

The news today, leaked by anonymous someones who'd like you to believe that Google is doomed, I suppose, is that Google is now being investigated by the FTC regarding licensing of its standards-essential patents. As you know, both Apple and Microsoft, linked by common goals regarding Android, both claim that standards-essential patents owners are not allowed to seek injunctions as a remedy and that they are asking too much to license their patents. But there was just a decision at the ITC by Administrative Law Judge E. James Gildea on September 14th regarding the dispute there between Apple and Samsung, where Apple raised that defense and accused Samsung of improper behavior before ETSI, claiming it was violating its FRAND obligations and asking for too much to license. The Administrative Law Judge in his "Initial Determination" ruling utterly and definitely rejected Apple's FRAND allegations and completely exonerated Samsung. He ruled that injunctions are definitely available at the ITC for standards-essential patents, and that there is zero evidence of any wrong behavior by Samsung. Furthermore, the judge told Apple, which had claimed that the amount Samsung asked for licensing was too high to be a FRAND offer, that Apple can't unilaterally decide what is or is not a fair price. If it had objections, it could negotiate, which Apple failed to do, or there is a mediation process at ETSI it could have used, which it also apparently failed to do. Instead, the ruling says, the court battles are about negotiating a lower price. The FTC will no doubt be informed of all this, but I wanted you to know about it too. If you've wondered what the FRAND issue is all about, you can find out by reading the section on the FRAND claims in this ruling, which I've done for you as text. And Samsung has already brought this ruling to the attention of Judge Lucy Koh, the judge presiding over the Apple v. Samsung case in California. The judge not only totally debunks the arguments Apple brought, he goes further and rules differently than the jury in the case recently decided in California US District Court, Apple v. Samsung on the question of patent exhaustion. He writes that he can't rely on that jury's verdict, because it arrived at contradictory conclusions. Something really is wrong with that jury's verdict, and now a judge at the ITC has said so. The rest of the reasons for utterly rejecting Apple's FRAND claims are fascinating and, to me, refreshing. The ITC ruling is huge, and while I have it all for you as PDFs, chopping it into 14 chunks for ease of downloading, I only did the text for you of the section on Apple's FRAND claims, which you can find in sections 8 and 9.



Jump To Comments Can Standards-Essential Patent Owners Seek Injunctions at the ITC? - ITC: Yes The ruling points out that an injunction is ITC's only remedy. Unlike district courts, it doesn't decide issues like money damages. So, if it were true, as Apple argued, that FRAND patents can't be used to seek injunctions, then there could be no FRAND patents brought to the ITC. But there have been many such, and in no case was it held that FRAND patents didn't belong before the ITC or that injunctions were not available to the owners of FRAND patents. Finally some common sense. What's happening is indeed that Apple, and hence Microsoft, who makes similar claims about FRAND patents, are trying to make new law, esentially, according to this ruling, to get the price down. Besides, the judge points out that ETSI has a procedure for settling ETSI disputes. And there is no evidence Apple even tried it. In any case, the ITC has broader goals than ETSI or than the private interests of the parties to a patent dispute in a civil court, so none of the cases, such as the one recently by Judge Posner in Apple v. Motorola, apply to the ITC, the judge writes. The ITC must consider the interest of the public at large, and so he concludes that FRAND provisions do *not* preclude injunctions as a remedy: c) Findings and Conclusion of the Administrative Law Judge The Administrative Law Judge concludes that ETSI and its FRAND provisions do not preclude the imposition of Section 337 remedies in investigations in which the Commission determines that the authorizing statute is violated by reason of the importation into the United States of articles that infringe a valid and enforceable United States patent. Section 337 investigations are different than private patent suites in district courts, where damages or other forms of personal relief are sought. Section 337 investigations have a wider scope than the private interests of the litigants, as they include the interest of the public as well. In Section 337 investigations, the United States International Trade Commission can exclude infringing articles from entry into the United States by offending parties and can issue cease and desist orders, but the statute does not authorize the Commission to provide compensatory relief to the complaining party. In this respect, the subject of Judge Posner's order in the Motorola case is inapposite, since it essentially concerns an issue of election of remedies, or waiver thereof, which is not the gravamen of a Section 337 investigation. Section 337 investigations are time sensitive, because of the irremediable effects that unfair competition, including entry of patent infringing articles, might have on domestic industries in the United States, and the policies and procedures established by ETSI are not necessarily compatible with the mandate of the United States International Trade Commission, for prompt and preventive action. To be more specific, the ETSI states as follows: Any violation of the POLICY by a MEMBER shall be deemed to be a breach, by that MEMBER, of its obligations to ETSI. The ETSI General Assembly shall have the authority to decide the action to be taken, if any, against a MEMBER in breach, in accordance with the ETSI statutes. (RX-0710, Clause l4.) In the ETSI Guide on IPRs, it is stated: "The purpose of the ETSI IPR Policy is to facilitate the standards making process within ETSI. In complying with the Policy the Technical Board should not become involved in legal discussion on IPR matters." (RX-0713 at Clause l.l.) Elsewhere it states: "[I]t should be noted that once an IPR (patent) has been granted, in the absence of an agreement between the parties involved, the national courts of law have the sole authority to resolve IPR disputes." (Id. at 4,3.) The Guide also states that "ETSI MEMBERS should attempt to resolve any dispute related to the application of IPR Policy bilaterally in a friendly manner[]" and [s]hould this fail, the MEMBERS concerned are invited to inform the ETSI GA in case a friendly mediation can be offered by other ETSI Members and/or the ETSI Secretariat." (Id.) This procedure, while accommodative and suited to seeking harmony between and among the consensus-building ETSI membership, is also a prescription for a delayed and protracted dispute-resolution process that relies on the good faith and willingness by the parties to settle their disputes themselves, in an amicable manner, an ideal that usually fails in patent cases. Section 337 investigations have a wider concern than a desire to achieve voluntary resolutions in patent disputes where the interests of the patties may not coincide with the interest of the public at large, and the Commission's mandate should not be subordinated to the ulterior objectives of the ETSI. As a practical matter, if the ITC were precluded from performing its mandate as set forth in the authorizing statute, an infringing party could, by making unrealistic counter-offers to the patent holder, while claiming that such counter-offers more accurately reflect FRAND than the offers proposed by the patent holder, hold up or frustrate Section 337 investigations. As is discussed in the following section, there is disagreement between Samsung and Apple about what is a fair, reasonable, and non-discriminatory license with respect to Samsung's standards-essential patents. According to ETSI, the national courts of law, not ETSI, resolves patent disputes, absent the parties' agreement, as stated in Clause 4.3 of ETSI Guide on IPRs; but if that extends to deciding what is FRAND, any uncooperative party can do an end-around of a Section 337 investigation in cases of standards essential patents. That is, of course, exactly what Apple and Microsoft have been trying to do. And this judge was having none of it. There is much more there to read, and I strongly encourage you to slog through it, because it ends up that the FRAND claims being made don't hold water at all with this ITC judge, and his reasons make a lot of sense. If they stand and survive the inevitable appeal, I wonder if Apple and Microsoft spent money foolishly on "analysts" to advise them on FRAND issues. Was the Samsung Price to License Violative of Frand Obligations? - ITC: No Apple also claimed that Samsung's offer to license was so pricey it violated its FRAND obligations, but the judge didn't accept that either: The Administrative Law Judge concludes that the evidence does not support Apple's allegation that Samsung failed to offer Apple licenses to Samsung's declared-essential patents on FRAND terms. Patents have the attributes of personal property. 35 U.S.C. § 261. Their value, in terms of licensing, varies according to a myriad of factors, and it is not enough for Apple to say that Samsung's license offer was unreasonable based on Apple's rationale. Remarkably, even though Apple complains that Samsung's license offer was not FRAND, Apple has not shown that, as a member to ETSI, it ever availed itself of the process and procedures of the ETSI under Clause 4.3 of the ETSI Guide on IPRs, which provides for mediation by ETSI Members or the Secretariat. (RX-0713 at Clause 4.3.) It is not enough for Apple to complain that Samsung's license offer of 2.4 percent of the selling prices of Apple's devices, is unreasonable, since there is insufficient evidence of customs and practices of industry participants showing that Samsung's demand is invidious with respect to Apple. Furthermore, negotiations often involve a process of offer and counteroffer before the parties arrive at an agreed price, but Apple's evidence does not demonstrate that Apple put forth a sincere, bona fide effort to bargain with Samsung. Rather, it appears that Apple and Samsung both decided to negotiate licensing terms between each other through the tortuous, and expensive, process of litigation. Was Samsung Guilty of FRAND Misconduct, Making the Patents Unenforceable? - ITC: No Apple also claimed that Samsung was guilty of misconduct before ETSI and inequitable conduct, making the patents unenforceable, but the judge says there's not law that says that, that a violation of some ETSI rule makes a patent unenforceable, and even if there was, Samsung didn't do anything wrong: The Administrative Law Judge concludes that Apple has failed to demonstrate that either the evidence or the law supports Apple's contention that the '644 patent is unenforceable by reason of