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Federal jury to weigh infringement issues
By Kathryn Balint
UNION-TRIBUNE STAFF WRITER
January 10, 2007
Chip-making giants Qualcomm and Broadcom opened a patent-infringement trial over digital video compression in federal court yesterday with each accusing the other of “trying to get something for nothing.”
Qualcomm, a San Diego developer of wireless technology and maker of chips that run cell phones, filed the lawsuit against Irvine-based Broadcom 1½ years ago. Qualcomm accused its rival of infringing on two of its patents in making chips that power Apple video iPods, cable and satellite TV set-top boxes, high-definition DVD players and now-discontinued moviemaking equipment.
Qualcomm is seeking $8.3 million in payment from Broadcom for patent infringement from the date the lawsuit was filed in October 2005 to the present. In addition, the company seeks an unspecified amount for use of its patents in the future.
The case before U.S. District Judge Rudi M. Brewster is just one battle in a much larger war being waged by the two multibillion-dollar companies in courts and other legal venues around the globe.
At the heart of the case are two patents for digital-video-compression technology developed by Qualcomm employee Chong Lee and patented by the company in 1995 and 1996. The technology compresses video, yet it still retains a sharp picture, for sending over the Internet, over cellular networks or cable TV.
A jury of five men and four women was seated yesterday in the patent dispute, and attorneys for both companies made roughly one-hour opening statements.
Attorney James Batchelder, representing Qualcomm, told the jury that Broadcom is using that patented technology in its chips and does not want to pay the San Diego company for the privilege.
He accused Broadcom of getting “caught with its hand in the cookie jar,” refusing to pay for the use of the patented technology and then making excuses for the company's behavior to divert attention from the patent infringement.
“Broadcom wants something for nothing,” Batchelder said. “In our society, that's not how it works.”
But attorney William Lee, representing Broadcom, told the jury that Qualcomm is trying to seek payments for patents that no one – including Broadcom – is infringing on. He said Broadcom uses a different type of video compression.
Lee said the patents are invalid because Qualcomm's patent attorneys left out key information when filing for the patents.
Lee told jurors that they need to ask themselves, “Who is it that's trying to get something for nothing?” He said Qualcomm seeks to profit from products that it had no hand in developing.
The case could have ramifications for dozens of other companies that use the same type of video-compression standard that Broadcom uses.
Qualcomm's Batchelder claimed that one of the patents at issue is incorporated into a video-compression standard set by the electronics industry. If Qualcomm wins the case against Broadcom, it means that potentially dozens of makers of electronic devices using that standard could be forced to pay royalties to Qualcomm.
But Lee, Broadcom's attorney, said that when a standards-making group of employees from a variety of manufacturers worked on the standard between 2001 and 2003, Qualcomm never mentioned it owned a patent that might be key to the standard.
He said the first that Broadcom heard of Qualcomm's allegations that Broadcom was infringing on the two patents was the day the lawsuit was filed.
Batchelder said Qualcomm had informed the standards-making group that it owned a key patent and intended to collect royalties.
The trial is expected to continue through the week of Jan. 22, not including jury deliberations.
The billionaire founders of Qualcomm and Broadcom are expected to testify. Today, Qualcomm plans to call its founder and chairman of the board, Irwin Jacobs, as a witness.
Qualcomm and Broadcom, which once collaborated on the Bluetooth wireless technology, found themselves at odds when Broadcom sought to compete against Qualcomm in making cell phone chips.
Qualcomm is the world's second-largest chip maker for cell phones. It also holds key patents necessary to make chips for cell phones that can surf the Internet at high speeds, download videos and play 3-D video games.
Broadcom was unable to reach an agreement to license Qualcomm's technology for use in its cell phone chips. The company said Qualcomm was overcharging for use of its technology.
A spate of lawsuits between the companies and other complaints followed in U.S. federal courts; the U.S. International Trade Commission in Washington, D.C.; and the European Commission in Brussels, Belgium. |
