Congress, the ITC and the Biden Administration Must Move Forward to Stop Samsung’s IP Abuse

By John Michaelson
November 23, 2020

“The ITC must decide to uphold its duty, step in, and investigate the blatantly illegal actions of Samsung. The Commission took a step in the right direction during the Comcast-TiVo litigation, and it needs to keep moving forward.”

Editor’s note: The author is a director at Pictos.

https://depositphotos.com/31248541/stock-photo-opinion-business-concept.htmlLast week, years of arguing and contention came to an end. The fight I’m referring to was not a political campaign, but that doesn’t make its impact on our country any less significant – it’s a victory that everyone can celebrate.

Finally, the long-running patent litigation battle between TiVo and Comcast is over. Comcast had infringed TiVo’s patents and, to put it simply, was bullying the smaller company by weaponizing their larger legal team. Eventually, the International Trade Commission (ITC) stepped in and the two companies were able to reach a new, long-term licensing agreement. In doing this, a crucial precedent was potentially set – it will arguably harder for massive companies to take advantage of smaller ones.

The Pictos Story

Still, we can’t allow this encouraging behavior to be a one-time decision. Fortunately, the ITC has another opportunity to step in and protect another small company that’s been victimized. You might not know Pictos by name, but, in the early 2000s, it was a worldwide leader in a major technology. In fact, its technology is likely in your smartphone, tablet, computer, video monitors, and car. An American company, Pictos invented and pioneered the miniature CMOS-based cameras now sold in the billions worldwide.

While you may not be familiar with Pictos, I have no doubt that you know the name Samsung. The tech giant has a history of intellectual property (IP) conflict. In fact, Pictos was put out of business by the massive Asian company’s blatant violation of its patents and industrial espionage. Samsung, not an American company, now dominates the market for the CMOS-based cameras. This should have been an American industry employing thousands of Americans.

Samsung also has a history of litigating to death any small company that challenges it. In 2016, a Texas jury found that Samsung “willfully” infringed Pictos’ technology and awarded them infringement damages. The district court also awarded treble damages to Pictos and, citing Samsung’s wanton behavior at trial, awarded them $7 million in legal fees. Still, the verdict didn’t stop Samsung from continuing its tradition of stealing from smaller companies, getting sued and deploying its massive legal team.

Samsung, with its legion of lawyers, filed countless motions in different jurisdictions. It lost over and over. Finally, it went to the United States Court of Appeals for the Federal Circuit. Remarkably, and in what is widely considered a bizarre decision, that court invalidated the patents at issue, overruling the Texas jury, the district court judge, and the U.S. Patent and Trademark Office.

Congress Steps In

Samsung’s perverse behavior is finally starting to catch the eye of lawmakers on Capitol Hill, though. This week, Senator Mike Crapo (R-ID) wrote a letter to ITC Chairman Jason Kearns. Senator Crapo wrote, “The ITC was created to protect the rights of inventors and patent holders. Pictos is a small American company suffering abuse from a large multinational corporation. Lacking other viable alternatives, they have appealed to the ITC to seek judgment and relief from international violations of [their] patent rights.”

The need for this investigation represents more than just Pictos’ victimization – this investigation represents our willingness to protect all of the small, innovative American companies that have been drowned out by big, foreign tech corporations. Our economy already loses between $225 and $600 billion to Chinese IP theft every year. Particularly right now, as we continue our economic recovery from COVID-19, these are losses that we simply can’t afford.

How many more jobs, industries, and ideas are we going to surrender to foreign competitors before we act? Pictos invented and pioneered a miniature camera that is still used today. These cameras should be a major American industry doing tens of billions of dollars a year and employing tens of thousands of Americans. However, it is not. And not because Americans did not out-innovate and out-compete. They did. And, sadly, this Pictos case is only one of countless stories.

Moving Forward

The ITC has a critical decision to make, and President-elect Biden has an important opportunity. The ITC must decide to uphold its duty, step in, and investigate the blatantly illegal actions of Samsung. The Commission took a step in the right direction during the Comcast-TiVo litigation, and it needs to keep moving forward.

