On June 9, 2011, Apple filed a motion to intervene in a lawsuit instigated by non-practicing entity Lodsys against various app developers. Apple argued that it has a license to the patents Lodsys is asserting, and that its developers are licensed by extension. The concept is called patent exhaustion and sometimes raises complicated legal and technical issue.
Originally, the defendants in that lawsuit in the Eastern District of Texas were mostly small companies, but in an amended complaint, Lodsys also targeted some larger organizations including Angry Birds maker Rovio.
In late July, 2011, Lodsys filed its opposition to Apple's motion for an intervention. In early August, Apple insisted that its motion should be granted. But for a long time, nothing happened with respect to Apple's motion. In the meantime, the judge originally presiding over the case resigned. Today, finally, Apple's motion was granted in part: "Apple is permitted to intervene in this suit, but such intervention is limited to the issues of patent exhaustion and licensing."
Judge Rodney Gilstrap concluded that Apple was entitled to intervene, and in any event, a permissive intervention (one that the court can allow in its discretion) was also an option.
Here's the short summary that entered the public record (I also saw the actual order):
"SEALED MEMORANDUM OPINION and ORDER - Apple has satisfied each of the four requirements for intervention as a matter of right under Rule 24(a)(2). The Court finds that permissive intervention is also appropriate under Rule 24(b). To avoid any potential prejudice to Lodsys rights under the License Agreement such intervention shall be and is hereby limited to the issues of license and patent exhaustion. Apples Motion to Intervene is GRANTED-IN-PART to the extent and as specified herein. Motions terminated: [4] MOTION to Intervene filed by Apple, Inc.. Signed by Judge Rodney Gilstrap on 4/12/12. (ehs, ) Modified on 4/12/2012 (ch, )."
A friendly source told me about this. As a service to the app developer community, I wanted to provide this update. But as I pointed out last summer, there's so much going on between large operating companies that I haven't been able since then, and won't be able in the foreseeable future, to monitor lawsuits by non-practicing entities. The only lawsuit filed by a non-practicing entity on which I reported during the last six months or more was an Intellectual Ventures lawsuit against Motorola Mobility (and I reported on that one only once).
I wish the app developer community luck as far as Lodsys is concerned. I saw that some of the smaller defendants, including Iconfactory, settled the dispute on undisclosed terms, presumably because they couldn't afford the cost and deal with risk of protracted litigation. I wish the remaining defendants as well as all those facing the threat of being sued that Apple's intervention will help to get his troll defeated. I also hope that Google's reexamination requests will be successful. I still believe that those large players should do a whole lot more for app developers than what they are doing at this stage (for example, I believe they should give them blanket coverage against litigation costs), but there's no need to go into further detail on that. I'm glad that Apple has, finally, been admitted to the proceedings as an intervenor, and I hope this will help defeat Lodsys.
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