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Fri, Mar 19, 2010 - 10:59 PM EDT  —  AAPL: 222.2499 (-2.4001, -1.07%)  |  NASDAQ: 2374.41 (-16.87, -0.71%)

Analyst: Apple has no legal ground to stand on with Multi-Touch™ patent
Monday, February 02, 2009 - 04:39 PM EDT

"A couple of weeks ago I posted a blog about the challenges Apple might face in what appeared to be a threatened legal battle with Palm and its new Pre touch screen smart phone. Or any other comers that Apple deemed as 'ripping off' its intellectual property, as Chief Operating Officer Tim Cook put it on the company's earnings call recently," Jim Goldman reports for CNBC.

"This morning, wireless analyst Pablo Perez-Fernandez of Global Crown Capital is out with the most detailed note yet as to just how difficult — and financially dangerous — Apple's battle could be, if it decides to go after Palm," Goldman reports.

"His report this morning says that if Apple goes after Palm, it could also wage patent war against HTC, Garmin and Research in Motion since all of them use some form of the 'multi-touch' interface, specifically the 'pinching' motion to control images on the screen," Goldman reports. "However, Perez-Fernandez points out that the US Patent Office may have erred in its awarding of the Apple patent, that the firm's research indicates that Apple's own patents, indeed its technology, may be in violation of a patent already awarded to the University of Delaware, and that if Apple proceeds with threatened litigation, it may end up with no protections of any kind when it comes to the multi-touch interface for both iPod and iPhone."

Goldman reports that Perez-Fernandez says, "'They are also trying to pre-empt Microsoft's use of multi-touch in Windows 7 and they are trying to trademark multi-touch, which is ridiculous since the term has been used openly for a long time.'"

MacDailyNews Take: Apple's not "trying" to do anything: Multi-Touch™ is a trademark of Apple Inc. - May 29, 2008

Goldman reports, "Perez-Fernandez argues that Apple has no legal ground to stand on, and while the sabre-rattling might be rattling some competitor stocks, if Apple were to move forward with any litigation based on this, it could prove more threatening to itself than to any of its rivals."

Full article here.

MacDailyNews Take: Since when are Global Crown Capital analysts expert patent attorneys? Ask Dr. Fernández a math question instead; according to his bio, he holds "a bachelor's degree in pure Mathematics from Yale University and a Ph.D. in Applied Mathematics from the University of California in Los Angeles." Try this one: ($28.145 billion in cash on hand - $0 debt) - ($224 million in cash on hand - $396 million in debt) = ?

Now, go to the next random brokerage house, Jim, and find some other "analyst" who'll tell you Apple has a slam dunk case and write that one up, too, okay? We'd rather wait to see what actually happens and report on that instead.

Oh, by the way: "FingerWorks was a gesture recognition company based in the United States, known mainly for its TouchStream multitouch keyboard. Founded by John Elias and Wayne Westerman of the University of Delaware in 1998, it produced a line of multi-touch products including the iGesture Pad and the TouchStream keyboard. Its assets were acquired by Apple Inc. in early 2005, and its product lines were discontinued." - Wikipedia

Finally, how about some disclosure? It would be nice, not to mention helpful, to know if Pablo Perez-Fernandez's and Global Crown Capital's holdings involve any of the companies being discussed.

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Feb 02, 09 - 05:50 pm Comment from: caddisfly

"no legal ground to stand on"....

well, there is a patent granted by the US Patent Office which has the sole authority to grant patents...IMHO, that seems like at least a prima facie legal ground to stand on...

Feb 02, 09 - 05:54 pm Comment from: Splat

the outcome is usually directly related to how much you pay your legal team, to either buy the pot or stall to infinity. Apple has lots of chips to waste on this one and could buy the pot. Maybe Apple should just buy Palm and save time.

Feb 02, 09 - 06:03 pm Comment from: Pharfer

What's with Jim G lately? He's so down on Apple all of the sudden... Did he get his feelings hurt with the whole "my sources confirm that Steve Jobs' health is okay" article a month ago? If so, he should be pissed at his "sources"... I guess he is no different that all of the other click-whores out there in internet-news-land...

