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Mar. 3, 2010

Yesterday, wireless handset maker HTC has been sued by Apple and the company filed a complaint with the U.S. International Trade Commission, alleging that HTC is infringing no less than twenty Apple patents related to the iPhone.

The various patents that Apple says HTC is infringing on are directly related to the iPhone's GUI (graphical user interface), as well as the iPhone's underlying hardware and software design. Apple is asking for a Court injunction, which would prevent HTC from importing and selling infringing devices in the U.S. permanently.

Apple also said that it is seeking damages, but it didn't specify any amount as of yet.

Steve Jobs, Apple's CEO said yesterday "we can sit by and watch competitors steal our patented inventions, or we can do something about it. We've chosen to do something about it. We think competition is healthy, but competitors should create their own original technology, not steal ours."

This isn't the first this has happened. Apple has been around the patent infringement segment a few times before with regard to its iPhone, which quickly became both a technological and a cultural touchstone when it was launched three years ago.

However, its lawsuit against HTC marks the first time it has aggressively initiated infringement accusations against another wireless handset maker without being prompted first.

Additionally, it's also interesting to note that Apple has chosen to target HTC in this lawsuit and not other mobile phone makers, such as Motorola, Samsung or Palm, which have also built smartphones that are very similar to the iPhone.

For its part, HTC said yesterday that it was caught off-guard by the legal action. In a statement, the company said it has heard of the complaints only through media reports and Apple's press release. The company said it was reviewing the filings. Until it completes its review, a company representative said she is unable to provide "comment on the validity of the claims being made against HTC."

"HTC is a mobile-technology innovator and patent holder that has been very focused over the past thirteen years on creating some innovative phones," the company said in its statement. "HTC values patent rights and their enforcement, but is also committed to defending its own technology innovations."

Another interesting point is the fact that Apple did not name software makers Google or Microsoft in its filings either. In its complaint to the International Trade Commission, Apple named twelve phones that it claims use technology that infringes its patents.

Five of those phones, including the Nexus One (sold directly by Google) use the Android operating system, which is made by the search giant. Overall, 7 of the phones named in the complaint use Microsoft's Windows Mobile software.

The fact that neither Microsoft nor Google were named as co-defendants in the federal patent case or the ITC complaint is perhaps because the technology in question is software that HTC layers on top of the operating system.

Throughout the course of this case, if Apple targets software features that are inherent in either the Google Android or the Windows Mobile operating systems, then Google and Microsoft would be forced to defend the technology in their own operating systems. It will be interesting to see if that happens.

When a company licenses its technology to another company for use in a product, there is usually an indemnity clause that requires the licensor to defend its technology, should it come under legal attack. This is what happened in a patent case that Lucent Technology filed against computer makers Gateway and Dell about seven years ago.

Microsoft, which was not named in the original suit, ended up joining the lawsuit because the infringement claims in the lawsuit had to do with MP3 and MPEG video-encoding and compression technologies that were supplied in its Windows operating system running on the Gateway and Dell computers.

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Source: Apple.