In 2009, the ITC ordered a ban on chips made by Qualcomm, STMicroelectronics, Advanced Micro Devices (AMD), and Motorola (MOT), among others. The commission said the companies were selling chips with packaging that violated patents held by Tessera, a San Jose-based semiconductor material company. Qualcomm and the other companies have appealed the decision.
Though the ITC was conceived in part to protect U.S. manufacturers from the import of cheaper, inferior products, foreign companies are increasingly willing to use it to wage patent disputes against U.S. companies, Chien says. Espoo (Finland)-based Nokia in December complained against Apple at the ITC, alleging patent infringement. The ITC agreed to investigate the claims on Feb. 25. Apple filed a countercomplaint on Jan. 15.
Settlement likely
Apple's complaints are the latest in a string of cases before the ITC involving smartphones. On Feb. 19, the same day the commission agreed to investigate Apple's complaint against Nokia, it also agreed to investigate a complaint against BlackBerry maker Research In Motion brought by Motorola, the Schaumburg (Ill.)-based maker of mobile phones. RIM and Apple have also been sued at the ITC by camera giant Eastman Kodak, which alleged that both make phones with built-in cameras that infringe some Kodak patents.
About 90% of cases brought before the ITC are resolved by a settlement, Chien says. Apple may genuinely be looking to win an import ban against HTC, she says. Still, even where an import ban is issued, cases often end in a settlement, says Ezra Gottheil, analyst at Technology Business Research in Hampton, N.H. "No one will be prevented from importing their phones into the country," he says. "It's just a matter of how much money flows to which party for the rights they end up swapping."
In other cases, ITC decisions may be overturned. In 2007, the ITC ordered a ban on the import of chips made by Qualcomm found to have infringed patents owned by Broadcom. Qualcomm appealed, and a U.S. court of appeals vacated the ruling on procedural grounds in October 2008. Qualcomm ultimately resolved the dispute with an $891 million global settlement in April 2009.
With reporting by Susan Decker in Washington. Hesseldahl is a technology writer for Bloomberg BusinessWeek.
