Tuesday, August 16, 2011

European Galaxy Tab 10.1 Injunction Lifted, Except in Germany | News & Opinion | PCMag.com

European Galaxy Tab 10.1 Injunction Lifted, Except in Germany | News & Opinion | PCMag.com: "- Sent using Google Toolbar" One of the things I really hate about Microsoft are the hidden key commands. One can inadvertently hit a key and some command is set into action that you do not want. I must have inadvertently hit some key and sent off this post. There is no dialogue box, nothing. The link was sent before I had even started to comment the posting, which I will do in the next post.

European Galaxy Tab 10.1 Injunction Lifted, Except in Germany | News & Opinion | PCMag.com

European Galaxy Tab 10.1 Injunction Lifted, Except in Germany | News & Opinion | PCMag.com: "- Sent using Google Toolbar"

The Nortel Patent Auction Scandal: Part of a Conspiracy Against Android in Restraint of Trade?

This is an addition to the previous posting at LawPundit, made here because the quote below from the Washington Post article by Jia Lynn Yang in Antitrust officials probing sale of patents to Google’s rivals deserves its own status:
"Brian Kahin, a senior fellow at the Computer & Communications Industry Association, said the companies don’t even have to litigate. They could sell the patents to “patent trolls” — firms that don’t invent or make products but acquire patents and then sue or threaten to sue bigger tech companies for infringement.

The one thing that’s significant here is you have three of the four smartphone platforms ganging up on the fourth,” said Kahin. “You want patents for an economic benefit, not as a legal instrument. [emphasis added by LawPundit]
The whole point there is that these appear to be clear conspiracies in restraint of trade. As noted by Kendyl Hanks, Sarah Jacobson, Kyle Musgrove and Michael Shen at Business Law Today: The ABA Business Law Section's Online Resource in "Pay-for-Delay" Settlements: Antitrust Violation or Proper Exercise of Pharmaceutical Patent Rights?:
The Sixth Circuit held [in the case in question] that the agreement was "an illegal per se restraint on trade" under the Sherman Antitrust Act because it was "a horizontal agreement to eliminate competition."
As written at the Wikipedia under Sherman Antitrust Act:
"The Sherman Antitrust Act (Sherman Act,[1] July 2, 1890, ch. 647, 26 Stat. 209, 15 U.S.C. §§ 17) requires the United States federal government to investigate and pursue trusts, companies, and organizations suspected of violating the Act. It was the first Federal statute to limit cartels and monopolies, and today still forms the basis for most antitrust litigation by the United States federal government. However, for the most part, politicians were unwilling to refer to the law until Theodore Roosevelt's presidency (1901–1909)....

Despite its name, the Act has fairly little to do with "trusts". Around the world, what U.S. lawmakers and attorneys call "antitrust" is more commonly known as "competition law." [emphasis added by LawPundit] The purpose of the Act was to oppose the combination of entities that could potentially harm competition, such as monopolies or cartels. Its reference to trusts today is anachronistic. At the time of its passage, the trust was synonymous with monopolistic practice, because the trust was a popular way for monopolists to hold their businesses, and a way for cartel participants to create enforceable agreements.[3]....
[Section 1 of The Sherman Act [provides]:
"Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal."
[Section 2 of The Sherman Act provides]:
"Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony . . . "
[About the Clayton Antitrust Act]:
The Clayton Antitrust Act, passed in 1914, proscribes certain additional activities that had been discovered to fall outside the scope of the Sherman Antitrust Act. For example, the Clayton Act added certain practices to the list of impermissible activities:
  • price discrimination between different purchasers, if such discrimination tends to create a monopoly
  • exclusive dealing agreements 
  • tying arrangements 
  • mergers and acquisitions that substantially reduce market competition.

A Trust in Restraint of Trade? Google Rivals as Rockstar Bidco (Apple, RIM, EMC, Ericsson, Sony, Microsoft) Financed by Apple Join Forces to Keep Google from Acquiring Nortel Patents: A Violation of the Antitrust Laws?


Let's see.

Google originally entered a bid of $900 million for the patent portfolio of the bankrupt Nortel Networks, as a result of which Nortel decided to hold an auction for the patents, calculating to receive even more money in subsequent bidding.

