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Apple forced to enter into contract with patent-licensing firm

Apple transferred some of their patents to a firm called Digitude Innovations the news of which was revealed after Digitude filed suit to other Tech Giants

Recently Digitude Innovations filed suit against some the major tech giants which includes the names as Research in Motion, HTC, LG, Motorola, Samsung, Sony, Amazon and Nokia. But out of these big Electronics Giants, Apple was seemed to be missing from the list.

TechCrunch leads a further investigation regarding the absence of Apple from the list and later revealed that two of the patents wielded in the lawsuit had belonged to Apple earlier this year. Their report says that there was a license agreement between Apple and Digitude, whose details are not made available to the public.

Earlier this year, Apple has transferred a dozen patents to a shell company called Cliff Island LLC. Although much was not informed about Cliff Island but according to Jason Kincaid the company’s address is same as Digitude investors Altitude Capital. The patents were subsequently transferred to Digitude.

According to a report from Forbes in June, Digitude Innovations were put together by Altitude founder Robert Karmer. The company later went on to invest $50 million for purchasing consumer electronics patents that would be used to sue big tech companies.

Kramer also noted a new investment strategy which allows investors to combine patents instead of money. They offered license for all of the firm’s patents in return of participating. The company was also labeled as a patent troll for this reason.

It’s still not clear about the agreement between Apple and Digitude as whether it is formal or beyond a licensing agreement. According to Kincaid, Apple might be using Digitude as one of its weapons in its patent wars.

However Google, Apple’s rival has complaints about the current patent system. David Drummound the company’s chief legal officer wrote that Patents are meant to encourage innovations but now they are being used as a weapon to stop it. 


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Pallab Jyotee Hazarika, 2011-12-13 (Update: 2012-05-26)