Qualcomm pays $1.5bn to ban some iPhone sales in Germany

Qualcomm has elected to post $1.5 billion as a security bond to enable the enforcement of remedies ordered by the Munich District Court blocking the sale of iPhone 7 and iPhone 8 models in Germany.

The ban comes as the latest chapter of the long-running Qualcomm-Apple legal saga, with the chipmaker finding success in its copyright infringement claim in Germany. On December 20 the District Court of Munich decided Apple had in fact infringed Qualcomm’s technology for power savings in the older models and ordered the company to halt all sales in Germany.

Although the ruling was make a couple of weeks ago, the bond itself makes the ban official, allowing the court to pay Apple for any damages incurred should it be able to successfully appeal against the ruling. Apple has already stated it will appeal the ban and will also stop selling the devices at its 15 retail locations across the country.

But this doesn’t seem to be good enough for Qualcomm.

“Apple was ordered to cease the sale, offer for sale and importation for sale of all infringing iPhones in Germany,” Qualcomm said in a statement. “The Court also ordered Apple to recall infringing iPhones from third party resellers in Germany.”

This is one of the elements of interpretation in the case. Apple will continue to ship devices to third-parties to sell, only ceasing sales at its own retail locations. Qualcomm lawyers read the ruling differently however, suggesting this is a blanket ban on all iPhone 7 and iPhone 8 devices across the country, third-party retailers included.

For Apple, this is just a bad end to a bad week. Having just reduced its guidance for what traditionally is its strongest quarter in the year, a sales ban in a large, developed market is not ideal. Some suggest it has nothing to worry about considering these are older models, though cash conscious consumers are more alert to bargains than ever before and the iLeader seemingly pushed the pricing boat too far with the ridiculously priced iPhone X.

For Qualcomm, assuming it can fight to have the ruling upheld, this is a massive win. Precedent is a very powerful concept in the legal world and this might well be an order which it can use as evidence for additional ruling in other markets. The legal battle between the two has certainly been a long one, but this ruling has handed the Qualcomm team a bit of additional incentive.

Looking at the wider patent dispute, a similar case has been heard in China, were Apple has been told to stop importing the infringing models while Qualcomm is also pushing the case in the US. Qualcomm has the better of the early exchanges, though it will be the US ruling which will dictate the winner of this battle ultimately.

Washington DC takes Zuckerberg to court

The Attorney General for the District of Columbia has filed a lawsuit against Facebook on the grounds of failing to protect user’s privacy and enabling one of the biggest digital scandals to date.

It was only going to be a matter of time before one of the Attorney Generals took the opportunity to take Mark Zuckerberg and his cronies to court, the big question which remains is how many of them will do so. The Cambridge Analytica scandal might be old news in the eyes of the consumer nowadays, but the lawyers aren’t forgetting about it. Blood has been smelt and Washington DC is going to have the first bite.

“Facebook failed to protect the privacy of its users and deceived them about who had access to their data and how it was used,” said Attorney General Karl Racine.

“Facebook put users at risk of manipulation by allowing companies like Cambridge Analytica and other third-party applications to collect personal data without users’ permission. Today’s lawsuit is about making Facebook live up to its promise to protect its users’ privacy.”

The lawsuit itself relates back to the Cambridge Analytica scandal, focusing on Facebook’s inability to meet expectations and commitments when it comes to data protection and privacy, but also the firm’s role in allowing the 2016 Presidential Election to be manipulated. It’s the permission to use data, or lack thereof, which is the big issue here. Cambridge Analytica harvested the data and sold it onto a political consulting firm, none of which it was entitled to do.

This is perhaps one of the biggest grey areas of the digital economy as while technology firms have streamed ahead in how data can be commercialised, rule makers have struggled to keep pace. Firms like Facebook has taken advantage of this regulatory void but cases like this will aim to hold them accountable retrospectively.