The official court document provides: (Court File No. 09-CL-7950

"17.  Subsequent to this Honourable Court’s approval of the Bidding Procedures and prior to the Bid Deadline, Nortel and/or its financial advisor, Lazard Frères & Co. LLC (“Lazard”), contacted 98 parties likely to be interested and able to acquire the Residual   IP.   Five   interested   parties   executed   supplemental   confidentiality agreements, were provided access to the electronic data room, and completed further due diligence on the Residual IP. Ultimately, four parties (in addition to Ranger [Google]) indicated their interest in participating in the Auction, were deemed to be Qualified Bidders and submitted bids for the Residual IP. These parties were: (i) Apple Inc. (“Apple”); (ii) Rockstar Bidco, LP (“Rockstar”), a consortium of various technology companies; (iii) Intel Corporation (“Intel”); and (iv) Norpax LLC (“Norpax”), an affiliate of RPX Corporation."
How Rockstar Bidco LP obtained permission to bid on Nortel without its composition of companies previously being disclosed to the public is a mystery, since auction rules require complete transparency. The identity of the consortium was made public only after the auction. A violation of U.S. law?

The court document states:
"31. Rockstar is a single purpose entity formed by a consortium of technology companies for purposes of participating in the sale process for the Residual IP. The entities participating in Rockstar are as follows:

a)  Apple;

b)  Research in Motion Limited (“RIM”) through its wholly owned subsidiary 2256355 Ontario Limited – RIM is based in Waterloo, Ontario, Canada and is a  company  listed  on  the  NASDAQ  and  Toronto  Stock  Exchange.  RIM designs, manufactures and markets mobile communications devices;

c) EMC Corporation (“EMC”) – EMC is a company based in Hopkinton, Massachusetts and listed on the New York Stock Exchange.  It develops and provides information infrastructure technology and solutions;

d) Telefonaktiebolaget LM Ericsson (“Ericsson”) – Ericsson is based in Stockholm, Sweden. Its shares are listed on the NASDAQ and the NASDAQ OMX Stockholm. Ericsson provides telecommunications and related services to mobile and fixed network operators;

e)  Sony Corporation (“Sony”) through its wholly owned subsidiary SCA IPLA Holdings Inc. – Sony is based in Tokyo, Japan and is listed on the Tokyo Stock Exchange and New York Stock Exchange. Sony develops, designs, manufactures and sells electronic equipment, instruments, and devices for consumer, professional and industrial markets. Sony is also engaged in the home entertainment and television business, in the recorded music business and in various financial services businesses; and

f) Microsoft Corporation (“Microsoft”) – Microsoft is based in Redmond, Washington and is listed on the NASDAQ. It develops, manufactures, licenses and  supports  software  products  and  services.  It  also  designs  and  sells hardware and provides consulting services."
As reported at TechCrunch in How Apple Led The High-Stakes Patent Poker Win Against Google, Sealing Ballmer's Promise, Rockstar Bidco LP dropped out of the bidding in the fifth round. The court document reads:
"27. Rockstar did not submit a bid in the fifth round and in accordance with the Auction rules established by the Sellers was not permitted to submit further independent bids. Accordingly, the number of Qualified Bidders entitled to participate independently in the Auction at the conclusion of round five
was reduced to three.

28. Following the fifth round, Apple, with the consent of the Sellers, had discussions with Rockstar regarding potential partnership opportunities. Following these discussions, Apple indicated it wished to partner with Rockstar and adopt Rockstar's transaction structure (including using Rockstar as the purchaser). The Sellers consented to this proposal and the balance of Apple's bids at the Auction adopted the Rockstar structure. Following the sixth round of the Auction, Intel indicated it was withdrawing and would not be submitting further independent bids in round seven or in subsequent rounds. At this point, the Sellers gave their consent to the two remaining Qualified Bidders, being Ranger and Apple, to discuss partnering opportunities with those Qualified Bidders who were no longer able to participate independently in the Auction (i.e., Norpax, Rockstar and Intel) upon providing prior written notice to the Sellers, it being understood that the Sellers had to consent to any partnering proposals. Following the eighth round of bidding, Ranger asked for and was granted consent by the Sellers to allow it to partner with Intel on specific conditions as read into the record at the Auction. Apple (in partnership with and using the Rockstar transaction structure) and Ranger exchanged counter-bids in rounds nine through 19 in increments of $100 million dollars. The bidding in these rounds proceeded solely through increases to the cash purchase price (and confirming certain requisite points on the record) as the forms of sale agreement and ancillary transaction documents were substantially comparable from the Sellers' perspective. 