alleged acts of misconduct on the part of any of the named inventors or Samsung in its dealings with the 3GPP and ETSI. With respect to the evidence, Samsung has shown a legitimate reason for why it advanced its proposals in opposition to Motorola's. The fact that members of consensus bodies that set industry standards advocate positions they favor and denigrate positions advocated by others is a dialectical process which is conducive to arriving at outcomes deemed desirable to the goals of the organization. The fact that Samsung, or its participating members, found fault with Motorola's proposals and favor with their own is not enough to demonstrate misconduct. Samsung has shown reasons for the stand it took and the Administrative Law Judge finds no reason to conclude that there were any improprieties in what Samsung did vis-à-vis its participation in the ETSI. Nor has Apple provided a legal basis for rendering the '644 patent unenforceable even if it were to be concluded that Samsung's activities with respect to the 3GPP and ETSI contravened in some respect a policy thereof. ETSI is an organization that has adopted various policies, among which is the following: 14 Violation of Policy Any violation of the POLICY by a MEMBER shall be deemed to be a breach, by that MEMBER, of its obligations to ETSI. The ETSI General Assembly shall have the authority to decide the action to be taken, if any, against the MEMBER in breach, in accordance with the ETSI statutes. (RX-710 at APLNDC-WH-A0000012546.) There is no evidence that Apple has exhausted, or even pursued any course of action or remedy available to it under this provision, or any other, offered by ETSI or otherwise shown that pursuit of the forms of relief or remedy available from ETSI would be inadequate. There is no law cited by Apple that authorizes an Administrative Law Judge to superintend the affairs of ETSI and make findings that may not be in accordance with its objectives and governing provisions . The Administrative Law Judge finds that there is not clear and convincing evidence that inequitable conduct was committed during the prosecution of the '644 patent before the USPTO. Is There Patent Exhaustion? - ITC: No Apple also claimed patent exhaustion, saying that by reason of an Intel-Samsung licensing agreement, Apple got to use the patents without paying. That definitely didn't fly: The Administrative Law Judge concludes that the evidence is not sufficient to support Apple's patent exhaustion defense .And even though Apple claims that {[redacted]}, according to one of the cases Apple relies on, Apple v. Motorola, No. 1:11-cv-03540 (N .D. Ill.), Motorola had requested a 2.25 percent royalty rate of sales, which is closely comparable. (Id. at 17.) While this may be an apples and oranges comparison, the fact is that Apple has offered only attorney argument, rather than substantive evidence, that Samsung breached its FRAND obligations. From all appearances, {[redacted]}, even though there was a mechanism in place under ETSI Guidelines for resolving disputes. Dr. Walker did not testify, nor could he, as to the bona fides of Samsung's licensing offer to Apple; nor did anyone else. Judge Posner, in the Motorola case found the expert evidence offered by the parties with respect to damages inadequate, but similarly, Apple's evidence of what constitutes a FRAND license under the facts of this Investigation is inadequate. For reasons previously discussed, the Administrative Law Judge finds that there is insufficient evidence to warrant a finding that Samsung breached its obligations with respect to its membership, and participation in ETSI. For the foregoing reasons, the Administrative Law Judge concludes that Apple has not sustained its burden of proof that Samsung's sales to Qualcomm serve to exhaust Samsung's patent rights with respect to the '348 and the '644 patents. Apple, after its victory over Samsung in District Court, added that news, with some argument that it settled the matter, to the ITC case, to kudos from FOSSPatents at the time [http://www.fosspatents.com/2012/09/apple-leverages-jury-verdict-on-patent.html]. But the ITC didn't see that way: Apple argues that under the four-part test for issue preclusion, the jury's verdict in the District Court case "are determinative of the issues of (1) Intel's authority under the Samsung Intel License to sell Apple the baseband processors used in the accused products, and (2) whether 521 the sale of Intel baseband processors to Apple takes place in the United States." (Id. at 6-7.) Apple asserts that those two issues in the District Court case are identical to the issues presented in this Investigation. (Id. at 7.) Apple says the infringement allegations in the District Court case concerned the same processors as those accused in this Investigation; the jury found that the same license at issue in this Investigation authorized Intel to sell those processors to Apple; and the jury found that the identical sales of those processors that are at issue in this Investigation were made to Apple in the United States. (Id.) The Administrative Law Judge concludes that the jury's verdict in Apple Inc. v. Samsung Electronics Co. Ltd. et al., No. 5:11-cv-01846 (N.D. Cal.) that "Apple has proven by a preponderance of the evidence that Samsung is barred by patent exhaustion from enforcing... [patents '516 and '941] against Apple[,]" is not issue preclusive with respect to the '348 or '644 patents in this Investigation. (Notice, Ex. A, No. 33 at 20.) The Federal Circuit has held that issue preclusion, or collateral estoppel, "is appropriate only if: (1) the issue is identical to one decided in the first action; (2) the issue was actually litigated in the first action; (3) resolution of the issue was essential to a final judgment in the first 526 action; and (4) plaintiff had a full and fair opportunity to litigate the issue in the first action." In re Freeman, 30 F.3d 1459, 1465 (Fed. Cir. 1994.) According to the jury's verdict, they found that there was no infringement by Apple of Samsung's asserted patents. (Notice, Ex. A, No. 24 at 17.) However, the jury also found that Samsung's patents were exhausted by virtue of the Samsung-Intel agreement. (Id. No. 33 at 20.) If the accused Apple products do not infringe Samsung's '516 and '941 patents, as alleged by Samsung in the district court case, by virtue of those products' incorporation of the Intel's PMB 9801 baseband processor, then the sale of those chips by Intel would not exhaust Samsung's patents, because the PMB 9801 logically could not have practiced all of the limitations of those patents. The affirmative defense of exhaustion requires proof of an authorized, territorial sale of articles embodying the patents at issue. Quanta, 553 U.S. at 628. Therefore the jury's verdict with respect to the issue of patent exhaustion cannot be considered an essential fact determination by the jury, since it is inconsistent with the jury's verdict that Apple's products containing the PMB 9801 did not infringe Samsung's patents. Although Apple maintains that these were not inconsistent verdicts, but rather, alternative verdicts, this does not settle the question of whether the jury's verdict with respect to the issue of exhaustion satisfies the Federal Circuit's requirement that, for purposes of issue preclusion, the preclusive finding must be essential for a final judgment . Thus, the Administrative Law Judge concludes that the jury's verdict with respect to patent exhaustion is not preclusive of the issue of patent exhaustion that has been asserted by Apple in this case. The Administrative Law Judge further concludes that Apple's Notice is procedurally improper, for the reasons set forth by Samsung in its opposition. As you can see, it was a wipeout across the board on FRAND. There are numerous redactions, as you'll see in the complete text version, but there's enough to see that when Apple yesterday was quoted in the NY Times article about software patents being destructive weapons, saying it was worried about standards essential patent owners charging too much, the comment flies in the face of this ruling, which I take to mean that Apple plans to charge forward, despite just being told that its arguments are not valid. By the way, the judge thinks this is about negotiating a lower price. I think it's part of a larger conspiracy to destroy Android with constant litigation and constant complaints to administrative bodies like the FTC. It's proprietary versus open. Android runs on Linux, you know. And now that Android is winning in the smartphone market, Apple and Microsoft (and Oracle, who just joined Microsoft's other running dogs at the hilariously named FairSearch) feel about it just like SCO, whose litigiousness it now imitates, but on a much grander scale. [ Update: There was a meeting under the auspices of the ITU in Geneva, and David Meyer at ZDNet reports that while Apple continues to whine, the representative from Motorola said that the real problem is Apple is new to FRAND, new to standards in connection with smartphone patents, and it simply misunderstands how FRAND policies have worked for decades now. That, I am afraid, is unlikely but conceivable. What is more likely is that they are presenting how they *want* it to be, by pretending it already is that way: Google's Motorola subsidiary has tried to use standards-essential patents against Microsoft and Apple in injunction bids, and has argued that a reasonable rate for licensing those patents would be 2.25 percent of the sales price of the full product. Microsoft, Apple and Cisco have banded together in disagreement. "The average selling price [ASP] approach wrongly permits the patent holder to collect value unassociated with its contribution to the standard," Apple chief intellectual property counsel BJ Watrous argued in a morning session. "Using the ASP of the end user product as the royalty base [is] discriminating against companies like Apple who sell high-value products." During the same session  the morning talks were open, while those during the afternoon were held under the Chatham House Rule  Motorola senior licensing counsel Ray Warren said Apple was misunderstanding the way FRAND works in the telecoms industry, as it is relatively new to that game. "For 20 years the [FRAND] licensing commitments made by innovators in the communications industry have been sufficient," Warren said. "Past experience would indicate that [FRAND] has been effective but that doesn't mean there isn't room for improvement to improve the present situation." So price is the issue with Apple, but if you claim the other side is violating something, you get to wax indignant. If you just presented it that you'd like a change in the way FRAND works because you are selling "high-value products", it doesn't inspire action in quite the same way as if you portray others as the bad guy. - End Update.] Here are all the PDFs, and note that some of it at the end is exhibits. I see references to cases in Europe, for example, if that is something you are curious about: Part 1 Part 2 Part 3 Part 4 Part 5 Part 6 Part 7 Part 8 Part 9 Part 10 Part 11 Part 12 Part 13 Part 14 The ITC Ruling, FRAND Section, as Text: Here's the section on FRAND, taken from Part 8 and a little of Part 9: PUBLIC VERSION VI. ENFORCEABILITY A. Whether the Claims of the '348 and '644 Patents Are Barred under Samsung

