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Intel, HTC, Apple, Honeywell: Intellectual Property

Intel Corp.’s 1.06 billion-euro ($1.3 billion) fine for using rebates to block rivals is based on an “utterly hopeless” and untenable case by European Union regulators, company lawyers told an EU appeals court.

The 2009 decision by the EU’s antitrust regulator was based on claims that are “utter nonsense,” an Intel lawyer told the EU General Court in Luxembourg. Claims that Intel made payments to Lenovo Group Ltd. (992) to cut Advanced Micro Devices Inc. (AMD) out of the market are baseless and should be overturned. Intel and AMD have engaged in patent and antitrust battles with each other since the early 1990s.

“This case is utterly hopeless and should never have been brought,” Nicholas Green, a lawyer for Intel, told the EU’s second-highest court on the third day of hearings.

The EU probe concluded Intel impeded competition by giving computer makers rebates from 2002 until 2005 on the condition that they buy at least 95 percent of their chips for personal computers from the Santa Clara, California-based company. Intel imposed “restrictive conditions” for the remaining 5 percent, supplied by AMD, which struggled to overcome Intel’s hold on the PC processor market, the EU said. The infringement continued until at least December 2007, the EU said.

Accusations that Intel paid Lenovo, the world’s second- largest computer maker, in 2006 to delay AMD-based notebooks and gave the manufacturer rebates in 2007 under an agreement not to buy from AMD were wrong and the commission ignored evidence that showed otherwise, Green told the court yesterday.

The 2006 payments “were to win business, not to cancel a launch” of AMD-based notebooks, Green said. Lenovo also told the investigators the 2007 deal wasn’t exclusive and “there was serious concern that AMD was not a reliable supplier and business partner,” Green said.

The EU began investigating after AMD complained in 2000. Intel agreed to pay AMD $1.25 billion in 2009 to end all civil litigation. Sunnyvale, California-based AMD is no longer involved in the case and won’t intervene at this week’s hearing.

The antitrust fine was the EU’s biggest, more than double the 497 million-euro penalty against Microsoft Corp. in 2004. It represented about 4 percent of Intel’s $37.6 billion in sales in 2008, below the maximum penalty of 10 percent of annual sales.

Any decision by the EU General Court can be appealed to the EU Court of Justice in Luxembourg.

The case is T-286/09 Intel Corp. (INTC) v. Commission.

HTC Phones Don’t Infringe Apple’s Patents, British Judge Says

HTC Corp. (2498), Asia’s second-largest smartphone maker, won a London court ruling against Apple Inc. (AAPL) over patents for touchscreen technology used for its mobile devices, including Apple’s slide-to-unlock feature.

HTC’s devices don’t infringe four Apple patents for the technology, and three of those patents are invalid, Judge Christopher Floyd said July 4.

The U.K. court judgment “marks a considerable defeat for Apple in the smartphone patent wars,” said Peter Bell, an attorney at Stevens & Bolton LLP, who isn’t involved in the case. “Two of Apple’s prize patents have been knocked out in the U.K.”

Apple is fighting patent lawsuits on four continents against rivals including HTC and South Korea-based Samsung Electronics Co. (005930) as it competes for dominance of the $219 billion global smartphone market. The firms have accused each other of copying designs and technology used in mobile devices.

“Competition is healthy, but competitors should create their own original technology, not steal ours,” Cupertino, California-based Apple said in an e-mailed statement, without commenting specifically on yesterday’s decision.

While HTC was pleased with the ruling, “we remain disappointed that Apple continues to favor competition in the courtroom over competition in the marketplace,” Andrea Sommer, a spokeswoman for the Taoyuan City, Taiwan-based company, said.

In addition to the slide-to-unlock feature, the ruling covered Apple’s patents on tools used to scroll through photographs and change alphabets, and software allowing users to touch the screen in two spots simultaneously.

While the court ruled that Apple’s photo-management patent is valid, Floyd found that HTC didn’t infringe it.

The same four patents are being contested by Apple and HTC in German lawsuits, scheduled to be heard later this year.

In the U.S., Apple tried to stop HTC from importing its newest phones, saying they violate a patent order issued in December. The U.S. International Trade Commission decided this week that HTC could continue to import the devices while it investigated claims a system for detecting telephone numbers in e-mails was copied.

Before his death, Apple co-founder Steve Jobs waged war on Google Inc. (GOOG)’s Android operating system, used by HTC, Samsung and other rivals in their phones. He told his authorized biographer he would spend every penny in the company’s coffers “to destroy Android” because it was a stolen product.

The case is: HTC Europe Co. v Apple Inc., High Court of Justice, Chancery Division, HC11C02826

Apple Gets Patent on Wearable Display Technology

The next iPad may reside in a user’s eyeglasses, according to a new patent issued to Cupertino, California-based Apple Inc.

Patent 8,212,859, issued July 3, covers a “head-mounted display apparatus” onto which images are projected in front of the eyes of the wearer. The apparatus could be a pair of eyeglasses, a visor or a helmet, according to the patent.

