On January 28, the day after Apple announced its highly-anticipated iPad product to the world, a company called Intellect Wireless sued Apple in the Northern District of Illinois, seeking nearly $10 million dollars in damages for infringement of its patents (Case No. 1:2010cv00586).
In less than two years, Intellect Wireless has sued almost every single major wireless telephone manufacturer for patent infringement.
On February 28, 2008, Intellect Wireless sued T-Mobile USA, US Cellular, Virgin Mobile USA, Helio in the Northern District of Illinois on three patents. These patents generally covered a “Picture Phone with Caller ID”, as well as improvements in paging systems.
Following the well-worn strategy of settling with smaller companies and climbing the food chain, Intellect Wireless hammered out settlements with Helio and Virgin Mobile within six months. (The case remains pending against the remaining defendants.)
On March 6, 2008, Intellect Wireless sued Motorola, LG Electronics, Sanyo Electric Co, Kyocera Wireless, and Sprint Nextel Corp for infringement on two patents. These patents can be generously labeled as “broad,” since they cover the use of picture and video messaging on wireless devices, and the means for updating contact information in such devices: core features of today’s modern cellular phones. Despite the fact that the technology claimed in these patents has been long in existence, Intellect Wireless was issued these two patents in 2007. These patents are not only noteworthy for their undeserved breadth in subject matter, but also for the length of the patent document itself. For example, Intellect Wireless’ voluminous patent on a “Method and Apparatus for Improved Paging Receiver and System” cites nearly fifteen pages worth of prior art references, offers 45 pages worth of diagrams and presents 37 actual claims.
One can only imagine the reaction of the overworked examiner presented with these tomes.
Regardless of the questionable validity of the Intellect Wireless patents, three defendants settled within a year and a half of the initial suit filing, presumably unwilling to take the litigation risk (Motorola, 10/2/08; LG Electronics, 4/16/09; Sanyo Electric Co, 7/7/09). This case continues, with the remaining parties currently entering the crucial claim construction phase of the litigation.
Intellect Wireless’ next round of litigation targeted Samsung Electronics, with a suit filed on October 14, 2008. Just over a year later in mid November 2009, the case was settled between the parties.
Prior to last week’s filing, Intellect Wireless’ most recent lawsuit went after HTC, Research in Motion, and AT&T Mobility, being filed on May 14, 2009. The same patents at issue in the prior cases were once again being asserted. This case is still ongoing with all the original parties still involved.
There’s a blueprint here: 1) obtain a broad patents covering an important, highly technical field; 2) file shotgun suits against a large number of companies; 3) settle quickly with small players; 4) leverage previous settlements to climb the food chain and sue larger players until you’re going after the most profitable companies in America. Rinse, repeat.
According to TechCrunch’s take this weekend: “In other words: it’s a non-practicing entity, aka patent troll, hard at work…”