Tuesday, August 21, 2012

(BN) Samsung Copying Was ‘Intense,’ Apple Lawyer Says in Closing (1)

Aug. 21 (Bloomberg) -- Samsung Electronics Co. was so desperate to catch up with Apple Inc.'s smartphones and tablet computers in February 2010 that that the South Korean company began "three intense months of copying" the iPhone maker, a lawyer for Apple said.

Attorney Harold McElhinny, in closing arguments at a multibillion-dollar intellectual property trial in federal court in San Jose, California, told jurors documents prove better than witness testimony how Samsung went about changing its mobile devices to mimic Apple's "revolutionary" designs.

McElhinny said internal e-mail at Samsung revealed that the company was experiencing a "crisis of design" due to competition from the iPhone even as another e-mail sent just two weeks later showed Samsung was facing pressure from Google Inc. to make its devices look less like Apple's.

"Samsung realized how far it was falling behind the iPhone," McElhinny said. "In those critical three months Samsung was able to copy and incorporate" Apple's four years of research and development "without taking any of the risk," he said.

Apple, based in Cupertino, California, sued Samsung in April 2011, and Suwon, South Korea-based Samsung countersued. The case is the first to go before a federal jury in a battle being waged on four continents for dominance in a smartphone market valued by Bloomberg Industries at $219.1 billion.

Big Conglomerates

Samsung's lawyer, Charles Verhoeven, framed the jury's decision as one that could shape the future of the technology industry. If the jury rules in Apple's favor, he said, big conglomerates with large patent portfolios would stifle innovation by blocking out competitors.

"It's a very important decision you have to make," he said. The decision "could change the way competition works in this country," he said. "Rather than compete in the marketplace, Apple is seeking to gain an edge in the courtroom. It's seeking to block its biggest and most serious competitor from even attending the game."

Instead of copying the iPhone, Samsung seized on technological advances to design its devices with full glass screens for the best view of e-mail, an Internet browser and video, he said.

Verhoeven said Apple's estimate of more than $2 billion in damages is unfounded.

"There was no confusion, deception, consumer harm," he said. "Apple is here asking for what it's not entitled to."

Damages Sought

In addition to damages, Apple seeks to make permanent a preliminary ban it won on U.S. sales of a Samsung tablet computer, and extend the ban to Samsung smartphones.

Samsung seeks as much as $421.8 million in royalties that the company claims it's owed for Apple's infringement of two patents covering mobile-technology standards and three utility patents.

The case is Apple Inc. v. Samsung Electronics Co. Ltd., 11- cv-01846, U.S. District Court, Northern District of California (San Jose).

(BN) Google Finally Leads in China -- in App Ad Sales

Aug. 22 (Bloomberg) -- After years of seeing its China strategy hobbled at almost every turn, Google Inc. has finally carved out a market niche where it's the leader: ads aimed at mobile phone applications.

App developers and corporations such as Bayerische Motoren Werke AG and Shanghai General Motors Co. are turning to Google's AdMob unit to reach Chinese smartphone users on the go.

Google's strength in mobile ads stands in contrast to its search-engine business in China. The global leader has failed to catch homegrown favorite Baidu Inc. in computer-based search, and two years ago Google moved its search servers out of the mainland in a censorship dispute with the government.

"Since 2010, Google has been trying many things to keep its presence in China," said Steven Chang, chief executive officer of ZenithOptimedia's China division, which buys advertising from Google and Baidu. "AdMob now has quite a significant share of the market."

Revenue in China's mobile-app ad market will probably more than double to about 1.8 billion yuan ($283 million) this year, exceeding the 1.2 billion yuan from mobile-search queries, according to iResearch.

In mobile-search advertising, queries from users generate related ads, while app-based marketing automatically sends ads to mobile users playing games, viewing videos, or using applications on smartphones and tablet computers.

Thousands of Developers

AdMob says it has more than 10,000 registered developers in China. The unit, which Google acquired for $750 million in 2010, says its servers get 7.9 billion requests a month to show ads to mobile-app users in the country.

China will overtake the U.S. as the world's largest smartphone market this year, with shipments climbing 52 percent to 137 million, according to market researcher IDC.

AdMob's key advantage is its reach across smartphone technologies, covering iPhones and iPads as well as Android devices, said Chen Haozhi, chief executive officer of Chukong Co., a maker of mobile games in Beijing.

Chukong, whose "Fishing Joy" game was ranked China's most-popular for Android users in the first quarter by iResearch, is spending more than $1 million on advertising through AdMob this year, Chen said.

"Mobile advertising is better at targeting users than desktop-based ads because they can be more personalized," he said.

Olympics Boost

Hylink Advertising Co. bought most of AdMob's spots in China during the London Olympic Games to meet growing demand for mobile promotions, said Su Tong, chief executive officer of the digital marketing company.

The deal allowed Hylink to resell the space to clients such as BMW's China unit and Shanghai General Motors, a Chinese venture of General Motors Co., Su said. The Google-run advertising includes a banner ad for GM's Chevrolet brand, seen at the bottom of the screen in the mobile edition of China's state-backed Global Times newspaper.

"At the moment, in the field of mobile Internet, Google has a clear advantage," Su said. "The market is heading the way of mobile."

Besides AdMob and search, Google also generates sales in China from its display advertising business, which helps clients market on the websites of partners such as Sina Corp.

Internet-search advertising contributed 96 percent of Google's $38 billion revenue last year, according to data compiled by Bloomberg. Google, based in Mountain View, California, doesn't break out earnings from mobile ads or revenue generated in China, where its main search business is overshadowed by Baidu's.

Trailing Baidu

Beijing-based Baidu had 78.6 percent of China's search- engine market by revenue in the second quarter, versus 15.7 percent for second-ranked Google, according to Analysys International.

Google began losing ground in China's search-engine market in January 2010, when the company said it was no longer willing to comply with government regulations to self-censor Web content. Two months later, it began redirecting Chinese users of the Google.cn search-engine service to a Hong Kong site. The company has also been a target of hackers based in China.

Google's leadership in Chinese mobile advertising faces a challenge from domestic rivals such as Baidu and Tencent Holdings Ltd. as they develop services for smartphone users.

Baidu is working with developers to help them design and market apps and has yet to deploy resources "full scale" in app-based advertising, said Kaiser Kuo, a company spokesman. "Mobile search will continue to be important."

Mobile search contributes as much as 4 percent to Baidu's revenue, Nomura Holdings Inc. estimates. Kuo declined to comment on the figure.

Lack of Content

Baidu's ability to generate revenue from mobile services is lower than that for PCs because of a relative lack of content and information on the Internet that is tailored for phone users, Chairman Robin Li said last month.

Tencent, China's biggest Internet company, sells advertising on its mobile Web portal and platform for wireless apps. A small share of Tencent's online advertising sales come from mobile, spokeswoman Jane Yip said without elaborating.

Google sends about five times as many phone ads to iPhone and iPad users as Domob, the closest competitor in China, according to iResearch.

In the researcher's survey in March of 60 free mobile apps in Apple's China App Store, almost 45 percent of ads displayed were generated by Google versus 9 percent for Domob.

"In app-based advertising, Google's AdMob has an advantage," said Ada Wang, an analyst at iResearch in Beijing. "The technology has developed longer and is being used in other markets."


(BN) Nokia’s $39 Phone Rebound Wins More Time for Comeback Bid

Aug. 22 (Bloomberg) -- Nokia Oyj, burning cash as it struggles to revive its smartphone business, is winning time for the recovery effort by gaining more customers for another product: basic mobile phones it sells for $39.

By adding features such as quicker Web and online games to its Asha handsets popular in faster-growing economies including India and China, Nokia boosted its share of the basic-phone market to 35 percent last quarter -- the highest in two years. Unlike the smartphone division, the basic-phone business is profitable and unit sales are increasing.

The more than 70 million cheaper handsets Nokia sells each quarter is providing relief for Chief Executive Officer Stephen Elop as he tries to stem revenue declines and recover from five quarters of losses. The basic-phone division is also winning over first-time users who may stick with Nokia when upgrading to a more expensive device.

"Nokia's Asha models are selling quite well and that is good news for them since it gives the company a bit more time to get its smartphone business on track," said Teemu Peraelae, who helps manage $1.5 billion including Nokia shares at Alfred Berg Asset Management in Helsinki.

Nokia's cheaper phones outsold its smartphones 7-to-1 last quarter and, at 2.29 billion euros ($2.86 billion), brought in 49 percent more revenue for the Espoo, Finland-based company.

If Nokia's smartphone strategy fails, the basic-phone unit may become the company's most attractive asset for an acquirer because it remains profitable and has a dominant market position in many emerging markets, said Sami Sarkamies, a Nordea Bank AB analyst in Helsinki. A buyer would also benefit from Nokia's strong relationship with carriers in growth economies, he said.

Asha Demand

Nokia's Asha phones are gaining users in the developing markets because they resemble smartphones, yet cost a fraction of the price, Anshul Gupta, an analyst at research firm Gartner Inc. in Mumbai, said in an interview. Some Ashas have full- length touch screens similar to Nokia's higher-end models and Apple Inc.'s iPhone. The underlying operating system is less sophisticated, making them cheaper to build.

"They have almost all the features a smartphone should have like an application portal to download apps, a touch interface, social-networking integration -- so these devices are completely like a smartphone," he said.

Nokia added touch-screen handsets to the Asha line in June to meet the surging demand for smartphone features. The Asha 305, retailing at 65 euros, is Nokia's cheapest full-length touch-screen phone. The Asha 311, featuring a faster touch screen and a 1-gigahertz processor, costs 95 euros.

The company on average sells basic phones for 31 euros each, compared with 151 euros per smartphone.

India Shoppers

The 305 and 311 are seeing "fantastic traction" among customers, said Sathish Babu, who owns handset retailer Univercell with about 500 outlets across southern India.

"The new Nokia phones are doing very well," Babu said in an interview, adding today's younger shoppers demand slimmer phones with vibrant colors and full touch screens. "The more stock that comes in the more my sales go up and it's even cannibalizing into other brands. With the touch screen, the balance is tilting toward Nokia now."

Nokia CEO Elop, commenting in an e-mail, attributed rising sales to its devices' "bold design" and new colors. Nokia's basic-phone sales climbed 2 percent to 73.5 million units in the second quarter from a year earlier, even as the global market for such devices fell 15 percent to 211 million units, according to research firm Strategy Analytics.

