Apple, Google, Apotex, Microsoft, Kodak, RIM: Intellectual Property

Apple Inc. (AAPL), Google Inc. and other smartphone technology companies may face tougher European Union restrictions on the way they handle user-location data after data privacy watchdogs said the information is private.

Information that could betray the location of devices such as Apple’s iPhones and phones running Google’s Android software must be treated as personal, requiring companies to comply with European Union data protection law, EU privacy officials said in a nonbinding opinion that was published yesterday.

Users must be given “clear, comprehensive” and understandable information about how, why and for how long their data is processed, the so-called Article 29 Data Protection Working Party said in the opinion. Technology firms can use location data to deliver targeted advertising and help customers find nearby businesses.

Data protection officials in Europe, including Germany and France, are investigating recent reports on the collection and storage of location data on Apple’s iPhones. Apple and Google last week defended their handling of user location before U.S. lawmakers.

The opinion, dated May 16, said information collected through the combination of a Wi-Fi access point with a mobile device’s location is also personal data, and subject to EU privacy rules.

“We have seen the Working Party’s paper and we are reviewing it closely,” Al Verney, a spokesman for Mountain View, California-based Google, said by telephone. “It’s worth remembering that Google can’t identify anyone using Wi-Fi header information, nor would we want to,” Verney said.

Apple spokesman Alan Hely didn’t immediately respond to a phone call and an e-mail seeking comment. Apple has said in statements it is “not tracking the location of your iPhone” and “has no plans to ever do so.”

While the opinion is nonbinding, it “confirms the position of the regulators that are going to be policing compliance,” Ustaran said. “It could potentially lead to sanctions particularly if any infringements are seen to have an impact on people’s privacy.”

Apple, Google, Microsoft Queried by U.S. Senator Over Privacy

Senator Richard Blumenthal asked Apple Inc., Google Inc. and Microsoft Corp. (MSFT) for information about the companies’ collection of data from private wireless networks to create maps of Wi-Fi service, saying the practice raises privacy concerns.

Blumenthal, a Connecticut Democrat who serves on the Senate Judiciary Committee, made the request in a letter to the companies that was released yesterday by his office in Washington. The letter also was sent to BlackBerry maker Research In Motion Ltd., handset manufacturer Nokia Oyj (NOK1V) and Skyhook, a provider of wireless phone location services.

“Attempting to document the locations of personal wireless networks in individuals’ homes without their knowledge or consent raises issues what constitutes a reasonable expectation of privacy for an ordinary citizen,” Blumenthal said in the letter.

Google Rejects Skyhook’s Allegations Over Phone-Location Service

Google Inc. (GOOG) rejected allegations that it undermined plans by Samsung Electronics Co. and the former Motorola Inc. (MOT) to use a competing location-finding service on Android-based mobile phones.

Skyhook Wireless Inc., a closely held software company in Boston, claimed in a September lawsuit that Motorola and Samsung were willing to pay for its service until Google threatened to cut off the phonemakers’ access to third-party applications in the Android Market. Motorola and Samsung rely on Google’s Android operating system for some of their devices.

Google said it did nothing improper with regard to any contracts Skyhook had with the phonemakers, according to a May 13 filing in response to the lawsuit in Suffolk County, Massachusetts, Superior Court in Boston. The service, a software system that uses Wi-Fi positions, GPS and cell-tower triangulation to pinpoint a phone’s location, is used by advertisers and businesses to target potential customers.

“To the extent Google took any action that affected Skyhook, those actions were the lawful exercise of legitimate rights of Google and therefore are not actionable,” Mountain View, California-based Google said in the filing. “If Skyhook suffered any damages, which is denied, then any such damages resulted solely from its own acts or omissions.”

In a separate complaint in federal court in Boston, Skyhook has claimed that Google infringed four of its patents related to ways to establish the precise location of a smartphone. Google has denied infringing the patents, and said in court filings that the patents are invalid.

The state case is Skyhook Wireless Inc. v. Google Inc., 2010-3652, Massachusetts Superior Court, Suffolk County (Boston). The patent case is Skyhook Wireless v. Google Inc., 10cv11571, U.S. District Court for the District of Massachusetts (Boston).

Patent

Genentech Sues Apotex Claiming Valcyte Patent Infringement

Roche Holding AG (ROG)’s Genentech unit sued Apotex Inc. for planning to sell a generic version of Valcyte, which treats a virus that afflicts transplant patients and people with AIDS, before Genentech’s patent for the drug expires.

Apotex, based in Toronto, told Genentech on April 6 that it had applied for approval from the U.S. Food and Drug Administration to make a generic of Valcyte, according to the complaint filed May 17 in federal court in San Francisco.

