Apple and Intel this week filed a new lawsuit against Fortress Investment Group, a patent assertion entity controlled by SoftBank, in response to patent infringement lawsuits brought by the firm against the two technology giants in recent years. The companies are accusing Fortress of anticompetitive stockpiling of patents in a bid to enforce them, and have asked the court to ‘remedy the harms that they had already suffered’ from Fortress and unravel Fortress’s operations.

Intel already filed a lawsuit against Fortress in the U.S. District Court for the Northern District of California back in October. In that lawsuit, Intel contested the legality of Fortress’s massive patent aggregation business through a network of patent assertion entities (PAEs) in a bid to license them (usually in packages) to Intel and other high-tech companies. In particular, Intel said that it had to license patents originally owned by NXP Semiconductors after the latter were acquired by Fortress. That lawsuit has since been withdrawn, and replaced with the new lawsuit from Intel and Apple.

The new lawsuit filed by the two companies in the same court makes the same accusations, but mentions a different set of patents, which includes patents originally issued to companies like Philips, Huawei, Panasonic, Seven Networks, and Nokia. Apple claims that so far PAEs associated with Fortress have filed 25 lawsuits against the company demanding $2.6 – $5.1 billion in damages. Meanwhile, the plaintiffs note, just one of Fortress’s PAEs — Uniloc — has been a plaintiff in more than 130 patent infringement cases since February 2013, so the scale of operations appears to be gargantuan.

Intel and Apple claim that Fortress’s patent aggregation business violates Section 1 of the Sherman Antitrust Act, Section 7 of the Clayton Act (an antitrust law that prohibits mergers and acquisitions where the effect may reduce competition), and California Business Provision Code § 17200 (an unfair competition law). To that end, the plaintiffs ask the court to declare the business practices as unlawful, return royalties that Apple and Intel have paid to the defendant (and its entities), transfer all of the claimed patents back to the transferors, declare those patents unenforceable, and award to Intel and Apple their expenses associated with the lawsuit.

Teaming up with Apple against the patent trolls is a logical, yet a relatively unexpected move from Intel. Overall, the chip giant is leading a legal war against Fortress and the more allies it can get the better. Meanwhile, there are some hitches. Fortress is controlled by SoftBank, a Japanese conglomerate which owns Arm. Meanwhile, Intel competes against Arm, whereas Apple uses Arm’s architecture in its SoCs, which makes the coalition look rather odd. On the other hand, the patents mentioned mainly cover telecommunication technologies, a sphere where Intel and Apple have interests, but not going to compete against each other.

Intel’s and Apple’s prayer for relief (for the Intel Corporation et al v. Fortress Investment Group LLC et al, case number 3:2019cv07651) reads as follows:

a) That Defendants’ unlawful conduct be declared a violation of Section 1 of the Sherman Act, 15 U.S.C. § 1; Section 7 of the Clayton Act, 15 U.S.C. § 18; and Cal. Bus. Prov. Code § 17200, et seq.;

b) That Intel and Apple recover damages against Defendants in an amount to be determined and multiplied to the extent provided by law, including under Section 4 of the Clayton Act;

c) That all contracts or agreements Defendants entered into in violation of the Sherman Act, Clayton Act, or Cal. Bus. Prov. Code § 17200, et seq. be declared void and the patents covered by those transfer agreements be transferred back to the transferors;

d) That all patents transferred to Defendants in violation of the Sherman Act, Clayton Act, or Cal. Bus. Prov. Code § 17200, et seq. be declared unenforceable;

e) Award to Intel and Apple their costs and expenses associated with this case, together with interest; and

f) Grant such other and further relief as the Court may deem just and proper under the circumstances.

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Sources: Reuters, USCourts.gov
Image Source: Quince Media via Wikimedia Commons

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  • Samus - Saturday, November 23, 2019 - link

    It isn't patent troll.

    In our PC society, they prefer to be called a "patent assertion entity"

    Now don't be a bully and go in the corner for a 10 minute timeout, you jerk.
    Reply
  • believeland - Friday, November 22, 2019 - link

    Your description of § 7 of the Clayton Act isn't quite accurate. It doesn't cover "unethical business practices." It prohibits one corporation from acquiring the stock of another where it would lessen competition or create a monopoly. That section is most often used by federal antitrust regulators to contest proposed mergers. It's a little different from § 1 of the Sherman Act for reasons that aren't worth getting into here. Reply
  • Anton Shilov - Friday, November 22, 2019 - link

    Thank you a lot for that, fixed.
    I am from Europe, so I do not know all the laws or how they work.
    Reply
  • alufan - Saturday, November 23, 2019 - link

    lol the irony Reply
  • FreckledTrout - Saturday, November 23, 2019 - link

    I don't find this ironic at all. Sure Intel and Apple have done some greedy things with there patents but at least they make the stuff they go after people about. I'm thrilled they are going after Softbank because smaller companies can't fight back. I bet we find out they have milked a lot of smaler companies so in a sense they are protecting the little as well. Reply
  • speculatrix - Sunday, November 24, 2019 - link

    Softbank are a huge investor in companies which innovate, like Arm. Reply
  • vladx - Friday, November 29, 2019 - link

    Lol, you mean Softbank "milks" companies instead of investing in them. Reply
  • alufan - Monday, November 25, 2019 - link

    seriously?
    so claiming to have invented a brick with rounded corners? I could go on but wont.
    Both Apple and Intel have for years (and still do) extracted the maximum from the public whilst holding back innovation Intel by doing nothing whilst AMD was in the doldrums Apple by being simply anti competitive with its Business model and not allowing free competition on its own app platform and hunting down jail breakers (sony too in this case), its very Ironic to me at least that they now have to defend them selves against a company that has rights and financial muscle to hold them to account something they have both smashed smaller innovators with in the past, softbank has tried to negotiate but they refuse to play ball figuring they are both beyond reproach due to the size of each of them, for them to climb into bed together like this softbank must have a real strong case.
    The rights or wrongs are not really the discussion here more the fact they both seem to have been avoiding paying for a tech or product they have used and profited out of
    Reply
  • Trikkiedikkie - Saturday, November 30, 2019 - link

    Like the rounded corner?

    Apple has not invented much, ever. They only improved most of the time. So pretty much it is all existing tech they sued over.
    Reply

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