Shares of Nokia have risen 66 percent since it reported the second-quarter numbers on July 19. The stock is still down about 90 percent since Apple introduced the iPhone in 2007, a debut that started Nokia's decline in smartphones.

'Myopic Focus'

Nokia's share of the basic-phone market rose to 35 percent last quarter from 29 percent a year earlier. In smartphones, the fastest-growing and most valuable market segment, Nokia, the former leader, has slumped to less than 10 percent.

"People forget how significant it is that we're selling a million phones a day," Peter Skillman, head of mobile-phone design at Nokia, said in an interview. "There's almost a myopic focus on smartphones."

Features helping Nokia's basic-phone sales include browser data-compression technology, which lowers the cost of Web surfing, Skillman said. Nokia is also benefiting from demand for phones that let users insert two SIM cards, a feature many consumers in developing countries need to make it easier to switch service between carriers as they travel, he said. This month, Nokia said Asha users get Zynga Inc.'s "Draw Something" and "Zynga Poker" games for free.

Such features are important for a company whose biggest markets last year were China, which made up almost 16 percent of revenue, and India with 7.6 percent.

Samsung Competition

Nokia's success in basic phones isn't guaranteed, as ZTE Corp., Huawei Technologies Co. and other manufacturers are entering the cheaper market segments with phones using Google Inc.'s Android operating system.

Samsung Electronics Co., which passed Nokia as the biggest handset maker overall this year helped by smartphone sales, also pushes basic touch-screen phones under the Star and Champ names.

The intensifying competition caused Nokia to reduce the average selling price of its basic phones 14 percent last quarter, dragging down revenue even as unit sales rose. Profit margins on Nokia's cheaper phones also narrowed.

"It's been a slippery slope for Nokia's feature phones, but they did see an improvement in volumes in the second quarter unlike their smartphone business," said Janardan Menon, a Liberum Capital Ltd. analyst in London. "Competing more effectively with low-end smartphones will be key to any recovery."

(BN) IPhones Become Mobile Casinos by Adding Real-Money Bets

Aug. 16 (Bloomberg) -- IPhone users will soon be able to gamble with real money on virtual slot machines, trying their luck with the swipe of an index finger.

Big Fish Games Inc. is introducing a version of its gambling application Big Fish Casino with real-money betting in the U.K., where it is legal, the Seattle-based company said. It will arrive in Apple Inc.'s App Store in the coming weeks, and Betable Ltd., a London-based partner of Big Fish, will process bets in the program.

Game developers are building digital versions of Las Vegas casinos as users of smartphones and tablets are expected to wager $100 billion annually on the devices by 2017, up from about $20 billion last year, estimates Juniper Research. That potential payout has made Big Fish and other developers eager to replace virtual currencies with real cash in apps, even though use may be limited by gambling restrictions in the U.S.

"This is the biggest opportunity that game developers have had since the advent of the Internet," Christopher Griffin, chief executive officer of Betable, said in an interview.

Big Fish may soon face competition from Zynga Inc., the largest maker of social games, which last month said it plans to introduce real-money betting in the first half of 2013.

Restrictions on Internet gambling in the U.S. may also ease, as several states, including California, Nevada and New Jersey, are considering legislation to legalize the practice.

Game Makers

In the U.K., companies including Betfair Group Plc, and William Hill Plc currently have gambling in iPhone apps. Betable is working with dozens of other game makers to debut real-money games this year, Griffin said.

Big Fish Casino enables users to provide credit card numbers to place bets. Betable and Big Fish will divide the "take," or the amount made on each slot machine wager.

Even as Apple's storefront plays host to an increasing number of casino apps, the Cupertino, California-based company isn't taking a cut of sales from gambling in its apps, Tom Neumayr, a spokesman for Apple, said in an interview. Games are permitted in the App Store as long as they comply with local laws, said Neumayr, who declined to comment specifically on Big Fish.

"Apple wants to keep arms' length from this," said Paul Thelen, CEO of Big Fish. "They don't want to be the middleman in a gambling operation."

Last year, Apple prevented Big Fish from operating a subscription service that would have given iPad users access to dozens of video games for a monthly fee.

Big Fish, founded in 2002, had revenue of more than $180 million last year, Thelen said. He expanded in online gambling with the March acquistion of Self Aware Games, a startup based in Oakland, California.

Many players already pay real money for virtual currency in Big Fish games to bet on poker, slots and other games of chance, though they cannot cash out their winnings. These users are likely to flock to real-money wagers, Thelen said.

"It's a very lucrative opportunity," Thelen said of real- money gambling in mobile games.

(BN) Nokia to Offer Zynga Games for Users of Cheaper Phones

Aug. 17 (Bloomberg) -- Nokia Oyj, seeking to fend off competition from Android devices in growth markets such as Asia, said it plans to start offering two Zynga Inc. games on its cheaper mobile phones.

"Draw Something" and "Zynga Poker" will be available as free downloads for Nokia's Asha touch-screen handsets this quarter, according to a statement from the Espoo, Finland-based phonemaker today.

Nokia is adding features to cheaper devices as ZTE Corp., Huawei Technologies Co. and other mobile-phone manufacturers using Google Inc.'s Android operating system lure away users in emerging markets such as India. Nokia, which has also ceded market share in higher-priced smartphones, lost its lead as the biggest mobile-phone maker by units this year.

For San Francisco-based Zynga, the agreement with Nokia provides more than 100 million potential users. Zynga, the biggest maker of games played on Facebook Inc.'s website, is seeking growth in mobile devices as more users access the Web using smartphones and tablets.

(BN) Dish Network Said to Plan Nationwide Satellite Broadband

Aug. 16 (Bloomberg) -- Dish Network Corp. is preparing to introduce a nationwide broadband-Internet service using a satellite from sister company EchoStar Corp., according to three people familiar with the situation.

The EchoStar 17 satellite, launched into orbit July 5, can support download speeds of 15 megabits per second, although introductory nationwide packages will probably offer rates of 5 megabits so the system can take on more capacity, said one of the people, who declined to be named because the plans are private. Dish and EchoStar can handle about 2 million new Internet customers with the service, the person said.

The move is the result of technological advances for the U.S. satellite industry, which can now use higher-frequency bands to offer faster broadband to more people. The capacity for these kinds of services has climbed "by an order of magnitude," said Deepak Dutt, vice president of investor relations at EchoStar, who declined to comment on the Dish deal.

Dish expects to formally offer the service in late September or early October, mainly to subscribers in rural areas who may not have access to cable broadband, two of the people said. Bob Toevs, a spokesman for Englewood, Colorado-based Dish, declined to comment.

2008 Split

EchoStar and Dish became separate companies in January 2008, with Charlie Ergen remaining the chairman of both. The details of how they will split revenue and how much the service will cost consumers are still being discussed, one of the people said.

Dish shares fell 0.2 percent to $31 at the close in New York. The stock has climbed 8.8 percent this year. EchoStar, up 36 percent this year, rose 0.2 percent to $28.45.

Dish already offers satellite broadband through a partnership with Carlsbad, California-based ViaSat Inc., though that only covers certain parts of the U.S., including areas east of the Mississippi River and the West Coast. It gives some customers speeds of as much as 12 megabits per second. The new offering will augment that product and give Dish nationwide coverage, the people said.

By packaging satellite broadband with its current video service, Dish can offer customers a bundled option. That means it will compete more directly with cable companies, as well as satellite rival DirecTV, AT&T Inc.'s U-verse and Verizon Communications Inc.'s FiOS.

Future Expansion?

Dish may need to add more satellites to expand the service beyond 2 million people while maintaining the same speeds. The company, which has a total of about 14 million customers, hasn't disclosed how many users are served by the ViaSat agreement.

Dish is waiting for Federal Communications Commission approval to use its wireless spectrum to offer mobile Internet and phone service, which the company could bundle with satellite TV and broadband. That would give users a so-called quad play.

The EchoStar service is meant for customers who can't get the faster speeds provided by cable and phone companies in more urban areas. Comcast Corp., the largest U.S. cable provider, offers as much as 305 megabits per second. Verizon FiOS, meanwhile, goes as high as 300 megabits.

Most home Internet users typically don't notice a difference in speed beyond 25 to 50 megabits, according to Jonathan Atkin, an analyst with RBC Capital Markets in New York.

Dish Chief Executive Officer Joseph Clayton said in January that the market potential for satellite broadband service is "substantial, given the nearly 8 million to 10 million mostly rural American households that are unserved."

Separately, Dish reached an agreement in principle with Sinclair Broadcast Group Inc. on retransmission fees, keeping 70 broadcast stations on the air for its customers. The companies agreed today to extend their existing programming contract two weeks to allow both parties to sign off on a final agreement.

Dish had said earlier this week Sinclair was demanding more money for its stations than any other broadcast group in the country.

(BN) Verizon Is Said to Offer Nokia Windows 8 Phone This Year

Aug. 21 (Bloomberg) -- Verizon Wireless plans to sell a new Nokia Oyj phone with Microsoft Corp.'s Windows 8 software this year, marking the first time it has released a Windows device since May 2011, a person with knowledge of the matter said.

Microsoft and Nokia are holding a press conference on Sept. 5 in New York to discuss Nokia's Lumia brand of Windows phones. While Verizon isn't expected to be part of that event, the carrier intends to roll out a Nokia phone later, said the person, who asked not to be named because the plans are private. That would give Nokia a new beachhead at the top U.S. carrier, building on its longstanding relationship with No. 2 AT&T Inc.

Verizon is looking to lessen its dependence on Apple Inc.'s iPhone and devices running Google Inc.'s Android software, which dominate the smartphone market. For Microsoft and Nokia, meanwhile, the move would bolster efforts to regain market share. The Nokia phone would also provide fresh ammunition against the latest iPhone, which people familiar with the matter expect to be introduced on Sept. 12.

Brenda Raney, a spokeswoman for Basking Ridge, New Jersey- based Verizon Wireless, declined to comment, as did Erica Fields at Redmond, Washington-based Microsoft. Christopher Hollis, a U.S. spokesman for Espoo, Finland-based Nokia, also declined to comment.

Verizon released its only current Windows Phone, the Trophy from HTC Corp., more than a year ago, and it hasn't been a top seller. Microsoft and Verizon also stumbled with the 2010 release of the Kin phone, which was scrapped after less than two months in Verizon stores. While that experience strained relations, the companies have made strides in improving the partnership since then, the person said.

AT&T Relationship

For now, Nokia is more closely tied with AT&T, which introduced the Lumia 900 Windows Phone on April 8. AT&T Chief Executive Officer Randall Stephenson has promoted the device and uses it personally.

