The wireless patent wars faced more twists last week. Australian antitrust regulators slammed Apple for labeling its new iPad as “4G”, while judges are getting impatient with the Google-Oracle saga.
The Australian Competition and Consumer Commission (ACCC) said it will apply to the federal court in Melbourne for an injunction against the new iPad - and for fines, refunds to customers, and corrective advertising, as penalties for misleading customers.
Australia has proved a legal hotbed for Apple in recent months, staging the first major courtroom battles against Samsung's Galaxy Tab, with mixed results.
The ACCC alleges that Apple is misleading Australian consumers because the iPad cannot connect to a 4G network in the country. The cellular version of the tablet is advertised as the “new iPad with WiFi + 4G" but as yet it only works with LTE on the 700MHz and 2.1GHz bands.
“Consumers who have purchased or are considering purchasing an 'iPad with WiFi + 4G' should ensure that they have a proper understanding of the mobile data networks which this iPad can directly access by a SIM card,” the ACCC said.
The small print in documents offered by the Australian Apple Stores does mention that 4G can only be used overseas. The Australian view is likely to spread to Europe, where Sweden has already seen floods of complaints that the iPad 3 will not run on the country's various LTE networks, mainly in 2.6GHz. The Swedish Consumer Agency is likely to launch an investigation to determine whether Apple’s advertising is misleading, says The Wall Street Journal. Because Apple does not have a direct presence in Sweden, a complaint would have to be lodged with its European head office in Ireland, which could have knock-on effects around the rest of mainland Europe.
While in the US “4G” has been used to market HSPA+ services as well as LTE, in Europe the general understanding is that the label applies only to LTE.
And in the UK, where there are no LTE networks, the Advertising Standards Agency (ASA) could impose a marketing ban on the iPad 3's claims that it supports 4G in the country. The ASA previously banned a 2008 iPhone advert for giving a misleading view of its browsing capabilities.
Meanwhile, Apple is in court in Germany defending its iPad against alleged unfair competition from the Motorola Xoom. Motorola Mobility argued on Tuesday that its tablet differs significantly from the original iPad, though Apple is alleging that it illegally copied that product's design. Apple is suing its rival on three counts of design patent infringement in Dusseldorf, and is also taking action for alleged competition law infringement.
Motorola's lawyer said there were very clear indications on the front and back of the Xoom and there was “no way” it could be mistaken for an iPad. The presiding judge had said in her opening remarks that the court considered the evenly-bent rear side and the shaped edges on the front suitable to give the Xoom an individual character. A ruling is scheduled for May 31.
Oracle, Google fail to make up
If judges in Europe and Australia seem increasingly impatient with Apple's bids for injunctions against rival products, that is nothing to the exasperation publicly expressed by those presiding over Oracle's copyright and patent infringement cases against Google, centering on alleged Android copying from Java.
The trial is set for April 16, after several delays while the judge insisted that Oracle come up with more reasonable damages claims, and some patents were removed from the complaint. Now magistrate judge Paul Grewal – who presided over failed settlement talks involving both firms' CEOs last fall – is calling on the antagonists to make one last attempt to come to an out-of-court agreement.
Lawyers from both sides have been ordered to propose dates for a settlement conference, to be held before April 9. But apparently one offer has already been made this week, and rejected, so a truce now looks unlikely.
According to Reuters, Google made a proposal, which has been re-buffed by Oracle. This would reportedly have applied to two patents - $2.8 million (€2.1 million) in damages upfront for the two, plus 0.5% of Android revenue for the first one, up to December 2012, and 0.015% for the second, up to April 2018. Oracle said no on the basis the offer was too low, and may be hoping for injunctions as well as higher fees after the trial.
The stakes, at least in financial terms, have been lowered, with Oracle unlikely to get more than $100 million if it wins the Android-focused case, rather than the billions of dollars it had once sought. As many commentators point out, Oracle could have made more money by offering Google an open-ended Java license in the first place, though of course there is more to IPR lawsuits from giants like these than cash – this is also about influence and control of key standards.
Since the suits were filed in 2010, Google has asked the US Patent and Trademark Office (PTO) to review the patents at issue, and only two now remain in the case. That has made Oracle focus more heavily on claims that Android infringed Java copyright, and has even offered to drop the patent claims, temporarily or even permanently, in return for a fast track decision on the copyright.
Meanwhile, the trial has been delayed by the judge repeatedly rejecting Oracle's damages estimates, which have dropped from an initial bid of $6.1 billion. Google most recently responded with a figure of $37.5 million, if they lost on all counts, and Oracle has, oddly, come back with an even lower estimate than that, at $32.2 million. After legal costs, Oracle could even lose money on the suit.