29. In the nineteenth round, Apple (in partnership with Rockstar) presented a bid of $4.5 billion, which bid was declared the Leading Bid. At the beginning of the twentieth round, Ranger requested and was granted an adjournment by the Sellers. The Auction was reconvened at approximately 6:45 pm on June 30, 2011, and Ranger indicated it would not make a further bid. The Sellers adjourned the Auction solely for the purpose of allowing the Sellers and the Purchaser to finalize and execute definitive documentation and the $4.5 billion bid submitted by Apple (in partnership with Rockstar) was declared the Successful Bid."
As reported at TechCrunch in How Apple Led The High-Stakes Patent Poker Win Against Google, Sealing Ballmer's Promise:
"While much of the press after the auction focused on the Rockstar group's win, the court documents make it very clear that it was actually Apple that won in partnership with Rockstar. Apple was the only group that had not dropped out. Again, they staked the Rockstar group to ensure a victory for the stronger player. Why was Rockstar the stronger player? Because of the other companies involved. RIM, EMC, Ericsson, Sony, and yes, Microsoft."
That group is "a coalition" of Google's main competitors, obviously formed to keep Google from getting the Nortel patents rather than being expressly created to obtain the patents for their own use. In the law, this used to be called something like a conspiracy in restraint of trade, i.e. a trust, the kind of thing that antitrust law is specifically intended to prevent.

As written by Jia Lynn Yang at the Washington Post in Antitrust officials probing sale of patents to Google’s rivals:
"“Why is the portfolio worth five times more to this group collectively than it is to Google?” said Robert Skitol, an antitrust lawyer at the Drinker Biddle firm. “Why are three horizontal competitors being allowed to collaborate and cooperate and join hands together in this, rather than competing against each other?”" [emphasis added]
Why did it take a letter from the American Antitrust Institute to the Justice Department to get the wheels rolling to investigate an antitrust issue that is obvious to everyone except -- apparently -- the people in the government in the agency responsible? WHAT are those people doing there in their positions of responsibility other than collecting their paychecks?

Google-Motorola Deal and Antitrust Law: Patent-Based Monopolies are the Name of the Current Economic Game: Antitrust Law is a Paper Tiger

Matt Weinberger reports at ZDNet that With Motorola acquisition, Google makes itself a legal target for antitrust law investigations.

Antitrust law is a fata morgana, a mirage in the eyes of the legal system. The entire world is locked in so many monopolies, partially as a result of absurd patent and copyright laws and even more absurd patent law and copyright law interpretation by the courts, that conducting investigations of companies like Google for possible antitrust law violations seems like a crude legal joke.

Name an industry that is not controlled by handfull of biggies.
Antitrust law? Surely you jest. It is one of the law's paper tigers.

The whole tenor of current prevailing patent and copyright monopolies, justified and unjustified, as well as of the activities of the patent trolls and their ilk, is to suppress competition as much as possible -- a suppression of CAPITALIST competition that the anti-trust laws are intended to prevent.

If the judges on our courts had their heads on straight, every invocation of patents to suppress competition would run foul of anti-trust laws.

The U.S. Constitution provides in setting up the IP right that it is intended "To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries."

It says nothing about authors having any power over the writings of others, nor about inventors having any power to suppress competition of similar products, to issue injunctions against the sale of competing non-identical products, or to produce the economic and technological chaos that patents and copyrights are currently creating by ACTIVELY SUPPRESSING COMPETITION WHEREVER YOU LOOK.

90% of current patent and copyright law is the product not of the U.S. Constitution but of incompetent lawmaking by Congress and overreaching "judge-made law" by the courts, giving "Authors" and "Inventors" far greater rights and powers than were ever envisaged by the drafters of the U.S. Constitution, who also considered in their draft version the alternative or eplanatory text "to encourage, by proper premiums & Provisions, the advancement of useful knowledge and discoveries".

Should there be a "premium cap" on copyrights and inventions?

Yes, there should.

See also:

The Ignominious Patent Law Legacy of Judge Giles S. Rich

The Conception of a Child is Not an Invention - But Don't Be Too Sure : The Patenting of Living Things is In Vogue

Google Invests In Rocket Lawyer: Will the Law be Googleized?

Google’s Investment in Rocket Lawyer Will Accelerate the Google Maps-ization of Law

Via the ABA Journal, Paul Lippe of Legal Rebels writes at The New Normal:
"pretty inevitable that legal information will be Google-ized....

... Google is investing in Rocket Lawyer—and will apparently use Google Docs as the basic productivity platform for small law firms ... another indication of the Google Maps-ization of law...."
Read all about it here.

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