people on the basis of the design patents. Since they never agreed not to do that, and it was trivial for Samsung to design it's way around said patents once they realized that courts enforce design patents, Samsung got it's ass reamed in court and nobody is worried that Samsung will be forced out of the smartphone market.
Korea is smaller then either four individual countries in the EU. It's 1/10 the population of the EU. It's economy is based on exporting shit.
The Koreans do not win a tariff battle with the EU. The US and Japan might be able to force a draw in a tariff battle with the EU. But nobody else could win a tariff battle with the EU. It is a bigger economic bloc then the US.
In theory.
In practice if you piss them ioff by suing them they counter-sue your ass even if you paid the SEP fee.
It the first time for a while I consider something done by European Commission as good. But I wonder what law is used to define the abuse and to allow a fine. Perhaps it could be reused somewhere else.