Florida Patent Lawyer Blog

On Monday, Kodak and Samsung settled a long-running patent infringement dispute spanning several years and multiple continents. The settlement includes a patent license agreement wherein each side gains a patent license for the other's patents. The license agreement, which provides appreciable benefits to both parties, is royalty bearing to Kodak. Additional financial details were not disclosed. As a Florida patent lawyer that frequently deals with patent infringement disputes, this case illustrates various important aspects surrounding patent litigation.

This case illustrates how a legal dispute can easily escalate into a world-wide battle requiring enormous resources. This disagreement started as a simple request for another party to take a patent license and blossomed into a two-way, 26-month patent infringement litigation that was concurrently being heard in two separate district courts in the U.S., in a federal court in Germany and the U.S. International Trade Commission. The legal bills for both sides are easily calculated to be in the millions of U.S. dollars. The end result - a settlement agreement comprising a cross-license - was not proportional to the extent of the conflict. Tomes can be written about the psychology behind why parties don't settle. But the abject lesson here is that parties should push to settle as early as possible, especially in complex commercial litigation cases, such as a patent infringement case.

This case further illustrates a common settlement outcome in patent infringement cases - a cross-license. As I discussed in an earlier post about the uses of a patent, a savvy company with an intellectual property program will obtain patents on its core technologies not just for the purpose of asserting them against their competitors, but also for the purpose of using them as a shield in the face of a competitor's attack. This is exactly what transpired in the Kodak-Samsung dispute. What started out as a single patent infringement claim, ended up as a two-way fight where each party both asserted patent infringement claims and defended against the same. Counterclaiming for patent infringement can have a chilling effect on a patent plaintiff and can move the parties to settlement, since both parties have much to lose if they are beaten at trial. In this case, it took the parties quite a while to realize this, but ultimately it led to settlement.

This Friday, the U.S. International Trade Commission (ITC) issued a notice stating that Mitsubishi does not infringe GE's wind turbine patent, thereby ending a long-running legal dispute between the two companies at the ITC. The patent infringement dispute dates back to early 2008 when GE claimed that Mitsubishi infringed upon GE's wind turbine patents in a complaint filed with the ITC, in an effort to block the importation of Mitsubishi's wind turbine products into the U.S. The effort, however, backfired and exposed the weaknesses of using the ITC as a forum for a patent infringement dispute.

As a Florida patent attorney that handles patent infringement disputes, I'm often confronted with the question of where a patent infringement dispute should be heard. As I wrote on Jan. 2, 2010, the ITC is becoming a more popular route for patent owners attempting to halt infringers of their patents, due to: 1) lower litigation costs and 2) the reduced waiting time compared to litigation in a federal court. The biggest drawback of the ITC, however, is that theITC only has the power to stop the importation of infringing goods into the U.S. The ITC does not have the power to award damages, stop the selling of U.S. manufactured goods or force a royalty upon the infringing party.

The recent Mitsubishi-GE case, however, illustrates how a dispute at the ITC can actually take an extended period of time to resolve - more than 2 years in this case and it did not even go to trial. There has also been speculation as to expenses in this case. Due to the extended period of time and the amount of wrangling in this case, the fees may have been rather high. Again, this goes against the conventional thinking that the ITC is a less-expensive forum. Thus, this case challenges the assumption that the ITC is a cheaper, faster forum. As a patent practitioner, the practice pointer I've taken from this story is that the choice of forum for every patent dispute should be taken on a case-by-case basis. One should not rush to one forum or another based on assumptions. The case should be carefully reviewed and a practitioner who knows the forum well should be consulted on how that particular forum would fit the instant case.