Market Overview

Apple's Most Important Patent is Invalid

Apple (NASDAQ: AAPL) has two months to contest a decision by the U.S. Patent and Trademark Office, which ruled that the Steve Jobs multi-touch patent is invalid.

According to CBS News, Kelly Drye & Warren -- a New York-based law firm -- filed a motion to have the patent reexamined in January 2010. Coincidentally, that firm has previously served both Apple and Samsung by aiding the firms with their intellectual property work. While it is unknown if Samsung is the company behind the motion, many investors are bound to make that assumption.

The Steve Jobs multi-touch patent is important because it covers the touch interface of the company's most prominent devices -- the iPhone and the iPad. Without it, Apple's defenses could be weakened. It could also make it more difficult for Apple to pursue legal action against its South Korean adversary, Samsung.

Over the past few years, Apple has accumulated an insurmountable number of lawsuits. The Mac maker initiated many of these lawsuits as it attempted to quash the competition through litigation. That strategy backfired when Samsung and other firms began to counter sue. It has also inspired a plethora of Chinese firms to attack Apple over patent and trademark infringement.

While Apple seemed to have gained the upper hand when it won a $1 billion verdict in its first domestic patent trial with Samsung, the South Korean firm may have found a way to eliminate that verdict and start over.

That being the case, Apple's biggest win may ultimately come from its settlement with HTC. The company had reportedly vowed to fight Apple to the death. Failing that, HTC settled with Apple for an undisclosed sum. The settlement terms call for a deal that lasts 10 years and can be extended in the future.

Apple, which has lost more than eight percent of its value over the last five days, does not seem to have endeared investors with these lawsuits. In fact, the iPhone creator actually declined more than one percent in the week after the $1 billion verdict was announced last August.

Follow me @LouisBedigianBZ

Posted-In: Apple SamsungNews Legal Tech Best of Benzinga

 

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