Feb 02, 09 - 06:03 pm Comment from: Rike

Perhaps Apple should just let Palm go out of business on its own. It will happen eventually.

Feb 02, 09 - 06:05 pm Comment from: Gregg Thurman

Sounds like an analysis commissioned by Apple's competitors. Think about it. When was the last time an analyst got the simple stuff correct? Now think of the resources this analyst would have had to expend to come up with this analysis of Apple's legal prospects. I'm sorry but analysts just aren't that bright.

This smacks of a highly assisted "analysis", with the assistance coming from MSFT, RIMM and/or PALM, among others. It's their way of returning Apple's shot across the bow, without it looking like imminent warfare.

If the University of Delaware's prior patents have any value, I could see either Apple, or one of its competitors trying to acquire it. That they haven't speaks volumes.

Feb 02, 09 - 06:13 pm Comment from: dallas

Why is it so hard for pundents to understand that the Nuclear option is rarely used in Patent cases? Typically, the two companies strike a deal that ends up in a mutually beneficial compromise.

Feb 02, 09 - 06:21 pm Comment from: Demon

The devil is in the Patents that Apple has applied for that have yet to become awarded and public.
One patent in this case is not the be all end all. It's going to be a Multi-Patent violation approach.

Feb 02, 09 - 06:22 pm Comment from: Mac-nugget

This is the stupidest analysis ever. So Apple would risk losing the protection of this patent if it tries to enforce it. So then, Mr. Fernandez, what good is having a condom if you are not going to use it? Having it in your pocket will not to crap.

Feb 02, 09 - 06:25 pm Comment from: HMCIV

That's nothing. I hold a degree in Adulterated Mathematics from Princeton. (Catholic mathematicians have all the fun! grin )

Feb 02, 09 - 06:25 pm Comment from: Demon

Financial Asshats are not Patent Attorneys. And, even patent Attorneys are only guessing before a case is filed. So I say Asshats off and stop speculating when there is nothing to speculate on yet.

Feb 02, 09 - 06:46 pm Comment from: Lurker

I seem to recall the Fingerworks guys were some how tied to the University of Delaware. Maybe there's a connection there somehow and Apple may already own those patents.

Feb 02, 09 - 06:47 pm Comment from: Passerby

This analyst and/or this reporter may be right. But, in the last few years, analysts and tech journalists have pissed away any credibility they once had. Getting information and analysis from the professionals these days is on par with asking the pimply 12-year-old down the street.

If you have to make decisions based on this information, there are no more shortcuts. You have to do the research and analysis yourself, which is what you should have been doing all along.

Feb 02, 09 - 06:55 pm Comment from: Can't blame a fruit for trying!

MacDailyNews Take: Apple's not "trying" to do anything: Multi-Touch™ is a trademark of Apple Inc. - May 29, 2008

Dear MDN, if you check the links you provide, you will see that the trademark has not yet been granted.
But Apple is still trying, the latest amendment to the so far unsuccessful application by Apple was 12-Jan-2009.

Feb 02, 09 - 06:55 pm Comment from: Jo Jo the Dancer

Go Apple.

I'm all for competition, when it's legit

Feb 02, 09 - 07:00 pm Comment from: El Rocco

If you look carefully at the wikipedia description of FingerWorks, you'll notice that the IP that was developed at the University of Delaware was bought by Apple when they acquired FingerWorks...

FingerWorks on Wikipedia

Feb 02, 09 - 07:05 pm Comment from: Mr. Trademark™

@Can't blame a fruit for trying!

The first link MDN provides is:
http://www.apple.com/legal/trademark/appletmlist.html

What part of it don't you understand?

Feb 02, 09 - 07:18 pm Comment from: Missy Pants

Interesting.
Just this morning, the analyst I contacted stated that Apple seems to have an air-tight case against anyone trying to infringe on Apple's patents.

Disclosure:
My analyst, Dr. Wolfie, is an expert in sensory studies, specialising in olfactory and auditory extremes.
Dr. Wolfie has associated extensively with Dr. Ballard, of the acclaimed animal nutrition research institute.

