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Siemens patent snafu sees Seagate slip away

Oi, that idea ain't yours

Internet Security Threat Report 2014

Siemens went to the US courts to try and get Seagate to cough up patent royalties - only to be told its patents were invalid.

Siemens reckoned Seagate had infringed a group of patents it thought it owned concerned with multi-layer hard disk drive sensor technology in GMR (Giant Magneto-Resistive) read heads. Siemens claimed up to $1bn in damages, based on all Seagate hard drives shipping since 2000 using its patented technology. Subsequently this was reduced to $366m, which it calculated as a three per cent royalty on Seagate HDD sales of $12.2bn in the relevant period. The judge then restricted the damages claim to royalties on disk drive sales after November 24 2004, which amounted to $160m.

The case was held at the US District Court, Central District of California (Santa Ana), and began on November 14. Before the hearing the Judge ruled that Seagate had infringed one of Siemens's patents. During the hearing Seagate said it had leased the technology from IBM, and that this IBM technology predated the Siemens patent, constituting prior art, and therefore invalidated the Siemens patents.

Siemens' lawyers brought in physics Nobel prize winner Sheldon Glashow and an ex-Commissioner of the US Patent Office, Harry Manbeck, to strengthen their case that the patents were valid and should be enforced. Glashow has worked in the electroweak and charmed quark areas of physics and not directly with GMR read head technology.

Seagate's lawyers arranged for Stuart Parkin, the IBM engineer who invented the GMR elements at issue, to provide a videotape testimony to the court. The IBM technology used six layers, including a stabilizing one. The Siemens patents referred to just five layers, not including IBM's stabilizing layer.

David Gross, lead counsel of the law firm hired by Seagate, told the court that Siemens did not tell the US Patent and Technology Office of two papers published by one of the IBM inventors of the technology that predated its patent application by two years. Therefore the ideas Siemens was trying to patent didn't constitute new inventions, and the patents were wrongly given to Siemens.

The court agreed, via a jury decision, that the Siemens patents were invalid and Seagate wasn't liable to pay Siemens a cent. Siemens may yet appeal the decision.

Meanwhile, Seagate is suing SSD maker STEC for patent infringement. With the company having seen off Siemens, its lawyers may now be licking their lips. ®

Internet Security Threat Report 2014

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