Apple v. Kodak to Remain in Bankruptcy Court

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Apple vs. Kodak

After a day-long hearing, U.S. District Judge George Daniels denited a request from Apple that its patent dispute with Kodak be moved to a federal district court in Manhattan rather than the bankruptcy court where it is currently under consideration. Judge Daniels wants to give bankruptcy Judge Allan Gropper a chance to rule on some of the key issues first.

Bankrupt Kodak has 10 patents that Apple has laid claim to involving technology that allows previews of photographs to be displayed on LCD screens. The patents have brought in billions in licensing fees over the years, and Kodak wants to keep them as part of a 700 patent portfolio the company is trying to auction off as part of its bankruptcy proceedings. 

Kodak filed for Chapter 11 bankruptcy on January 18. A month later, Apple asked for permission to sue Kodak over patent infringement, even though the company was in bankruptcy proceedings.

Kodak then filed suit to block that motion, as the company wanted to keep the patents in the portfolio up for auction. The stay was granted and Apple objected, but the stay remained in place. This kept the disagreement in bankruptcy court rather than moving to the federal district court. Apple then appealed, which was was was denied on Thursday.

Kodak expects the patents to be auctioned off in early August, but Judge Gropper has yet to rule on that. The company has argued that Apple is muddying the waters with these claims, claims that Kodak believes were settled years ago.

Reuters reported  that Apple lawyer Gregory Arovas told the court that the dispute involves substantive patent law, and that the complexity of the case would be best addressed by a federal district judge and required ‘mandatory withdrawal to district court.’

The court disagreed, and the bankruptcy proceedings will proceed.

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