After seeking damages and an injunction in Texas federal court, Ericsson is now going the regulatory route with a request to ban pretty much any piece of hardware Samsung sells in the United States. Ericsson’s complaint targets “wireless communication devices, tablet computers, media players, and televisions” and lists products like the Samsung Captivate Glide smartphone and the Galaxy tablet.

As we noted last week, Ericsson is challenging Samsung on radio technology, which spans the entire mobile industry from the lowliest handset to the most powerful cell-site base transceiver station. Though Ericsson is no longer in the handset business, it was one of the key contributors to every generation of handset technology from analog to LTE. It now seems to be using its patent portfolio to hit Samsung where it hurts: device sales.

But Samsung has seen a lot of recent success in its infrastructure business. It’s building Sprint’s LTE network right alongside Ericsson.

If this dispute follows the course of other patent blow-outs between industry titans, Samsung is likely to file a countersuit in court and at the ITC. Big companies like Samsung and Ericsson typically possess hundreds of thousands of patents and use them as strategic weapons against competitors. Typically, the disputes are resolved by cross-licensing or in court but, in recent years, the ITC has become a popular secondary venue because of its power to ban imports and because the body often issues decisions faster than courts.

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According to Ericsson, Samsung entered into a licensing agreement with Ericsson in 2001 for the latter’s 30,000 patents relating to technologies ranging from Wi-Fi to GSM and LTE. They renewed the agreement in 2007, but after failing to reach a third renewal agreement following two years of negotiations, Samsung let the deal expire, Ericsson chief intellectual property officer Kasim Alfalahi said in a phone interview.

Alfalahi said that Ericsson has more than 100 cross-licensing deals with vendors across the industry, all with similar terms it has offered Samsung. Ericsson’s suit, filed today in a U.S. district court in Texas, is demanding THAT Samsung pay licensing fees in arrears and damages for willfully infringing its patents. If Samsung refuses to accept new a cross-licensing agreement, Ericsson wants an injunction against Samsung selling any equipment based on its patents, Alfalahi said.

These kind of licensing dust-ups are part and parcel for the telecom industry, which relies heavily on standards to build global networks. Though no single company controls the standard itself, they do own patents to the individual technologies and techniques that make up the standard. Consequently no vendor can build a phone or design a network without using the intellectual property of multiple competitors.

To prevent a single patent holder or group of holders from mucking up the standard, vendors are supposed to cross-license their intellectual property under Fair, Reasonable And Non-Discriminatory (FRAND) terms. Obviously how FRAND is quantified can vary considerably depending on how each company values its own patents. The result has been a lot of blood spilled over licensing fees, as evidenced by the epic battles between Qualcomm and Broadcom in the last decade. The nastiness of those patent wars have led companies like Apple and Google to buy up the patent portfolios of faded wireless giants like Motorola and Nortel in order to bulwark their intellectual property defenses.

“Our patents give us a right to exclude others, but with open standards we have all committed to license openly,” Alfalahi said. “We feel confident that we have given Samsung an offer we feel is FRAND. We feel any judge is going to see our offer as FRAND.”

Samsung’s fight with Ericsson is different from its battle with Apple because instead of focusing on handset design it revolves around core wireless technologies; in particular, infrastructure, a field in which Samsung was a minor player for most of its history. Samsung, however, has been asserting itself in the networking space in recent years, breaking into both the U.S. and European markets with huge contracts from Sprint and 3 UK. Not only are North America and Europe traditionally Ericsson turf, but Samsung’s recent success means the stakes are higher for both companies. The more equipment Samsung sells, the more of its revenue it has to pay out to its licensors. And Samsung has some big ambitions. It recently made the rather audacious claim it will become the No. 3 infrastructure vendor in the world.

We’ve only heard from Ericsson on this spat, though we’ve reached out to Samsung for comment and will update this post when we hear back. The disagreement is likely much less one-sided than Ericsson makes it appear since these deals are never one-way licensing agreements. Samsung is still a major player in the wireless world and has a huge patent portfolio of its own. That means Ericsson has to license Samsung’s intellectual property as well. Expect to see a counter-suit soon.

Featured image courtesy of Flickr user opensourceway; Gavel image courtesy of Shutterstock user zimmytws.

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Samsung is much more than a phone maker, but its smartphone business has been a growth juggernaut in recent years as its Galaxy line has emerged as the flagship brand for Android phones and the iPhone’s one legitimate challenger in the smartphone wars.

