ZTE, Boston Strong, Allen & Unwin: Intellectual Property

ZTE Corp. (763), China’s second-biggest maker of mobile-phone equipment, signed a patent-licensing agreement with Microsoft Corp. (MSFT) for technology used in smartphones and tablet computers.

Financial terms weren’t disclosed, Microsoft said in a blog posting announcing the deal. The agreement gives Shenzhen, China-based ZTE access to Microsoft technology for use in its phones, tablets, computers and other devices that run on Google Inc. (GOOG)’s Android and Chrome OS operating systems.

With ZTE and other licensees, Microsoft gets royalties from 80 percent of the Android smartphones sold in the U.S. and more than half of those sold worldwide, Horacio Gutierrez, deputy general counsel at Redmond, Washington-based Microsoft, said in the blog posting. Google’s Motorola Mobility and ZTE’s crosstown competitor Huawei Technologies Inc. are the two largest holdouts.

“There’s no one that can build a great product these days without using the ideas of other companies,” David Kaefer, general manager of Microsoft’s intellectual property licensing, said in an interview. “ZTE and Huawei look at each other as competitors. Having ZTE licensed only convinces others there is good value there.”

Microsoft has been embroiled in patent litigation with Motorola Mobility for more than two years. It won a ruling that limited U.S. imports of Motorola Mobility phones that have a feature for syncing schedules between phones and personal computers, and is awaiting a final decision in a case that targets the Xbox video-gaming system.

ZTE and Huawei have their own fight going on, with patent- infringement suits against each other in Europe.

ZTE had 4.4 percent of the global smartphone market in the fourth quarter of 2012, making it the fourth-biggest manufacturer of smartphones, just behind Huawei. The field is dominated by Cupertino, California-based Apple Inc. (AAPL) and Samsung Electronics Co. (005930), based in Suwon, South Korea, which together made half the smartphones sold in the world during the last three months of the year, according to Bloomberg Industries data from researcher IDC.

Last week, Microsoft announced it had reached a similar licensing agreement with Hon Hai Precision Industry Co. (2317), the world’s largest contract manufacturer of electronics, and its Foxconn unit. Microsoft also has agreements with LG Electronics Inc. and Samsung.

For more patent news, click here.

Trademark

Two Different Applications Filed for ‘Boston Strong’ Trademark

Two applicants are seeking to register “Boston Strong” as a trademark, according to the database of the U.S. Patent and trademark office.

The phrase became a symbol of the city’s recovery from last week’s bombing of the Boston Marathon.

One of the applications was filed by Born Into It Inc. of Woburn, Massachusetts. The company indicated it plans to use the mark on clothing and accessories.

The other application was filed by an individual, Kerim Senkal of Allston, Massachusetts. His application is for use of the mark on clothing, accessories, and mugs.

Born Into It, which does business as Chowdaheadz, said in a blog posting that it filed the trademark application before the phrase “really caught on.” The company had no idea it would “become such a big rally cry for our city,” according to the blog.

The company said it has “Boston Strong” T-shirts ready to ship and that 20 percent of all of its online sales through April 30 will be donated to The One Fund, which was set up to help people recover from injuries suffered in the bombing and related events. According to that charity’s website, more than $21 million has already been raised.

Meanwhile, others have been getting on the “Boston Strong” bandwagon.

Redwood City, California-based Zazzle Inc., which prints T- shirts and other items on demand, lists 458 different items bearing that phrase. CafePress Inc. (PRSS) of San Mateo, California, which also prints items on demand, presently has 435 “Boston Strong” gift designs. And a search yesterday of San Jose, California-based EBay Inc. (EBAY)’s Internet auction site yielded 2,470 “Boston Strong” items.

Lions Gate Says ‘Mad Men’ Opener Doesn’t Infringe Model’s Rights

Lions Gate Entertainment Corp., the Santa Monica, California-based film and television studio, has responded to a suit related to the opening credits for the “Mad Men” television series.

On March 1, Gita May Hall filed suit against Lions Gate, claiming the sequence makes use of her image without authorization. She was a model in the 1960s, and the opening sequence uses an image from a Revlon Inc. (REV) ad in which she was featured.

Hall is seeking compensation for the use of her image for commercial purposes.

In its response, Lions Gate says the use of her likeness was “fleeting” and “expressive.” The studio claims Hall’s suit impinges on the studio’s right of free expression, potentially violating a California statute that would inhibit the exercise of free-speech rights.

The opening sequence of “Mad Men” is “highly transformative,” Lions Gate claims, that comes “nowhere close” to being a literal depiction of the former model for commercial gain.

The case is Gita May Hall v. Lions Gate Entertainment Corp. (LGF), BC502104, California Superior Court, Los Angeles County.

For more trademark news, click here.