Commitments to ETSI 1. Whether FRAND Commitments Preclude Samsung from Seeking an

Exclusion Order. a) Apple's Contentions Apple alleges that Samsung's obligations to ETSI to license its declared essential patents, which include the '348 and '644 patents, on fair, reasonable, and non-discriminatory terms ("FRAND") precludes Samsung from any rights it might have otherwise enjoyed to obtain an exclusionary remedy and limits Samsung to monetary relief (RBr. at 134.) According to Apple, courts and regulatory agencies are increasingly vigilant in preventing FRAND patent holders from abusing their patent rights by seeking exclusionary remedies, and, therefore, Samsung should not be permitted to engage in such "abuse" here. (Id. at 134-135.) (1) Whether the ETSI FRAND Policy Is Incompatible with

Exclusionary Remedies Apple says the ETSI IPR Policy recognized that an "investment in the preparation, adoption, and application of STANDARDS could be wasted as a result of an ESSENTIAL IPR 454 for a STANDARD being unavailable." (Id. at 135 (citing RX-710, Clause 3.1; Tr. (Walker) at 1346-48).) According to Apple, in order to avoid the risk that ESSENTIAL IPR could be "unavailable," Clause 6.1 dictates that licenses must be available on FRAND terms, and this requires members who agree to license their IPR to make an "irrevocable" commitment to do so. (Id. (citing RX-0710, Clause 6.1).) Apple notes that Dr. Walker, who is knowledgeable about the operations and procedures of the European Telecommunications Standard Institute, based on his experience as an executive there, explained that a Clause 6.1 commitment involves a trade-off by the IPR holder, who benefits from having IPR incorporated as part of a standard, and with that, enjoys the opportunity to receive FRAND related royalties from all implementers of the standard. (Id.) That opportunity can instantly transform the value of IPR (such as in the case of the "precise pattern" of the '644 patent), thereby providing access to a mass global market, with a potential for high-volume royalties. (Id. (citing Tr. (Walker) at 1349).) What the IPR holder gives up for this commercial opportunity is the right to do anything but license its IPR, which includes relinquishing rights it might otherwise have to preclude competitors from using that IPR. (Id. (citing Tr. (Walker) at 1349-50).) Apple says that, while the ETSI IPR Policy does not expressly forbid injunctions, it makes clear that such a step is incompatible with making the FRAND bargain to license to all interested parties. (Id. (citing Tr. (Walker) at 1350).) Apple argues that this view is not Apple's alone, noting that on June 22, 2012, United . States Circuit Court Judge Richard Posner, while sitting as a district court judge, rejected a claim by Motorola, seeking an injunction against Apple, despite Motorola's FRAND commitment, and in so doing, Judge Posner made this comment: 455 To begin with Motorola's injunctive claim, I don't see how, given FRAND, I would be justified in enjoining Apple from infringing the '898 unless Apple refuses to pay a royalty that meets the FRAND requirement. (Id. at 135-136 (citing Apple v. Motorola, Inc., No. 1:11-cv-08450 (N .D. lll. June 22, 2012) at 18).) Apple says that Judge Posner rejected Motorola's argument, which is identical to Samsung's here, that Motorola was justified in seeking an injunction based on its contention that Apple had rejected a FRAND offer: If Apple said no to 2.25 percent, it ran the risk of being ordered by a court to pay an equal or even higher royalty rate, but that is not the same thing as Motorola's being excused from no longer having to comply with its FRAND obligations. Motorola agreed to license its standard-essential patents on FRAND terms as a quid pro quo for their being declared essential to the standard. It does not claim to have conditioned agreement on prospective licensees' making counteroffers in license situations. (Id. at 136 (citing Apple, No. 1:11-cv-08450 at 20).) Apple further quotes Judge Posner's conclusion: "A FRAND royalty would provide all the relief to which Motorola would be entitled if` it proved infringement of the '898 patent, and thus is not entitled to an injunction. (Id. (citing Apple, No. 1:11-cv-08450 at 21). Apple says the same logic applies here. Apple says that two weeks before Judge Posner's decision, the Federal Trade Commission submitted a Statement on the Public Interest in Investigation No. 337-TA-752, in which the FTC observed that "ITC issuance of an exclusion or cease and desist order" for patents that have been declared essential to a standard, "has the potential to cause substantial harm to U.S. competition, consumers and innovation." (Id. (citing ThirdParty United States Federal Trade Commission's Statement on the Public Interest, Inv. No. 337-TA-752 (June 6, 2012) at 1, http://www.frc.gov/os202/06/1206ftcgamingconsole.pdf ("Third Party Statement").) Apple notes that the FTC cautioned that, given the "hold up" power inherent in patents declared essential to a standard, an "imbalance between the value of patented technology and the rewards for 456 innovation may be especially acute where the exclusion order is based on a patent covering a small component of a complex multicomponent product." (Id. (citing Third Party Statement at 3).) Apple says the FTC observed that a RAND commitment provides evidence that the SEP [standard-essential patent] owner planned to monetize its IP through broad licensing on reasonable terms, rather than through exclusive use." (Id. (citing Third Party Statement at 5).) Similarly, according to Apple, in March a court in the Netherlands rejected Samsung's attempt to enjoin Apple with respect to patents for which Samsung had made FRAND declarations. The court concluded that "seeking injunctions during negotiations on a FRAND license must be considered to be an abuse, or as the case may be breach of precontractual good faith." (Id. at 136-137 (citing Samsung Electronics Co./Apple Inc., District Court of the Hague ¶¶ 4.31, Mar. 14, 2012 (attached to CBR. as Ex. 6).) Apple contends that the statements of the FTC, and the decisions of Judge Posner and the Netherlands court underscore that Samsung's FRAND commitments are fundamentally inconsistent with an exclusion order for the '644 and '348 patents, and that by making FRAND commitments, Samsung has disclaimed any right to seek such a remedy and should not be allowed to renege on that irrevocable commitment. b) Samsung's Response Samsung responds that, in order to support its proposition that a FRAND commitment precludes the ITC from issuing an exclusion order, Apple cites the recent order issued by Judge Posner, sitting by designation, in Apple, No. 1:11-cv-08540. (CRBr. at 85.) Samsung says that in that order, after excluding both parties' damages theories, the judge dismissed the case with prejudice, stating that "[b]y committing to license its [declared essential] patent on FRAND terms, Motorola. . .implicitly acknowledged that a royalty is adequate compensation." (Id. (citing Apple, No. 1:11-cv-08450 at *18-19).) Samsung says that the court in that case noted that the 457 basic principle that injunctive relief is not automatically available in a district court infringement action, where damages are otherwise adequate to compensate for infringement. (Id. (citing Apple, No. 1:11-cv-08450 at *21, 34).) With respect to Motorola's asserted standards patent, Samsung notes that the court made the comment first quoted above. (Id. at 85-86.) In other words, argues Samsung, even in a district court setting governed by eBay principles, the judge recognized that a party that refuses to pay a FRAND royalty is in fact subject to an injunction. (Id. at 86.) In contrast, argues Samsung, where the authority of the United States International Trade Commission to issue exclusion orders is implicated, Judge Posner's opinion has no application. (Id. (citing Spansion, Inc. v. Int'l Trade Comm 'n, 629 F.3d 1331, 1359 (Fed. Cir. 2010) (holding that eBay does not apply to remedy determinations in the ITC under Section 337)).) Samsung says that Section 337, as amended, sets forth the ITC's mission, namely to protect United States industries from infringing and other unfairly competing imports. (Id. (citing 19 U.S.C. § 1337(a)(1) (stating that unfair acts under Section 337 "shall be dealt with in addition to any other provision of the law.")).) Samsung says that Section 337 authorized the Commission to grant an exclusion order when an imported article is shown to infringe a valid and enforceable United States patent. (Id.) The statute does not contain any special provisions or carve-outs for RAND-encumbered patents, and Samsung says it is not aware of any statute requiring special treatment for such patents. (Id.) According to Samsung, in the absence of express change by Congress to the ITC's statutory authority, there is no legitimate basis for the Commission to create a bright-line rule preventing the Commission from issuing the only relief it can grant, solely because an asserted patent may be subject to some type of RAND obligation. (Id.) Samsung argues that RAND issues have been raised in numerous investigations, but not once has the 458 Commission concluded that it lacks the authority to issue an exclusion order solely because an asserted patent is subject to a RAND obligation. (Id.) Samsung says that Apple itself admits "the ETSI IPR Policy does not expressly forbid injunction" and Apple's expert also confirmed that ETSI could not impose such a rule. (Id. (citing Tr. (Walker) at 1450-51).) As for the FTC's Statement on the Public Interest in Investigation No. 337-TA-752, Samsung says the FTC did not say that an exclusion order is inappropriate in all circumstances; rather, the FTC urged the ITC to "consider the impact of patent hold-up on competitive conditions and United States consumers" when issuing exclusion orders based on standard-essential patents. (Id. at 86-87 (citing Third Party United States Federal Trade Commission's Statement on the Public Interest, Inv. No. 337-TA-752 (June 6, 2012) at 5).) Samsung argues that in cases such as this, where a respondent has not come forward with evidence that a FRAND offer has been made, an exclusion order is entirely appropriate, just as Judge Posner's recent decision acknowledges. (Id. (citing Apple, Inc. v. Motorola, Inc., No. 1:11-cv-08540, *18 (N.D. Ill. June 22, 2012).) Staff also disagrees with Apple's contention that Samsung's FRAND declarations precludes the Commission from issuing an exclusion order in this Investigation, noting that Apple has failed to cite any precedent holding that the Commission lacks jurisdiction to conduct " a Section 337 investigation as to a patent for which FRAND obligations may exist. (SBr. at 67.) Staff says that even though FRAND issues have been