Judge Blocks Apple from Intervening in Lodsys Patent Licensing Attacks

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iPhone and iPad app developers were dealt a serious blow recently when a Federal Court Judge ruled that Apple can't intervene on their behalf in in the ongoing patent licensing case patent holding company Lodsys is bringing against them. The patent holder claims app developers must pay licensing fees for in-app purchases even though Apple already paid to use the technology.

Easter Texas Court greenlights Lodsys patent attacks by blocking Apple's involvementEaster Texas Court greenlights Lodsys patent attacks by blocking Apple's involvement

Judge Rodney Gilstrap, the Judge overseeing the case in U.S. District Court in East Texas, wouldn't consider Apple's motion because instead he approved settlements between app developers and Lodsys which he felt made the Cupertino company's involvement unnecessary. The end result is that as Lodsys adds more app developers to its case Apple won't be able to offer any help.

Lodsys began threatening legal action against iOS and Android app developers in 2011 saying they needed to pay licensing fees to to take advantage of Apple's in-app purchase system. Apple's legal team stepped in and sent a letter to Lodsys stating it had already paid licensing fees to use the company's in-app purchase patent, and since it was providing the mechanism to make the feature available, that developers didn't need to pay additional licensing fees.

Lodsys disagreed and kept pushing for developers to pay their own licensing fees on top of the money Apple had already paid to the company. Apple filed a motion to intervene on behalf of developers, and at the time the court agreed to allow the company's involvement, but only so far as to cover patent exhaustion and licensing.

With the iOS-related companies that were mentioned in the suit now out of the scene after settling, Judge Gilstrap doesn't see any reason to allow Apple to be a part of the case.

The ruling is good news for Lodsys and bad news for app developers, regardless of the platforms they target. The patent holding company now doesn't have the threat of Apple's legal powerhouse looming over its shoulder and can continue to target app developers demanding money or risk facing legal action.

Considering the potential court costs it's typically much easier for developers to pay up than fight, even if they're handing over upwards of US$500,000. Without Apple in the mix, developers have even fewer resources available if they do end up in court.

According to Apple, there are more than 6 million iOS app developers and by blocking its involvement the court is giving Lodsys carte blanche to target any of them for payments without recourse.

Developers still have the Electronic Frontier Foundation and the App Developers Alliance on their side, but without the threat of Apple there isn't much to keep Lodsys in check. Lodsys chose the Eastern Texas court because it's known to favor patent trolls, and so far that tactic is paying off. That success, however, will come at a price because eventually the number of developers willing to risk releasing apps that could draw the attention of Lodsys will drop and there will be fewer choices for consumers -- and that means fewer companies for Lodsys to sue.

[Thanks to Ars Technica for the heads up]

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6 Comments Leave Your Own

Bosco (Brad Hutchings)

Just remember that TMP favorite Florian Mueller recommended that affected developers just settle with these particular despicable patent trolls. #CustomerAcquisition

Lee Dronick

“Lodsys chose the Eastern Texas court because it’s known to favor patent trolls”

jfbiii

Given the repetitive nature of the suits, couldn’t Apple simply opt to provide the representation for every affected developer? Lodsys seems to be settling or dismissing the suits Apple is trying to attach itself to, but they can’t dismiss everything. If Apple really wanted to involve itself it seems like it has the ability to force the issue.

Lee Dronick

How about a change in venue?

Tiger

Well, if Apple’s paid for the licensing, and the judge is wrongfully blocking, Apple should be able to sue for breach of contract against the patent holder, aka Lodsys.

They can’t double dip. Any judge should know that, but hey, that’s a big assumption apparently.

Imagestealer

You poor folks in the excited States.  Perhaps someone needs to follow the money trail of the patent troll to the district courts?  Just a thought.

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