Copyright

Allen & Unwin Ordered to Pay Damages to Drug Smuggler’s Family

Allen & Unwin Pty Ltd., an Australian book publisher, was found to have infringed copyrights belonging to the family of a convicted drug smuggler and was ordered to pay out A$54,250 ($55,700) in damages, the Sydney Morning Herald reported.

Australia’s Federal Court said the publisher made unauthorized use of five photos supplied to news media by the family of Schapelle Corby, who was arrested in Bali on drug- smuggling charges, according to the newspaper.

Although the family had supplied the photos to news media, the court said the publisher was required to obtain separate permission to use them in “Sins of the Father,” Eamonn Duff’s book about Corby’s conviction, the newspaper reported.

The court also ordered that all copies of the book in the publisher’s possession must be destroyed, according to the Herald.

AF Holdings Disses EFF, Loses Motion to Dismiss Case

In a case filing related to unauthorized downloading of adult-film content, San Francisco’s Electronic Frontier Foundation was characterized as an organization with the same goals as “the anti-government group ‘Anonymous’ as well as the terrorist group ‘Wiki-leaks.’”

This filing, in federal court in Gainesville, Georgia, was made in response to EFF’s motion for sanctions on behalf of the defendant. Plaintiff in the case is AF Holdings LLC. EFF has accused counsel for AF Holdings as both a “copyright troll” and a “porn troll.”

In a separate AF Holdings case in California, a federal judge granted a defendant’s motion to dismiss the case while rejecting AF’s similar request. U.S. District Judge Edward Chen said that AF had an “apparent inability to prove standing to assert its claim of copyright infringement.”

Chen said he was unpersuaded by AF’s argument that it was dismissing the case because the defendant had allegedly damaged the evidence or the company couldn’t afford to post the $50,000 bond required by the court.

He said there was no evidence to suggest that AF actually investigated whether the defendant deliberately damaged the evidence. He found AF’s financial-hardship argument “unconvincing,” noting that “as the plaintiff which initiated the action, AF knew at the outset that a bond might be required.”

AF had sought a dismissal under terms that would permit refilling of the case at a future date. Instead, Judge Chen granted a dismissal “with prejudice,” which bars AF from filing the claim a second time against the defendant. He said that this order didn’t preclude the defendant’s filing a motion seeking attorney fees from AF.

The Georgia case is AF Holdings LLC v. Rajesh Patel, 2:12- cv-00262-WCO, U.S. District Court, Northern District of Georgia (Gainesville).

The California case is AF Holdings LLC v. Joe Navasca, 3:12-cv-02396-EMC, U.D. District Court, Northern District of California (San Francisco).

A third AF case was dismissed April 9 because the defendant was never served with the complaint. That case is AF Holdings LLC v. Christopher Heggum, 2:12-cv-02130-SRB, U.S. District Court, District of Arizona (Phoenix).

For more copyright news, click here.

Trade Secrets/Industrial Espionage

U.S. Making Cybertheft Focus of Talks With China, Donilon Says

The U.S. has taken a hard line and insisted cybersecurity be central to any economic dialogue with China, given the scale of attacks waged against U.S. companies, White House National Security Adviser Thomas Donilon said.

“The only way to deal with this was to bring it to the center of the relationship and to present the proposition that any economic discussion with the United States -- given the threat to the United States, the degree of theft that is going on -- was going to involve cyber,” Donilon said yesterday at Columbia University in New York.

Ties between the U.S. and China have been strained by a report from a U.S. security company, Mandiant Corp., saying China’s army may be behind cyberattacks on companies worldwide. Chinese officials have rejected the findings.

General Martin Dempsey, chairman of the U.S. Joint Chiefs of Staff, met this week with Fang Fenghui, chairman of the People’s Liberation Army General Staff, who compared the effects of an Internet attack to those of a nuclear bomb. Still, no specifics measures on a code of conduct for cybersecurity were discussed.

Donilon said the U.S. asked the Chinese to recognize the scope of the problem, to begin an investigation of computer crimes and to engage in a discussion on a set of rules.

“We are moving on all of them, they have agreed to open up a dialogue,” he said. “This is not general cybercrime or hacking, this is a direct theft of United States private and government assets for use for advantage. That is the discussion we are having with the Chinese.”

In a speech last month, Donilon said that the widespread theft of intellectual property and trade secrets through “cyberintrusions emanating from China at a very large scale” has become a point of contention with the Chinese government.

Donilon has said the U.S. would do everything necessary to shield the nation’s computer networks from attacks on vital infrastructure, such as power grids and transportation links.

Mandiant, based in Alexandria, Virginia, said in a February report that the Chinese army may be behind a hacking group that has hit at least 141 companies worldwide since 2006.

To contact the reporter on this story: Victoria Slind-Flor in Oakland, California, at vslindflor@bloomberg.net.

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

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