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Technology Stocks : Interdigital Communication(IDCC) -- Ignore unavailable to you. Want to Upgrade?

To: Original Mad Dog who wrote (3183)	1/10/2000 12:59:00 PM
From: Original Mad Dog	Respond to of 5195

As a lawyer who has dabbled in patent law from time to time (though it's not my specialty, I did give a deposition as in-house counsel in a patent case a few years back, and I have dealt with about a dozen patent cases in one role or another, so I have a basic familiarity with the concepts. I haven't read the patents that this lawsuit is about, so I cannot pretend to tell you what IDC's likelihood of success here is. Disclosure: I am long 1K shares IDC at the moment. 1. When you litigate over a patent you have, you put that patent "at risk" of being invalidated. Earlier versions of these IDC patents were in fact invalidated in a Motorola case a few years back. The new versions were granted by the patent office after IDC told the patent examiner about the Motorola decision. This means that at least the patent examiner thought the patents were sufficiently distinct from the claims of the invalidated patents to merit a new patent grant. I therefore wouldn't put much credence in the fact that IDC lost to Motorola before; the Ericsson case is a new case involving different patent claims. 2. To attack the patents, Ericsson has basically two options: prove it doesn't infringe the patents, or prove the patents aren't valid to begin with, either because IDC cheated in getting them or because the requirements of the patent act weren't met. The two major requirements are that the claimed invention was not obvious to those "skilled in the art" and the claimed invention was not in prior use more than one year before the patent application was filed (recently this was changed in certain respects). 3. Ericsson seems to be focusing on whether IDC played straight with the patent office (a concept called "fraud on the patent office"). If you don't disclose everything to the patent office that you are supposed to, and what you were hiding would have made a difference, then you can essentially have your patent invalidated. I have seen that happen in cases I have been involved in. The magistrate's ruling is primarily focused on the fact that he doesn't buy Ericsson's arguments that these patents should be invalidated for this reason. That is certainly good news, but . . . . 4. A magistrate's rulings are not final. Each side has a short period of time to ask the judge to review them. Judges usually don't overturn magistrates but sometimes do. 5. The scope of Ericsson's motion was narrow. It only sought to break the various attorney privileges to force IDC to turn over its lawyer stuff, which courts are reluctant to do. Sometimes when there's no dirt there, the patent holder will volunteer to have its attorneys deposed (I gave such a deposition once when my client had a real strong case). Here IDC chose for whatever reason not to do that. In any event, Ericsson presumably can still try to invalidate the patents on other grounds, but this ruling is a major step in IDC's favor because it appears to shoot one of Ericsson's major arguments out of the water. 6. I have no idea what else is going on in the case, but I would expect Ericsson to ask the Judge to review the magistrate's ruling. If he does, don't expect a settlement this month. MAD DOG