Lodsys Threatened by Apple

Lodsys Threatened by Apple

On Tuesday May 31, intellectual property firm Lodsys filed suit against seven developers for patent infringement in the U.S. District Court for the Eastern Texas district.  Ongoing is a three-way battle between Lodsys, Apple, and third-party developers over two of Lodsys’s patents, one regarding “a customer-based design module” and the other on “Methods and Systems for Gathering Information from Units of a Commodity Across a Network.”

Filing suit in this particular district comes as no surprise as this district has the reputation of being friendly to plaintiffs in intellectual property disputes. Those being sued by Lodsys are Combay, Iconfactory, Illusion Labs AB, Shovelmate, Quickoffice, Wulven Games, and Richard Shinderman of Hearts and Daggers for iPhone. This lawsuit, however, is not limited to just Apple’s iOS but also targets the Android platform in at least one case (Labyrinth for Android of Illusion Labs AB).

Lodsys’s main claim is that it holds the patent for “in-app purchasing”.  Apple, on the other hand, says that Lodsys’s accusations are baseless and that devs, or “App Makers, “ are “entitled to use this technology free from any infringement claims by Lodsys,” because Apple has already licensed the technology on their behalf. Interestingly enough, Apple didn’t make any real “threat” against Lodsys; Apple just took a position concerning the scope of its own license, and Lodsys made it clear that it disagrees with Apple.

This lawsuit is a very critical situation for the app developers being sued. Although patent litigation can be very costly, it is vital for these app developers to clarify with Apple, and possibly to an extent with Google, whether they will be held harmless and receive blanket coverage including possible damage awards.

Finally, Lodsys has announced that it will reimburse any developer, which is improperly targeted by an infringement notice, $1,000 for their troubles. This willingness basically suggests that the firm is confident in its standing and convinced that it will prevail against Apple’s claims that Apple’s existing license rights apply to fully license these developers.

Authored by: Rohit Deedwania

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