raised in numerous investigations, not one of them has resulted in a finding that the Commission lacks jurisdiction to conduct an investigation or to award relief merely because the asserted patent is allegedly subject to FRAND obligations. (Id.) Rather, in investigations where an asserted patent is subject to FRAND obligations, the focus has typically been on whether the patentee engaged in good-faith efforts to 459 license the patent on FRAND terms. (Id. (citing Certain Dynamic Random Access Memories, Components Thereof and Products Containing Same, Inv. No. 337-TA-242, in which there was a determination that the complainant was estopped from asserting the patent-in-suit and was not entitled to an exclusion order, but only because the complainant had been found not to have negotiated in good faith a renewal of a cross-license agreement with the respondent).) Staff says the contractual obligations of the complainant in that case required a good-faith effort to license the asserted patent before the complainant could obtain such relief at the Commission. (Id.) Staff proposes that, if Apple had presented appropriate evidence, Apple might have been able to show the Samsung is equitably estopped, for example, from asserting its patent rights against Apple; however, the mere fact that Samsung may have FRAND obligations does not, by itself bar Section 337 remedies. (Id.) Apple responds that Samsung has disclaimed its right to an exclusionary remedy through its FRAND commitments. (RRBr. at 88.) Apple contends that Samsung never rebutted Dr. Walker's testimony that a FRAND license is a commitment to license, rather than seek exclusionary remedies, except in rare circumstances, not present here, such as where a party ignores a court judgment setting a FRAND royalty. (Id. at 89.) Moreover, argues Apple, contrary to Samsung's and Staff's contention, Apple has provided authority supporting the proposition that a FRAND commitment is incompatible with the remedy Samsung seeks, again citing to Judge Posner's order in the Motorola case discussed above and the ruling of the Netherlands court, also mentioned above. (Id.) c) Findings and Conclusion of the Administrative Law Judge The Administrative Law Judge concludes that ETSI and its FRAND provisions do not preclude the imposition of Section 337 remedies in investigations in which the Commission 460 determines that the authorizing statute is violated by reason of the importation into the United States of articles that infringe a valid and enforceable United States patent. Section 337 investigations are different than private patent suites in district courts, where damages or other forms of personal relief are sought. Section 337 investigations have a wider scope than the private interests of the litigants, as they include the interest of the public as well. In Section 337 investigations, the United States International Trade Commission can exclude infringing articles from entry into the United States by offending parties and can issue cease and desist orders, but A _ the statute does not authorize the Commission to provide compensatory relief to the complaining party. In this respect, the subject of Judge Posner's order in the Motorola case is inapposite, since it essentially concerns an issue of election of remedies, or waiver thereof, which is not the gravamen of a Section 337 investigation. Section 337 investigations are time sensitive, because of the irremediable effects that unfair competition, including entry of patent infringing articles, might have on domestic industries in the United States, and the policies and procedures established by ETSI are not necessarily compatible with the mandate of the United States International Trade Commission, for prompt and preventive action. To be more specific, the ETSI states as follows: Any violation of the POLICY by a MEMBER shall be deemed to be a breach, by that MEMBER, of its obligations to ETSI. The ETSI General Assembly shall have the authority to decide the action to be taken, if any, against a MEMBER in breach, in accordance with the ETSI statutes. (RX-0710, Clause l4.) In the ETSI Guide on IPRs, it is stated: "The purpose of the ETSI IPR Policy is to facilitate the standards making process within ETSI. In complying with the Policy the Technical Board should not become involved in legal discussion on IPR matters." (RX-0713 at Clause l.l.) Elsewhere it states: "[I]t should be noted that once an IPR (patent) has been granted, in the absence of an agreement between the parties involved, the national courts of law 461 have the sole authority to resolve IPR disputes." (Id. at 4,3.) The Guide also states that " ETSI MEMBERS should attempt to resolve any dispute related to the application of IPR Policy bilaterally in a friendly manner[]" and [s]hould this fail, the MEMBERS concerned are invited to inform the ETSI GA in case a friendly mediation can be offered by other ETSI Members and/or the ETSI Secretariat." (Id.) This procedure, while accommodative and suited to seeking harmony between and among the consensus-building ETSI membership, is also a prescription for a delayed and protracted dispute-resolution process that relies on the good faith and willingness by the parties to settle their disputes themselves, in an amicable manner, an ideal that usually fails in patent cases. Section 337 investigations have a wider concern than a desire to achieve voluntary resolutions in patent disputes where the interests of the patties may not coincide with the interest of the public at large, and the Commission's mandate should not be subordinated to the ulterior objectives of the ETSI. As a practical matter, if the ITC were precluded from performing its mandate as set forth in the authorizing statute, an infringing party could, by making unrealistic counter-offers to the patent holder, while claiming that such counter-offers more accurately reflect FRAND than the offers proposed by the patent holder, hold up or frustrate Section 337 investigations. As is discussed in the following section, there is disagreement between Samsung and Apple about what is a fair, reasonable, and non-discriminatory license with respect to Samsung's standards-essential patents. According to ETSI, the national courts of law, not ETSI, resolves patent disputes, absent the parties' agreement, as stated in Clause 4.3 of ETSI Guide on lPRs; but if that extends to deciding what is FRAND, any uncooperative party can do an end-around of a Section 337 investigation in cases of standards essential patents. 462 2. Whether Samsung Has Not Made a FRAND Offer to Apple; and

Whether Apple Has Refused To Negotiate in Good Faith Apple says that Samsung's counsel stated in Samsung's opening statement that the "biggest point on FRAND" is that Samsung "did make an offer and they made a FRAND offer," and Apple "refused to engage." (CBr. at 137 (citing Tr. at 42).) Apple says that, according to Samsung's theory, based on those facts, Samsung is entitled to pursue an exclusionary remedy against Apple. (Id.) Apple says that for the reasons stated in the prior section this issue need not be reached, because Samsung has disclaimed its right to seek an exclusionary order; but in any event, the record does not support Samsung in this regard. Apple says that no witness took the stand to defend Samsung's license demands as being on FRAND terms. (Id.) Apple argues that Samsung previously identified trial witnesses on these issues, but when the actual hearing arrived, Samsung did not call the relevant witnesses: David Teece, a professor who was identified by Samsung as an "expert on the history, nature and practice of FRAND licensing" and was also "expected to testify on ...the appropriateness of certain proposed FRAND rates[.]"

Eric Stasik, a licensing consultant was identified by Samsung as an "expert on the history, nature and practice of FRAND licensing" and was also "expected to testify on. . .the appropriateness of certain proposed FRAND rates[.]" (Id. (citing Samsung's pre-hearing statement at 3).) Apple argues that Samsung could have called a witness from Samsung to defend its licensing demand but Samsung did not do that either. (Id.) Apple argues that, fundamentally, Samsung is wrong on the facts because, first, Apple has not refused to negotiate with Samsung, because as the co-pending 796 investigation confirms, the issues separating Apple and Samsung include Apple's claim that Samsung is copying Apple's products, and some of the negotiations between the parties, some of which 463 have been publicly reported, Apple has always been willing to pay Samsung a FRAND royalty for any valid, infringed, and enforceable patent that Samsung has declared essential to the UMTS standard. (Id. at 137-138.) Apple says that as recently as April 30, 2012, Apple made a licensing proposal to Samsung under which each party would take a license to the other's declared-essential patents using the same methodology to derive a FRAND royalty (based on using each other party's proportion of patents declared essential to UMTS to determine a royalty rate that would be applied to the price of the baseband processor). (Id. at 138 (citing RX-1695 C).) Second, Apple says that Samsung has demanded a royalty of 2.4 percent of the full price of each Apple device, which is not remotely close to FRAND, as Apple's April 30, 2012 letter makes clear. (Id. (citing CX-l589C; JX-0010C (Chung Dep.) at 57-58).) According to Apple, Samsung's demand of a royalty of 2.4 percent on the full price of each Apple UMTS-compliant product is divorced from the requirements of the ETSI IPR Policy and at odds with Samsung's other licenses for patents subject to FRAND commitments. In short, says Apple, it is unfair, unreasonable, and discriminatory. (Id.) Apple says that Samsung is seeking payment for the value in the iPhone and iPad, including features such as the design, the screen, the camera, and the operating system, that is wholly unrelated to any contribution Samsung made to the UMTS standard. (Id.) Apple claims that Samsung's demand is not only unfair and unreasonable but it also discriminates against Apple for developing sophisticated products with higher prices than more basic cellular phones. (Id.) Apple says that Samsung can offer no justification for attempting to extract a tax on Apple's innovation that goes well above and beyond basic cell phone functionality supported by UMTS, and more specifically, above and beyond any conceivable value that Samsung may have 464 contributed to that standard. (Id.) By seeking to charge royalties on the full price of iPhones and iPads, Samsung is also seeking a double recovery on the Samsung components within those devices, for which Apple already pays Samsung billions of dollars each year. (Id.) Apple says the consequences of Samsung's non-FRAND demand are stark, because the Apple iPhone sells for between $650 and $850. (Id. at 138-139 (citing Tr. (Blevins) at 965).) Samsung's 2.4 percent demand thus seeks a payment of between $15.60 and $20.40 per iPhone, (Id. at 139.) By contrast, Apple purchases the baseband processor that allows the iPhone