Nokia's first Windows Phone in the U.S. was the Lumia 710, which debuted at T-Mobile USA in January. Both the AT&T and T- Mobile Lumia devices rely on Microsoft's older-generation Windows Phone 7 software.

Microsoft is releasing the Windows Phone 8 operating system as a companion piece to its new software for personal computers and tablets. The phone software will be able to run on devices with speedier, dual-core chips and high-definition screens, Microsoft has said.

In July, a Nokia vice president told the tech news website Neowin that Nokia's Lumia Windows phones would soon be available on Verizon.

Microsoft had a 3.5 percent share of the mobile operating system market in the second quarter, with shipments of 5.4 million, according to research firm IDC. That's dwarfed by Android's more than 68 percent and Apple's 16.9 percent.

(BN) Intel Boosts Tech Investment After Anobit Sale: Israel Overnight

Aug. 21 (Bloomberg) -- Intel Capital, the investment unit of Intel Corp., is expanding its presence in Israel at a time local venture capital funds are cutting back, Marcos Battisti, a managing director at the chipmaker's subsidiary, said.

The unit added two investment managers in Tel Aviv last month to boost its portfolio in the country as first-time Israeli investments in technology companies were at the lowest level in a decade, he said. Israel has about 60 companies traded on the Nasdaq Stock Market, the most of any country outside the U.S. after China, and the three largest gainers on the Bloomberg Israel-US Equity Index of the most-traded Israeli stocks in New York this year are technology developers.

"We are betting big on Israel because of the type of innovation coming out of there, and very few small countries can match that," Battisti, who oversees the unit in Western Europe and Israel, said by phone from London yesterday. "Venture capital money has dried up a little bit in the region, so fundamentally we have less competition and we are not seeing overbidding in the market."

Intel Capital previously invested in Herzliya, Israel-based Anobit Technologies Ltd., which was acquired by Apple Inc. in January and Yokneam Elit, Israel-based Mellanox Technologies Ltd., the best performer on the Nasdaq Computer Index this year. The Bloomberg Israel-US Index was little changed at 84.25 yesterday. Given Imaging Ltd., the Israeli maker of pill-sized cameras for diagnosing digestive ailments, dropped to a three- year low.

'Heating Up'

Israel's TA-25 Index rose 1.3 percent to 1,118.73 at the close in Tel Aviv today. The benchmark gauge has climbed 3.1 percent this year, compared with 13 percent for the Standard & Poor's 500 Index. The Bloomberg US-Israel index has gained 3.7 percent this year, led by Mellanox's 248 percent rally and Allot Communications Ltd.'s 79 percent jump.

Israel's spending on research and development accounted for 4.4 percent of its gross domestic product in 2010, the most among countries in the Organization for Economic Co-operation and Development, according to statistics by the group. The data is a key indicator of government and private sector efforts to obtain competitive advantage in science and technology, the OECD said on its website.

"The evidence we have is that Israel is heating up in a positive way with good companies coming out," said Battisti, who focuses on investments in technology, media and telecommunications companies. It is becoming "more and more attractive for us because we are able to find companies that are going to yield good returns," he said.

The unit of Intel, the world's largest semiconductor maker, has invested in more than 60 companies in Israel since 1996.

Shrinking Investment

Israeli technology companies raised $453 million in the previous quarter, according to a survey conducted by IVC Research Center and KPMG Somekh Chaikin Israel. That's the least amount raised since the fourth quarter of 2010.

First investments by Israeli venture capital funds accounted for 18 percent of total investments in the second- quarter, the lowest share in a decade, IVC said.

"The percentage of high-tech investment from Israeli venture capital firms is continuing to decline as capital available for new investments is shrinking," Koby Simana, chief executive officer of IVC, said in a July 16 statement. "We expect a further decline in VC high-tech investments throughout this year."

In the last quarter, first investments by Israeli venture capital funds accounted for 18 percent of their total investments, the lowest quarterly share in a decade, IVC said.

Scailex Deal

Partner Communications Co., Israel's second-largest mobile phone provider, slumped the most in a month, dropping 5 percent to $3.81. Its shares in Tel Aviv dropped 2.1 percent to 15.52 shekels, or the equivalent of $3.86, today.

Scailex Corp., which owns 44.5 percent of Partner, said a group led by Hutchison Whampoa Ltd. canceled an agreement to buy 75 percent of the company due to "adverse findings" and a "decline in operations" discovered in the due diligence process, according to a statement filed with the Tel-Aviv Stock Exchange. Partner's shares has declined 18 percent since the deal was announced on June 5.

Given Imaging declined 1.9 percent to $12.69 in New York to the lowest since September 2009. Its Tel Aviv shares fell 3.3 percent to 50.52 shekels, or $12.55, today.

The Yokneam, Israel-based company has hired a foreign bank to help find strategic partnerships that could also include the sale of control of the company, the Bizportal website reported yesterday, without saying where it got the information. An e- mailed message sent to the media department of the company seeking comment wasn't immediately returned.

(BN) SAP Courts Startups From Health to Retail in Data Push

Aug. 17 (Bloomberg) -- Jan Karstens is looking for ways to reduce the amount of food supermarkets have to throw away and avoid items getting out of stock. As better forecasts require processing ever more data, he opted to seek an ally in SAP AG.

Karstens, head of development at Karlsruhe, Germany-based Blue Yonder GmbH & Co., joined more than 30 startup executives in Berlin this week to pitch ideas to the world's largest maker of business-management software -- and earn access to SAP's real-time data crunching technology. The software giant hopes its tiny partners will spawn new concepts that give it an edge against competitors including Oracle Corp., which dominates the $26.7 billion database market.

"If you can do a business model change with innovation, that's very hard to catch up with," Aiaz Kazi, SAP's senior vice president of technology and innovation market strategy, said in an interview at the event. "We have something here that's frankly beyond traditional SAP."

SAP's Startup Focus Program was begun at the behest of company co-founder Hasso Plattner and Chief Technology Officer Vishal Sikka to aid the rollout of Hana database technology. The program began a world tour in March, starting in California's Palo Alto and moving through cities including Seattle, Toronto, Tel Aviv and Bangalore, India, with Tokyo and Singapore to follow in coming weeks.

Health Treatment

In Berlin, candidates vying to use the technology include Pixray GmbH, whose software helps photographers and companies find illegal copies of their images on the Web, and Next Audience GmbH, which helps advertisers better grasp the interplay between their digital marketing activities, Internet- advertising platforms and customer management systems.

Alacris Theranostics GmbH would use Hana to improve its ability to analyze the genome of cancer patients and predict which treatments work best on particular individuals. That would reduce side effects and raise rates at which drugs are approved by regulators, Chief Executive Officer Bodo Lange said.

The startups' offerings will be more attractive to clients if the systems allow larger amounts and more types of data to be analyzed and if they issue results more quickly, using technology such as Hana, the startup leaders said.

Faster Analysis

Karstens, Lange and the other executives now await the verdict from SAP's jury on which companies will be given free use of Hana development tools for a year and marketing assistance. Walldorf, Germany-based SAP, via its venture arm, may also invest a share of the $155 million it has budgeted for that purpose.

SAP shares were little changed at 51.96 euros as of 9:53 a.m. in Frankfurt trading, giving the company a market value of 63.8 billion euros ($78.8 billion). SAP overtook Siemens AG last month to become Germany's most valuable public company. Oracle added 1.5 percent in New York yesterday.

Hana is designed to quickly analyze vast caches of sales and operational information, as well as unstructured data such as e-mail and social media. It allows operations to be performed in a computer's memory, avoiding data transfers to and from slower hard drives.

Sales of Hana have exceeded 300 million euros so far this year, Kazi said. That compares with a target of more than doubling last year's figure of 160 million euros by the end of 2012. SAP is evaluating how to make Hana-based software more affordable by delivering it via the Web, he said.

SAP Investments

The ramp-up comes at a cost. In April, SAP said it planned to spend almost $500 million to convince customers to adopt Hana and get smaller partners to develop software to showcase the capabilities of the technology. The company may offer Hana to the startups at a discounted upfront price or take a share of the revenue the companies generate.

SAP has invested in smaller companies via its SAP Ventures arm. Investments have included professional social network LinkedIn Corp., e-mail marketer ExactTarget Inc., Box Inc., a provider of cloud storage and collaboration systems, and Lithium Technologies Inc., a social-media marketing company.

Oracle CEO Larry Ellison last year unveiled the so-called Exalytics Intelligence Machine, which also analyzes information within dynamic random access memory. SAP has said its in-memory approach leads rivals by about 18 months, and that Hana is cheaper and more versatile than other offerings.

"Oracle has reacted the least," Blue Yonder's Karstens said. "They've cobbled something together from old technologies that's not an alternative for me." Hewlett-Packard Co.'s Vertica, International Business Machines Corp.'s solidDB, Microsoft Corp.'s SQL Server, and Germany's ParStream GmbH are more useful than Oracle's big data offering, he said.


(BN) Ford Boosts Investment for Battery-Powered Cars

Aug. 15 (Bloomberg) -- Ford Motor Co., debuting five battery-powered models this year, is spending $135 million to design electric-drive parts and double battery testing capacity.

Ford is moving more battery research in-house and has hired 60 engineers in the last year, bringing its electric-vehicle engineering staff to more than 1,000, according to a statement today. The moves help reduce the cost of hybrid systems by 30 percent and speed development by 25 percent, Ford said.

Almost all of the electric-vehicle engineers will work under the same roof to foster "an innovative atmosphere," Joe Bakaj, Ford's vice president of powertrain engineering, told reporters in Dearborn, Michigan. Some of the $135 million includes a U.S. Energy Department grant, Christin Baker, a Ford spokeswoman, said in an e-mail.

Ford has said hybrids, plug-in hybrids, and all-electric cars will account for as much as 25 percent of its new vehicle sales by 2020, from less than 3 percent last year. The second- largest U.S. automaker is competing in the nascent market for electrified vehicles with Toyota Motor Corp., General Motors Co., Nissan Motor Co. and startups such as Tesla Motors Inc. and closely held Fisker Automotive Inc.

Ford said it plans to hire "dozens" of additional engineers for electric-vehicle development. It's also renaming its 285,000-square-foot (26,477-square-meter) advanced engineering center in Dearborn the "Ford Advanced Electrification Center."

Electrified vehicles accounted for 3.4 percent of the U.S. market in this year's first half, up from 2.2 percent a year earlier, according to researcher LMC Automotive. Hybrids fell to 2.2 percent of the U.S. market last year, down from 2.4 percent in 2010 and 2.8 percent in 2009, LMC said.

