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Business Briefing

War over Patents Now a Full-On Clash of the Titans

War over Patents Now a Full-On Clash of the Titans
November 1, 2013 11:48AM

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Apple, Microsoft, BlackBerry and Sony are all part of what has come to be called the Rockstar Consortium. Rockstar bought Nortel's patents in June 2011 with a primary purpose being to use them in intellectual property lawsuits against competitors. Google and Samsung, among others, are targeted in the latest suits filed in U.S. District Court in Texas.

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Some of the largest technology companies in the world are facing intellectual-property lawsuits initiated by the Rockstar Consortium, a group of companies including Apple and Microsoft that owns patents previously held by Nortel.

The Rockstar Consortium bought thousands of Nortel patents for $4.5 billion and is now turning around and suing others for allegedly infringing upon them. It is not often that Microsoft and Apple work together, but in this situation they are working toward a common goal.

Rockstar Consortium

Apple, Microsoft, BlackBerry and Sony are all part of what has come to be called the Rockstar Consortium. The companies jointly own the Nortel patents and brought their case to a U.S. District Court in Texas.

Rockstar has owned the Nortel patents since it submitted the winning $4.5 billion bid in June 2011. The group operates with only the intention of holding onto patents and is not necessarily an active company or organization.

The consortium has a team of 10 reverse engineers devoted to proving that rival devices infringe on at least one of the 4,000 patents held by Rockstar. Once an infringement is found, the group's legal team moves into action and requests money from the manufacturer that infringed on the patent.

Rockstar is a controversial group, considering it is made up of some of the largest technology companies simply working together to cause trouble for others.

Patent Lawsuit

Rockstar's move against Google, Samsung, and others will be the largest legal battle it has entered since forming two years ago. Google's key business, advertising, is specifically under attack as Rockstar claims it infringed upon seven advertising-related patents. These patents are for technology that matches users with relevant ads.

Not only is Rockstar going after Google and Samsung, but most Android manufacturers are being targeted as part of the lawsuit. It is quite convenient, however, that the Android OS is the strongest competitor to Apple and Microsoft in the smartphone market.

One of the most intriguing aspects of the lawsuit is that Google had tried to buy the Nortel patents for $900 million but lost when Rockstar put up a significantly larger bid. Google went on to counter Rockstar by acquiring Motorola Mobility for $12 billion. Despite losing the chance to acquire Nortel's patents, Rockstar claims Google went about using Nortel's ideas anyway.

"Despite losing in its attempt to acquire the patents-in-suit at auction, Google has infringed and continues to infringe," the lawsuit says.

Rockstar is suing multiple companies but seems to be particularly offended by Google, whom it says willfully infringed upon the patents, whereas the other companies did not necessarily plan on doing so.

Perhaps Rockstar and numerous other tech companies should learn from what Apple's co-founder Steve Wozniak has said: "I wish everybody just did a lot of cross-licensing and sharing the good technology; all our products would be better, we'd go further."

Tell Us What You Think
Comment:

Name:

Eric:

Posted: 2013-11-03 @ 4:54pm PT
And they say that free market competition creates the best products...

Danny:

Posted: 2013-11-03 @ 3:38pm PT
Now I need to think about Linux.



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