to communicate with the cellular network, and which contains the hardware (defined by VHDL code) that Samsung alleges infringes the '644 and '348 patents, { [redacted] }. (Id. (citing Tr. (Blevins) at 960-961, 965-966, 969-971; see also RX-1236C, RX-l237C).) Therefore, argues Apple, Samsung is demanding as much, or more, for a license as Apple pays for the hardware that Samsung accuses of infringement, which means that Samsung has demanded a royalty of over 100 percent of the cost of the baseband processor. (Id.) This would be grossly excessive, even if the entire baseband processor contained Samsung technology; however, argues Apple, Samsung's infringement allegations are aimed at tiny portions of the circuitry in the baseband processors, and dozens of other companies hold thousands of other declared-essential patents for the UMTS standard. (Id.) Apple says that Samsung's demand is excessive by another measure as well, noting that {[redacted] } (CX-3 80C at 1), and if Apple had paid Samsung $18 per iPhone, Samsung would have received about $1.3 billion from Apple for the year, not including what Apple would have had to pay for sales of UMTS-compliant iPads. (Id.) 465 Apple claims that Samsung has not even tried to show that its patents merit such immense value. (Id.) Nor does Samsung's 2.4 percent demand find any support whatsoever in Samsung's other licenses and past licensing practices. Apple says that Samsung's top licensing executive, Dr. Seuing-Ho Ahn, was unable to offer any support for the figure, as shown here in testimony he provided: Q. Do you know any reason or basis to support that number? A. Personally, I don't-there is nothing I know. (Id. (citing JX-0006C (Ahn) at 23 -24, 117-118).) That is because Samsung has never demanded a 2.4 percent royalty from any company but Apple. (Id. (citing J X-0023C at 61 (Lee); JX-0010C at 106 (Chung)).) In fact, argues Apple, Samsung had never even previously set a FRAND royalty rate to charge for its portfolio. (Id. (citing JX-0023C at 61 (Lee)).) The only time that Samsung has put a figure on its UMTS portfolio during license negotiations was with { [redacted]} in 2005, when it valued it at {[redacted] } than it has demanded from Apple. (Id. at 139-140 (citing RX-0190C at 19; JX-0016C (SW Kim) at 63-64, 68-69, 75-76, 92, 94, 96-99,104-106,109,11],113-114,116-117,120-121,126-127,129-131,133-134,138-139, 142, 144, 149-150).) Apple says that no company has ever paid { [redacted]} for a license to its UMTS portfolio. (Id. at 140 (citing JX-0010C at 56 (Chung); JX-0006C at 83 (Alm)).) Instead, Samsung {[redacted] } licensing covering UMTS patents. (Id. (citing JX-00006C at 83 (Ahn)).) On these facts, argues Apple, Samsung's demand of Apple is not only unreasonable, but discriminatory, because { [redacted]}. (Id.) Samsung responds that it is Apple who refuses to comply with the ETSI framework, which, Samsung says, envisions that parties will negotiate a license to declared essential patents. 466 (CRBr. at 87.) According to Samsung, almost a year ago it offered to license its portfolio of patents that had been declared essential to the UMTS standard to Apple at a "headline" rate of 2.4 percent for each relevant end product. (Id. (citing CX-1589.0001).) In response, Apple by letter proposed a "methodology to derive a FRAND royalty rate" for Samsung's patent portfolio. (Id. (citing RBr. at 137-138).) Samsung claims that Apple's letter did not provide a counteroffer, but merely critiqued Samsung's offer. (Id. (citing RX-l659C).) Although Apple contends that Samsung's offer was too high, Samsung argues that Apple submits no evidence to suggest that it has ever made a counterproposal to Samsung's outstanding offer. (Id.) Samsung says that Apple's contention that Samsung's licensing offer was too high is wrong and the fact that the royalty payments might be significant hardly demonstrates that Samsung's offer is unreasonable, particularly given the size of Samsung's UMTS patent portfolios and the valuable contributions reflected therein. (Id. at 88.) As regards Apple's contention that the royalty sought by Samsung would be higher than the price of a baseband chip, Samsung says this is irrelevant, because Apple fails to identify a single industry license that uses the price of a baseband chip as a royalty base. (Id.) Samsung says that licenses in the telecommunications industry typically use the net sales price of a handset as the royalty base, not the price of the baseband chip. (Id. (citing RX-0174C at 2; RX-205C at 2; RX-206C at 19-20; RX-0201C at 5; RX-0194C at 6; CX-0395C at 9).) Samsung says that even if its royalties would result in payments greater than the price of a baseband chipset, such royalty rates are consistent with industry practice, and other participants in the industry, including Qualcomm and Ericsson, require licensees to pay a royalty rate of more than 2.4 percent of the net sales price of handsets for patents declared essential to ETSI standards. (Id. (citing RX-0174C at 2; RX-205C at 2; RX- 206C at 19-20; RX-0194C at 6).) 467 Samsung says that Apple's reliance on a Fed. R. Evid. 408 document from the negotiation of a cross-license between {[redacted] } and Samsung is misplaced, and explains by way of this scenario: That {[redacted] } percent royalty rate for Samsung's WCDMA- declared-essential portfolio and Samsung pays { [redacted]} percent royalty rate for {[redacted] } WCDMA-declared-essential portfolio. (Id. (citing RX-0190C at S-794-ITC- A 005280737).) Samsung says that applying the rates used in this scenario to each party's projected sales of handsets, the parties calculated that Samsung would owe {[redacted] }, resulting in a net payment of {[redacted] }. (Id.) However, the parties ultimately agreed to a net payment of {[redacted] } greater than what was indicated by the initial calculations. (Id. (citing RX-0l89C at S-794-ITC-005280293).) At best, argues Samsung, the {[redacted] } rate is not reflective of the actual agreement reached by the parties, and if anything, the rate supports the reasonableness of Samsung's offer. (Id.) If the royalty rate contemplated in the scenario is proportionally increased to match the actual {[redacted] } net payment, the resulting royalty rate is over { [redacted]}, which is comparable to the rate offered by Samsung to Apple. (Id.) Samsung counters that Apple's contention that Samsung's proposed rate is out of line with other licenses to which Samsung is a party, is also wrong. (Id. (citing RBr. at 139-140).) Samsung argues that the fact that it has not previously licensed its portfolio of UMTS patents for a royalty rate of 2.4 percent demonstrates only that Apple's litigation-driven request for such a limited license, and Apple's refusal to negotiate terms and conditions are at odds with the typical practice in the industry, and at Samsung, of entering into cross-licenses of entire declared-essential patent portfolios, often in exchange for a balancing, or net, payment from one party to the other. (Id. (citing RX-0189C; RX-0l9lC; RX-0193C; RX-0178C; RX-0194C; RX-0195C; 468 RX-0196C; RX-0197C; RX-0198C; RX-0l99C; RX-0200C; RX-0202C; RX-0203C; RX-0204C; RX-0205C; RX-0206C; RX-0207C; RX-0208C; RX-0209C; RX-042lC; RX-0423C).) Samsung says that the fact that {[redacted] } in regards to some of these licenses does not reflect adversely on the value of Samsung's UMTS portfolio, but instead, suggests that Samsung's sales volume and corresponding exposure might be higher than that of competitors with much lower sales. (Id.) Apple responds that Samsung's 2.4 percent demand of Apple is not FRAND, nor remotely close. (RRBr. at 90.) Apple repeats that Samsung asks Apple to pay a price that {[redacted] }, which would result in per-unit royalties of greater than $12 a unit, which is greater than the price of the baseband processors that Samsung claims are infringing. (Id.) Apple argues that, having failed to put on any trial evidence, and without citation to any proof, Samsung claims that its proposed royalty rate and base are in line with the royalty rates of other companies for their declared-essential patents. (Id.) Apple says that Samsung's position is based only on attorney argument and is insufficient to meet Samsung's challenges of proving it made a FRAND offer. Insofar as Samsung suggests that Apple has refused to negotiate, Apple says that this is belied by the course of communications between the parties, including Apple's April 30, 2012 offer to Samsung that included a proposal for the parties to cross-license each other's UMTS portfolios on truly FRAND terms. (Id. (citing RX-l659C).) The Administrative Law Judge concludes that the evidence does not support Apple's allegation that Samsung failed to offer Apple licenses to Samsung's declared-essential patents on FRAND terms. Patents have the attributes of personal property. 35 U.S.C. § 261. Their value, in terms of licensing, varies according to a myriad of factors, and it is not enough for Apple to 469 say that Samsung's license offer was unreasonable based on Apple's rationale. Remarkably, even though Apple complains that Samsung's license offer was not FRAND, Apple has not shown that, as a member to ETSI, it ever availed itself of the process and procedures of the ETSI under Clause 4.3 of the ETSI Guide on IPRs, which provides for mediation by ETSI Members or the Secretariat. (RX-0713 at Clause 4.3.) It is not enough for Apple to complain that Samsung's license offer of 2.4 percent of the selling prices of Apple's devices, is unreasonable, since there is insufficient evidence of customs and practices of industry participants showing that Samsung's demand is invidious with respect to Apple. Furthermore, negotiations often involve a process of offer and counteroffer before the parties arrive at an agreed price, but Apple's evidence does not demonstrate that Apple put forth a sincere, bona fide effort to bargain with Samsung. Rather, it appears that Apple and Samsung both decided to negotiate licensing terms between each other through the tortuous, and expensive, process of litigation. More than what has been cited by Apple is necessary in order to establish that Samsung violated its obligations under Clause 6.1 of Annex 6: ETSI Intellectual Property Rights Policy. More than that, Apple needs to establish a legal basis for foreclosing enforcement under Section 337 in this Investigation, which Apple has not done. B. '644 Patent Enforceability 1. Alleged Standards Setting Misconduct (3GPP) a) Apple's allegation that Samsung engaged in misconduct in

transactions with 3GPP and ETSI involving the disclosures in the '644

patent Apple alleges that the '644 patent is unenforceable because Samsung violated the ETSI IPR Policy84 by hiding Samsung's then-pending '644 patent applications from ETSI and 3GPP ___________