Ford's Share

Ford, based in Dearborn, had just 4 percent of the U.S. hybrid and electric-vehicle market in the year's first half, compared with 72 percent for Toyota, said Mike Omotoso, a Troy, Michigan-based researcher for LMC. Ford's share of the hybrid market fell from 11 percent in the first half of last year because the automaker is discontinuing the slow-selling Escape hybrid, Omotoso said.

The automaker hasn't sold more electrified vehicles because "we are dependent on the price of gas," Bakaj said. "But when you look over the long term, it's still our feeling gas prices will rise." The national average price of unleaded gasoline was $3.71 a gallon yesterday, according to AAA.

Ford research showed 60 percent of customers would buy a hybrid or electric vehicle if there was no price penalty, Bakaj said. When customers are asked if they would accept a higher price if the premium is paid off in four years, 26 percent say they'd still be interested in a hybrid or electric, he said.

'Significant Number'

"That's still a very significant number," Bakaj said. "We know fundamentally there are customers who want to buy these products."

Ford was the first U.S. automaker to sell a hybrid when it debuted a gasoline and electric powered version of the Escape sport-utility vehicle in 2004. Sales of its Fusion hybrid sedan are down 22 percent this year, to 6,097, according to researcher Autodata Corp.

Ford began selling an electric version of its Focus compact car in May for $39,200. Later this year, Ford will introduce hybrid and plug-in hybrid versions of the C-Max wagon, a model coming from Europe. A new version of the Fusion hybrid, which gets 47 miles (76 kilometers) per gallon in city driving, is also coming this year. Production of a plug-in Fusion sedan starts at year-end.

Mulally's Plan

Chief Executive Officer Alan Mulally has made fuel- efficiency central to his turnaround plan for Ford. He said in April that Ford wouldn't back off its ambitious sales goals for electric-powered vehicles just because they get off to a slow start.

"We believe that the electrification of vehicles is going to continue as the battery cost comes down, as we move to generate electricity cleanly," Mulally told reporters in Laguna Niguel, California, that month. "We see this as continually growing. This is a long-term journey."

Ford gained 0.5 percent to $9.49 at the close in New York and fell to $9.48 at 8:04 p.m. New York time after the end of regular trading. The shares have slid 12 percent this year.

(BN) Beijing Plans to Levy Congestion Charges to Ease Traffic Jams

Aug. 21 (Bloomberg) -- Beijing plans to build a system for imposing road-congestion charges on motorists, adding to caps on vehicle registrations as China's capital seeks to ease traffic jams and cut emissions.

The municipal government will also accelerate the expansion of the subway network, increase dedicated bus lanes and encourage the use of bicycles for short commutes, according to a five-year development plan by the city's transportation commission posted on its website.

"Beijing faces a serious test in the next five years with the rapid growth in population and number of vehicles," the commission said in its plan, which covers the period from 2011 to 2015. The document didn't include details on the congestion charges or when they will be imposed.

If the plan goes ahead, Beijing will join London and Singapore among cities that levy congestion fees to deter usage. China's capital already caps the number of new vehicle registrations and limits the use of private vehicles on designated days based on their license plate numbers.

The city will also restrict growth in the number of official cars and targets to reduce vehicular emissions by 10 percent from 2010 levels, according to the plan.

Traffic jams eased to an average 55 minutes during weekdays in the first quarter, compared with 75 minutes a year earlier, the Beijing Transportation Research Center said in June. In 2010, commuters spent an average 2 hours and 25 minutes a day in gridlock.


(BN) Google, Oracle, Spotify, Apple: Intellectual Property

Aug. 20 (Bloomberg) -- Google Inc. said it didn't pay people to write about Oracle Corp.'s lawsuit against it over Android software, although nonprofits, universities and trade groups receiving Google money have commented on the case.

Oracle said Google maintains a network of direct and indirect "influencers" to advance its intellectual property agenda, according to an Aug. 17 filing in federal court in San Francisco. Oracle has hired one writer, Florian Mueller, author of the FOSS Patents blog, as a consultant, not to blog about the lawsuit, Oracle said. Mueller has written extensively on the lawsuit.

Both companies filed papers in court Aug. 17 responding to a judge's order to disclose payments to journalists, bloggers and commenters. U.S. District Judge William Alsup, who has presided over the lawsuit, said Aug. 7 that disclosure is needed to make clear whether anything written about the case is "possibly influenced by financial relationships to the parties or counsel."

Google said there were no quid-pro-quo payments to people for coverage, and commentators at entities which receive donations or financial support from Google weren't paid to write about the case.

"Google does not believe that individuals or organizations within these categories were intended to be encompassed within the scope of the court's order," Google lawyers said in the filing. They asked Alsup to let them know if he wants a "more comprehensive list."

A jury found May 7 that Mountain View, California-based Google, owner of the world's most-popular search engine, infringed Oracle's copyrights when it developed Android software for mobile devices yet deadlocked on whether the copying was "fair use." That denied Oracle the ability to seek as much as $1 billion in damages from the search engine company. The jury found May 23 that Google didn't infringe two Oracle patents.

The case is Oracle v. Google, 10-3561, U.S. District Court, Northern District of California (San Francisco).

Apple Witness Claims Samsung Abused Its 'Monopoly' Over Patents

Samsung Electronics Co. used "monopoly power" to make exorbitant licensing demands of Apple Inc. over two patents the South Korean company accuses the iPhone maker of infringing, a witness told a jury.

Janusz Ordover, a New York University economics professor, said Samsung "distorted" the process through which a standard- setting body in Europe set industry requirements based on its wireless-technology patents. Ordover testified Aug. 17 at the end of a three-week-long intellectual-property trial in San Jose, California.

Ordover, hired by Apple as an expert witness, said Samsung "acted in a way that evidences it has gained monopoly power by making licensing demands to Apple that are inconsistent" with reduced licensing rates required of patents used by the European Telecommunications Standards Institute to set technological requirements.

Samsung has declared the patents "essential" and is seeking as much as $399 million in royalties from Apple for infringing them, according to court testimony.

Apple, based in Cupertino, California, sued Samsung in April 2011, accusing it of copying patented designs for mobile devices, and Suwon, South Korea-based Samsung countersued.

Testimony concluded Aug. 17 at the trial. U.S. District Judge Lucy Koh limited each side to 25 hours and Samsung told the court that it declined to cross-examine Ordover because of the time constraints.

Koh said she aims to finish with jury instruction arguments by the end of today and to have the companies present closing arguments tomorrow.

The case is the first to go before a federal jury in a battle being waged on four continents for dominance in a smartphone market valued by Bloomberg Industries at $219.1 billion.

The case is Apple Inc. v. Samsung Electronics Co. Ltd., 11- cv-01846, U.S. District Court, Northern District of California (San Jose).

Spotify Sued by Nonend Inventions Over Music-Sharing Patents

Spotify Ltd. was sued by Nonend Inventions NV over technology that allows Spotify users to get music from the streaming service and other subscribers.

Netherlands-based Nonend accuses Spotify of "making, using, offering to sell, and selling streaming music services to users which incorporate methodologies that infringe one or more claims" of certain patents, according to court papers filed in federal court in Delaware.

Closely held Spotify said in November it had 10 million registered users worldwide, and 3 million paying subscribers. Spotify said July 31 that 5 million more subscribers signed up for its ad-supported music service since January, with expansion into countries including Australia and New Zealand.

Spotify has content agreements with Sony Corp.'s Sony Music, Vivendi SA's Universal Music, EMI Group and Warner Music Group. Under those agreements, artists, record companies and publishers receive a cut of ad sales and subscriber fees.

Graham James, spokesman for Spotify, didn't immediately respond to an e-mail seeking comment about the lawsuit.

The case is Nonend Inventions NV v. Spotify USA Inc., 1:12- cv-01041, U.S. District Court, District of Delaware (Wilmington).

Heinz Sued Over Patent for Single-Serve Ketchup Packaging

H.L. Heinz Co., the Pittsburgh-based food company, was sued for patent infringement by an Illinois inventor.

Scott Alan White, in a suit filed in federal court in Chicago, said he invented a container to be used for condiments and made a presentation to Heinz, suggesting the company use the product for individual-serving ketchup packages.

He filed a patent application in October 2005, before his initial contact with the food company in July 2006, according to court papers.

Heinz said it wasn't interested, and, told him his invention wasn't patentable, White said. White continued in his efforts to seek a patent, which was issued July 31 as patent 8,231,026, according to the database of the U.S. Patent and Trademark Office.

After Heinz's rejection of his design, White said he was surprised when Heinz began promoting single-serving ketchup in its "Dip' & Squeeze" package, even featuring it on the cover of the food company's 2012 annual report. The "Dip & Squeeze" packaging violates multiple claims of his patent, White said in his pleadings.

He claims he's damaged by Heinz's alleged infringement, and asked the court for an order barring further infringement. Additionally, he seeks awards of money damages, and asked they be tripled to punish the food company for its actions.

Heinz spokesman Michael Mullen characterized the case as a "frivolous lawsuit," and said the company will prove that the allegations are "groundless and without merit." The company "worked for years'" to develop the "Dip & Squeeze" package, he said.

The case is Scott Alan White V. H.J. Heinz Co., 1:12- cv-06074, U.S. District Court, Northern District of Illinois (Chicago).

For more patent news, click here.

For more trademark news, click here.


Coldwell Banker Infringed Architectural Renderings' Copyright

Coldwell Banker Residential Real Estate and Sard Custom Homes LLC, a Connecticut home builder, infringed an architecture firm's copyrights by making unauthorized use of architectural renderings, a federal appeals court ruled Aug. 15.

Although Prudential Connecticut Reality is also listed as a defendant, according to a footnote in the court opinion, the issues pursued in the appeal do not involve matters that were litigated by Prudential on the trial court level. The court said Prudential didn't participate in the appeal "although it remains technically a party."

The U.S. Circuit Court of Appeals in New York reversed a lower court ruling that no infringement occurred because the renderings weren't sufficiently detailed to enable construction of houses based on them.

Scholz Design Inc. of Toledo, Ohio, filed the infringement suit in federal court in New Haven, Connecticut, in October 2012, saying the unauthorized use of the renderings for marketing and advertising constituted copyright infringement. In July 2011 that court granted all three motions to dismiss the case, saying the drawings weren't sufficiently detailed to warrant copyright protection.

