Qualcomm Inc., v. Broadcom Corp., 548 F.3d 1004 (Fed. Cir. 2008).
Facts
This was a patent infringement case, where Qualcomm failed to disclose two patents to the Joint Video Team ("JVT") standards-setting organization ("SSO"). Both patents involved video compression technology. The initial suit was brought by Qualcomm against Broadcom for alleged infringement by using the video compression standards developed by Qualcomm. Broadcom claimed to be unaware of the Qualcomm patents.
Throughout the litigation, Qualcomm claimed to have not participated with the JVT in developing the video compression technology. However, near the end of the initial jury trial, one of Qualcomm's witnesses testified to having documentation that showed Qualcomm participated in the JVT. Evidence was eventually produced that showed Qualcomm's attempted concealment of its participation in the JVT and its attempt to hide the video compression patents.
Procedural Posture
The District Court held that Qualcomm breached its duty to disclose two video compression patents. The District Court ordered the patents "unenforceable against the world." Further, the District Court held that Qualcomm's misconduct provided the bases for the exceptional case determination, in which the Court awarded Broadcom its attorney fees.
Rule
By failing to disclose relevant intellectual property rights ("IPR") to an SSO prior to the adoption of a standard, a "patent holder is in a position to 'hold up' industry participants from implementing the standard. Industry participants who have invested significant resources developing products and technologies that conform to the standard will find it prohibitively expensive to abandon their investment and switch to another standard." Broadcom Corp. v. Qualcomm Inc., 501 F.3d 297, 310 (3d Cir. 2007).
Holding
The Federal Circuit affirmed the District Court's decisions in finding that Qualcomm had a duty to disclose the patents, breached that duty, and met the exceptional case determination. However, the Federal Circuit remanded the District Court's remedy that the patents were unenforceable against the world, as the Federal Circuit found the remedy too broad in scope.
Important Dicta
The Court found that the duty to disclose was only required on the best effort of the participants, according to the JVT's IPR. However, the Court looked at how the JVT participants treated the IPR, and it found that the participants treated the IPR as requiring disclosure.
The Court also applied the "reasonably might be necessary standard" in determining whether the patents fell within the standard and therefore required disclosure.
Future Importance
The Court appears to find a requirement for disclosure where one does not necessarily exist. Therefore, companies that are participants of an SSO should err on the side of disclosure.
Critical Analysis
This case should help clear some of the fog that has engulfed SSO's. SSO's are commonplace in areas of technology and the Court provides guidance as to what is required for disclosure of participants, even when the IPR may not require disclosure. Although, it is somewhat possible that this case could have ended differently had Qualcomm not acted so dishonestly throughout the litigation.
Facts
This was a patent infringement case, where Qualcomm failed to disclose two patents to the Joint Video Team ("JVT") standards-setting organization ("SSO"). Both patents involved video compression technology. The initial suit was brought by Qualcomm against Broadcom for alleged infringement by using the video compression standards developed by Qualcomm. Broadcom claimed to be unaware of the Qualcomm patents.
Throughout the litigation, Qualcomm claimed to have not participated with the JVT in developing the video compression technology. However, near the end of the initial jury trial, one of Qualcomm's witnesses testified to having documentation that showed Qualcomm participated in the JVT. Evidence was eventually produced that showed Qualcomm's attempted concealment of its participation in the JVT and its attempt to hide the video compression patents.
Procedural Posture
The District Court held that Qualcomm breached its duty to disclose two video compression patents. The District Court ordered the patents "unenforceable against the world." Further, the District Court held that Qualcomm's misconduct provided the bases for the exceptional case determination, in which the Court awarded Broadcom its attorney fees.
Rule
By failing to disclose relevant intellectual property rights ("IPR") to an SSO prior to the adoption of a standard, a "patent holder is in a position to 'hold up' industry participants from implementing the standard. Industry participants who have invested significant resources developing products and technologies that conform to the standard will find it prohibitively expensive to abandon their investment and switch to another standard." Broadcom Corp. v. Qualcomm Inc., 501 F.3d 297, 310 (3d Cir. 2007).
Holding
The Federal Circuit affirmed the District Court's decisions in finding that Qualcomm had a duty to disclose the patents, breached that duty, and met the exceptional case determination. However, the Federal Circuit remanded the District Court's remedy that the patents were unenforceable against the world, as the Federal Circuit found the remedy too broad in scope.
Important Dicta
The Court found that the duty to disclose was only required on the best effort of the participants, according to the JVT's IPR. However, the Court looked at how the JVT participants treated the IPR, and it found that the participants treated the IPR as requiring disclosure.
The Court also applied the "reasonably might be necessary standard" in determining whether the patents fell within the standard and therefore required disclosure.
Future Importance
The Court appears to find a requirement for disclosure where one does not necessarily exist. Therefore, companies that are participants of an SSO should err on the side of disclosure.
Critical Analysis
This case should help clear some of the fog that has engulfed SSO's. SSO's are commonplace in areas of technology and the Court provides guidance as to what is required for disclosure of participants, even when the IPR may not require disclosure. Although, it is somewhat possible that this case could have ended differently had Qualcomm not acted so dishonestly throughout the litigation.