Samsung sold 50.2 million smartphones in the second quarter, nearly doubling Apple’s iPhone sales of 26 million. What’s more, 10 million of Samsung’s sales were of the new Galaxy S III, it’s most direct competitor to the iPhone. Of course, Q2 isn’t the best indicator: iPhone 4S is past its half-life as Apple gears up for a new iPhone launch next month, and the S III is a new device. But 2011 sales showed that Samsung and Apple were evenly matched in 2011.

The danger for Samsung is the long-term repercussions of today’s verdict. If Apple’s patents are held to be valid, Samsung could be forced to redesign its phones and their user interfaces. It’s found a recipe for success in the Galaxy line, but now it may have to change up the ingredients.

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A lower court judge had thrown out the case in 2010 on the grounds that Google was protected by a “safe harbor” law that protects hosting sites from being responsible for infringing content uploaded by third parties.

Studios led by Viacom argue that YouTube and other such rights forfeited that safe harbor protection because they ignored red flags that should have warned them about infringing content.

The YouTube videos are also the subject of a parallel class action suit led by the English Premier League.

Viacom claims it is owed $1 billion dollars as a result of Google showing over 79,000 clips of shows like “John Stewart” and “South Park.”

The appeals court ruling means that the case will go back to Manhattan District Court where a judge will now have to consider the red flag issue in detail.

This means that it could be years before the case is resolved.

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Many internet users in the United States have watched with horror as countries like France and Britain have proposed or instituted so-called “three strikes” laws, which cut off internet access to those accused of repeated acts of copyright infringement. Now the U.S. has its own version of this kind of law, and it is arguably much worse: the Stop Online Piracy Act, introduced in the House this week, would give governments and private corporations unprecedented powers to remove websites from the internet on the flimsiest of grounds, and would force internet service providers to play the role of copyright police.

To recap a bit of history, the Stop Online Piracy Act or SOPA is the House version of a previous bill proposed by the Senate, which was known as the PROTECT-IP Act (a name that was an abbreviation for “Preventing Real Online Threats to Economic Creativity and Theft of Intellectual Property”). That in turn was a rewritten version of a previous proposed bill that was introduced in the Senate last year. Not wanting to be outdone by their Senate colleagues when it comes to really long acronyms, the House version is also known as the E-PARASITE Act, which is short for “Enforcing and Protecting American Rights Against Sites Intent on Theft and Exploitation.”

Copyright holders win, free speech and an open Internet lose

What it really is, however, is a disaster for the internet. As the Electronic Frontier Foundation notes in a post on the proposed legislation, the law would not only require ISPs to remove websites from the global network at the request of the government or the courts (by blocking any requests to the central domain-name system that directs internet traffic), but would also be forced to monitor their users’ behavior in order to police acts of copyright infringement. Providers who do not comply with these requests and requirements would be subject to sanctions. And in many cases, legal hearings would not be required. As Senator Ron Wyden (D-Oregon) said of the PROTECT-IP Act:

At the expense of legitimate commerce, PIPA’s prescription takes an overreaching approach to policing the Internet when a more balanced and targeted approach would be more effective. The collateral damage of this approach is speech, innovation and the very integrity of the Internet.

In effect, the new law would route around many of the protections in the Digital Millennium Copyright Act, including the “safe harbor” provisions (a number of law professors have said that they believe the proposed legislation would be unconstitutional because it is a restraint on freedom of speech). The idea that ISPs and internet users can avoid penalties if they remove content once they have been notified that it is infringing, for example, wouldn’t apply under the new legislation — and anyone who provides tools that allow users to access blacklisted sites would also be subject to penalties.

In addition to using what some are calling the “internet death penalty” of removing infringing websites from the DNS system so they can’t be found, the proposed bill would also allow copyright holders to push for websites and services to be removed from search engine results and to have their supply of advertising cut off — and would require that payment companies like PayPal and ad networks comply with these orders. If you liked what PayPal and others did when they shut off donations to WikiLeaks, you’re going to love the new Stop Online Piracy Act.

Creating a firewall around the internet, just like China

According to Techdirt, which has been a vocal critic of the bill and its predecessors, the new legislation would create a “Great Firewall of America,” similar to the firewall that the Chinese government uses to keep its citizens from accessing certain websites and servers that it deems to be illegal. Techdirt’s Mike Masnick notes that the new bill actually expands the range of websites that could be targeted by the bill: the previous version referred to sites that were “dedicated to infringing activities” with no other obvious purpose, but the new law would allow the government to target any site that has “only limited purpose or use” other than infringement (by the government’s definition).