The technology covered by the patent improves the user’s experience by coordinating what the eye sees peripherally with the image that is being viewed. Existing projected technology occludes peripheral vision, giving the user the sense of viewing the image down a tunnel and often making the user susceptible to motion sickness, Apple said in the patent.

Apple applied for the patent in October 2006 with assistance from Womble Carlyle Sandridge & Rice LLP of Winston- Salem, North Carolina.

For more patent news, click here.

Trademark

Honeywell Files Trademark-Infringement Suit in Nigerian Court

Honeywell International Inc. (HON), the Morris Township, New Jersey-based technology and manufacturing company, filed a trademark-infringement lawsuit in Nigeria’s federal high court against a similarly named Nigerian company, that country’s PM News reported.

The suit is against Nigeria’s Honeywell Group, which registered its name in that country and claims the U.S. company is infringing, PM News reported.

Honeywell International says the Nigerian company’s actions are damaging, and seeks 20 billion naira ($122 million) in compensation, according to PM News.

Consumers Told to Look for ‘Pink Lady’ Stickers on Imports

Many “Pink Lady” apples imported to the U.S. and now appearing in supermarkets may not have been grown under standards required to legitimately display the trademark, Pink Lady America LLC said in a statement.

The apple, developed in Australia in the 1970s, ripens in the southern hemisphere in May and is sold in U.S. markets when local varieties aren’t in season. It is now also grown in the U.S. and bears fruit in the northern-hemisphere apple season.

Pink Lady America said consumers should ensure that “Pink Lady” apples sold in the U.S. bear the name on the sticker. Those without the stickers might not be packed according to required quality standards, Pink Lady America said.

Domestic apple growers can get a free license to use the trademark if they sign an agreement that outlines the brand requirements, according to Pink Lady America.

For more trademark news, click here.

Copyright

Righthaven Manager Seeks Ouster of Receiver-Hired Counsel

Righthaven LLP, the entity set up to enforce the copyrights for Las Vegas-based Stephens Media Group’s publications, is back in federal court in Nevada.

A receiver was appointed to handle the company’s assets after the failure of a copyright-infringement lawsuit Righthaven filed against Wayne Hoehn, who allegedly posted content from Stephens’s publications on his websites. Hoehn was awarded attorney fees, and in the wake of Righthaven’s non-payment, was given the firm’s assets. The Hoehn suit was one of more than 250 similar cases filed by Righthaven.

On June 25, the receiver told Righthaven Chief Executive Officer Steven Gibson that she was firing him. In a filing she made with the court that day, she said Gibson hired outside counsel for Righthaven without authority to do so, and that she was considering seeking a recovery of some of Righthaven’s losses from him, possibly through a malpractice suit.

Gibson responded in a July 2 court filing, saying the receiver had exceeded her authority and had hired an appellate counsel for Righthaven whose interests were adverse to the company’s. He also said he is manager of Net Sortie Systems LLC, which he says is the manager of Righthaven.

As such, Gibson claims in his filing that he is the “manager of the manager of Righthaven” and has the right to hire or fire any counsel representing the company. He asked the court to rescind his termination, reconsider the receiver’s appointment, and force the withdrawal of the appellate counsel the receiver hired.

The case is Righthaven LLC v. Hoehn, 11-cv-050, U.S. District Court, District of Nevada (Las Vegas).

ALA Files Brief in Supreme Court Copyright Case

The American Library Association, together with two other library groups, filed a friend-of-the court brief in the copyright case the U.S. Supreme Court said it would hear in the upcoming term.

John Wiley & Sons Inc. (JW/A), based in Hoboken, New Jersey, accused a bookseller in a lawsuit of infringing its copyrights by importing foreign editions of the publisher’s books. Supap Kirtsaeng appealed after a jury awarded Wiley $600,000 for importing the books from Thailand and selling them for a profit.

In a statement released by the Library Copyright Alliance, of which the ALA is a member, the library group said an adverse decision in the case could affect libraries’ rights to circulate books manufactured abroad.

They argue against an appeals court ruling that said copyright law’s “first sale doctrine” -- which allows any purchaser of a copyrighted work to resell it -- applied only to copies manufactured in the U.S. The libraries asked the court to extend the first-sale doctrine to all lawfully made copies of a work, regardless of where they are manufactured.

Other members of the alliance are the Association of College & Research Libraries and the Association of Research Libraries.

The case is Kirtsaeng v. John Wiley & Sons Inc., 11-607, U.S. Supreme Court.

For more copyright news, click here.

IP Moves

Baker & McKenzie Expands IP Practice with Hire from Venable Firm

Baker & McKenzie LLP hired Julie A. Petruzzelli for its IP practice, the international firm said in a statement.

Petruzzelli, who joins from Baltimore’s Venable LLP, is a litigator who has handled patent, trademark, copyright and trade-secret disputes. Many of her clients, who come from the computer, pharmaceutical, biochemical, medical device and chemical industries, are based in Asia.

She has represented clients in federal courts and before the U.S. International Trade Commission, a Washington-based body with the power to exclude infringing products.

Petruzzelli has an undergraduate degree from Brown University and a law degree from the University of Virginia.

To contact the reporter on this story: Victoria Slind-Flor in San Francisco at vslindflor@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.

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