84 This is the European Telecommunications Standards Institute (see RX-723 at APLNDC-WH-A 9397) Intellectual Property Rights Policy (see RX-710 at APLNDC-WH-A 12542). 470 while simultaneously advocating that TS 25.212 § 4.10.4 should be amended to adopt the rate-matchjng pattern of those applications. (RBr. at 127 (citing RX-710 at Clause 4.1).) Apple contends that Samsung was bound by the duties of disclosure set forth by the ETSI in Section 4, entitled "Disclosure of lPRs," which reads as follows: Each MEMBER shall use its reasonable endeavors to timely inform ETSI of ESSENTIAL IPRs it becomes aware of In particular, a MEMBER submitting a technical proposal for STANDARD shall, on a bona fide basis, draw attention of . ETSI to any of that MEMBER's IPR which might be ESSENTIAL if that proposal is adopted. (Id. at 127, 62-63 (citing RX-710 at Clause 4.1).) Apple says that the duties set forth in Clause 4.1 apply to Samsung, and Apple maintains that Samsung's actions in connection with the '644 patent, and in particular, Samsung's claims that the patent has priority to three prior Korean patent applications: KR 10-2004-0099917 ("KR 9l7"), filed December 1, 2004; KR 10-2004-0110552, filed December 22, 2004; and KR 10-2005 0007437 filed January 27, 2005, demonstrate that Samsung breached those duties. (Id. (citing JXM-3).) Apple further notes, in that connection, that the United States application (App. No. 11/289, 572) was filed on November 30, 2005. (Id. (citing JXM-3).) Apple argues that the ETSI IPR policy contemplates that its members must declare any of their proprietary IPR that may be essential to a standard that is under consideration before any such standards are adopted by the ETSI. (Id. (citing Tr. (Walker) at 1362-65 (explaining ETSI IPR policies)).) Apple alleges that Samsung did not declare any of the aforementioned patent applications as essential to TS 25.212 until May 16, 2006, almost a year after Samsung successfully convinced the 3GPP to adopt the claimed '644 rate-matching pattern as TS 25.212 §4.10.4. (Id. (citing RX-722 at APL79-A000O00963 (indicating adoption of Samsung's E-AGCH 471 proposal by RAN 1); RX-854 at 55 (indicating adoption of Samsung's E-AGCH proposal by RAN 1); RX-133 at 14 (declaring KR 917 as essential)).) According to Apple, what Samsung did declare was a single application, which was the only application (KR 917), which does not disclose the claimed '644 rate-matching pattern. (Id.) Apple says that Mr. Kim, one of the named inventors of the '644 patent, was unabashed at the hearing about Samsung's strategy vis-a-vis its involvement in the ETSI when he conceded that his Korean applications covered the very same rate-matching pattern that he had proposed to RAN 1. (Id. (citing Tr. at 374-376, 378 (Kim)).) Despite that connection and what Apple contends were his and Samsung's obligation to disclose potentially essential IPR, Mr. Kim admitted that he withheld the pending Korean patent applications: Q. And on February 14th, 2005, you're in, I believe it was Scottsdale, Arizona for the meeting, right? A. Yes, that's how I recall. Q. And you heard the call for IPR, right? A. As I sit here today, I don't quite recall, but I would believe that's how it had happened. Q. Well, you do recall that the RAN l meetings always started with a call for IPR, right? A. That is correct, based on my ten years of experience. Q. And what the chairman says is if you have IPR that might be essential to your proposal, you have to disclose it, right? A. No, I don't think so. Q. It says, "own IPR which are or likely to become essential," right? A. That's how it is written. Q. Now, 18 days before this on January 27th, you had filed the third of your three patent applications, right? A. I believe so. Q. An application that covered the rate-matching patterns at this meeting, right? A. I believe so. Q. And you took no steps in response to the chairman's call for IPR to disclose your patent applications, right? A. I did not take any step in response to the call for IPR. . .. (Id. at 127-128 (citing Tr. at 377-378 (Kim)).) Apple notes that Mr. Kim conceded that he never disclosed the applications leading to the '644 patent at any time. (Id. (citing Tr. at 380 (Kim)).) 472 Apple says that, although Samsung kept the '644 patent secret from 3GPP and ETSI, the named inventors actively lobbied RAN 1 and other member companies to adopt Samsung's pattern as § 4.10.4, instead of better-performing technology, known as "tail-baiting," that had been proposed by Motorola. (Id. at 128 (citing RX-718 at APL794-A0000009562-63 (showing competing E-AGCH proposals at RAN 1 Meeting #40).) Apple says that Samsung's internal and external communications tell two entirely inconsistent stories, because Mr. Kim's simulation data from 2004 show that he was aware the Motorola's technology substantially outperformed what Samsung was proposing. (Id. (contrasting RPX-31C at "case4(2)," col. W-AB at lines 154-177 to RPX-31C at "case4(s)," col. Q-V at lines 156-177).) According to Apple, Mr. Kim's March 2005 internal report states that Motorola's tail-biting proposal produced a gain of 1.2 dB over standard convolutional codes, which is about six times as much gain as that produced by the '644 rate-matching pattern, which was 0.2 dB. (Id. (citing RX-878C at 4).) Apple says that Mr. Kim's report admits that tail-biting was "no problem from the ...complexity point of view"; however, he quickly recognized that adoption of Motorola's tail-biting technology would obviate the need for his adapted rate-matching pattern. (Id. at 128-129 (citing RX-878C at 4 ("it is expected that the performance gain from the improved rate matching pattern would be marginal due to the equal error protection of tail-biting convolutional code, i.e., uniform puncturing (R99 type RM) may be enough.")).) Apple argues that, in order to thwart that outcome, Samsung set upon a strategy to exploit the conservative nature of 3GPP and ensure that Motorola's technology was excluded. (Id. at 129 (citing RX-878C at 4 ("tail-biting convolutional code may be excluded by the conservativeness of 3GPP.")).) Apple contends that Samsung's representations to the 3GPP were in furtherance of Samsung's devious strategy, and just before RAN 1 Meeting #40bis, Mr. Kim e-mailed RAN 1 473 delegates from Ericsson, Qualcomm, Nokia, and Siemens to discuss Motorola's tail-biting proposal. (Id. (citing RX-893C).) Apple argues that Mr. Kim deliberately misled other 3GPP delegates by reporting that the gains from tail-biting were "just about 0.2 dB" and that the gain did not justify adopting Motorola's proposal, in light of the "big increase in receiver complexity." (Id. (citing RX-893C).) Based on these representations, Mr. Kim asked these delegates to endorse Samsung's proposal. (Id. (citing RX-893C; Tr. at 380 (Kim)).) According to Apple, Mr. Kim never revealed that his own testing was directly contrary to these representations, and he never revealed that Samsung had filed several patent applications covering Samsung's proposal. (Id. (citing Tr. at 380 (Kim)).) Apple says that, in April 2005, at RAN 1 Meeting #40bis, Mr. Kim submitted E-AGCH proposal Rl-050308, again recommending that Samsung's technology be adopted over Motorola's. (Id. (citing RX-152).) Contrary to Mr. Kim's own internal reports, Mr. Kim again argued that tail-biting increased decoder complexity. (Id. (comparing RX-152, at 3, with RX-878C at 4).) Apple reports that Mr. Kim also submitted change request R1-050309, seeking adoption of the '644 rate-matching pattern as part of TS 25.212 § 4.10.4. (Id. (citing RX-152, RX-050 at APL794A0000075473, 75).) Apple contends that, based on Mr. Kim's representations, the delegates to RAN 1 #40bis decided to move forward with Samsung's technology, at which time they had not been informed by Samsung's participating members that Samsung had applied for patents that were based on Mr. Kim's proposal, or that Mr. Kim's internal reports showed that Motorola's technology performed better and that complexity was "no problem." (Id.) Apple says that the following month, at RAN 1 Meeting #41, Mr. Kim renewed his formal request to adopt the '644 pattern. (Id. (citing RX-722 at APL794-A0000009663).) At no 474 time, argues Apple, did any of the named '644 inventors or anyone else from Samsung inform the 3GPP participants that they had filed three patent application on the very technology they were advocating for adoption. (Id. at 129-130).) Apple says that Samsung's technology was adopted by RAN 1 and then embedded in the standard by the full RAN group in June 2005. (Id. (citing RX-854 at 55).) Apple contends that Samsung's strategy of "non-disclosure" was part of a corporate policy to generate "standards adopted" patents. (Id at 130 (citing JX-23 at 114 (J .W. Lee) ("disclosure of IPR prior to its adopting would be "stupid"); RX-741C at 6 ("[E-AGCH rate matching] appears to be valuable as a patent if we can find the puncturing position that can ensure gain of approximately 0.2 dB and can be contained in the specification in the same way."); JX-9C at 31-35 (Choi Dep.) (Samsung's corporate representative witness testifying that Samsung {[redacted] }); RX-163C at 23-24 (showing "deliverables" for 1998-2005)).) Apple argues that the named inventors of the '644 patent went so far as to { [redacted]}. (Id. citing RX-141C at 7; JX-30C at 120 (Van Lieshout Dep.)).) These efforts, argues Apple, were part of a specific "standards project" that set quotas for Samsung patents to be "adopted in to the standard." (Id. (citing JX-9C at 31-35 (Choi Dep.)).) Standards' "adopted patents" were a specific "deliverable" that Samsung expected from all of its engineers that Samsung allowed to participate in RAN 1, according to Apple. (Id. (citing JX-9C at 31-35; RX-163C at 23-24).) Apple argues that Samsung deliberately misled 3GPP on two fronts. First, Samsung failed to disclose Samsung's patents to ETSI in a timely fashion, thereby depriving other 475 member companies of the opportunity to balance Samsung's IPR against the benefits of adopting their technology. (Id. (citing Tr. at 1363-65 (Walker) ("If solution one is encumbered by IPR. . .it is going to cost your company something. If solution 2, which is technically the equivalent is not encumbered by any IRP, so it will be free to use, then I believe that most people would choose the second.")).) Second, Samsung made false and misleading statements to the 3GPP regarding the relative merits of their own technology compared to Motorola's technology. (Id. at 130-131.) These statements were made in service of Samsung's policy of acquiring a certain number of standards-essential patents on a yearly basis and in light of Samsung's failure to disclose its patent applications, and its misleading statements to the 3GPP, the '644 patent should be held unenforceable, argues Apple. (Id. at 131.) Samsung responds that the Motorola proposal was discussed at 3GPP, but "tail-biting" was a brand-new technology that would have required an entire overhaul of all decoders that were already implemented in UMTS systems. (CRBr. at 74 (citing Tr. (Kim) at 299-300).) Therefore, according to Samsung, it was not an option for the 3GPP to adopt Motorola's proposal. (Id. (citing Tr. (Kim) at 299-301).) Eventually, after much discussion, the members of 3GPP adopted Samsung's proposal, recognizing that it was the best solution to the problem they were