Joff over at the IAM Blog pointed out that HTC and Round Rock entered into a stipulated dismissal of the latter’s patent infringement lawsuit more than two weeks ago.
Earlier this month documents were issued by a Delaware court dismissing a case Round Rock had brought against Taiwanese company HTC. Round Rock had originally initiated the action on 1st October 2010, claiming infringement of five patents.
While Joff speculates that HTC has become the latest licensee of the Micron spin-out, I’m significantly more skeptical.
First, in the two weeks since this dismissal, there’s been no announcement or press release issued by the publicly traded smartphone maker about a settlement, license or other agreement resolving the litigation. When major litigation threatens a company, it’s often customary (and in many instances, mandatory) for companies to announce when litigation has been neutralized. Also, getting HTC signed up as a licensee would be a “big feather” as Joff notes, so, again, given that the dismissal is a public record, why no announcement from Round Rock?
Second, the dismissal is “without prejudice” which means that Round Rock is free to re-file its claims at a future date. Granted, it is entirely possible that HTC paid Round Rock for a license that would provide an absolute defense to a future infringement lawsuit. However, most lawyers prefer the safer “belt-and-suspenders” practice, and secure a dismissal with prejudice along with a license, covenant not to sue and release of claims. (In reality, this is more of a belt, suspenders, duct tape and superglue approach).
Finally, the existence of a settlement agreement resolving the litigation is typically mentioned in the dismissal papers being filed with the court. This alerts the judge to the fact that both sides have resolved their differences, and the dispute isn’t likely to reappear in the future.
So why the paperwork? What they may have done is reach a separate agreement that terminates the “hostile” nature of the relationship between the parties without actually allocating any rights under the Round Rock patents.
Earlier this year, efforts by Chinese manufacturer Huawei to acquire patents were thwarted by a US committee on foreign investment (Cfius) citing security concerns. This news could signal difficulty for foreign firms desiring to acquire and enforce US patents. Recall also that, about a week before the stipulated dismissal, HTC announced a $75 Million purchase of an 80 patent portfolio related to wireless and 4G technologies.
Meanwhile, Round Rock’s business is patent licensing and monetization, getting its start by acquiring a large chunk of Micron’s IP portfolio. A foreign company like HTC might be better served in its monetization plans if cooperation of US-based patent holders like Round Rock are at its disposal.
Observers of the smartphone IP space would be wise to keep an eye on transactional news involving the HTC patent purchase and any new Round Rock acquisition and licensing efforts.
- UPDATE: Ocean Tomo/Round Rock Patent “Covenant Auction (gametimeip.com)
- The New Patent Licensing Regime (gametimeip.com)
- HTC Buys Up Wireless Patents (patentcalls.com)