President-elect Joe Biden also has the opportunity to keep a promise that he repeatedly made on the campaign trail and immediately send a message to the American people – that he truly is willing and ready to fight for the little guy. This fight isn’t just about two companies, this fight is about the future of American innovation.

Image Source: Deposit Photos
Author: tashatuvango
Image ID: 31248541

The Author

John Michaelson

John Michaelson is Chief Investment Officer at Michaelson Capital Partners LLC. He has spent his career as an executive and investor in emerging disruptive technology companies. From 1993 through 2005, Mr. Michaelson served as President and Chief Executive Officer of Needham Investment Management. During his tenure, the team grew assets under management from $35 million to $4.6 billion in private funds and listed mutual funds.

Warning & Disclaimer: The pages, articles and comments on IPWatchdog.com do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author as of the time of publication and should not be attributed to the author’s employer, clients or the sponsors of IPWatchdog.com. Read more.

Discuss this

There are currently 11 Comments comments. Join the discussion.

  1. TFCFM November 24, 2020 10:52 am

    Article: “Remarkably, and in what is widely considered a bizarre decision, that court invalidated the patents at issue, overruling the Texas jury, the district court judge, and the U.S. Patent and Trademark Office.

    OK, I get it that a patentee isn’t happy when their patent is ruled invalid (who would be?), but it’s hardly “bizarre” for the Federal Circuit to hold that non-controverted evidence establishing anticipation invalidates a patent, even if a patent examiner didn’t know about the art and a lay jury was fooled. Being “a small company” doesn’t exempt a patentee from invalidation for anticipation pursuant to 35 USC 102.

    With the infringement verdict reversed, it’s not remotely surprising (let alone “bizarre”) that the court also nullifies the award of fees that requires prevailing on the infringement charge (i.e., the “bizarre decision” in the opinion linked here to that phrase). The court could not have ruled otherwise, given the reversal of the infringement verdict.

    (Never mind the hypocrisy that the “small company” with a patent anticipated by another seeks to monopolize what that “other” invented before the “small company” did.)

  2. Anon November 24, 2020 1:33 pm

    TFCFM,

    Nice strawman, as you make of straw an assertion of bizarre something different than what the author indicates.

    It’s a nice trick – albeit subtle. One no doubt likely to impress your non-lawyer friends.

    However, whether or not an item of art IS an objective item for anticipation is NOT the position here. That is NOT what is being called ‘bizarre.’

  3. Samuel November 25, 2020 6:06 am

    Quote:

    We reverse that award. Under § 285, a party may not
    be awarded fees unless it is “the prevailing party.” 35
    U.S.C. § 285. The district court found the “prevailing
    party” requirement met because “Imperium was successful
    in proving [Samsung] infringed asserted claims in the
    ’884 and ’029 Patents.” Imperium IP Holdings (Cayman),
    Ltd., No. 4:14-CV-371, 2017 WL 4038883, at *2. Today, in
    a separate opinion, we reverse the judgment of liability
    against Samsung and affirm the judgment of no liability
    on the ’290 patent. Imperium IP Holdings (Cayman), Ltd.
    v. Samsung Elecs. Co., Nos. 2017-2107, 2017-2133, slip op. (Fed. Cir. Jan. 31, 2019). Accordingly, Imperium is no
    longer the prevailing party, and we must reverse the
    award of attorney’s fees at issue in this case.

  4. TFCFM November 25, 2020 1:44 pm

    Anon@#2: “That is NOT what is being called ‘bizarre.’

    Pray, tell us what you believe is being called “bizarre” in the article.

    The article itself refers to the decision invalidating the patent:
    (Article: “Remarkably, and in what is widely considered a bizarre decision, that court invalidated the patents at issue, overruling the Texas jury, the district court judge, and the U.S. Patent and Trademark Office”), but the link attached to the words “a bizarre decision” leads to the separate decision reversing the prevailing-party-fee-award.

    I’m not sure which decision the author intended to call the “bizarre” one (my guess is the reversal of the infringement finding, given that that’s what the author’s words say). If you’re doing more than your usual hand-waving-without-specifying-what-you’re-talking-about, please do us the favor of telling us what you believe is being called “bizarre.”

