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Wearables: Article

Apple & HTC Settle All Litigation

Terms aren’t being disclosed

Late Saturday - on the eve of Armistice Day - Apple and HTC announced that they have settled their patent litigation at the price of a 10-year license agreement that covers "current and future patents held by both parties."

Terms aren't being disclosed.

An HTC spokeswoman told the Wall Street Journal that the company "doesn't expect the license agreement to have an adverse material impact" on it.

Back in 2010 Apple offered Samsung terms of $30 a smartphone and $40 a tablet or $24 for a cross license, sums that might be pricey for HTC, which unlike Samsung, is no longer a serious market threat.

It's the first licensing deal Apple has cut with an Android vendor.

The practically historic announcement consisted of all of four sentences including a statement from Apple CEO Tim Cook, who has called the Steve Jobs-sparked patent litigation "a pain in the ass," said, "We are glad to have reached a settlement with HTC. We will continue to stay laser-focused on product innovation."

HTC CEO Peter Chou said that "HTC is pleased to have resolved its dispute with Apple, so HTC can focus on innovation instead of litigation." He might have also said that it's expensive up against Apple's boundless treasure. HTC, whose smartphone market share has shrunk, is expecting another poor quarter.

HTC, which has few patents of its own, was also first to settle with Microsoft back in the spring of 2010. HTC went on to pay $300 million for S3 Graphics thinking its patents would protect it from Apple. It also borrowed patents from Google and HP to countersue Apple. Neither avenue proved successful, but then neither Apple nor HTC seemed to be getting very far in the litigation arena.

HTC lost to Apple at the International Trade Commission resulting in a temporary ban on a couple of its phones. The ITC also found that the iPhone and iPad didn't infringe on HTC patents. Another ITC decision is imminent. HTC had better luck with a British court which said it didn't infringe four key Apple patents. On the other hand, Apple seems a bit stymied in district court. Meanwhile, HTC has taken up with Windows Phone 8.

FOSS Patents warns not to interpret the reference to the deal covering "current and future patents" as meaning all Apple patents since such an arrangement could imperil Apple's claims against Samsung and Google subsidiary Motorola Mobility.

The blog says, "Apple knows that any license deal it strikes will, at least potentially, impair its ability to obtain injunctive relief in the United States over the patents covered by such deals. In any future situation in which Apple seeks injunctive relief against an Android device maker, the Apple-HTC license agreement will have to be shown to the court and the parties' lawyers, and other adversaries will hold it against Apple, claiming that Apple's willingness to sell a license to HTC covering a given patent means that it can be compensated with money for the continued infringement of such a patent. For Samsung this Apple-HTC deal probably comes too late to leverage it at the December 6 hearing in formal terms."

December 6 is when the California district court takes a stab at deciding what of the $1.05 billion jury decision against Samsung stands, increases or falls.

More Stories By Maureen O'Gara

Maureen O'Gara the most read technology reporter for the past 20 years, is the Cloud Computing and Virtualization News Desk editor of SYS-CON Media. She is the publisher of famous "Billygrams" and the editor-in-chief of "Client/Server News" for more than a decade. One of the most respected technology reporters in the business, Maureen can be reached by email at maureen(at)sys-con.com or paperboy(at)g2news.com, and by phone at 516 759-7025. Twitter: @MaureenOGara

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