This is one of the most difficult things about innovation. Because these firms are playing with new ideas for the first time there is no precedent to where the line between right and wrong should be. In most cases, this would be an effective defence, as while most governments will of course want to protect citizens, they will also want to encourage innovation and exploration. In this case however, Facebook might not be able to lean on this idea.

Recent documents released by the UK government demonstrate not only that Facebook was aware there might unethical and illegal aspects to these practises, but that this knowledge went from the bottom to the top of the organization. The internal emails, which were secured by Six4Three during its own lawsuit against Facebook, paint a very deceptive and nefarious picture of the firm, with no regard to the opinion or privacy of the user.

Facebook is in a hole right now, which seems to be getting deeper and deeper. While it cannot shake off the Cambridge Analytica scandal, new controversies are being thrown at the platform, including the most recent claim. Rumbling through the world as we speak are claims Facebook granted certain technology companies, such as Netflix and Spotify, access to user’s private messages.

Facebook will of course end up in court and considering it has admitted wrong-doing on several occasions, there will be heavy punishments laid out. One of the big questions which remain is how many of the Attorney Generals across the US will bring their own lawsuit forward.

Google faces lawsuit for snooping which would even embarrass spooks

One Napoleon wanted to conquer the Commonwealth Empire, but this one only wants to topple Google. We’re not too sure which mission is more difficult.

San Diego resident Napoleon Patacsil has filed a lawsuit against Google following the revelation the internet giant was continuing to track user location after the user had opted out from location tracking services. Patacsil is suing for unspecified damages and class-action status on behalf of US users. The San Francisco court will first have to decide whether he has a case, and then whether he can take forward the class action suit.

“Google itself assured individuals that they could prevent Google from tracking them by disabling a feature called ‘location history’ on their devices,” the filing reads. “Google represented that a user ‘can turn off Location History at any time. With Location History off, the place you go are no longer stored’. This is simply not true.”

The filing claims Google’s conduct falls short of reasonable expectations of not only privacy, but the trust which is placed in a business in a valuable position in the data economy. The privacy debacle could lead Google down a path towards PR disaster, though should the firm be found to be directly misleading users, this could evolve into a completely new saga.

While it does appear Google has quietly altered the support page detailing it might still collect location data since the revelation, there might be a way for Google to squirm out of any wrong doing. We suspect Google has given itself permission to continue to collect data, despite the opt-out, in terms of use. It would like be buried down, and thanks to some creative legal work, it might not have to have told users it was making the changes. As users accept the terms and conditions before using a device, they have effectively opted-in.

That said, explicitly telling the user it would not collect data is directly misleading. This is a massive no-no when it comes to consumer confidence, ethical behaviour and what the company can do legally. There might be a few regulators throughout the US keeping an eye on the situation here. An investigation would not be a massive surprise.

While multi-national corporations making money by any means possible is nothing new, the Silicon Valley firms have always considered themselves above such human desires. These were companies which only existed to make our lives better, and they certainly had the advertising budgets to tell us how wonderful they actually are. The last couple of months are starting to create an image of Silicon Valley firms similar to the investment banks who caused the financial collapse in 2008.

Facebook’s Cambridge Analytica saga, alongside Twitter’s initial refusals to silence Infowar’s resident lunatic Alex Jones, Google’s war-mongering ambitions for AI and this Big Brother impression are not doing Silicon Valley’s reputation any favours.

Blackberry sues Facebook – has it just given up on tech?

Blackberry is taking Facebook, WhatsApp and Instagram to court for patent infringement relating to messaging apps. We wonder if Blackberry has just given up on tech in favour of a litigious business model.

Of course there are still areas of the Blackberry business where it is developing technology, but the brand on the whole is becoming less and less relevant to today’s society. Such is its relevance, the company is hitting the headlines far more often in cases where it is taking another business to court than for its technology breakthroughs.