facing. (Id. (citing Tr. at 300-301).) The technology in the '644 patent was adopted into the 3GPP standard and is practiced by all HSUPA-capable products today. (Id. (citing CX-1748).) Samsung says that Apple has pointed to no evidence that corroborates Apple's accusation that Samsung misled the 3GPP regarding Motorola's proposal. (ld. (citing Tr. (Kim) at 299-301).) In fact, argues Samsung, Apple itself completely misrepresents a document in an attempt to make its point. As regards Apple's assertion that "Mr. Kim falsely told these other RAN 1 476 delegates that the results from Motorola's tail biting proposal 'show that the gain from the tail biting code is just about 0.2 dB'--the same gain Mr. Kim contended his rate-matching pattern produced[,]" (id. at 74-75 (citing RBr. at 84)), Samsung says the actual language of document shows otherwise and corroborates Mr. Kim's testimony: Enclosed are Samsung draft contributions on coding for E-AGCH. In this contribution, we compared performance of the tail biting convolutional code and the convolutional code specified in current TS 25.212. The results show that the gain from the tail-biting code is just about 0.2 dB. In our view, this gain is not enough to justify the impact on implementation especially big increase of the UE decoder complexity. (Id. at 75 (citing (RX-0893C).) This shows that Mr. Kim admitted that there is gain from the tail-biting code, but he said that it was not enough to justify the impact, given the necessary complexity in the decoder. (Id. (citing Tr. (Kim) at 299-3 00).) Samsung says that Apple seeks the creation of a new patent unenforceability defense untethered to any recognized legal or equitable doctrine, namely, if a patent owner fails to disclose an IPR before a potentially related standards contribution has been "frozen," there must be a declaration that any patent in the family of that IPR is unenforceable regardless of circumstances. (CRBr. at 77.) But this is not the law, argues Samsung, as Qualcomm v. Broadcom, 548 F .3d 1008, 1024 (Fed. Cir. 2008), the sole legal authority on which Apple relies, demonstrates. Although a court sitting in equity has the discretion to declare a patent unenforceable based on conduct before a standards body, such an order must be predicated on clear and convincing evidence that the patent owner engaged in intentional conduct that was so egregious as to fall squarely within a recognized equitable doctrine, such as implied waiver, equitable estoppel, or unclean hands. (Id. at 78 (citing Broadcom at 1024).) For example, although Apple contends that in Broadcom "there was no evidence that the inventors had participated in the standards-setting process," Apple necessarily ignores a critical fact, namely that Qualcomm concealed its involvement in, and manipulation of, the standard-setting process 477 right through trial as part of its "carefully orchestrated scheme" to conceal its patents and thereby hold the industry hostage. (Id. (citing Broadcom at 548 F.3d at 1009-10).) Samsung says that Apple failed to provide any evidence of such bad faith conduct on the part of Samsung; rather, to the contrary, the record reflects that Samsung complied with its ETSI obligations. (Id.) Samsung says that it openly complied with its ETSI obligations and only participated in the standard-setting process and voluntarily submitted a general IPR declaration in 1998, long before the standards proposals or patent applications at issue existed, stating that is was prepared to offer licenses to all of its essential patents on FRAND terms and conditions. (Id.) Samsung says that it then declared members of the '348 and '644 patent families, along with dozens of other patents and pending patent applications, as essential to the UMTS standard to ETSI in December 2003 and May 2006. (Id. at 78-79 (citing RX-0164C; RX-0133).) Samsung says it has entered into licensing agreements with numerous industry participants that include the '348 and '644 patents along with Samsung's entire portfolio of UMTS-declared essential patents. (Id. at 79 (citing RX-0188; RX-0189C; RX-0191C; RX-0193C; RX-0178C; RX-0194C; RX-0195C; RX-0195C; RX-0197C; RX-0198C: RX-0199C; RX-200C; RX-0201C; RX-202C; RX-020cC; RX-204C; RX-205C; RX-206C; RX-0207C; RX-0209C; RX-0421C; RX-0423C).) Samsung says that before this Investigation was initiated, Samsung offered Apple a license that would have included these patents and then, nearly a year ago, at Apple's request, offered Apple a license limited to Samsung's portfolio of UMTS-essential patents, and Samsung has unsuccessfully attempted to engage Apple in negotiations ever since. (Id. (citing CX-0390C; CX-0769.0006; CX-1589C).) Samsung says it thereby fully complied with ETSl's disclosure obligations and there is no evidence to suggest that Samsung intentionally shielded the related Korean patent application from disclosure or refused to license its declared-essential UMTS 478 patents on FRAND terms and conditions. (Id.) Samsung says that Apple's own expert testified that he was not accusing Samsung of any intentional conduct. (Id. (citing Tr. at 1418).) Samsung argues that the testimony of its witnesses, including its inventors, that Apple cites does not support a finding of implied waiver; nor is it reasonable to infer from this evidence that Samsung intentionally failed to timely disclose its patents to ETSI, let alone that this is the single most reasonable inference. (Id. (citing Therasense, Inc. 649 F.3d at 1290 (holding that, to find a patent unenforceable for inequitable conduct, the accused infringer must prove that "the specific intent to deceive must be the single most reasonable inference able to be drawn from the evidence")).) Although Apple faults the inventors for not disclosing their Korean applications at ETSI technical working group meetings, Apple ignores unequivocal evidence that ETSI members never disclose IPRs at such meetings in response to a call for IPR; in fact, working group members like Mr. Kim would have neither the responsibility nor the authority to make such disclosures. (Id. at 79-80 (citing Tr. (Kim) at 381).) Samsung says that Apple's own expert, Dr. Walker, until recently the Chairman of the ETSI Board, conceded that in his 25 years of involvement at ETSI he could not recall a participant at a working group meeting "ever having made a declaration about IPR in a submission." (Id. (citing Tr. (Walker) at 1414).) Mr. Walker also confirmed that it has never been the policy of ETSI that participants in working groups should submit e-mails mentioning the filing of patents in lieu of submitting an IPR declaration. (Id. (citing Tr. at 248, 378-379 (Kim), 1414-15 (Walker)).) Samsung says that this is not surprising given that ETSI unequivocally states that technical meeting are not the proper forum for disclosures and discussion of IPR. (Id. (citing CX-0441.0012).) Samsung says that the only mechanism that ETSI provides for IPR disclosures is the "ETSI IPR Information Statement and Licensing Forms" that is attached to Annex 2 of ETSI 479 Guide to IPRs. (Id. (citing CX-0902.0022).) These IPR declaration forms are typically signed by relatively senior executives who can bind the company to the required FRAND licensing terms. (Id. (citing Tr. at 1410 (Walker)).) Samsung says that in large companies like Samsung, there are several layers of management between working group members and those with the authority to sing these forms. (Id. (citing Tr. at 1413-14 (Walker)).) Thus, the evidence presented at the hearing, including Mr. Walker's own testimony, cannot support an inference that the inventors of the '348 and '644 patents or Samsung intended to deceive ETSI. In response to Apple's assertion that "Samsung's strategy of non-disclosure is part of a corporate policy to obtain 'standards adopted' patents," Samsung says there is no ETSI regulation against obtaining standard essential patents and, for the reasons previously mentioned by Samsung, discussed above, Samsung's conduct of developing successful technologies, openly working with ETSI, disclosing potentially relevant patents, and willingly licensing them on FRAND terms, is plainly inconsistent with a "strategy of non-disclosure." (Id. at 80-81.) Samsung says the testimony cited by Apple actually demonstrates that Samsung has established internal processes to comply with ETSI policies, including patent teams that access whether patents being prosecuted are essential to an ETSI standard. (Id. at 81 (citing JX-0009C at 65 (Choi Dep.); JX-0023C at 12 (JW Lee Dep.)).) The most reasonable inference from such evidence is that Samsung, unlike Apple, had processes in place to comply with the policies of standards setting organizations, and endeavored to comply with them. (Id. (citing J X-0023C at 12 (JW Lee Dep.)).) Samsung argues that Apple's assertion that Samsung did not timely disclose its patents rests on a bright-line rule that finds no support in the ETSI Policy. (Id.) Relying on Clause 4.1, Apple contends that an IPR disclosure is not timely unless the IPR is disclosed before the 480 adoption of the proposal to which it applies; however, argues Samsung, Clause 4.1 simply states this: Each MEMBER shall use its reasonable endeavors to timely inform ETSI of ESSENTIAL IPRs it becomes aware of. In particular, a MEMBER submitting a technical proposal for a STANDARD shall, on a bona fide basis, draw the attention of the ETSI to any of that MEMBER's IPR which might be ESSENTIAL if that proposal is adopted. (Id. (citing CX-0908.002 at § 4.1).) Samsung says that Apple misreads this clause, which merely requires that a member use "its reasonable endeavors" with respect to IPR it "becomes aware of," and then goes on to require disclosure, on a "bona fide basis," i.e., in good faith and without deceit, of IPR that might be essential if a proposal submitted by a member is adopted. (Id.) The second sentence of the clause unmistakably refers back to the first sentence and cannot be read in isolation without reference to the required "reasonable endeavors" of IPRs that the member "becomes aware of." (Id. at 81-82.) Samsung notes that Apple's expert, Dr. Walker, confirmed the evidence of intentional misconduct is absent here. (Id. at 82 (citing Tr. (Walker) at 1418 ("Q. But you were not offering an opinion to His Honor that Samsung intentionally delayed, are you sir? A. No, I had not said--I had not used the word intentionally delayed at all.").) Samsung says that Apple erroneously asserts that the use of the phrase "if the proposal is adopted" in Clause 4.1 of the ETSI IPR Policy necessarily requires disclosure before the proposal has been adopted; however, the clause simply provides the conditions under which IPR must be disclosed if a proposal is adopted, not the time when it must be disclosed before the proposal is adopted. (Id.) Samsung argues that Apple failed to introduce any evidence that ETSI has ever considered whether a proposal is subject to an IPR before adopting it, let alone that it should have done so here. Samsung says that Dr. Walker admitted that he had virtually no personal experience with IPR