MICROSOFT & APPLE FIRE AT EMG

| April 8, 2010

The difficulty faced by a patentee who sues Microsoft and Apple simultaneously was demonstrated last week – as if any demonstration were needed.  Microsoft has filed two very substantial requests for inter partes reexamination, one against U.S. Patent No. 7,020,845 and the other against U.S. Patent No. 7,441,196.

The ‘845 patent claims a simplified interface method for navigating Internet content, for instance on a television screen; the ‘196 patent contains similar claims, additionally reciting “viewing and zooming and/or scrolling … the displayed on-line content.”  The ‘845 and ‘196 patents are owned by EMG Technology, which filed infringement actions in the Eastern District of Texas, against Apple in 2008 and against Microsoft in August of last year.  The cases have been consolidated before Judge Davis.

Already pending at the PTO were two inter partes reexamination requests filed in December by Apple.  The PTO granted those requests February 2, and on the same day rejected the ‘845 and ‘196 claims, for substantially the reasons presented in the requests.[1] Microsoft’s requests appear to differ from the Apple requests, in terms of their technical analysis and the primary references relied upon.

Pending before the Eastern District of Texas is a motion by Microsoft and Apple to stay that litigation pending completion of Apple’s reexaminations.  Microsoft’s requests will likely be cited as additional support for that motion.

The motion covers the three familiar factors that courts consider in deciding a stay motion – whether the patentee would be unduly prejudiced, whether the reexamination would simplify the issues to be litigated, and stage of the litigation – but also relies heavily upon the asserted strength of the prior art presented in the reexamination.  We have always felt that this is the most important factor for a court to consider in its decision of whether to stay.

EMG has not been idle.  It has filed two continuing applications that could be used to obtain new claims, written in light of the invalidity and non-infringement arguments made by Microsoft and Apple.  EMG has also petitioned the PTO to vacate Apple’s reexaminations because of an alleged failure to address certain claim limitations.

One issue that EMG may probe is whether there is a joint defense agreement between Microsoft and Apple, such that the two companies would be considered to be “in privity.”  If so, Microsoft might be prohibited from filing inter partes reexamination requests.

There are ten other co-defendants in the Texas case: Scottrade, Southwest Airlines, Priceline.com, Zagat, Comcast, American Airlines, Dell, Hyatt, Marriott and Barnes & Noble.

[1] The PTO continues its policy of strictly enforcing its deadlines by denying EMG’s petition that the due date for answering the rejection be extended from April 2 to May 2.  The denial faulted EMG for failing to “include (A) a statement of what action the patent owner has taken to provide a response, to date as of date the request for extension is submitted, and (B) why, in spite of the action taken thus far, the requested additional time is needed.”  In a later action, the PTO relented and granted EMG 10 additional days because of the snow storms in Washington.

Category: Reexamination Requests, Stays/District Courts

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