The bottom line is that if it passes and becomes law, the new act would give the government and copyright holders a giant stick — if not an automatic weapon — with which to pursue websites and services they believe are infringing on their content. With little or no requirement for a court hearing, they could remove websites from the internet and shut down their ability to be found by search engines or to process payments from users. DMCA takedown notices would effectively be replaced by this nuclear option, and innocent websites would have to fight to prove that they deserved to be restored to the internet — a reversal of the traditional American judicial approach of being assumed innocent until proven guilty — at which point any business they had would be destroyed.

That might make for the kind of internet that media and entertainment conglomerates would prefer, but it would clearly be a much diminished version of the internet we take for granted. Opponents of the bill have set up a website to try and convince voters to reject the legislation and tell their congressman not to support it. Embedded below is an interview that Senator Wyden did at the recent Web 2.0 Summit about his views on the PROTECT-IP Act and why it needs to be stopped:

Post and thumbnail photos courtesy of Flickr users Stefan and Kevin Dooley

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The Federal Court of Australia granted Apple’s request for a temporary injunction against the Galaxy Tab 10.1 in Australia on Oct. 13, pending a full trial, which likely won’t take place until 2012. Samsung argued that the injunction would essentially mean that its larger Android tablet was essentially dead in the water in Australia, since it would miss the lucrative holiday buying season.

Samsung immediately signaled its intention to appeal the decision, and on Thursday, the Federal Court in Sydney granted Samsung the right to fast-track its appeal (via the Sydney Morning Herald). While an exact date hasn’t yet been set, the hope on Samsung’s side is that it can get the issue decided quickly, in an effort to overturn the ban ahead of the holiday shopping season.

Samsung initially opposed the fast-tracking of its full Australian hearing in the tablet dispute, owing to the fact that it needed more time to prepare its case, according to its lawyers.

Meanwhile, Apple is wasting no time in making sure its recent victory actually does stop the sale of Samsung’s devices down under. Local retailers have apparently been complying with the injunction order, but online stores haven’t been as eager to take the ruling seriously. Apple is issuing legal threats by letter to some of the offending sites, but the reach of the ruling only goes so far. Companies based in Hong Kong, for example, who wish to sell to Australia might not have to abide by the ruling, depending on how you interpret the letter of the law.

Recent comments made by Steve Jobs in his biography suggest that Apple’s goal (at least under Jobs) was not a cross-licensing agreement or settlement but the ultimate destruction of Android. If that remains the company’s strategy, it’s unlikely that Apple will ignore the issue of online retailers who continue to sell Samsung’s products thanks to legal loopholes.

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During Friday’s proceedings, Samsung revealed (via Bloomberg) that it has approached Apple with a proposal to end the dispute between the two companies regarding touch-screen patents. Apple lawyer Steven Burley informed the court that his employer would need time to review and consider the offer. During proceedings Thursday, Samsung told the court it would withdraw its use of accidental touch detection tech from the Galaxy Tab 10.1, and it has also withdrawn another feature related to Apple’s zoom technology. Only one touch-screen patent remains in contention at this stage.

Samsung has voluntarily agreed not to sell the Galaxy Tab 10.1 in Australia until a formal decision is reached about this proposed injunction, and Thursday, Justice Bennett told both parties she hoped to reach a decision by next week. Both sides may have to wait a little longer, however, as the judge said on Friday she couldn’t guarantee a decision date, but would “try to get it out as soon as possible.” Bennett reiterated that the parties should push for an early trial beginning in October, something Apple had already agreed to.

This hearing was originally scheduled for two days but has already gone three this week and will continue on Oct. 4, since neither side has yet concluded their arguments. We heard Thursday that Steve Jobs personally tried to intervene to prevent legal trouble between the two companies, but now it looks like it’s Samsung making the effort to avoid more trouble at this point. Given that they’re willingly making major compromises regarding a product that’s already shipping in other markets around the world, and that they seem less enthusiastic about an expedited trial than Apple, it does seem as if they know their position is weak in this case.

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Monday was day one of the two-day hearing to determine whether or not the Galaxy Tab 10.1 should be banned until the dispute is resolved. The hearing concludes Thursday. Until now, Samsung has itself delayed the sale of the Tab 10.1 in Australia, pending this decision.

