A few days back, the obama administration vetoed a ban on the import of older iPhones and iPads, imposed by the US International Trade Commission (ITC).
The move has its ghosts of familiarity. back in 1987, the US government under Ronald Reagan had overturned a similar ban involving samsung computer chips. Surprisingly, in both cases, the disappointed party was quite the same: samsung.
Sometime ago, Samsung had filed infringement charges on Apple regarding several patents. However, ITC found only one of the Samsung patent to be infringed by Apple: Patent No. 7,706,348, dubbed by Samsung as a “standard essential patent” or a basic patent. To facilitate the adoption of industry standards, standard-essential patents should be licensed at stress-free prices to anyone who wants to use them. (This is called “fair, reasonable, and non-discriminatory,” or FRAND, licensing.)
However, Apple decided to use the technology in the patent without licensing it. Instead of going to federal court to sue, Samsung went to the I.T.C. The I.T.C.’s most attractive offering being that it can ban infringing imports without going through a federal court’s narrow criteria. This is what Samsung wanted: it asked the I.T.C. to ban the import and sale of the iPhone 3GS, the iPhone 4, and older iPads entirely. For Samsung, a ban on Apple’s imports would have been far better than a one-time billion-dollar jury verdict. The ban would have derailed Apple’s current strategy of selling older models to compete with Samsung’s cheaper line of phones.
President Obama’s veto should dim the attraction of the U.S.I.T.C. as a forum for patent disputes. For the first time since 1987, we find USA bailing out its home-grown high tech champion by overriding its own IP controls. Obama has hence showcased his plans to use the Oval Office to reform the US patent system. By stifling the judicial system, the US government has shown that an american company does not have to be bound by the intellectual property framework that it expects the rest of the world to follow. Even more problematic, a subsequent ITC ruling found that Samsung infringed upon two Apple patents – and that its products could therefore be banned in the US. Will the Obama administration once again intervene against the ban?
The US government has two options: one, intervene in this ban too and reinforce its claim that the ITC rulings are more determinations of principles rather than determinations of any legal consequence. Or it can follow the easy, legal but morally reprehensible act of allowing the ban to stand, citing the importance of ITC ruling.
Author, Leo Paul Johnson, is a patent engineer working at IP ASTRA