Update II: Apparently not frightened off by Apple's letter defending its developers, Lodsys went ahead and sued at least seven developers in the Eastern District of Texas for patent infringement. In its original cease-and-desist letters, Lodsys gave developers 21 days to respond. But – apparently in response to Apple's letter – Lodsys went ahead and filed suit sooner, claiming that it needed to "preserve its legal options." We continue to monitor the situation and follow developments in the litigation.
Update: We were pleased to learn that Apple has decided to stand up for its developers. Its detailed letter to Lodsys, sent yesterday, explains in no uncertain terms why the patent infringement allegations are baseless and improper. Let's hope this ends the matter.
We've been waiting expectantly for Apple to step up and protect the app developers accused of patent infringement solely for using a technology that Apple required they use in order to sell their apps in Apple's App Store. Apple's failure to defend these developers is troubling and highlights at least two larger problems: patent trolls and developers' vulnerability when harassing and counter-productive patent litigation comes around.
In case you missed it, Lodsys – a troll whose sole business model is owning and suing on patents – has sent letters to many of Apple's app developers accusing them of infringing a patent that covers the in-app purchasing functionality that Apple provides as part of its operating system. In addition to these accusations, Lodsys' letters demanded payment. Unfortunately, suing app developers – who often lack the resources required to defend a lawsuit – is a trend we’re seeing more and more often.
What’s different here, however, is that Apple provides this functionality to its developers and requires that they use it. Apple itself is protected from liability – Apple took a license from Lodsys' predecessor to use this very patent (which was likely part of a larger blanket license). And the apparently one-sided Apple-developer agreement does not require that Apple indemnify developers from suits based on technology that Apple provides.
This is a problem that lawyers call a misallocation of burden. The law generally works to ensure that the party in the best position to address an issue bears the responsibility of handling that issue. In the copyright context, for example, the default assumption is that the copyright owners are best positioned to identify potential infringement. This is because, among other reasons, copyright owners know what content they own and which of their works have been licensed. Here, absent protection from Apple, developers hoping to avoid a legal dispute must investigate each of the technologies that Apple provides to make sure none of them is patent-infringing. For many small developers, this requirement, combined with a 30 percent fee to Apple, is an unacceptable cost. Even careful developers who hire lawyers to do full-scale patent searches on potential apps surely would not expect to investigate the technology that Apple provides. Instead, they would expect (with good reason) that Apple wouldn't provide technologies in its App Store that open its developers up to liability – and/or would at least agree to defend them when a troll like Lodsys comes along.
By putting the burden on those least able to shoulder it, both Apple and Lodsys are harming not just developers but also the consumers who will see fewer apps and less innovation. We hope that going forward companies like Apple will do what's right and stand up for their developers and help teach the patent trolls a lesson.
