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Samsung proposes five-year patent lawsuit ceasefire to avoid $18B fine

updated 10:44 am EDT, Thu October 17, 2013

Proposal sees Samsung avoiding standard-essential patent lawsuits

The European Commission is requesting feedback on an offer by Samsung to stop suing other device manufacturers over specific types of patents. The proposal would prevent Samsung from suing over standard-essential patents (SEPs) for a five-year period, in order to cease the antitrust proceedings it is embroiled in, and to avoid a potential fine from the EC of $18.3 billion.

The Commission has been investigating Samsung's activities for some time, with the manufacturer having been advised last December that its attempt to sue Apple over an SEP relating to UMTS connections was anti-competitive. A settlement offer was found in September to be insufficient, with the EC opting to continue in its antitrust investigation. The details of this first settlement attempt were not disclosed at the time.

Samsung's new offer, according to the EC, is that it "agrees to abstain from seeking injunctions for mobile SEPs for a period of five years against any company that agrees to a particular licensing framework." The framework itself consists of a negotiation period of up to 12 months, followed by a third-party determination of FRAND terms by a court or arbitrator if no agreement can be made. The EC will now accept comments about the proposals from other parties for the next month, before deciding whether or not to make Samsung's proposal legally binding.

The proposal itself, if accepted, would affect Samsung only in the European Economic Area, under the supervision of an independent trustee. Despite its limited regional reach, this could also affect Samsung's business and other lawsuits the company is involved with in other countries.

"Enforcing patents through injunctions can be perfectly legitimate." said EC vice president Joaquin Almunia, continuing "However, when patents are standard-essential, abuses must be prevented so that standard-setting works properly and consumers do not have to suffer negative consequences from the so-called patent wars."

by MacNN Staff



  1. TomMcIn

    Fresh-Faced Recruit

    Joined: 12-21-01

    In five years, SameSong can then start its shenanigans over again. In the meantime, they will make every request last as long as it can until the five year period is over. Make them pay the $18B now and make sure they stay honest after that.

  1. mytdave

    Fresh-Faced Recruit

    Joined: 08-16-00

    How about Samesung pay a hefty fine now, and also be required to stop suing over standard-essential patents forever? There you go EC, there's my comment about the proposal.

  1. Flying Meat

    Dedicated MacNNer

    Joined: 01-25-07

    Clearly they believe they could well be found guilty of the charge, and the fine would be more than they are willing to part with. That is supposed to be the nature of a fine. It should something everyone recognizes as a deterrent. When you hold it up, people should immediately think, "That's what we will want to avoid like the plague from now on."

    If it were the financial industry, or big oil, the U.S. would just throw some more money at 'em, or at worst, fine them a measly amount that they'd be okay with, which would never really enter into a corporate decision conversation again. :P

  1. Charles Martin

    MacNN Editor

    Joined: 08-04-01

    I completely agree with mytdave. This is like the Republicans playing Calvinball the past couple of weeks (and look where it got them). As numerous judges have already made clear, lawsuits over SEPs shouldn't even exist (or at least be exceptionally rare). So Samsung is arguing from a position to complete weakness here, and the EC would be idiots to let them get away with that.

  1. xomniron

    Fresh-Faced Recruit

    Joined: 10-17-13

    Calvinball? How about the Democrats were and still are playing Lucy pulling the football away? "Give us everything we want, then we'll negotiate about the budget." How many times has that happened over the past 5 years? Heaven forbid the Republicans trying to actually keep this country from going bankrupt while the Democrats continue to push us further and further into trillions of debt. When was the last time Mr. Obama actually submitted a budget to Congress? It is the "law of the land" that he do so, you know.

  1. SwissMac

    Fresh-Faced Recruit

    Joined: 08-11-06

    @xomniron Hmm, a law that was passed by both Houses of Congress, and ruled to be completely Constitutional for a service that was a main component of Obamas original election campaign that got him elected and re-elected because the people want health care is undermined at every opportunity by a few millionaire Tea Party Republicans who then hold the US economy hostage, reduce economic activity by more than $20 billion, and who care more about their ideology than the health of their own Nation, and then you blame the side who wanted to protect the Economy and keep the Government working?

    You should apply for a job at Samesung; you're as mad as they are!

  1. I-ku-u

    Junior Member

    Joined: 08-08-11

    @xomniron You clearly have no clue about the "law of the land" - the president is expected nowadays to submit his budget, but it has never been required that the president do so. The constitution also requires that the full faith and credit of the US shall never be questioned, so if Congress actually failed to raise the debt limit, the president could reasonably argue that more must be borrowed anyway if it's necessary to meet our legally required obligations. The Republicans have clearly been playing chicken with the Democrats on this issue, but they really have no leg to stand on. Also, it's ludicrous to blame the Democrats for our ballooning debt when the bulk of our debt is the result of actions and initiatives caused by the Republican party.

    As to the actual point of this article, I sincerely hope that the EC doesn't accept Samsung's proposal since it has so many loopholes attached it won't really constrain Samsung any.

  1. xomniron

    Fresh-Faced Recruit

    Joined: 10-17-13

    Ah yes, Obamacare. Passed by a Congress with Democrat super majority that prevented Republicans from any participation other than voting for it -- no amendments, no suggestions, no input of any kind. Passed with creative accounting to make it look like it would cost less than $1 trillion dollars. Passed in the middle of the night using specious parlimentary procedures to bring it to a vote. Lied about by the president -- you can keep your current plan, it will cost less, no tax increase if you earn less than $250,000 -- all lies. And then the Supreme Court changed the premise to make it constitutional -- it's not a tax, now it's a tax.

    But all that aside. We now see that it this signature product of Mr. Obama's presidency is NOT going to be cheaper and it's implementation is an unmitigated disaster ...before it even begins. And how about the $600+ million dollars to build the web site that doesn't work? Incompetency is the legacy of Mr. Obama's regime.

    Oh, BTW, this stopped being the "law of the land" when Mr. Obama started offering exemptions and special subsidies to his crony buddies and now labor unions.

  1. Mike Wuerthele

    Managing Editor

    Joined: 07-19-12

    Move the Obamacare discussion to the correct forum, please.

    Not in my news section.

  1. pairof9s

    Senior User

    Joined: 01-03-08

    Hear, hear, EstaNightshift!!

  1. Spheric Harlot

    Clinically Insane

    Joined: 11-07-99

    I'm hoping Samsung gets laughed out of court for this one.

  1. Zanziboy

    Forum Regular

    Joined: 08-27-08

    How two-faced. Promise not to sue, but force everyone into a licensing framework, which could very easily not be FRAND.

  1. iphonerulez

    Dedicated MacNNer

    Joined: 11-28-08

    They should simply ban Samsung smartphones and tablets from the U.S. for a couple of years. That would be a fair solution.

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