  5. Dave Bee November 25, 2020 3:20 pm

    It baffles me how we can collectively be so outraged by a foreign entity running amock in the US courts while Amazon, Apple, AT&T and a multitude of other companies flagrantly violate the PTAB’s rulings via the Federal Circuit Court. Justice Lucy Koh cites Alice 101 in rejection of Voip-Pal’s clearly legitimate lawsuit against these domestic commercial giants, but refuses to say why. One can only assume by this seemingly agregious manouver that there is no reason other than she might be looking for a retirement job later, much like some of her predecessors who ruled in favor of the mega-corporations. Please tell me how this flouting of comon sense in favor of legal rulings differs from Samsung v Pictos other than nationality? So we’re supposed to allow this flouting of the law because the infringer here is a cabol of domestic megoliths and not international? Hypocrisy at its maximum.

  6. Anon November 26, 2020 8:26 am

    If you’re doing more than your usual hand-waving-without-specifying-what-you’re-talking-about

    LOL – nice — but false — spin.

    My post was clear in that the focus is on YOUR inappropriate characterization.

    I need not, nor did I – clearly – broaden my point beyond that.

    Such is NOT a matter of ‘hand-waiving,’ nor is it in any measure any type of ‘without specifying what I am talking about.’

    YOU happen to NOT LIKE the specifics of what I am clearly talking about, and you think this tactic of spinning a false statement ‘gets you off the hook.’

    That tactic may impress your non-lawyer friends.

    It impresses no one here.

  7. TFCFM November 27, 2020 9:24 am

    Still waiting for your answer:

    Anon@#2: “That is NOT what is being called ‘bizarre.’

    TFCFM@#4: “Pray, tell us what you believe is being called “bizarre” in the article.

  8. Anon November 27, 2020 3:16 pm

    Keep on waiting – in the meantime, read again what I did say and put your attention there.

  9. Anon November 28, 2020 10:28 am

    TFCFM,

    You yourself have refused to engage on discussion points when I have presented an author’s direct link to a topic (related to eligibility and ‘discoveries’).

    Here, you would turn around and request that I do MORE than that.

    You (nor the authors of the present article) even link to the CAFC opinion that may well provide the author’s basis of reasoning why they chose the phrase ‘the bizarre decision’ as the hyperlink associated with that phrase is NOT to the 12 page decision rendered that same day, but instead is to the 3 page parallel decision.

    The link, by the way, to the 12 page decision is: http://www.cafc.uscourts.gov/sites/default/files/opinions-orders/17-2107.Opinion.1-31-2019.pdf

    Notwithstanding this additional elucidation on my part, YOUR post is still a piece of spin, and YOUR spin has been called out. I need make no further additional arguments (on the behalf of the authors) to present the point of YOUR spin.

    You may want to move the focus off of the point that I have actually presented, and you may be snarky in following up on your wants, but your wants simply are not material to the point put to you.

    So, for as long (and snarkily) as you wait, the ball remains in your court to actually address the actual point put to you.

  10. TFCFM November 30, 2020 10:19 am

    Kook with free time = lots of comments that mean nothing.

    The decision for which you provide the link is precisely the one to which I (and the original article’s author) referred:

    TFCFM@#4: “The article itself refers to the decision invalidating the patent

    As I said @#1: “it’s hardly “bizarre” for the Federal Circuit to hold that non-controverted evidence establishing anticipation invalidates a patent, even if a patent examiner didn’t know about the art and a lay jury was fooled. Being “a small company” doesn’t exempt a patentee from invalidation for anticipation pursuant to 35 USC 102.

    If you disagree (obviously, you do) and think that this reasoning is somehow “bizarre,” I’d love to hear the slightest bit of logical reasoning as to why.

    (I’m beginning to believe that you simply like the physical act of typing nonsense in facial disagreement, rather than explaining any logical basis {beyond childish name-calling which, of course, doesn’t count} underlying your disagreement.)

  11. Anon November 30, 2020 2:02 pm

    The author provided no such basis as you are demanding.

    You rest on a point NOT at hand, and hence, my counters remain valid.

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