ITC to rule on Apple, HTC case

December 19, 2011

The International Trade Commission is set to rule Monday on the patent dispute between Apple and HTC , which could set the tone for a broader fight between Apple and Android-based smartphone makers.

In July , an administrative law judge ruled that HTC had infringed on two of 10 Apple patents brought before the court. HTC appealed the ruling.

Florian Mueller, an intellectual property analyst who’s been following the case said it’s difficult to say what the court will rule, since there are many possible outcomes. The judge could rule to uphold the earlier decision, overrule the earlier decision, or change a ruling on one or both of the patents in play, he said.

“Obviously everyone’s awaiting this with a great deal of interest,” Mueller said.

Mueller said that the court could find that there was some kind of infringement, but it’s less likely that the ITC would overrule the administrative law judge on both of the patents.

The court could also bring up other patents that are still in play, Mueller said, but that’s also less likely.

“The question is really to what degree are they going to uphold the earlier ruling?”

The case is a battle in a much larger war between Apple and HTC and other Android-based smartphone makers. Google has said that it doesn’t believe that the complaints against HTC address the Android platform. But Mueller said that the patents in play are definitely not HTC-specific. If Apple prevails over one or two of these patents, he said, the company will likely use the ruling as fuel in future cases.

“HTC is unlucky because they were the first to be sued,” Mueller said. “HTC has the weakest patent portfolio and were picked as the first target. But Apple is suing Motorola and Samsung, as well.”

Mueller said it’s not in Apple’s best interest to settle because it makes much more off its own portfolio of devices than it ever could through licensing fees.

But a settlement could have a large impact on the Android market, said General Patent Corp. chairman and chief executive Alexander Poltorak.

Apple’s endgame, Poltorak said, is likely to make a “broad global settlement” with those who use the rival platform.

“I think what they do hope is to impose significant enough royalties or attacks on those who use Android operating system so that it becomes not economical to produce for that platform,” he said.

In his biography by Walter Isaacson, late Apple co-founder Steve Jobs made it clear that he did not want any kind of settlement, but Poltorak said that’s not reasonable.

“Now that [Jobs is] no longer with us and running Apple, his successor will likely take a more businesslike view of that and make a judgement that it’s probably not possible to kill Android,” he said. But Apple could force up the costs of developing for Android so that it becomes much less appealing to original equipment manufacturers.

The ITC could rule to block imports of HTC products to the United States, but Mueller said that, whatever the ruling, it won’t spell the end of HTC.

“The one thing we can set our watches by is that HTC will appeal” if they lose, he said.

The ITC also ruled Friday on HTC’s countercomplaint against Apple, dismissing all but one patent complaint.

Related stories:

Motorola wins patent lawsuit against Apple, could threaten to block some iPhone, iPad sales

Post Tech: Smartphone patent wars heat up: Microsoft v. Motorola

Apple victory means Android headache over patents

Hayley Tsukayama covers consumer technology for The Washington Post.
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