Samsung Electronics, which has been persistently attacked by non-practicing entities (NPEs) or “patent trolls,” has filed a complaint with a U.S. court to prevent an NPE from litigating repeatedly. As the number of lawsuits filed by NPEs against Korean companies steadily increased to reach 580 over the past eight years, South Korean companies are taking aggressive measures to stop such lawsuits.
Samsung filed a lawsuit last month with the U.S District Court in Northern California against IXI Mobile, an Israel-based NPE. The lawsuit was intended to halt IXI Mobile from litigating a patent case repeatedly.
In the lawsuit, Samsung accused IXI Mobile of repeatedly filing a lawsuit for infringing its claimed hotspot patent. It asked the court to declare that the patent is invalid.
The bad relationship between Samsung and IXI Mobile dates back to 2014. In June 2014, IXI Mobile sued Samsung, Apple and Blackberry for infringing its patent related to wireless hotspots. A wireless hotspot refers to a location where users can connect to the Internet through Wi-Fi.
At that time, Samsung and Apple filed a petition with the Patent Trial and Appeal Board (PTAB) for reviewing the validity of the relevant patent. In December 2015 the PTAB reached a decision in favor of Samsung and Apple, and in September last year the Court of Appeals for the Federal Circuit (CAFC) also invalidated IXI Mobile’s claim that the two companies infringed the patent. However, in the meantime, IXI Mobile requested several times an amendment in the hotspot patent, demanding that the two companies sign a licensing contract with it. Last month the court ultimately made the ruling once again that it is impossible to amend the hotspot patent.
Through its lawsuit, Samsung has gone a step further, emphasizing that IXI Mobile should be prohibited from claiming the hotspot patent. Apple also filed a complaint against IXI Mobile on the same day as Samsung, requesting that the hotspot patent be invalidated.
South Korean companies have been the core target of NPEs, which have been labelled as patent trolls over the past ten years, but now they are taking preemptive measures to fight against them. Especially conglomerates, including Samsung and LG Electronics,are forming patent pools bysigning cross-patent (cross-license) agreements with other companies or securing their own intellectual property right.
To begin with, in order to avoid being sued for patent infringement, companies are signing more cross-patent agreements with other firms. A cross-patent agreement allows both parties to the agreement to share their patent portfolios for a certain period, leading them to cooperate not only in fight against lawsuits by patent trolls but also in developing future technologies.
According to the Data Analysis, Retrieval and Transfer System (DART) of the Financial Supervisory Service (FSS), Samsung has signed cross-patent agreements with Qualcomm, Goggle and other firms which paly an essential role in the production of semiconductors and smartphones. Furthermore, the company agreed to share patents with its competitors in smartphones and communication devices such as Huawei, Ericsson and Nokia. In 2014 LG and Google entered into the contractthat the two companies share not only their existing patents but also the patents which are to be granted to them for the following10 years.
However, even when companies take preemptive measures including strengthening patent cooperation between them, patent trolls are still filing new lawsuits. Over the past eight years from 2012 to June this year, they filed a whopping 582 lawsuit against South Korean companies. LG was sued most frequently (227 cases), followed by Samsung (212 cases) and Hyundai and Kia Motors (66 cases).