Monday, December 12, 2011

Apple Outsources IP Disputes to Patent Trolls

These are some lively times at Apple's legal department. The company is locked in intellectual property disputes with multiple companies, in multiple countries. Some of these are familiar foes such as Motorola Mobility and Samsung, others regional and lesser-known. The one thing patent disputes do, to all parties involved in them, is dent PR. Every legal dispute attracts or at lease leaves scope for bad press, and more often shapes public opinion against the disputing parties.

Apple learned a new trick in the trade which at least two recent events with very different outcomes, may have helped shape. First, it recently thwarted display IP infringement claims by S3 Graphics thanks to timely help by GPU supplier AMD, and second, it suffered a setback with regards to some brand names claimed by Chinese company ProView. You see, the ups and downs of IP disputes can have some very varied effects on the company's image. Apple's new trick is simple: make a different company, with a much different brand name, to handle those IP disputes on behalf of Apple, so brand Apple isn't directly dragged into the mess. Enter your friendly neighbourhood patent-troll, Digitude.

The mechanism couldn't be simpler. Digitude serves as a "patent investment vehicle" (in its own words), which will hold its clients' patents, protect them from infringement, and fight IP disputes on its behalf, more often discretely. As time passes on, Digitude will have achieved a level of discretion and abstraction to the general public over actually whose patents the company is holding. It's a win for Apple. All Apple has to do on paper is work out license agreementa with that patent investment vehicle to access its own patents. Digitude chairman, Robert Kramer, claims that "Digitude is a new kind of patent investment vehicle because it seeks to team up with strategic players that can invest not with money, but by contributing patents. The contributing entity would then get a license for all of Digitude's patents."

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