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The lawsuit that started the war: Apple had to pay Creative Technology $100 million in 2006 for patent violations


For the past few years, Apple [2] has been in the spotlight for patenting anything and everything, and then using those patents to legally go after the competition. Ever wonder what pushed Apple towards this behavior? Is it because that is just how Apple is or was there a specific turning point that changed Apple? Some may argue that it is simply Apple corporate culture to behave like a bully but there is definitely an event that can be singled out as the one that pushed Apple towards war — Apple’s loss to Creative Technology in 2006.

In 2006, Apple lost a patent-related lawsuit filed by Creative Technology aimed at the iPod. According to the New York Times, it was this lawsuit that spurred Steve Jobs to declare “we’re going to patent it all”, particularly in regards to the iPhone [3]. According to an ex-Apple lawyer, Apple would (does) even file patents for ideas Apple figured they couldn’t patent — because, “if nothing else, it prevents another company from trying to patent the idea”. In other words, preemptive patents.

To ensure Apple was “patent[ing] it all”, Jobs, Apple engineers, and Apple lawyers held monthly “invention disclosure sessions” at which Apple R&D was discussed and the lawyers decided if they could/should apply for patents related to the tech. It is unclear if Apple still holds these sessions.

Apple’s patenting activities have become so frequent that last year was the first year that Apple has spent more money patenting technology than money spent on developing new technology (aka research and development).

Of course Apple, and probably other tech companies including Samsung [4], feels it is completely within its rights to apply for patents. In fact, in the words of an ex-Apple executive, various iPhone features  — such as “slide to unlock” — took a lot of investment, time, and effort to develop and perfect; “other companies shouldn’t be able to steal that — that’s why the patent system exists”.

Not very many people will disagree with the last part of the above statement. The patent system is intended to protect companies, and individuals, from having their innovations stolen. Patents are meant to incentivize companies and individuals to spend time and money to develop new technologies without risk of that tech being stolen by others. However, patents become a joke when companies are granted patents for “technology” such as, drum roll please, rounded corners and rectangles.

[via Cult of Mac [5], image via opensourceway [6]]