Android patent case faces verdict

For two years, Apple has told the world that phones running on Google's Android operating system are iPhone rip-offs. Now Apple is about to learn whether a US trade agency thinks its claims have merit. The International Trade Commission (ITC) is set to rule today in a patent complaint lodged by Apple against rival smartphone maker HTC Corp. The decision would mark the first final verdict from any judicial entity in Apple's global patent war against HTC and fellow Android-phone makers Samsung Electronics and Motorola Mobility Holdings. A ruling for Apple may lead to a ban on US imports of HTC devices, derailing the Taoyuan, Taiwan-based company's trajectory from a small contract manufacturer founded in 1997 to the biggest US smartphone seller in the third quarter. A victory for HTC may help it secure favourable terms in any settlement with Apple. "In the past two years, HTC has emerged essentially from obscurity by promoting their own brand and high-end phones, and they've largely been able to do this by leveraging Android," said Alex Spektor, an analyst with Strategy Analytics Inc. Article continues below HTC generated about $5 billion (Dh18.3 billion) in US sales last year, according to a separate patent complaint it filed at the trade agency against Cupertino, California-based Apple. That's more than half of HTC's $9.1 billion in global 2010 sales. HTC sold 24 per cent of the smartphones in the US during the third quarter, ahead of Samsung's 21 per cent and Apple's 20 per cent, Canalys reported October 31. The Android platform accounts for almost 70 per cent of the US smartphone market, the Palo Alto, California-based researcher said. There were 120.4 million smartphones worldwide in the third quarter, a 49 per cent jump from the year-ago period, Canalys said. Ripp-off HTC's Android phones, introduced in 2008, infuriated Steve Jobs, according to Walter Isaacson's biography of the late Apple founder. Jobs made it his mission "to destroy Android," which he said "ripped off the iPhone, wholesale," according to the book. Apple contends that HTC's Android phones in fringe four Apple patents, including one for a system to detect telephone numbers in emails so they can be stored in directories or called without dialing the numbers. The commission is reviewing an agency judge's findings that HTC infringed that patent and one covering the transmission of multiple types of data, along with two other Apple patents that the judge said weren't infringed. The case is one of about a dozen before the commission related to the dispute over Android devices. Microsoft is fighting with Motorola Mobility and Barnes & Noble, while Apple has legal fights with HTC, Samsung and Motorola Mobility. An Apple victory would mark the second setback for HTC in two weeks at the agency. On November 21, the commission rejected an agency judge's findings that Apple was violating the patent rights of HTC's S3 Graphics unit. HTC agreed to buy S3 Graphics for $300 million in July after the judge said Apple was infringing two S3 Graphics patents for video compression. Independent The commission is an independent agency set up to protect US markets from unfair trade practices. It has the power to block imports of products found to infringe intellectual property rights. HTC has said it has "alternative solutions in place" to work around the patents if a violation is found.