The appeals court disagreed, noting that "copyright protection of a pictorial work, whether depicting a house, or a flower, or a donkey, or an abstract design, does not depend on any degree of detail." The court said it saw "no reason" why the renderings should be treated differently from any other pictorial work for copyright purposes.

Although paintings by Claude Monet of the Rouen Cathedral, and by Andrew Wyeth and Edward Hopper of houses weren't sufficiently detailed to enable construction of the buildings they depicted, that lack of detail wouldn't justify the denial of copyright protection, the court said.

Instead, all that is required is "independent creation and originality," and the renderings qualified, the court ruled.

The court vacated the lower court's dismissal of the infringement claim and of a breach-of-contract claim made by Scholz. It also awarded litigation costs to the architectural firm.

The appeals court case is Scholz Design Inc. v. Sard Custom Homes, 11-3291, U.S. Court of Appeals for the Second Circuit. The lower court case is Scholz Design Inc. v. Sard Custom Homes LLC, 3:10-cv-01681-JBA, U.S. District Court, District of Connecticut (New Haven).

MTN Group Responds to Politician's Ringtone Infringement Suit

MTN Group has responded to a copyright suit by the former mayor of Kampala, Uganda, by saying its use of recordings of his speeches doesn't infringe, according to the AllAfrica.dom website.

The Cresta, South Africa-based telecommunication company is arguing that while it's Al Haji Nasser Ntege Sebaggala's voice on the ringtones, he isn't the author of the recording and ringtones, since they were "fine-tuned" into transferable material, AllAfrica.com reported.

The recordings are the product of the engineer who shaped the raw speech, the telecom company said, according to AllAfrica.com.

Sebaggala, who filed the infringement suit in July, is demanding the proceeds MTN realized from selling the ringtones, which the company makes available to telephone users for a 30- day period for 500 Ugandan shillings ($.20), AllAfrica.com reported.

For more copyright news, click here.

Trade Secrets/Industrial Espionage

CBS Drops Infringement Suit Against ABC Over 'Glass House'

CBS Corp. dropped a lawsuit alleging that "The Glass House," an ABC network reality television show, is a copy of CBS's "Big Brother," according to a court filing.

CBS, based in New York, sued Burbank, California-based Walt Disney Co.'s ABC in May, alleging that "The Glass House" infringed on its own reality series, in which a group of contestants spend months secluded in a house, evicting one another on camera.

CBS filed a notice of voluntary dismissal in federal court in Los Angeles yesterday. The broadcaster said in a statement that it reserved the right to re-file its claim.

"The viewers have spoken and delivered the ultimate form of justice against 'The Glass House,'" CBS said in the statement. In the week ended Aug. 12, "The Glass House" ranked 87th among broadcast shows in TV ratings based on viewers, with an audience of 1.59 million, according to Nielsen data.

U.S. District Judge Gary Feess in June denied CBS's request to block the ABC show, saying that he wasn't convinced CBS would prevail in its copyright suit. The harm to ABC and the people working on "Glass House" caused by stopping the show would outweigh the harm to CBS from allowing it to air, he said.

Two former supervising producers and a former co-executive producer of "Big Brother" plus 16 other ex-producers and series staff are working on "Glass House" and disclosed CBS trade secrets and confidential information in violation of nondisclosure agreements, CBS said in its complaint.

CBS said the contract and trade-secrets claims against the ex-producers will continue in arbitration.

Representatives of ABC didn't immediately respond to e- mailed requests for comment on the dismissal.

The case is CBS v. ABC, 12-4073, U.S. District Court, Central District of California (Los Angeles).

(BN) Hitachi Metals, Zumbox, Apple: Intellectual Property

Aug. 21 (Bloomberg) -- Hitachi Metals Ltd., a Japanese maker of specialty metal products, filed a U.S. trade complaint against more than two dozen companies, seeking to block imports of competitors' rare-earth magnets used in electronics, golf ball markers and power tools.

The companies are infringing four patents related to the manufacture of sintered rare-earth magnets, Hitachi Metals said Aug. 17 in a complaint at the U.S. International Trade Commission in Washington. It's asking the agency to block products that are using rare-earth metals from China, where 95 percent of all such materials are mined and processed.

Hitachi Metals, based in Tokyo, said in the complaint it has an agreement to make the magnets with Molycorp Inc., the owner of the only rare-earth mine in the U.S., and plans to begin production in 2013. Rare earths are 17 chemically similar elements used in batteries, magnets and computer hard drives. Sintered rare-earth magnets are small, light and powerful.

The complaint names Chinese companies that mine or use the metals, as well as firms that import or make products that use them. They include audio-equipment makers Skullcandy Inc., Harman International Industries Inc., and Bose Corp., and athletic-gear makers Callaway Golf Co., Taylor Made Golf Co., and Adidas AG.

Molycorp is working to reopen a rare-earth mine in Mountain Pass, California, which closed in 2002 because Chinese exports caused global prices to plunge, according to Hitachi Metals. More recently, prices have risen and the U.S. Congress has been calling for an increase in domestic production.

Hitachi Metals said it and other suppliers would be able to make up the difference were the rare-earth magnets from China halted at the U.S. border.

It said the commission has twice limited imports of certain rare-earth magnets based on patent-infringement complaints, in 1996 and 1999.

The new case is In the Matter of Sintered Rare Earth Magnets, 2908, U.S. International Trade Commission (Washington).

For more patent news, click here.


Australia Post Office Suit of Digital Mailbox Company Dismissed

Australia's national postal service's trademark challenge against a company planning to begin a competing digital mailbox service was dismissed by an Australian federal court, PC World reported.

The competitor, Digital Post Australia -- created by Zumbox Software Inc., Computershare Ltd. and Salmat Ltd. -- was accused of using a name too similar to Australia Post, the official postal service, according to PC World.

David Hynes, who heads Digital Post Australia, told PC World his company had no intention of trying to trick customers into believing it was the official postal service, PC World reported.

Australia Post said it seeks to prevent third parties "from using an Australian-owned, trusted brand for their commercial gain" and is considering whether to appeal the judgment, according to PC World.

Ryan Lochte Seeks 'Jeah' Trademark; Rapper Says He May Oppose

Ryan Lochte, a member of the U.S. Olympic swim team who said he was quitting swimming after failing to win gold medals in two events in London last month, filed an application to register "Jeah" as a trademark, according to the database of the U.S. Patent and Trademark Office.

Lochte's application, filed Aug. 1, suggests he plans to use the mark for a wide range of merchandise, including gift cards, baseball caps, swim goggles, drinking classes, trading cards and clothing.

There is one existing "Jeah" trademark, registered in 2002 for Web hosting, belonging to Jeah Communications LLC of Menomonee Falls, Wisconsin.

M.C. Ehit, a 1990s rap performer, told the TMZ website that he's been using it since 1988 and that he plans to send the athlete a cease-and-desist letter.

IPhone Ice Cream Big Hit in China, Not Connected to Apple Inc.

Although Apple Inc.'s iPhone 5 mobile phone is still several months away from release, Chinese customers are buying an iPhone 5 ice cream product in that country's Liaoning Province, China Daily reported.

The ice cream product is shaped like the Cupertino, California-based company's logo and has become a best-seller, according to China Daily.

China has 45 trademark classes, and the computer company registered in only 27, with Chinese companies going after the remaining ones, China Daily reported.

The newspaper reported that a Chinese trademark lawyer suggested that while the action of the other companies isn't illegal, "it should not be encouraged" because of the trademark-management burden it imposes.

Leaked Vuitton Ads May Bring Olympian Phelps Fines, Medal Loss

Olympic swimmer Michael Phelps may be in danger of losing his hoard of medals, depending on whether LVMH Moet Hennessy Louis Vuitton SA deliberately leaked two ads containing photos of the athlete with a bag bearing the luxury brand's trademark monogram, the U.K.'s Daily Mail reported.

The ads appeared on several websites on Aug. 13, within the time Olympics rules bar athletes from appearing in non-Olympic marketing, according to the newspaper.

Both Vuitton and Phelps's manager have denied leaking the photos, which were by celebrity photographer Annie Liebowitz, according to the newspaper.

Phelps's agent Peter Carlisle said the photos hadn't been reviewed or approved by the athlete and that it would be unfair to punish him for unauthorized actions by some unknown person, according to the Daily Mail.

For more trademark news, click here.


Merchant Ivory Sues Janus Films Over Movie Distribution

Merchant Ivory Productions Ltd., the maker of films such as "A Room With a View," accused movie distributor Janus Films LLC of infringing copyrights by distributing films after their licensing deals expired.

Janus, which handles the so-called Criterion Collection, initially was granted rights to 26 Merchant Ivory films in 1999, according to a lawsuit filed yesterday in federal court in Manhattan. The agreements for all of the films except "Howards End" expired by Dec. 31, and Merchant Ivory later learned Janus was still distributing them, according to the complaint.

"Plaintiffs therefore bring this action to protect their copyrights in and to the films being exploited by Janus without plaintiffs' permission," Merchant Ivory said in the complaint filed by attorneys Zeynel Karcioglu and Stephen Nakamura.

"Janus denies any unlawful distribution of any Merchant Ivory title," Jeffrey Ullman, a lawyer for Janus, said in a phone interview. He declined to comment further, saying the company hadn't been served with the suit.

The lawsuit followed Janus's efforts to negotiate a new license agreement, which were complicated by an arbitration proceeding between London-based Merchant Ivory and an entity called ACKMA Recovery LLC and discussions over a proposed deal with HanWay Films, according to the complaint. Either deal required approval from ACKMA, according to the filing.

Janus entered a side arrangement with HanWay, which had discussed a possible distribution agreement with Merchant Ivory, the company alleged.

The closely held company asked the court to stop Janus from reproducing the films or otherwise using the copyrighted materials and seeks damages including all profit related to the alleged infringement.

The case is Merchant Ivory Productions Ltd. v. Janus Films LLC, 1:12-cv-06325, U.S. District Court, Southern District of New York (Manhattan).

Google Ordered Anew to Disclose Commentators in Oracle Case

Google Inc. was ordered by a judge for a second time to disclose the names of commentators and authors who wrote about Oracle Corp.'s copyright case against it and received money from the search engine company.

Google failed to comply with an Aug. 7 order requiring it and Oracle to disclose the information, U.S. District Judge William Alsup said yesterday in a court filing. Alsup presided over a trial in the case in federal court in San Francisco.

"Public commentary that purports to be independent may have an influence on the courts and/or their staff if only in subtle ways," Alsup said. "If a treatise author or blogger is paid by a litigant, should not that relationship be known?"

