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Apple’s NPE Posing Threat to Android Device Manufacturers
Roundabout Attack
Apple’s NPE Posing Threat to Android Device Manufacturers
  • By matthew
  • April 21, 2014, 01:57
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An argument has come out that Apple’s current patent litigation against Samsung Electronics is targeting the entire Android alliance, as the United States District Court for the Northern District of California, which is deliberating on the case in question, has determined that Apple is threatening the Android group by means of its patent troll subsidiary.

According to German patent blog FOSS Patents on April 18 (local time), United States federal judge Claudia Wilken recently remarked that Rockstar Consortium, which is a subsidiary of Apple, is trying to increase the profits of its parent company by hampering the business of Google. “We have no dialogue with our shareholders with regard to our potential license partners or patent infringement lawsuits,” Rockstar Consortium CEO John Veschi said, adding, “Still, we make reports to the shareholders as to the progress and the work we are engaged in.” Rockstar Consortium has filed a series of lawsuits against companies using the Android operating system such as Samsung Electronics, Google, LG Electronics, Pantech, HTC, ASUS, Huawei, and ZTE.

Back in 2011, Apple organized a consortium with Microsoft, Ericsson, Sony, and the like and purchased patents of Nortel, a Canadian telecoms equipment manufacturer, at US$4.5 billion, to set up the non-practicing entity (NPE) Rockstar Bidco. The company filed patent lawsuits against Samsung Electronics, LG Electronics, HTC, Google and Huawei in November last year. It appears that the federal judge confirmed the close link between Apple and Rockstar Consortium in view of this aspect.

“Apple currently owns the majority of the shares in Rockstar Consortium, and it is fair to say that the former has an influence on the latter,” said an industry source, continuing, “It is likely that Apple is pulling strings from behind in that Rockstar Consortium has threatened Android handset manufacturers in an intensive way.”

Apple is making use of its NPE in the litigation in order to dodge the risk of counterclaims. According to industry insiders, NPEs do not produce or sell products or services, and thus the risk of cross action is relatively low and more pressure can be put when an NPE leads a patent suit.