On Friday it became discoverable that Fujifilm, a Japanese company, has sued Google subsidiary Motorola Mobility for Android's alleged infringement of four of its patents. So far, Fujifilm has mostly played a defensive role in patent litigation, bringing declaratory judgment actions or countersuits. But after trying unsuccessfully since April 2011 to work out a license deal, it became the eighth company with a multi-billion dollar market capitalization to assert intellectual property rights against Android in court.
I have looked at Fujifilm's complaint, and it describes the scope of its four asserted patents in extremely broad terms. If Fujifilm really believes to have monopolized, for one particularly outrageous example, the idea of "a telephone that can communicate with other devices (e.g., a computer) over a path other than the telephone network", such as over WiFi, then its demands may have been out of line and Motorola Mobility may have been forced to take its chances in litigation. It's very likely that those patents will be narrowed dramatically, if not invalidated in their entirety, during the course of litigation. But it's too early to talk too much about the merits of this lawsuit. Claim construction and summary judgment will provide some more clarity between now and a possible trial.
What I'm more interested in at this stage is a certain phenomenon. Android continues to be an IP infringement lawsuit magnet not just with respect to troll lawsuits (the trolls sue everyone including Apple) but, more importantly, lawsuits from large publicly-traded industry players. Apart from reactive or preemptive lawsuits brought by Android device makers against Apple, the only large companies to have sued Apple in recent years are Eastman Kodak and Nokia. Apple and Nokia settled more than a year ago. That's it. But eight large publicly-traded companies are currently embroiled in litigation with Android companies (be it Google or its device maker partners) over Android's alleged infringement of intellectual property rights. Seven of those companies have brought patent infringement claims; one of them, eBay, has asserted trade secrets, a different kind of intellectual property right.
If I exclude eBay (which closed on Friday with a market capitalization of $51.58 billion), the other seven large companies (all of whom assert patents, and a couple of them additionally other categories of IP) have a collective market capitalization, based on Friday's closing, of $1.06 trillion. Here's a list of those companies in chronological order of each company's first patent infringement lawsuit targeting Android:
Apple (AAPL): $565.68 billion
Oracle (ORCL): $144.42 billion
Microsoft (MSFT): $246.9 billion
Gemalto (PINK:GTOMY): $6.52 billion
British Telecom (BT): $27.02 billion
Nokia (NOK): $6.89 billion
Fujifilm (PINK:FUJIY): $8.47 billion
By comparison, Google's market capitalization is $188 billion.
The companies who claim that Google's Android infringes on their intellectual property are too diverse to believe in a conspiracy. And I repeat myself: apart from reactive or proactive countersuits from Android companies, Apple doesn't face much of a problem with big-company lawsuits. Does it do a better job at steering clear of infringement than Google does? Does it do a better job at working out license deals or non-aggression pacts with others in the industry? Honestly, I don't know what Apple does because they obviously don't tell the public what their dealings with other industry players are like. But whatever they do, they show that the commercial success of a platform is only one of the relevant factors. Android's IP issues are not simply a function of its market share. There must be some more fundamental problems.
Google's defensive abilities are admirable, but it can't fend off all of those assertions. I recently published a list of 11 Apple and Microsoft patents that courts in different jurisdictions ruled were both valid and infringed by Android.
As an Android user, I would like to see Google address those problems more effectively. When I look at public statements made by Google officials, it sometimes seems that the company is, at different levels, in a state of denial concerning Android's intellectual property issues. 11 months ago, Google announced its merger agreement with Motorola Mobility. By now, it becomes clearer and clearer that this acquisition is not the answer.
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