Google said in court filings Aug. 17 that it didn't pay people to write about the lawsuit, although nonprofit organizations, universities and trade groups receiving money from the owner of the world's largest search engine have commented on the case. The company said it may be impossible to name all the people who wrote about the case and asked if Alsup wanted a more comprehensive list.

"We'll comply with the order," Jim Prosser, a spokesman for the Mountain View, California-based company, said in an e- mail.

The case is Oracle v. Google, 10-3561, U.S. District Court, Northern District of California (San Francisco).

Thursday, August 16, 2012

(BN) New York Chases Silicon Valley With Roosevelt Island Site

Aug. 17 (Bloomberg) -- New York City's ambitions to challenge Silicon Valley as a technology center are taking root on a narrow isle in the East River, where Cornell University is building a $2 billion campus and startup incubator.

Manhattan's Roosevelt Island will be home to a new engineering and applied science graduate school, part of a bet that the next Apple Inc. could be born in the Big Apple. West Coast companies are already helping lay the groundwork, with Google Inc. donating office space to the project and Facebook Inc. hosting a "hackathon" to build buzz with all-night programming binges.

New York has an uphill fight in trying to draw startups and engineers away from the San Francisco Bay area -- home to Apple, Google, Facebook and Twitter Inc. Silicon Valley attracted almost six times more venture-capital investment dollars than New York in the second quarter, according to a PricewaterhouseCoopers LLP study. Still, the city has an edge in giving entrepreneurs access to the worlds of finance, fashion, advertising and retail, making New York fertile ground for startups that fill the needs of those industries.

"There is more interest in New York as a potential tech center than ever before," said Greg Pass, a former Twitter executive who now works for the new Cornell campus. "As the world becomes more technological, the role of engineers will be become more substantial."

Winning Bid

The graduate school, known as CornellNYC tech, is part of a broader push by Mayor Michael Bloomberg to make the city a global technology leader. In December, Cornell and the Technion- Israel Institute for Technology beat out six competing bids to build the campus, including one from Stanford University. A $350 million donation from Cornell graduate Charles Feeney helped seal the university's victory.

The city is donating space on Roosevelt Island and as much as $100 million for infrastructure improvements. The mayor is founder and majority owner of Bloomberg LP, the parent company of Bloomberg News.

The project is meant to bolster job creation in the city and generate 600 spinoff companies and $23 billion in economic activity over the next three decades. Until the Roosevelt Island campus opens in 2017, it will run in Manhattan's Chelsea neighborhood, in space leased rent-free from Google.

Facebook, Google

The campus will offer pilot courses this year and begin conducting master's classes in the latter part of 2013. Key to the effort is enlisting technology companies, which will give students a glimpse into their operations, Dan Huttenlocher, dean of the campus, said in an interview. Facebook, Google, EBay Inc., Amazon.com Inc., Groupon Inc., Juniper Networks Inc., Advanced Micro Devices Inc. and Twitter said they intend to collaborate with the campus.

"You can almost name a company, and they're very excited," Huttenlocher said.

While New York trails the Valley in startup funding, it's closing the gap. The number of venture deals in the city grew by almost a third between 2007 to 2011, while falling 10 percent in Silicon Valley, according to the Center for an Urban Future. The city now has more than 1,000 technology startups, and the number of so-called tech accelerators has grown from zero to at least 12 since 2009, making it easier for budding companies to find investors and form business models.

Google, Facebook, Twitter, Microsoft, EBay, Yelp Inc. and LinkedIn Corp. have set up offices in the city. From 2005 to 2010, New York's tech workforce grew 10 times faster than total city employment, according to the Center for an Urban Future.

Doubling Students

The Cornell campus aims to almost double the number of engineering graduate students in "leading programs" in the city, according to the New York City Economic Development Corp. The graduate engineering or applied science schools at Columbia University, City University in New York and the Polytechnic Institute of New York University had a total of about 2,800 students as of 2011, the mayor's office said.

"It inevitably develops the likelihood that we will have developed better tech talent in the city," said Alfred Spector, vice president of engineering at Google, which may fund CornellNYC faculty posts.

To maintain closer ties to the technology industry, CornellNYC plans to focus research on real problems that companies are trying to solve. That's a shift from a tradition in which academia sets the agenda, Huttenlocher said.

New Model

"We're working on a new model," he said. "We often think about education happening first and entrepreneurship happening second. We are trying to intertwine those at the same time."

Companies will have a place on the campus as resident entrepreneurs and guest lecturers. A mentorship program will pair each student with an industry mentor. And businesses are already picturing CornellNYC as a recruitment hotbed.

Facebook lured 80 students to its Madison Avenue offices on July 21 for a 24-hour hackathon, an event organized with CornellNYC. In between bean-toss and mini-basketball games, students worked together in small groups to code and solve problems of their choice, huddled in an office with exposed plywood and pipes. Scooters and squirt guns were scattered around the room.

Cornell is one of the top schools from which Facebook recruits, said Jessica Traynor, academic-relations manager at the social-networking company. Facebook will probably host Cornell professors and students as presenters at its offices, and its staff may give lectures or teach at the campus, said Traynor, who helped Cornell on its bid for the project before joining the company.

Facebook's Users

"Faculty are really interested in our scale, with 900 million-plus users," Traynor said. Students could work with the company on topics such as systems engineering and human-computer interface, she said.

Facebook will compete for candidates with companies such as Groupon, which is including Cornell's Ithaca and New York campuses on its recruiting list for the first time this year.

Corey Kaminsky, a 19-year-old rising sophomore at Cornell who plans to major in chemistry, said she wants to attend the New York campus for graduate studies and eventually start her career in the city.

"I want to go into biotech," said Kaminsky, who grew up in New York. "I would be thrilled to go back to being in a big city where new technology will come out."

Teaching Entrepreneurship

Cornell hired Pass, Twitter's former technology chief, as its founding entrepreneurial officer. He oversees partnerships with industry and ensures that business-startup lessons are integrated into the curriculum and campus culture.

Pass's own experience comes from the intersection of academia and business. A patent he had produced as a Cornell undergraduate formed the foundation of a company called ToFish, which produced an image-search product. It was acquired by America Online Inc. in 2000. At Twitter, Pass was responsible for hiring hundreds of engineers, Huttenlocher said.

"What Greg brings can certainly be very rare on a university campus," Huttenlocher said. "He is someone who is a very successful serial entrepreneur. He is going to help us start programs that will bring this academic culture together with the culture of commercial success."

CornellNYC's first faculty hire shows its ambition to compete with the West Coast for talent. Deborah Estrin comes to the campus from University of California at Los Angeles, where she is a computer-science professor and founding director of its Center for Embedded Networked Sensing.

Estrin will teach courses such as Internet architecture starting in January. Her research focuses on how mobile and wireless systems can be used to collect and analyze data.

"We plan to connect to the overall ecosystem of companies around the campus," Estrin said. "Los Angeles and California are a very special place, but I don't see it as leaving behind the heart of tech."

Wednesday, August 15, 2012

(BN) Apple Said to Talk With Cable Industry About Set-Top Box

Aug. 16 (Bloomberg) -- Apple Inc., the world's most valuable company, is in talks with at least one of the largest U.S. cable companies about building a set-top box that would carry live television and other content, a person with knowledge of the discussions said.

Consumers would be able to purchase the device instead of paying a monthly leasing fee to cable companies, said the person, who requested anonymity because the talks are private.

A deal would mark the iPhone maker's biggest foray into TV after years of calling it a "hobby." The company's $99 Apple TV product doesn't carry live network broadcasting and is mainly used for downloading movies and TV shows from the iTunes media store or streaming content from such services as Netflix Inc. and Google Inc.'s YouTube.

By partnering with cable companies, Apple would get access to myriad channels now available to subscribers, instead of having to strike independent licensing deals with media companies and program owners after shows have aired.

Tom Neumayr, a spokesman for Cupertino, California-based Apple, declined to comment. The discussions were previously reported by the Wall Street Journal.

Apple executives have long negotiated with media companies about ways to get more content for a TV product. Walt Disney Co.'s ESPN sports network has talked with Apple about giving subscribers online access to programming through Apple TV, executives said in May.

Broadcast Rights

One challenge Apple has faced is that cable companies such as Comcast Corp. have invested heavily in developing a new user- interface for their own set-top boxes that they lease to customers for a monthly fee.

Before his death last year, Apple co-founder Steve Jobs told biographer Walter Isaacson that he had "finally cracked" how to build a TV device.

"It will have the simplest user interface you could imagine," Jobs told Isaacson in the biography "Steve Jobs."

The comments fueled speculation about Apple's aspirations to reach customers in the living room. Gene Munster, an analyst for Piper Jaffray Cos., has said that the company has built a prototype TV for release by next year.

Besides Eddy Cue, Apple's senior vice president in charge of media partnerships, another executive leading Apple's TV effort is Jeff Robbin, who helped create the iPod and build the iTunes store, people familiar with the project said last year.

(BN) Google Asked Samsung to Change Device Designs, E-Mails Show (2)

Aug. 15 (Bloomberg) -- Google Inc. asked Samsung Electronics Co. to change the design of its phones and tablets to look less like Apple Inc.'s devices, according to e-mails shown to a jury today at a trial between Apple and Samsung.

Harold McElhinny, a lawyer representing Apple, asked Samsung designer Kim Jin Soo today if he recalled two e-mail exchanges in 2010 at Samsung about Google's request. The e-mails were introduced as evidence in the third week of the multibillion-dollar intellectual-property trial in federal court in San Jose, California.

Kim, speaking through an interpreter, denied he was aware of Google's request.

"Whether that is a fact or not, I cannot confirm that for you, and whether such statement was made, if it was the official position of Google, or by someone made" at a different level of the company, "I don't know such things," Kim said.

Samsung has used Google's Android free operating system to build phones that propelled it to the number one spot in the phone market.

Apple sued Samsung in April 2011, accusing it of copying patented designs for mobile devices, and Samsung countersued. The case is the first to go before a federal jury in a battle being waged on four continents for dominance in a smartphone market valued by Bloomberg Industries at $219.1 billion.

Internal E-Mail

McElhinny showed a Feb. 16, 2010, internal Samsung e-mail describing minutes from a design meeting sent to "pass along only a few comments from Senior Designer Cho who went into the Google meeting yesterday," according to the message.

"Since it is too similar to Apple, make it noticeably different starting with the front side," the message says, referring to one of the company's tablets.

The second e-mail, dated Feb. 22, 2010, from Ki Hyun Seo to more than 30 Samsung employees is titled, "Team Leader's Directives at the Executives' Meeting 2/22."