Dr. Wofie happens to be my Labrador Retriever, and I consider her to be at least as much of an expert on patent law as Dr. Pablo Perez-Fernandez appears to be.

One big difference between Dr. Wolfie and Dr. Perez-Fernandez, is that Dr. Wolfie never partakes in the practice of attempting stock manipulation, through uninformed, yet disparaging stories, disguised as expert commentary.

Woof.

Feb 02, 09 - 07:18 pm Comment from: edward

I don't see have any problem because what apple submitted for patent was very particular way of multi touch, including gestures. so if other companies try to do, they have to make different way of approaching multi touch technology. apple's multi touch is not only one existed in the world. there are few other companies use multi touch tech in different way. only matter is that apple's one is very efficient, working very well, and simple.

Feb 02, 09 - 07:23 pm Comment from: alansky

"Maybe Apple should just buy Palm and save time." —Splat

Buy Palm and haul it to the dump to put it out of its misery!

Feb 02, 09 - 07:24 pm Comment from: Olmecmystic

@Lurker:

Ding! Ding! Ding! Ding! Ding!

You get a gold star for the day. Apple bought up Fingerworks in 02/05 I believe, and Fingerworks then consisted of two University of Delaware professors who had developed the technology we see in use nowadays in the iPhone and the iPod Touch, as well as the Macbook trackpads.

When Apple buys you, they make sure the purchase includes all intellectual property rights, like they did with PA Semi, like they did when they bought Coverflow. Apple is not going to do ANYthing that will threaten their ownership of multi-touch, but they are also not going to allow anyone else to, either.

They went through that when Sculley threw Jobs out in 1985 and subsequently "negotiated" away the keys to the kingdom to M$ and Bill Gates, namely the original Mac OS.

This clown doesn't know WTF he's talking about, and is probably getting compensated very well for the "privilege". Ignore him.

Peace.
Olmecmystic cool smile

Feb 02, 09 - 07:29 pm Comment from: alansky

Getting information and analysis from the professionals these days is on par with asking the pimply 12-year-old down the street. —passerby

That's because nowadays the so-called "professional" often IS the pimply-faced 12-year-old down the street! In the age of the internet, anyone who can type and has an internet connection can masquerade as a "professional". The more hits they get, the faster their credibility rises, even if what you are writing is pure unadulterated crap. Evidently most people wouldn't know truth from fiction if it slapped them in the face.

Feb 02, 09 - 07:40 pm Comment from: Can't blame a fruit for trying!

@Mr. Trademark
"What part of it don't you understand?"

I did not understand this part:
http://tarr.uspto.gov/servlet/tarr?regser=serial&entry=77219819
Current Status: Applicant's response to a non-FINAL office action has been entered in application.
Registration Date: (DATE NOT AVAILABLE)

For registered trademarks, the Current Status should read:
Registered and the Registration Date should be indicated.

But, if Apple says "it's registered and any discrepancy is due to easily treatable hormonal imbalance", I will believe them and not the United States Patent and Trademark Office.

Feb 02, 09 - 08:02 pm Comment from: MacTony

These idiot Analysts can't even do their own jobs! Now, they have all of sudden, become patent experts. In their (pseudo) expert opinion, Apple's patents on the iPhone are invalid. Apple with lots of money in the bank and Palm with..... less than no money in the bank. All Apple has to do is stop the Pre for a extended period and Palm is no more . wink

Feb 02, 09 - 08:34 pm Comment from: breeze

It's only the idiots who lend any credence to anything these idiot anal-ists write that keep them in business.

It's amazing to me how these geniuses and investment bankers that caused the economic meltdown by not being truthful, knowledgeable, or having a clue, still have anyone reading let alone relating to the shit they spew. Now they also think they know the law...Patent law, of all things...Since when is Perez-Fernandez a lawyer or even have a clue about law and the process of granting a patent??? Not in a million years, the day bloggers get to mess with that area will never come - Forget it !!! Apple knows exactly where it stands legally and so do it's lawyers. Count on it. When Jobs says "boy do we have it patented"... he isn't just posturing. Does anyone doubt Apple's substance?