Over the last few years, Blackberry has sued Nokia for transmitters and software IP infringement, won $815 million off Qualcomm in a royalties dispute and taken Avaya to court for infringement of eight patents for product lines such as unified communications, network switches and routers, communications servers and client software. Blackberry reportedly has more than 38,000 patents to its name, so there is plenty of opportunity to make the software licensing business model work.

In the Facebook case, Blackberry is claiming Facebook has been using its patents relating to messaging without its permission. The apps mentioned in the filing are Facebook Messenger, Facebook Messenger Lite, Facebook Pages Manager, Facebook.com and Facebook Workplace Chat, WhatsApp and the direct messaging feature in the Instagram app. For those who wish to have a look through the filing, you can do so here, though we warn you its 117 pages long.

In short, Blackberry is suing for the following:

  • Security improvements: incorporating cryptographic techniques into a messaging app
  • Interface improvements: streamlining of notification symbols, previews of messages and display of timestamps on messages
  • Tagging contacts in photographs
  • Linking messaging and gaming
  • Read receipts on sent messages

Blackberry claims all of these features are now ‘table stakes’ for messaging apps and social media, and it came up with them all. As you can see below, Blackberry has said it is the very reason Facebook has succeeded in the messaging game. Facebook used Blackberry’s IP against it to gain the upper hand.

Lawsuit

While we are not legal experts, some of the claims are pretty superficial. Saying that anyone using encryption techniques on messaging would have to pay Blackberry royalties is a pretty big ask. As is showing an unread message indicator on top of an icon. Blackberry also says it should be paid by anyone who doesn’t show a timestamp next to every message. But perhaps this is an intentional overreach.

When negotiating, it is common practise to overextend your hand. Ask for too much and the counteroffer will come back. The back and forth could result in a net-gain, assuming of course Facebook does have any intention of settling. The social media giant has indicated it will fight the claims, which will be a relief to anyone else in the social media game. Should Blackberry win this legal battle, precedent would be set and it could sue basically anyone involved with social media or messaging. Twitter, Slack, Apple, Microsoft and Google (just to name a few) might have one, wary eye on this saga.

Blackberry did beat Facebook to the messaging space and to be fair to the Canadians, it was a pretty notable breakthrough at the time. This could be viewed as one of the first appearances of a ‘zero-rating’ offering as messages across BBM would not be charged to the user. This made it particularly useful to users who were in roaming territories. Don’t forget, this is more than a decade ago when using your device abroad was a very costly exercise.

Ultimately Facebook and the other OTTs won out here because of scale of adoption, default installations on multiple devices and interoperability with other features. Blackberry might have come up with a great idea, but limiting the feature to a doomed device was never going to spell a success story. In the latter years it did try to release a BBM app to move into the wider smartphone world, but this was too little too late. Like a Dad trying to relate to a teenagers taste in music, no-one took Blackberry seriously.

This does seem like a very speculative move from Blackberry. It seems like it knows it is dead to the technology world, irrelevant and largely forgotten, but it might as well make as much money as possible. It has 38,000 patents so might as well have a bit of a look around and figure out what it can sue for. We can just imagine some ‘no win, no fee’ lawyer approached the beaten and bored Blackberry executives with the idea, and they thought why not, haven’t got anything else to do at the moment.

Schrems loses first battle against Facebook but war has only just begun

Data privacy campaigner Max Schrems is been dealt a minor blow by the European Court of Justice but Facebook will have to fight to keep skeletons in the closet as individual court case is given thumbs up.

While the internet giant always had the upper ground, there was a small chance Schrems could pile misery sky-high with a class action lawsuit. Such occurrences are rare in European courts, and the European Court of Justice has now ruled he is unable to represent 25,000 people in an Austrian court to sue Facebook for data privacy violations, but he will be allowed to pursue an individual legal case.

This certainly takes the risk of a hefty financial blow out of the equation for Facebook, but the damage to credibility and consumer trust could be massive. Irrelevant as to whether Schrems is representing one person or 25,000, the privacy advocate will presumably use such an occasion to expose the data sharing practises and business model, which could leave Facebook in a relatively sensitive position.

