Federal Circuit Affirms Judgment Against Qualcomm, Limits Remedy of Patent Unenforceability
By Aaron Dulles – Edited By Stephanie Weiner
Qualcomm Inc. v. Broadcom Corp., Federal Circuit, December 1, 2008, No. 2007-1545 & 2008-1162
On December 1, 2008, the Federal Circuit affirmed in part the District Court for the Southern District of California, no. 05-CV-1958, holding that Qualcomm breached its duty to disclose relevant video-compression technology patents during its participation in a standards-setting organization (“SSO”). However the Federal Circuit limited the scope of the remedy; rather than make the patent unenforceable against the world, the court held the patent unenforceable only against products compliant with the standard created by the SSO.
The judgment arises from a patent infringement suit brought against Broadcom in which Qualcomm asserted two patents concerning video compression technology. After a concealment effort that resulted in sanctions for litigation misconduct, it came to light that Qualcomm had participated in an SSO called the Joint Video Team (“JVT”) that was responsible for creating a video compression standard known as H.264. The H.264 standard was intended to be achievable at a baseline by anyone without requiring them to pay royalties. The court found that Qualcomm was required to disclose to the members of JVT any patents it held covering technology that “reasonably might be necessary” to practice the standard. Qualcomm was held to have waived its rights to the two patents by not disclosing those patents to JVT.
The case provides some clarity in a previously murky area: The Wall Street Journal Law Blog notes that this case clarifies the court’s willingness to find a duty to disclose in the SSO context, while Zusha Ellinson of The Recorder observes that it also clarifies the penalties for failing to disclose. The case is also being held up as a demonstration of the disastrous results of withholding evidence. (more…)