Feb 02, 09 - 08:35 pm Comment from: this is my real name

This analyst has no clue what he's talking about. Of course, I've yet to see a single article by anyone who appears to have actually read the patent.

Apple was NOT awarded an all-encompassing patent on multi-touch. In fact, the patent has nothing to do with multi-touch whatsoever, though it does extend to that. Not that the it isn't important. What's been patented is the ability for a device with a touch screen to figure out on its own what a user wants to do **when multiple options are available**; i.e., enlarge a picture, scroll around it, or flip to the next one. It's something that's very specific and which, if it holds up in court, puts a serious limit on the capabilities of other touch screen devices. It's the iPhone's scroll-wheel, as it were. Without this ability, other devices will still be able to do all the individual things the iPhone can do, but they'll have to come up with clunky widgets or obscure gestures to do them.

Feb 02, 09 - 09:18 pm Comment from: mac11

What is going on with this good news site?
I had to register here in order throw some balance to the opinion specrum. Stop mindlessly badgering the 'other' company in every article. For ages I tried to throw my opinion on Apple's side because I recognized a company with real design and engineering talent that deserved more credit that was getting. But it is now time to cool it a bit with this fanboyism. Mac users are getting a little bit complacent, and too aggressive, taking comfort in the growing numbers.

Case in point with the latest patent arguments. So many talk about Apple being ready to hammer Palm with its newfound strength in multi-touch patent. Are we so sure Apple has an upper hand in the patent battle with Palm? I am not so sure about that. Please try to read the recent Engadget coverage on this issue covering some of the patents won by Apple and Palm. From what I gather the two companies each have their hand in others' throats for breaching each others' patents. For example, 'Airplane Mode' in iPhone is actually patented by Palm years ago. If Apple were to sue Palm for some infringement, then Palm can counter-sue Apple for same reasons. Palm just may demand immediate halt to iPhone sales due damage. That is not a pretty scenario. Stalemate that could seriously effect iPhone sales is the conclusion I see. Palm could go down in legal wrangle but I would hate to see people's opinions shift against Apple in the future. Palm Pre in all fairness is the first mobile phone that I think will compete with iPhone successfully, and even make it look old - for the first time in a long while. Hey, it happens. Competition is good. Just see what happened with Apple and Adobe. Suddenly they are pals re 'flash on iPhone'. You see.. consumers win with competition.

mac11

Feb 02, 09 - 09:29 pm Comment from: freebeer

Ah, another case of analyst - "I've got nothin'!" - just to generate some news - anything to use the Apple buzz word. What is always interesting is what Cupertino does not reveal. Loud words about patents and lawsuits are nice distractions and swell the heads of Palm execs and shareholder, but 6 months from now, would anyone be surprised if Apple up the ante to another level with more new products and innovation? The real serious question for Palm is - does anyone see developers drop Android or the effort to hack iPhone and switch to Palm's new OS?

Feb 02, 09 - 09:41 pm Comment from: coops

No offense but nothing palm makes is going to compete with apple at this time. It's more then just the device it's the all in one platform. Many people buy iphones to replace ipods etc. Palm has none of that. A few nerds will buy them, but that's about it. We have seen and heard the new challenger for two years now. They never pan out.

Feb 02, 09 - 10:05 pm Comment from: Peter

Also, consider that a trade-mark is just a name.

Obvious example: I cannot create a machine which makes copies of documents and call it a "Xerox machine." But I can call it a "Photocopier."

So, you're right. Palm cannot refer to pinching an image as "Multi-touch." So they'll call it a "Multi-finger interface" instead. *Doink* Problem solved for Palm.

Now whether or not Apple can actually patent the act of pinching to denote zoom out or something like that? That's going to be the question. Again, Apple tried this with the original Mac OS, patenting menus and such. I'm pretty sure when Apple tried to sue Microsoft over it's use, Microsoft basically waved the agreement and the court looked at that rather than at the legal questions of whether Apple actually could patent pull-down menus and icons.