Initially, Schrems was seeking permission to take Facebook to court on behalf of 25,000 individuals, seeking €500 compensation for each. Class actions lawsuits are rare in Europe, especially when the individuals are from a range of different nations and jurisdictions, therefore this idea was shot down. Perhaps this is a just a case of timing though. Under GDPR, which will be introduced later this year, collective action will be allowed in some cases. It is not known whether this is a case which would be accepted.

Although it is generally accepted that user information is used by Facebook to build its advertising solutions, some in the general public might be shocked at the breadth of information Facebook hordes, the granularity of the data, as well as the practise of data sharing with third-parties. Facebook has never denied it shares information with ‘selected’ third-parties, presumably ‘selected’ means anyone who is willing to pay, but it has been rather opaque about how the data mining, refining and distribution machine actually works.

Played correctly, Schrems could make a media circus of the situation, leaving Facebook to answer some awkward questions about practises which are common in the world of media, but rarely see the light of day or public scrutiny. Facebook has avoided a substantial financial penalty, having to fork out compensation to thousands, but the PR damage will be a crater the internet giant will want to avoid.

The actual case itself is based on how Facebook handled Schrems personal information, both with third-parties for advertising, as well as intelligence agencies in the states. Both areas Schrems believes violates his data privacy rights as a European citizen. The shady world of data and intelligence agencies is certainly an area which numerous parties would want to avoid getting into the public domain.

Again, it is generally accepted the internet giant collaborate with intelligence agencies when the appropriate occasion arises, but details on these relationships are very thin on the ground. Facebook and various others publish statistics on how much information is requested by the government, but the processes and discussions are secretive. Schrems could expose some uncomfortable truths should the game be played correctly.

While the smart money would be placed on the army of legal experts at the disposal of Facebook, it should be worth noting Schrems does have form when taking on the odds. Schrems was one of the leading activists and campaigners against Safe Harbour, the mechanism to facilitate and manage transatlantic data transmission, exposes its flaws and data privacy abuses from intelligence agencies in the US. The odds were against him there as well, but he was successful.

While there is a notable PR and financial risk for Facebook, precedent could also be set. Should Schrems be successful in his pursuit, the door could be opened for other privacy campaigners to have a poke not only at Facebook, but any other organization which facilitates the flow of information between third-parties. Google, Amazon, Twitter, app developers, media organizations and numerous other companies might be casting a wary eye over developments here.

Intel hit with class action suit over CPU defects

Law firm Doyle APC has filed a class action lawsuit against Intel for the design defect found in all of Intel’s x86-64x CPUs.

2018 has not been a great year for Intel so far, as the last week or so has simply been a tsunami of bad news concerning security vulnerabilities in its x86-64x CPUs. Considering the extent of the Intel’s woes, it wasn’t going to be too long before a class action appeared, and here it is; Garcia, et al. vs. Intel Corp, Case No. 18-cv-00046, (ND Cal).

The case itself aims to represent any US purchaser of Intel CPUs containing the defect, or purchasers of a device containing one of these Intel processors. The defect is actually down to what Intel must have through was a clever bit of engineering. The kernel mode attempts to guess what the user will do next, known as ‘speculative execution’, having certain programmes on stand-by to increase speed and performance. This action potentially exposes kernel data, one of the most sensitive parts of a computer.

Since the vulnerability was initially exposed, Intel has been rushing to develop a patch, essentially closing the threat, though it is believed it will degrade performance at the same time. Intel claims 90% of processor products introduced within the past five years will be fixed by the end of this week, and for the average user, the impact on performance will be minimal. This has also been echoed by Intel’s customers:

Apple:

“Our testing with public benchmarks has shown that the changes in the December 2017 updates resulted in no measurable reduction in the performance of macOS and iOS as measured by the GeekBench 4 benchmark, or in common Web browsing benchmarks such as Speedometer, JetStream, and ARES-6.”

