As you may have read or heard, a patent-holder by the name of Lodsys has sent cease-and-desist letters to several iOS developers claiming that they are infringing on a patent held by Lodsys.

Lodsuck Logo

The claim by Lodsys is that iOS developers who utilize In-app purchases are infringing upon Lodsys’s patent by offering in-app purchases. The reasoning that Lodsys is giving is iOS developers are using a two-way local interaction that allows a user to communicate with a central server which can then process a transaction.

Apple has sent out a letter to Lodsys that states that because Apple is fully licensed, which is not disputed by Lodsys and is even emphasized on Lodsys’s Blog, that Apple is licensing the technology to iOS developers.

The second major point by Apple is that Lodsys is invoking patent law to control the post-sale use of its patents by Apple. Apple has stated that Lodsys’s claims are actually barred by the doctrines of patent exhaustion and first sale. This means that after first-sale Lodsys can no longer tell Apple how it is allowed to use the patents that it has licensed.

The U.S. Supreme Court has also issued a ruling, which Apple references, back in 2008. The excerpt that Apple quotes is:

“[t]he authorized sale of an article that substantially embodies a patent exhausts the patent holder’s rights and prevents the patent holder from invoking patent law to control postsale use of the article.” Quanta Computer, Inc. v. LG Elecs., Inc., 553 U.S. 617 (2008).

The points that Apple is arguing do all make sense. If it is true that Apple’s license with Lodsys does cover iOS developers then it would behoove Lodsys to withdraw their cease-and-desist letters rather quickly since I do not believe that Lodsys has the wherewithal to fight against the Apple cash-hoard.

We will see if Lodsys decides to take this fight with Apple to the courts or not. I believe Lodsys will be wise and decide to not be out-sued.



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