"I am notifying you of the team leader's directives from the executives' meeting yesterday," the message begins. The sixth item on the list addresses a need to "respond to the issue of design similarity for the S series," which Kim testified was a reference to Samsung's S series of smartphones, some of which are at issue in the case.

'Distinguishable Design'

"Google is demanding distinguishable design vis-à-vis the iPad," the e-mail said. "Consider design distinguishability for the items demanded by Google while maintaining the current design, and in regards to each carrier's demands."

Kim testified that he doesn't recall any such directives from his superiors. Looking at the e-mails at trial, he said he saw the documents for the first time yesterday in preparation for his testimony.

Jim Prosser, a spokesman for Mountain View, California- based Google, didn't immediately respond to a voice-mail seeking comment on the testimony.

Apple is claiming at least $2.5 billion in damages for patent and trade-dress infringement. Cupertino, California-based Apple also wants to make permanent a preliminary ban it won on U.S. sales of a Samsung tablet, and extend the ban to Samsung smartphones.

Apple's Patents

Samsung, based in Suwon, South Korea, is trying to persuade the jury to declare Apple's patents invalid and to find that Apple has infringed its patents.

The company called a paid witness, Tim Williams, a retired entrepreneur and electrical engineer, who testified that versions of Apple's iPhone and iPad infringe two Samsung patents covering mobile-technology standards.

After using Williams's testimony to advance its counterclaims against Apple, Samsung called another witness to bolster its defense to Apple's infringement claims.

Andries Van Dam, a Brown University computer science professor who said he charges $1,000 an hour for his expertise, testified that Apple "was not the first to invent the snap- back" of graphic images. Samsung elicited the testimony in an attempt to invalidate a patent Apple claims covers "rubberbanding," or the way an iPad or iPhone screen seems to bounce when a user scrolls to the end of a file.

Presiding Judge

U.S. District Judge Lucy Koh, who is presiding over the case, today said both sides face risks in a jury verdict, and urged the chief executive officers at both companies to talk again before jurors begin deliberating. Koh said she wants deliberations to begin by Aug. 21.

Koh earlier this year ordered Apple CEO Tim Cook to meet face to face with his counterpart at Samsung, Choi Gee Sung, who has since been replaced as CEO by Kwon Oh Hyun. The May conference didn't yield a settlement.

"It's at least worth one more try," Koh said today.

Apple shipments of iPads surged 44 percent to 17 million in the second quarter, giving the company its biggest share of the tablet market in more than a year as devices from competitors lost ground. Apple's market share climbed to 69.6 percent in the quarter from 58.1 percent in the previous three-month period, according to a report yesterday from IHS.

Samsung had a 9.2 percent share in the second quarter, down from 10.8 percent.

The case is Apple Inc. v. Samsung Electronics Co. Ltd., 11- cv-01846, U.S. District Court, Northern District of California (San Jose).

(BN) Facebook Tests Service to Include More Ads in News Feeds

Aug. 15 (Bloomberg) -- Facebook Inc., owner of the world's most popular social network, is testing an advertising service that lets companies cast a wider net by placing more promotional messages in users' News Feeds.

Under the program, companies can place ads in users' main feeds on smartphones and personal computers even if those members or their friends haven't signaled they like the advertiser, said Annie Ta, a spokeswoman for Facebook. Until now, these types of ads only showed up on PCs to the right of the Facebook News Feed, which displays activities by friends and companies or groups a user has "Liked."

Facebook is grappling with investor concerns about its growth prospects as more users access the service from wireless devices, where its advertising options have been limited. Facebook rolled out its first mobile ad service for companies earlier this year with "Sponsored Stories," enabling companies to pay for content in the News Feed after members or their friends have indicated they like a company.

The new test service includes limits so that a member's News Feed isn't filled with too many advertisements, Ta said. The test is the company's third major effort in mobile advertising. Earlier this month, Facebook unveiled a tool that helps developers advertise their wares.

Facebook rose 4 percent to $21.20 today at the New York close. The stock has dropped 44 percent since its May 17 initial public offering.

The website Inside Facebook earlier reported the test of the service.


(BN) Apple, Samsung Patent Judge Asks CEOs to Talk Again

Aug. 15 (Bloomberg) -- The judge presiding over an intellectual property dispute between Apple Inc. and Samsung Electronics Co. said the chief executive officers of the contending companies should talk again before the jury begins deliberating.

"I'm going to make one more request that CEOs from both sides speak by phone," U.S. District Judge Lucy Koh said in federal court today in San Jose, California. "I see risks here for both sides," she said.

Koh earlier this year ordered Apple CEO Tim Cook to meet face to face with his counterpart at Samsung, Choi Gee Sung. That conference didn't yield a settlement.

"It's at least worth one more try," the judge said today. Koh has given each side 25 hours to present its case. Jury deliberations may begin as early as Aug. 21, she said.

Apple sued Samsung in April 2011, accusing it of copying patented designs for mobile devices, and Samsung countersued. The case is the first to go before a federal jury in a battle being waged on four continents for dominance in a smartphone market valued by Bloomberg Industries at $219.1 billion.

Apple is claiming at least $2.5 billion in damages for patent and trade-dress infringement. Cupertino, California-based Apple also wants to make permanent a preliminary ban it won on U.S. sales of a Samsung tablet, and extend the ban to Samsung smartphones.

'Message Delivered'

Samsung, based in Suwon, South Korea, is trying to persuade the jury to find Apple's patents invalid and to award unspecified damages for alleged infringement of its patents.

"If all you wanted is to raise that you have IP on these devices, message delivered," Koh said today. "External valuations" of the intellectual property have been established at the San Jose trial and in other courts, she said.

"In many ways, mission accomplished," she said. "It's time for peace."

Attorneys for both sides said they will comply with her request. Apple General Counsel Bruce Sewell, who was in court, told the judge he will deliver the message to his company.

"It's not necessarily uncommon for this to happen," Manotti Jenkins, a patent attorney at Valorem Law Group in Chicago, said in a phone interview. "Sometimes judges feel that cooler heads will prevail, possibly from both sides, given the evidence that has come out."


Oracle Corp. CEO Larry Ellison and Google Inc. CEO Larry Page were ordered by a federal judge in September to attend a settlement conference before trial in a copyright- and patent- infringement lawsuit that the maker of business software had brought against Google over its Android mobile-phone operating system.

Those talks were also fruitless, and a jury in May found that Google had infringed Oracle's copyrights, deadlocking on whether that was fair use. Later that month, the jury said Google hadn't infringed Oracle's patents.

Apple's dispute with Samsung is "a huge patent case, beyond an ordinary patent case, and a jury verdict could have major implications," Jenkins said. The magnitude of the outcome means the CEOs need to be involved in discussions, he said.

"With such potentially high stakes, if there is going to be a resolution that is rational and that both sides can live with, it's going to come from that level," he said.

The case is Apple Inc. v. Samsung Electronics Co. Ltd., 11-cv-01846, U.S. District Court, Northern District of California (San Jose).

(BN) EMC Weighs Using $5.65 Billion Cash on Security Startups

Aug. 15 (Bloomberg) -- Just three years ago, EMC Corp. was considered takeover bait. How things have changed: Since then, the world's biggest maker of storage computers has made 15 acquisitions and its mergers team is figuring out how to use $5.65 billion in cash to bulk up in security technology.

"The biggest area would probably be security," said President and Chief Operating Officer David Goulden, when asked about EMC's acquisition plans in a July 25 interview. He said the company had "all the key parts we were looking to put together" in its core storage business.

To fuel growth and repel competition, EMC uses acquisitions and a research and development budget that topped $2 billion last year. It also deployed a venture capital team to monitor emerging companies and turn them into allies before they become threats. EMC needs to show it can keep up revenue growth as an explosion in corporate data and shift to Internet-based cloud computing spurs former partners such as Dell Inc. and Oracle Corp. to enter the $64 billion storage industry.

"The market is now saying EMC is likely to be a consolidator and not a consolidatee," said Chief Executive Officer Joe Tucci, in an interview at EMC's Hopkinton, Massachusetts offices, where the entryway to the executive suite is decorated with two of EMC's newest sleek, black, refrigerator-sized storage machines.

Smart Buyers

Potential targets could include firewall companies such as Fortinet Inc. and Palo Alto Networks Inc., said Brian Marshall, an analyst at ISI Group who lists EMC as his top stock pick for the next few years. Tony Ursillo, an analyst at Loomis Sayles & Co., said EMC may go for a firewall company, and adds Check Point Software Technologies Ltd. to a list of possible targets.

"EMC and Oracle are arguably the two most savvy acquirers in the entire tech landscape and the two most successful," Ursillo said.

Reflecting the value the market places on its potential, EMC is valued at 15 times projected 2012 earnings, according to data compiled by Bloomberg, compared with 12 for Oracle and 6 for Dell. EMC shares have gained 19 percent this year, compared with 17 percent for the Standard & Poor's 500 Index.

While Goulden declined to discuss possible targets, he said security technology needs to be "reinvented" for a new age of cloud computing, where programs and security can be moved together smoothly from server to server.

"There's a lot of startups doing that kind of stuff now, so there's a lot of opportunity for us to expand," said Goulden, who was promoted to president and COO in a reorganization last month.

Traditional firewall and antivirus technology sold by Symantec Corp. and other companies is being upstaged by more innovative products crafted by startups such as Fortinet and Palo Alto Networks.

On Top

Three years ago, financial analysts at firms such as Credit Suisse and Stifel Nicolaus & Co. expected EMC to be acquired by a tech giant like Cisco Systems Inc. or Hewlett-Packard Co. The company was mentioned in Barron's and the New York Times as a potential target.

EMC was viewed as too small to reach the top tier of technology firms by itself, said Abhey Lamba, an analyst at Mizuho Securities USA. That isn't a comment you hear anymore, he said. While EMC's erstwhile acquirers have faced challenges, it consolidated a lead in the storage market. The 2004 acquisition of VMware for $635 million, which Lamba lists as the best technology acquisition of all time, boosted sales growth and thrust EMC into the vanguard of cloud computing.

Fueling Growth

EMC posted annual revenue growth of 18 percent in 2011 and 21 percent in 2010, bolstered by acquisitions, including the $2.25 billion purchase of Isilon Systems Inc. As its biggest- ever takeover, Isilon allowed EMC to serve a faster-growing part of the storage market and fend off competition from NetApp Inc. Sunnyvale, California-based NetApp is the only one among EMC's peers with a comparable 2012 price-earnings ratio of 16.

