ITC Staff Recommends Siding With Nokia, HTC in Apple Case

HTC Corp. (2498) and Nokia Oyj (NOK1V) shouldn’t be found liable of infringing Apple Inc. (AAPL)’s patents, the staff of the U.S. International Trade Commission recommended.

A staff lawyer, Erin Joffre, disclosed the position at the start of an ITC trial in Washington today in which Apple is seeking to ban imports of mobile phones made by HTC that run Google Inc. (GOOG)’s Android operating system, as well as block some Nokia devices. The staff acts on behalf of the public as a third party in the case. Its recommendations aren’t binding.

The case is the first patent dispute over phones using the Android operating system to reach this stage at the ITC, a quasi-judicial federal agency that arbitrates trade disputes. There are more than a dozen cases before the ITC over so-called smartphones such as Apple’s iPhone as companies jockey for position in what is now a $100 billion market.

“What makes Apple products so successful is not just what you see, but what’s under the hood,” Apple lawyer Greg Arovas of Kirkland & Ellis in New York said in opening arguments.

Apple claims Taoyuan, Taiwan-based HTC infringes five patents that Arovas described as being important for the “seamless integration of hardware and software” that makes the products more flexible in dealing with the complex requirements of having the equivalent of a personal computer in a phone.

Photographer: Simon Dawson/Bloomberg

Apple claims HTC's mobile phones infringe on five patents. Close

Apple claims HTC's mobile phones infringe on five patents.

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Photographer: Simon Dawson/Bloomberg

Apple claims HTC's mobile phones infringe on five patents.

‘Narrow Distinction’

Administrative Law Judge Carl Charneski is scheduled to release his findings Aug. 5. His order would be subject to review by the full six-member commission, which can bar imports of products found to infringe U.S. patents. Mountain View, California-based Google isn’t a party in the case.

The patents including those related to signal processing and inter-process communications are from technology developed in the early 1990s and “were, at best, a very narrow distinction” from the invention of others, HTC lawyer Robert Van Nest of Keker & Van Nest in San Francisco told the judge.

“HTC is a smartphone innovator and pioneer in the smartphone sphere -- they were there long before Apple,” Van Nest said. “The fundamental differences from the Apple patents represent choices made by HTC and Google.”

Apple also alleges that Espoo, Finland-based Nokia is infringing one patent that’s being asserted against HTC. The claim was spun off from a separate complaint against Nokia, which is scheduled to be decided by June 24.

A Nokia lawyer, Pat Flinn of Alston & Bird in Atlanta, said Apple decided to “dredge up patents” to assert after it was approached by the “pioneers of mobile phones” for royalties, including Ericsson AB and Nokia.

Moot Patent

“Advances in technology have made the patent moot,” Flinn said of the Apple patent for signal processing that’s asserted against both companies. “The Apple iPhone doesn’t practice the patent.”

HTC has its own claims against Apple. Proceedings in that case before a different ITC judge are scheduled to begin May 9, the week after the trial on Apple claims are completed.

An ITC judge last month said Cupertino, California-based Apple wasn’t infringing Nokia patents.

The ITC complaint is In the Matter Of Certain Personal Data and Mobile Communications Devices and Related Software, 337-710, U.S. International Trade Commission (Washington).

To contact the reporter on this story: Susan Decker in Washington at sdecker1@bloomberg.net

To contact the editor responsible for this story: Allan Holmes at aholmes25@bloomberg.net

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