Genentech, based in South San Francisco, California, said the plan to market the generic will cause “massive infringement” of its patent covering the drug. Genentech seeks a court order declaring that the Apotex generic is a patent- infringing drug, blocking the FDA from approving it until Genentech’s patent expires in 2015 and barring Apotex from engaging in commercial activity that would infringe the Genentech patent.

Genentech last month filed a suit based on similar claims against Sandoz Inc., a unit of Basel, Switzerland-based Novartis AG. (NOVN)

Roche has sued other drug manufacturers over generic copies of Valcyte. The company settled a lawsuit with Ranbaxy Laboratories Ltd. last year with Ranbaxy agreeing to sell its generic copy of Valcyte in 2013, two years before a patent expires, Basel-based Roche said in an August statement.

Elie Betito, an Apotex spokesman, said the company hadn’t reviewed the complaint and had no immediate comment.

The case is Genentech Inc. v. Apotex Inc., 11-2410, U.S. District Court, Northern District of California (San Francisco).

ITC Staff Issues Favorable Patent Recommendations for Kodak

The staff of the U.S. International Trade Commission has sided with Eastman Kodak Co. (EK) in its patent dispute with Research In Motion Ltd. (RIM) and Apple Inc. The staff found that RIM and Apple have infringed a Kodak patent on a way to preview digital images using less processing power and storage space. The recommendations, originally filed last month, were made public May 17. The six-member commission is scheduled to release its decision June 23.

Kodak, based in Rochester, New York, is “looking forward to the full ITC’s decision,” David Lanzillo, a company spokesman, said by e-mail. Kristin Huguet, a spokeswoman for Cupertino, California-based Apple, and Marisa Conway, a spokeswoman for Waterloo, Ontario-based RIM, didn’t immediately reply to e-mails and telephone calls seeking comment.

The staff recommended that the ITC issue an order barring imports of Apple’s iPhone and RIM’s Blackberry, saying the public interest and competition in the marketplace wouldn’t be harmed.

The ITC is a quasi-judicial arbiter of trade disputes. While the agency can’t order monetary damages, the threat of being shut out of the U.S. market often provides the incentive for settlements. The agency doesn’t always follow the recommendations of its staff, which acts as a third party in ITC cases.

The patent in dispute covers a feature that previews low- resolution versions of a moving image while recording still images at a high resolution. Higher resolution requires more processing power and storage space. Kodak, which generated $838 million from patents last year, contends the image-preview feature is used in every digital camera and phone with a camera.

On May 13, in a separate case, a U.S. International Trade Commission judge said Kodak’s digital-camera technology doesn’t violate Apple Inc.’s patent rights. The judge’s findings are subject to review by the six-member ITC, which has the power to block imports of products that infringe U.S. patents.

The case is In the Matter of Certain Mobile Telephones and Wireless Communication Devices Featuring Digital Cameras, and Components Thereof, 337-703, U.S. International Trade Commission (Washington).

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Trademark

Disney Defeats Trademark Suit Over ‘Little Miss’ T-Shirts

Walt Disney Co. won dismissal of a lawsuit alleging that the entertainment company’s sales of t-shirts bearing the logo “Little Miss” infringed trademarks held by London-based THOIP.

THOIP received the rights to the Mr. Men and Little Miss marks, books and characters in 2004 from the family of children’s author Roger Hargreaves, according to the complaint filed in 2008 in Manhattan federal court. Hargreaves created the characters in 1971 and died in 1988.

U.S. District Judge Shira Scheindlin said in a ruling issued May 17 that she had previously found in favor of Disney and had allowed the two sides to submit additional evidence to determine if there was any product confusion.

The judge said that after further review, she stood by her earlier ruling that there was “virtually no chance that a consumer seeing an allegedly infringing ‘Miss Disney shirt’ or ‘Little Miss Disney shirt’ would think it came from, was affiliated with or was approved by THOIP.”

The case is THOIP v. Walt Disney Co., 1:08-cv-06823, U.S. District Court, Southern District of New York (Manhattan).

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Copyright

U.K. Looks at Loosening Copyright Laws to Boost Creative Jobs

U.K. Business Secretary Vince Cable welcomed proposals to loosen copyright laws, saying they’d help creative industries grow by making it easier to use material.

A report yesterday by Ian Hargreaves, an academic at Cardiff Business School, recommended the government set up a Digital Copyright Exchange, where licenses to use material could be traded, and make it easier to use “orphan works,” whose authors can’t be traced.

Cable also welcomed proposals to make it legal to copy for private purposes, including ripping music from compact discs, something currently forbidden in the U.K.

“Such format-shifting is unlawful, though the music industry has made it clear that it does not intend to act against consumers who do it,” Cable said in a speech in London yesterday. “So the consequence of the ban on format-shifting is simply to make it harder for a British entrepreneur to compete with technology developed in the U.S. and other countries where there’s no such ban.”

For more copyright news, click here.

To contact the reporter on this story: Ellen Rosen in New York at erosen14@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net