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Apple Can’t Appeal Patent Board Rulings After Qualcomm Deal

April 7, 2021, 3:43 PM

A 2019 global settlement between Apple Inc. and Qualcomm Inc. bars the phonemaker from challenging patent office decisions upholding two Qualcomm patents, the Federal Circuit said.

The settlement ended all cases between the companies, including Qualcomm’s suit against Apple over the U.S. Patent Nos. 7,844,037 and 8,683,362 covering technology used in smartphones. Without parallel litigation, Apple can’t show a non-speculative injury it will face if the patents remain valid, the U.S. Court of Appeals for the Federal Circuit said in a precedential opinion.

“Ultimately, Apple’s assertions amount to little more than an expression of its displeasure with a license provision into which it voluntarily entered,” the court said. “Such allegations do not establish Article III standing.”

Apple challenged parts of the patents at the Patent Trial and Appeal Board after Qualcomm sued for infringement over technology in the iPhone 7 and iPhone 7 Plus. The board upheld the patents, finding Apple didn’t prove certain claims would have been obvious in light of existing inventions.

Before Apple appealed the board’s rulings, the parties agreed to end their two-year legal battle over billions of dollars of technology licensing fees. As part of the settlement, the parties executed a six-year license agreement covering tens of thousands of patents, including the two at issue here.

Qualcomm challenged Apple’s standing to appeal in light of the settlement.

The Federal Circuit rejected Apple’s argument that it has standing because its ongoing payment obligations are a condition for certain rights in the license agreement.

“In Apple’s view, a licensee’s obligations to pay royalties for a license to 100,000 patents would provide standing to challenge the validity of any single licensed patent, even if the validity of any one patent would not affect the licensee’s payment obligations,” the Federal Circuit said.

Apple hasn’t alleged the validity of the two patents will affect its ongoing royalty obligations, the court said.

The Federal Circuit also dismissed Apple’s argument that it has standing based on the possibility Qualcomm could sue for infringement of the two patents when the settlement expires in 2025 or 2027.

“This possibility of suit is too speculative to confer standing,” the court said. “Apple provides no evidence that it intends to engage in any activity that may give rise to an infringement suit of the ’037 patent or ’362 patent when the license expires.”

Judge Kimberly A. Moore wrote the opinion, joined by Judges Jimmie V. Reyna and Todd M. Hughes.

Fish & Richardson PC represented Apple. Baker Botts LLP represented Qualcomm.

The case is Apple Inc. v. Qualcomm Inc., Fed. Cir., No. 20-1561, 4/7/21.

To contact the reporter on this story: Perry Cooper in Washington at pcooper@bloomberglaw.com

To contact the editors responsible for this story: Renee Schoof at rschoof@bloombergindustry.com; Kibkabe Araya at karaya@bloombergindustry.com

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