The American VideoLabs has accused major manufacturers of personal computers of violating its patents. The company has applied to the US International Trade Commission (USITC) to ban the import of a number of devices manufactured by Taiwanese Acer and Asus, as well as Chinese MSI, Lenovo and Motorola Mobility (owned by Lenovo). The department announced the investigation into this case on the official website on August 3, 2022.
According to VideoLabs, PCs and other equipment manufactured by Acer, Asus, MSI and Lenovo run graphics accelerators (GPUs) with video signal processing functions that use proprietary technologies. In total, Chinese and Taiwanese companies are charged with infringement of four patents. The relevant complaint was sent to ITC on July 1, 2022. The Commission will examine the arguments of the plaintiff, and if it finds them convincing, then a ban on the sale of certain products of Asian PC manufacturers may be introduced in the United States.
Acer, Asus, MSI, Motorola Mobility and Lenovo have yet to publicly respond to allegations of intellectual property infringement.
Acer, Asus and Lenovo, according to the analytical company IDC, in the II quarter of 2022 were among the five largest suppliers of personal computers in the world. Lenovo shipped 17.5 million PCs during the reporting period, ranking first in the IDC rankings with a market share of nearly 25%. Much more modest results were demonstrated by its Taiwanese competitors: Acer sold 5 million computers (6.9% of the market), Asus – 4.7 million (6.6%).
What patents are infringed
Three of the four patents cited by VideoLabs in the lawsuit – 7,769,238, 8,139,878, 8,208,542 – describe methods for encoding and decoding video information developed by the Japanese company Panasonic in the early 2000s.
The latest patent number 7,372,452 was originally issued by Samsung – also in the early 2000s – and describes a method for playing video on a portable device with automatic image adaptation in accordance with the position of the device in space. In other words, we are talking about the auto-rotate screen function, which changes the display orientation from vertical to horizontal and vice versa. It is available in any smartphone or tablet computer.
Based on the description of the patents, it can be assumed that their effect can be extended to any modern device with a display and support for video output, including PCs, media players, smartphones, tablets, and even TVs.
What does VideoLabs do?
VideoLabs, founded in 2018, specializes in buying video processing intellectual property. During its existence, the company has acquired hundreds of patents from many owners in order to further license the technologies described in them to other businesses. VideoLabs’ clients include media conglomerate Disney and two Fortune 100 companies. Over the past 1.5 years, the firm has complained about tech giants like Amazon, Dell, Meta and Netflix.
The VideoLabs patent portfolio includes technologies created by Nokia, Alcatel-Lucent, Siemens, Swisscom, 3Com, Panasonic and Hewlett Packard Enterprise. On its official website, the company boasts more than $6 billion in revenue from patent trading and licensing of patented technologies, patent dispute resolution, and mergers and acquisitions.
Given the specifics of VideoLabs, the company can be classified as a so-called patent troll. Its representatives, as a rule, do not develop any products themselves, but strive to make money on other people’s popular ideas, while remaining in the legal field.
One of the recent brightest examples of patent trolling is the lawsuit filed by K. Mizra (LLC) against the South Korean corporation Samsung regarding patent infringement on the technology for assessing the residual battery life of Android gadgets.
Another interesting case with an unpleasant outcome for the troll involves the GNOME Foundation, which oversees the development of a project to develop the desktop environment of the same name. Rothschild Patent Imaging, owned by an American serial entrepreneur Lee Rothschild (Leigh M. Rothschild) not only failed to get a dime out of an open source project for using wireless image transmission technology in the Shotwell photo manager, but also ended up losing a patent that it used as an extortion tool.