EMC's revenue growth compares with 1 percent for Hewlett- Packard and 4.2 percent for Oracle in their latest fiscal years.

"The key for EMC is continuing to grow in adjacent markets and to look how they can continue 10 percent-plus annual revenue growth," said ISI's Marshall.

EMC also keeps a close eye on early-stage startups though a venture capital program. Run by a small team with a budget the company won't disclose, it takes several-million-dollar stakes in young companies to learn about emerging technologies. When EMC sees promise, it buys the startup, such as the purchase of Israeli flash storage company XtremIO Inc. in May for $430 million.

Turf Wars

EMC's joint venture with Cisco, forged in 2009 to sell software and gear for data centers, also could fall apart, said Mizuho's Lamba. He said he expects Cisco -- having expanded into the server market -- to try moving into storage and could buy NetApp, creating a more formidable competitor.

Tucci said although Cisco could try its hand at storage, EMC values the partnership and it's his "strong, strong desire" to retain it. Yet VMware last month bought Nicira, a software-based networking company and a direct Cisco competitor.

After delaying a planned move from the CEO job until at least the end of 2013, Tucci is unlikely to depart from EMC's longstanding acquisition policy of buying smaller companies. He said integrating big companies takes attention away from promising new technologies that come with a deal. While larger rivals will expand into wider categories, EMC will be cautious, he said.

"The big players will try and be more and more and more self-sufficient," he said. "In there presents a weakness, too. I don't know how you get great at everything."

Most Opportunistic

Tucci said the industry is about two years into a 10-year wave of change that will be the biggest in the history of information technology: the shift to cloud computing, which allows companies to tap into software online without installing programs onto their own hardware. The trend will be "the most opportunistic" and "the most destructive," he said.

Now a new shakeout is under way and already claiming victims. Jeremy Burton, EMC's executive vice president for product operations and marketing, cites Hewlett-Packard as an example of a company that has fallen behind because it failed to keep pace with research and development investments. He also lists Nokia Oyj and Research in Motion Ltd. as companies that "were giants five years ago and now they look like they're history."

Tucci knows the risks. He joined EMC in 2000 when the company was the second-best performer in the Standard & Poor's 500 Index for the previous decade with products that underpinned the Internet boom. Then the bubble burst, precipitating a two- year slide in EMC's sales before Tucci was able to turn it around.

"If you get complacent, you're going to get killed," he said.

Animated picture of the Day.

tags: picture, detection

Tuesday, August 14, 2012

(BN) Pfizer, Green Mountain, Google: Intellectual Property

Aug. 15 (Bloomberg) -- Pfizer Inc., the world's biggest drugmaker, will add an over-the-counter version of AstraZeneca Plc's heartburn pill to its stable of consumer products that include the pain reliever Advil and the vitamin Centrum.

Pfizer has been looking to expand its consumer business, which generated $3.01 billion last year. The New York-based company last year discussed trying to get regulators to approve a nonprescription form of Lipitor, its top-selling cholesterol pill that lost patent protection in November.

AstraZeneca is trying to plot its strategy after the April resignation of Chief Executive Officer David Brennan, who had been criticized by investors for failing to bolster the London- based company's pipeline of experimental drugs. Pfizer has been selling off its non-drug units and focusing on developing new medicines. While it's shedding its infant nutrition and animal health businesses, Pfizer opted to keep its consumer business that includes over-the-counter treatments.

To obtain the rights to an over-the-counter Nexium, Pfizer paid AstraZeneca $250 million upfront with royalties from sales once the pill enters the market in 2014, the companies said yesterday in a joint statement.

Pfizer said the cost of the deal reduces its 2012 profit forecast 2 cents a share, to a range of $2.12 to $2.22. AstraZeneca boosted its annual earnings forecast 15 cents a share, to $6 to $6.30.

With the deal, "Pfizer is continuing to enhance the value of our consumer health-care business," Ian Read, Pfizer's chairman and chief executive officer, said in the statement.

The Nexium deal may be the first of several such partnerships, Pfizer and AstraZeneca said. Both are "exploring the potential for a strategic partnership that could include similar agreements for other AstraZeneca prescription brands for which OTC versions might be appropriate," the companies said.

Nexium was AstraZeneca's third-biggest drug in 2011, with $4.4 billion in revenue, according to data compiled by Bloomberg. Nexium loses patent protection in the U.S. in 2014. The agreement doesn't change the sales rights for the prescription version of the drug, which will stay with AstraZeneca.

The over-the-counter version of the pill still has to be approved by regulators, the companies said in their statement. It could go on sale in the U.S. as soon as 2014, and other markets afterwards.

For more patent news, click here.


Green Mountain Trademarks Rivo Name for Espresso Machine

Green Mountain Coffee Roasters Inc., which plans to introduce an espresso maker this year to compete with Starbucks Corp., registered "Rivo" as a trademark for a machine to make such drinks.

The name Rivo, which means "stream" in Italian, was registered by Green Mountain's Keurig Inc. unit this year for electric brewing and electric espresso machines, according to the U.S. Patent and Trademark Office website. Waterbury, Vermont-based Green Mountain previously said it is working with Luigi Lavazza SpA to develop an espresso maker.

"We've not made a product announcement related to that name," Suzanne DuLong, a Green Mountain spokeswoman, said in an interview.

Green Mountain is facing more competition as grocers and other manufacturers, such as Safeway Inc. and Rogers Family Co., make private-label capsules to fit into Keurig machines. While the main patents for K-Cups expire in September, Chief Executive Officer Lawrence Blanford has recently started selling the more- expensive Vue machine and single-serve cups.

The Rivo is another step to help Green Mountain combat emerging rivals as it struggles to accurately forecast capsule sales. Green Mountain's espresso machine will likely compete with Starbucks's Verismo single-serve beverage maker, which will be sold in the U.S. this year online, in some Starbucks cafes and in specialty retailers.

Starbucks CEO Howard Schultz announced in March that the Verismo would specialize in high-pressure, espresso drinks and would also make brewed coffee. The Seattle-based company hasn't released pricing information for the Verismo.

Lavazza, based in Italy, owned 5 percent of Green Mountain as of February 24, according to data compiled by Bloomberg.

Dick's Sporting Goods Buys Some Rights to Field & Stream Marks

Dick's Sporting Goods Inc., the largest U.S. retailer of athletic goods, said it will buy the rights to Field & Stream magazine's trademark in a number of categories.

The magazine, which was founded in 1895, focuses on outdoor activities related to hunting and fishing. According to a statement from Coraopolis, Pennsylvania-based Dick's, the rights that were bought are for use of the mark in the hunting, fishing, camping and paddle categories.

Previously the company had leased these rights from the magazine since 2007. Now Dick's is paying $25 million to own them, according to the Dick's statement.

For more trademark news, click here.


Bulgari Accuses Kenneth Jay Lane of Copying Jewelry Designs

Bulgari SpA sued Kenneth Jay Lane Inc., saying the New York jewelry designer copies and imitates its rings and bracelets without permission.

Rome-based Bulgari accused Kenneth Jay Lane, in a complaint filed Aug. 13 in federal court in Manhattan, of copyright infringement, design patent infringement and unfair competition. The company, a unit of LVMH Moet Hennessy Louis Vuitton SA, seeks a court order to end the sale of allegedly infringing jewelry and unspecified damages.

"Bulgari's jewelry items consist of distinctive and original designs, including design elements and features that have become synonymous with Bulgari in the eyes of the public, consumers and the luxury goods industry," the Italian company said in the complaint.

Jonathan Wolfert, a lawyer who represents Kenneth Jay Lane in a separate trademark infringement case, didn't return an e- mail or telephone call to his office seeking comment on the Bulgari lawsuit.

The case is Bulgari v. Kenneth Jay Lane, 12-cv-6194, U.S. District Court, Southern District of New York (Manhattan.)

Google Can Appeal Class-Action Status of Digital-Book Case

Google Inc. can appeal the class-action status granted to a lawsuit over digital books, a federal appeals court in New York said yesterday.

U.S. Circuit Judge Denny Chin in New York, sitting as a federal trial judge in the case, in May granted class-action or group status to a series of plaintiffs, including the Author's Guild and the American Society of Media Photographers in lawsuits over electronic books.

Chin also granted a request for three individual plaintiffs to represent a nationwide class of copyright holders in the Author's Guild suit.

The appeals court yesterday granted Google leave to appeal the class-action ruling while the case is still pending before Chin.

In July, Google asked Chin to dismiss the Authors Guild case, arguing that authors benefit from the project because their books can be more readily found, bought and read, while the public gains "increased knowledge." Google also argued that the display of snippets of text is fair use under copyright law and that the authors haven't been harmed by the display.

In his May ruling, Chin also rejected Google's arguments that the groups lacked standing to sue over claims the search engine company's digital scanning of millions of books infringed the copyright owners' rights.

Maggie Shiels, a spokeswoman for Google, declined to comment on the court's ruling.

The suits stem from Google's plan, announced in 2004, to digitally scan books from public and university libraries to provide short excerpts of text to people who use its Internet search engine. The Authors Guild, individual authors and publishing companies sued in 2005, claiming the Mountain View, California-based company hadn't sought authorization from the owners of the works.

Google has argued that the display of snippets of text is fair use under copyright law. Chin asked Google today why it was important at this stage of the case to determine the ownership of the copyrights.

Google said in a February court filing that it has scanned more than 20 million books, and that Web users can see excerpts in English from more than 4 million of them. The project began with the digitizing of books from the libraries of the University of Michigan, Harvard University, Stanford University, Oxford University and the New York Public Library.

The authors' case is Authors Guild v. Google, 05-08136; the visual artists' case is American Society of Media Photographers v. Google, 10-02977; U.S. District Court, Southern District of New York (Manhattan).

For more copyright news, click here.

Trade Secrets/Industrial Espionage

Duke, Progress Ordered to Disclose Transactions Details

Duke Energy Corp. and Progress Energy Inc., were ordered to disclose some details of transactions with major customers they had argued was a trade secret, Capitol Broadcasting Corp. reported.

The North Carolina Utilities Commission told the two companies yesterday that the details they insisted should be protected didn't involve technical information and had no independent commercial value, according to Capitol Broadcasting Corp.

Aug. 24 is the deadline for the companies either to file an appeal or release the public records, Capitol Broadcasting reported.

The public inquiry that lead to the utility commission's ruling came in the wake of Duke's acquisition of Progress, according to Capitol Broadcasting.