On Monday, however, Samsung’s lawyer argued that an injunction at this point would take things too far, since it could be “well into next year” before the dispute is resolved. Apple’s legal counsel countered that they are ready to go to trial next week, should expedited proceedings be the preferred option. Samsung countersued Apple in Australia in September for infringing seven of its wireless patents.

Three patents are at issue, all involving touchscreen technology used in Apple’s iPad devices. These include a method for vertical scrolling, as well as technology that allows the device to ignore accidental touches. Samsung’s lawyer claimed in the hearing that the real reason for the suit is that Apple is “worried,” and that “it’s the thinness of [Samsung's] product that worries them.”

If the judge does issue a brief injunction followed by an expedited trial, Apple seems to believe it will have the upper hand, based on its statements in court on Monday. Samsung seems not to find either of those options appealing, so we should see Thursday more information about what other alternatives might be on the table at this point.

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As part of the deal, Samsung agreed to stop advertising for the release of the Android-based Galaxy Tab 10.1 in Australia and not to sell the device until the lawsuit is resolved or until it is granted approval by the court to do so. Apple appears to have won Samsung’s cooperation by promising to pay unspecified Samsung damages, should Apple lose the larger patent-infringement suit.

Apple sought an injunction in the Australian court because it claims the Galaxy Tab 10.1 infringes 10 Apple patents, according to Apple lawyer Steven Burley’s statements to the court. The judge in the case set a hearing for Aug. 29 to determine a trial date, if one is deemed necessary. The Australian legal action brings the total number of Apple/Samsung ligation instances to 11 courts, in nine countries on four continents.

Patent blogger Florian Mueller told me in an email that he thinks the message should now be clear:

All observers of Apple’s disputes with Android device makers must increasingly realize that Apple’s strategy is clearly that of a company optimizing for product differentiation, not licensing revenues. Apple’s objective is to stop iPhone and iPad lookalikes altogether, and companies like HTC will be required to degrade the user experience of their differences in order to ensure the iOS user experience stays unique.

In other words, we aren’t likely to see the end of this kind of action anytime soon, especially now that the growth of smartphone hardware makers like Samsung and HTC threatens to bump Apple from its lofty new perch as the No. 1 global smartphone maker.

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Mueller says that while the original complaint — filed by Apple on April 15 in U.S. District Court in Northern California — was “the most impressive multi-intellectual property rights complaint [he'd] ever seen,” it’s now “even bigger — the main document has 63 pages (previously 38) — and better.” The changes aim to paint Samsung’s infringement as blatant copycat behavior, asserting that Samsung, more than any other competitor, has been blatantly ripping off Apple designs since the very earliest days of the iPhone, circa 2007.

In addition to adding claims of specific infringement, Apple also strengthened language throughout its filing. For example, it replaced the word “misappropriated” with “copied” in at least one instance, and also cites many articles by prominent tech news publications that make specific reference to Samsung’s clear attempts at copying Apple product designs in articles about Samsung devices like the Galaxy Tab 10.1 and the Vibrant. Apple also added 14 specific Samsung product designations to the complaint by name, including the Galaxy Tab 10.1 and the Galaxy S II.

Part of the amendment is also intended to deflect Samsung’s requests to have advance access to unreleased iPhone and iPad products. Apple originally talked about its trade dresses (a legal term referring to the visual appearance of a product or its packaging) for the iPhone and iPad lines in general, but the altered complaint now makes specific distinctions about iPhone as a brand versus the iPhone 3G or iPhone 4, for example, which will help it deny the requests made by Samsung.

I asked Mueller about how this case compares to others, like the Nokia-Apple legal battle that recently resulted in a big settlement for the Finnish smartphone maker. He said that this case is unusual in that it seems to have escalated faster than most, thanks in part to Samsung’s rapid countersuit, which it filed not only in California but also in South Korea, Japan and Germany. It’s also unusual that Apple seems to be seeking “a preliminary injunction against the Galaxy product line,” which Mueller says could “force a settlement very early in the process.”

Mueller thinks that the case isn’t actually all that similar to the Nokia-Apple battle in particular, because he believes “Nokia has a much stronger smartphone-related patent portfolio than Samsung.” He does believe Apple is prepared to go far with this claim, however, since he thinks the company “has made the determination that fighting Android in general and Samsung’s alleged copying in particular is even more critical to its success than the supplier relationship [that the companies share].” Still, he thinks that existing business relationship “should facilitate a settlement” at some point before this case comes to a decision.

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