Lodsys patent suit targets petition court to allow Apple intervention

A group of mobile developers targeted in a lawsuit filed by patent holding company Lodsys are petitioning the court to allow Apple (NASDAQ:AAPL) to intervene on their behalf. Atari, Electronic Arts, Square Enix and Quickoffice are among the defendants lobbying the U.S. District Court for the Eastern District of Texas to grant Apple's motion to argue their case--the four companies are among roughly a dozen developers allegedly violating Lodsys patents related to in-app payments and data collection applied to user interactions. 

Lodsys first filed suit in May 2011, arguing developer are violating the company's intellectual property right by implementing in-app purchase options within their iPhone and iPad releases. Lodsys is seeking 0.575 percent of U.S. revenues over the period of the notice letter to the expiration of the patent, plus applicable past usage. Apple quickly filed to intervene on the developers behalf--weeks later, Lodsys amended its complaint to target five additional defendants including Rovio Mobile, maker of the smash Angry Birds, as well as gaming firms Electronic Arts, Atari and others.

"Apple repeatedly asserts that the defendants are allegedly individuals or 'small entities with limited resources,'" Lodsys argues. "But Apple prematurely filed its Motion before Lodsys filed its Amended Complaint against several large companies with substantial financial and technical resources. Accordingly, there can be no serious dispute that the defendants will more than adequately represent Apple's purported interest."

But in documents filed Monday, Apple dismisses Lodsys' argument it filed its initial motion "prematurely," contending a motion can be "untimely" only if entered too late. Apple also argues its interests could be impaired if it is not allowed to intervene, stating "Lodsys has already sued numerous significant Apple customers and threatened dozens of others, and a boycott of some of Apple's core products by App developers has been proposed." Apple additionally shot down the contention that companies EA and Rovio Mobile are large enough to defend themselves, arguing "None of the defendants have the technical information, expertise, and knowledge regarding how Apple's technology works or the negotiation and intent of the License itself to fully articulate and develop Apple's exhaustion defense."

The letter sent to the court by law firm Gibson, Dunn & Crutcher on behalf of Atari, EA, Square Enix and Quickoffice contends Apple must be allowed to act as an intervenor, not in a third-party capacity. "In view of the Supporting Defendants' critical need to rely upon Apple's assistance in developing the evidence in this matter, Apple's willingness to participate as a party in this action, and the lack of any cognizable prejudice to Lodsys, the Supporting Defendants respectfully urge this Court to grant the pending motion to intervene," the letter reads. "For example, as a party in this action, Apple and its counsel would have access under this Court's protective order to all written discovery and testimony on the subject of the background and scope of its license, as well as the nature and operation of its own, licensed technology. Were Apple's participation in this action limited to that of a third-party, Lodsys would be able to insulate the testimony of Lodsys's documents and witnesses--as well as the reports of Lodsys's experts--from review, critique and response by Apple."

For more:
- read this iPodNN article

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