Feb 02, 09 - 10:10 pm Comment from: Peter

"Ask Dr. Fernández a math question instead; according to his bio, he holds 'a bachelor's degree in pure Mathematics from Yale University and a Ph.D. in Applied Mathematics from the University of California in Los Angeles.'"

I suppose it's no more stupid than a Mechanical Engineer writing a report fro ACS about second-hand smoke.

Feb 02, 09 - 10:43 pm Comment from: iluvitwhenubitchslap

Excellent commentary as usual.

Feb 02, 09 - 10:53 pm Comment from: R2

People are focusing too much on that one patent. I think there's a slew of them waiting to be granted and Apple is just beginning to build up their multi-touch patent portfolio. Couple them with those now in their possession after the acquisition of FingerWorks and Apple clearly has the upper hand.

Feb 03, 09 - 12:02 am Comment from: Buster

@Missy Pants

Good one!

Feb 03, 09 - 12:07 am Comment from: ElectroTech

I hold a patent myself and according to my attorney, a patent can be challenged on many grounds including prior patent art or an obvious extension of existing patent teachings or can be just outright out spend the infringer or holder.

This case is no slam dunk and I can't stand all these pundits who think they can foretell the mind of a judge (or even a medical specialist or worse yet, the mind of God Himself [I don't mean Steve Jobs])

Feb 03, 09 - 12:14 am Comment from: Wal

Why don't we shutdown the patent office!?

Since according to all these uncertainties about its patents affirmation questioned above, what's the use of the patent office besides the 2 polarized situations as resulted: 1) to discourage truly innovative companies from creating good things and 2) to encourage those business opportunists to copy others and create compromised products. Just shut it down.

God blessed the USA amid the fast-developing countries around, and all those people in this global village who already compromised their living integrity.

The analytical ways of understanding something is good, but sometimes, you need to ask you heart to really know what's truly 'good'.

Feb 03, 09 - 12:17 am Comment from: To: mac11

Hey, you don't need to register in order to post your comments here. Sharpen your sense dude!

Feb 03, 09 - 12:19 am Comment from: NewtonsApple

How come Palm announces they too have "apps" and boast they can run more than one at a time, when they are actually web apps, and nobody cares? When Apple did that with the iPhone, they got crucified for going that route initially. The iPhone can run multiple (web) apps as well- one on each page in Safari. How come no one has highlighted this? The Pre doesn't run TRUE apps.

Feb 03, 09 - 12:27 am Comment from: Palm Pre is the best!

Rumors are suggesting that Palm has finally created a mobile OS that is so sophisticated that it is more advanced than the MacOSX powered iPhone, let alone those crappy Windows Mobile, Android and Blackberry phones.

Palm Pre is the best! It is an iPhone killer, and indeed it is the most advanced and innovative products of the century.

Feb 03, 09 - 12:56 am Comment from: Brau

It's a good thing Apple didn't cover the iPhone in "Corinthian Leather" or they'd be sued to death by Ricardo Montalban and Chrysler.

Feb 03, 09 - 01:33 am Comment from: Jubei

@Palm Pre is the best

Yep your right "PP is the best". Enjoy yourself.

Feb 03, 09 - 04:21 am Comment from: Passerby

@this is my real name,

First time through, I read your last line as, "Without this ability, other devices will still be able to do all the individual things the iPhone can do, but they'll have to come up with clunky widgets or obscene gestures to do them."

…That works, too. wink

Feb 03, 09 - 05:47 am Comment from: Intruder

@Mac11

So Palm has patented the ability to turn off the wireless transmissions of a phone ("airplane mode")? I'm sure that will come as a surprise to RIM and Microsoft. And Symbian. And Google.

Feb 03, 09 - 10:05 am Comment from: MacFhearghaile

@Brau
Mr. Montalban is dead, and Chrysler will be soon, however Lawyers don't worry about the small details they just sue.

Feb 03, 09 - 01:21 pm Comment from: spyinthesky

Peter the reason that MS was able to adopt the Mac like graphical user interface and get away with it was because Apple under Sculley agreed to them using it and then tried to claim it was only for early versions of Windows. Fundamentally all the Court did was to find that the agreements was in perpetuity.

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