Microsoft:

“The majority of Azure customers should not see a noticeable performance impact with this update. We’ve worked to optimize the CPU and disk I/O path and are not seeing noticeable performance impact after the fix has been applied.”

Google:

“On most of our workloads, including our cloud infrastructure, we see negligible impact on performance.”

Amazon:

“We have not observed meaningful performance impact for the overwhelming majority of EC2 workloads.”

This has been disputed by some commentators as the ‘speculative execution’ feature is believed to be one of the primary drivers of increased performance. Only time will tell.

Doyle APC’s ambulance chaser impersonation should of course been expected, though Intel has been the main recipient of attention so far. AMD and ARM are two other suppliers who have also admitted to vulnerabilities, though neither has gotten anywhere near the same amount of consideration. The flaw may not impact these products as much as Intel, or the severity of AMD and ARM defects has not been truly uncovered just yet.

Apple files countersuit against Qualcomm… again

It’s been a quiet couple of weeks for Qualcomm and Apple, so we really should have expected another chapter in the courtroom tale. This time Apple is suing Qualcomm for patent infringement.

In the latest installment of the saga, Apple has filed a countersuit against Qualcomm claiming the Snapdragon mobile phone chips infringe on Apple’s patents, according to Reuters. More specifically, Apple believes it owns several battery life patents which Qualcomm has incorporated into the Snapdragon design, which is then being used to power the devices of Apple’s competitor’s devices.

This is of course a countersuit, dating back to a lawsuit Qualcomm filed against Apple on exactly the same grounds. Apple denied it infringed any of Qualcomm’s patent, with the countersuit claiming the patents were invalid in the first place. It’s all very complicated, but this is common practice in the courts; deny a claim and then put forward a paper trail which proves there was no basis for the claim in the first place.

The patents actually involve more efficient use of a phones battery. The processor only draws the minimum amount of power from the battery that an application or function of the phone needs, and is then powered down when it is not needed. It is a pretty common feature across devices nowadays, but the question is who gets paid for patenting the idea?

This is of course just the latest skirmish in a larger legal battle between the two, which doesn’t look like it is going to end any time soon. We’re going to try and give as much detail about the wider battle as possible now, but because there are so many fights going on at once, you’ll have to forgive us if we miss one.

January: Apple sues Qualcomm for withholding almost $1 billion in payments it says it is owed. Qualcomm accuses Apple of providing false information to regulators and then files a countersuit. This case is still in the courts.

April: Qualcomm sues Apple accusing the company of inhibiting performance to make Intel look better.

May: Qualcomm sues Apple claiming the iBoss choked its supply chain, forcing its manufacturers to withhold payments from the chipmaker. The manufacturers decided to get in on the act, and filed a countersuit against Qualcomm. This case is also still in the courts.

June: Apple filed a lawsuit which essentially questioned the legality of Qualcomm’s business model. The iLeader argues that license agreements that secure Qualcomm a fee for every iPhone manufactured are invalid. This case also continues.

July: Qualcomm sues Apple for patent infringement and asks the International Trade Commission in the US to ban the import of some Apple devices. The ITC is continuing its investigation currently.

October: Qualcomm files a lawsuit at a Beijing intellectual property court attempting to have the iPhone banned from being imported into China, once again claiming patent infringement. This case is also still in the courts.

Aside from these disputes, Qualcomm has also found itself locking horns with Taiwan’s Fair Trade Commission, Intel on the grounds of competition and the European Commission for monopolistic activities. Samsung and Intel also filed amicus briefs backing the FTC’s complaints against Qualcomm, while it was also forced to refund Blackberry $815 million owing to royalties the Canadian smartphone maker overpaid between 2010 and 2015.

If we have missed anything out feel free to drop us through an email, but there only seems to be one question left. How many lawyers does Qualcomm actually have!?