disclosures, and Samsung notes that he did not offer an opinion on 481 whether ETSI might have adopted an alternative technology had it known of the Korean patent applications. (Id. (citing Tr. at 1365, 1399-1401 (Walker)).) Samsung says that Apple's theory that members must disclose their patents before a standard is "frozen," because patents disclosed thereafter "only emerge when it is too late for ETSI to consider them," is fundamentally at odds with the ETSI IPR Policy, which prohibits members from discussing IPRs at meetings, as well as the practice at ETSI. (Id. (citing CX-0441.0012 at § 4.1.).) Delegates at technical meetings, like the Samsung inventors, are to discuss the technical merits of a proposal, not their relative cost. (Id. (citing CX-0908.002 at §3.1 (stating that the goal of ETSI is to promulgate standards that "best meet the technical objectives of the European telecommunications sector.").) Samsung contends that the ETSI IPR Policy simply ensures that the relevant IPR will be available through a FRAND commitment. (Id. at 82-83 (citing CX-0908.003 § 6.1).) According to Samsung, ETSI encourages the filing of general disclosures, followed by the submission of specific disclosures "as soon as feasible." (Id. (citing CX-0441.0005 at § 2.1.1.).) Samsung contends that Apple has failed to demonstrate that the ETSI IPR Policy requires that a specific disclosure must occur before a proposal is frozen and also has failed to provide any evidence that ETSI members understand and require IPR to be declared before a potentially relevant standard is finalized. (Id. (citing Broadcom, 548 F.3d at 1016 (noting that the Federal Circuit relied on testimony regarding understanding of SSO members to define the disclosure duty).) Samsung says Apple failed to provide any evidence that Samsung's Korean patent applications were not confidential at the time Samsung made its proposals, and therefore that they even fell within ETSI's definition of IPR, which expressly excludes such information. (Id. at 84.) As an initial matter, Samsung says that Apple asserts that "confidential information," 482 which appears in that definition in lower case letters, includes "only information that a chairman of a committee has requested and agreed to treat as confidential." (Id. (citing RBr. at 84).) Samsung protests that because Apple did not disclose this theory in its pre-hearing brief and discovery responses, and Dr. Walker did not testify about it at the hearing or even in deposition, it should be deemed waived, and besides, is wrong. (Id.) Samsung notes that in defining "IPR," ETSI IPR Policy specifically provides that "[f]or the avoidance of doubt rights relating to get-up, confidential information, trade secrets or the like are excluded from the definition." (Id. (citing CX-0908.006 ("Definition of 'IPR'")).) Although ETSI's IPR Policy does separately define "CONFIDENTIAL INFORMATION" using upper- case letters to denote certain information requested by a committee chairman per Clause 10, this upper-case definition of the phrase does not appear outside of Clause 10, say Samsung. (Id.) Had the ETSI IPR Policy intended to incorporate the narrowly-defined phrase, "CONFIDENTIAL INFORMATION" in the definition of "IPR," it would have used upper-case letters to denote that fact as all of the other defined terms are capitalized in the IPR Policy; instead, "confidential information is used in a more generic way (along with "get-up,. . .trade secrets or the like." ) (Id. at 84-85.) Samsung contends that Apple offered no evidence that the Korean patent applications had been published or otherwise had lost their confidential status at the time when Apple claims they should have been "timely" disclosed. (Id. at 85.) Because Apple has failed to show that Samsung violated any ETSI policy with the specific intent to deceive ETSI and manipulate the standard-setting process, Apple's affirmative defense of implied waiver fails. Staff says that Apple's contentions regarding both the '348 and '644 patents and Samsung's conduct vis-à-vis the 3GPP and ETSI in regard to those patents does not constitute 483 misconduct that warrants holding the patents unenforceable. (SBr. at 87.) Staff says that the '644 patent claims priority to three Korean applications, two that were filed in December 2004, and one that was filed in January 2005. Staff notes that in February 2005 Samsung submitted a proposal to the relevant 3GPP working group regarding rate-matching candidates for absolute scheduling grants of 5-10 bits in length. (Id.) Then in June 2005, Samsung's rate-matching proposal was adopted by the 3GPP. (Id. (citing RX-854).) Staff notes that Samsung did not declare any of these patent applications as essential to the working group involved in the TS 25.212 standard until May 16, 2006, nearly a year after Samsung had successfully convinced the 3GPP to adopt the claimed '644 rate-matching pattern as TS 25.212 § 4.10.4. (Id. at 87-88.) Staff recognizes that ETSI IPR Policy establishes a duty for ETSI members such as Samsung to disclose potential "Essential IPR" to ETSI in a timely manner. (Id. at 88 (citing RX-701 Annex 6 §§ 4.1-4.2 (ETSI IPR Policy).) Staff concludes that Apple has not shown a breach of that duty for at least two reasons. First, a relatively short time passed between adoption of Samsung's rate-matching proposals by the 3GPP plenary group and Samsung's disclosure of the Korean patent applications to which the '644 patent claims priority, less than one year later. Second, the evidence suggests that the technology disclosed in Samsung's '644 patent is not essential to compliance with the technical standards of TS 25.212 and thus would not qualify as "Essential IPR." Staff says the evidence demonstrates that the Apple Accused Products, all of which are CDMA-compliant, do not infringe the asserted claims of the '644 patent. Accordingly, argues Staff it must be possible to comply with the ETSI technical standard without making use of Samsung's IPR. Thus, the evidence is insufficient to establish by clear and convincing evidence that the '644 patent is unenforceable due to Samsung's conduct as an ETSI or 3GPP member. (Id.) 484 In its reply brief, Apple argues that, although Samsung refers generally to standards disclosure (citing CBr. at 128-131), Samsung singularly fails to address the specific reasons Apple demonstrated at trial for why the conduct of Mr. Kim and the other specifically-identified Samsung RAN 1 delegates renders the '644 patent unenforceable, including their failure to timely inform fellow RAN l delegates or ETSI that Samsung had applied for three patents covering every permutation of AG and rate-matching pattern that Samsung had proposed to them and deliberately misleading other delegates about the superior performance and low complexity of Motorola's tail-biting technology. (RRBr. at 76.) According to Apple, Samsung failed to rebut Apple's proof in its opening brief and has waived any responsive arguments under Ground Rule 10.1. The Administrative Law Judge concludes that Apple has failed to demonstrate that either the evidence or the law supports Apple's contention that the '644 patent is unenforceable by reason of alleged acts of misconduct on the part of any of the named inventors or Samsung in its dealings with the 3GPP and ETSI. With respect to the evidence, Samsung has shown a legitimate reason for why it advanced its proposals in opposition to Motorola's. The fact that members of consensus bodies that set industry standards advocate positions they favor and denigrate positions advocated by others is a dialectical process which is conducive to arriving at outcomes deemed desirable to the goals of the organization. The fact that Samsung, or its participating members, found fault with Motorola's proposals and favor with their own is not enough to demonstrate misconduct. Samsung has shown reasons for the stand it took and the Administrative Law Judge finds no reason to conclude that there were any improprieties in what Samsung did vis-à-vis its participation in the ETSI. 485 Nor has Apple provided a legal basis for rendering the '644 patent unenforceable even if it were to be concluded that Samsung's activities with respect to the 3GPP and ETSI contravened in some respect a policy thereof. ETSI is an organization that has adopted various policies, among which is the following: 14 Violation of Policy Any violation of the POLICY by a MEMBER shall be deemed to be a breach, by that MEMBER, of its obligations to ETSI. The ETSI General Assembly shall have the authority to decide the action to be taken, if any, against the MEMBER in breach, in accordance with the ETSI statutes. (RX-710 at APLNDC-WH-A0000012546.) There is no evidence that Apple has exhausted, or even pursued any course of action or remedy available to it under this provision, or any other, offered by ETSI or otherwise shown that pursuit of the forms of relief or remedy available from ETSI would be inadequate. There is no law cited by Apple that authorizes an Administrative Law Judge to superintend the affairs of ETSI and make findings that may not be in accordance with its objectives and governing provisions. For example, Apple points to Clause 4.1 which states that each member shall use its reasonable endeavors to timely inform ETSI of essential IPRs. What constitutes "timely" is not specified, but it stands to reason that the members have views on that matter which may differ not only among each other but also, by way of their consensus, with what an Administrative Law Judge might determine in the context of a Section 337 investigation, not having the benefit of the members' thinking on the matter, as far as effectuating the policies of ETSI. The ETSI Guide on Intellectual Property (lPRs) (RX- 0713 at APLNDC-WH-OOOO12464), NOTE l, states: "Definitions for 'Timeliness" or "Timely" cannot be agreed, because such definitions would constitute a 'change to the Policy."'" If the ETSI itself cannot arrive at a definition of "timely," for someone outside that body to do so would amount to an assumption of non-delegated legislative power. It would be ill-advised to 486 decree what the members might by consensus not agree with. in short, Apple has not carried its evidentiary or legal burden for establishing that the '644 patent, a valid United States patent, should be held unenforceable by reason of Samsung's ETSI activities. 2. Alleged Inequitable Conduct a) Applicable Law Patent applicants and their attorneys have "a duty of candor and good faith" in dealing with the PTO, "which includes a duty to disclose . . . information known . . . to be material to patentability." 37 C.F.R. § l.56(a). A patent may become unenforceable on the grounds of inequitable conduct if the patentee withheld material information from the PTO with intent to mislead or deceive the PTO into allowing the claims. LaBounty Mfg., Inc. v. US. Int 'l Trade Comm'n, 958 F.2d 1066, 1070-1074 (Fed. Cir. 1992) ("LaBounty"). Both materiality and intent must be proven by clear and convincing evidence. Id. When inequitable conduct occurs in relation to one or more claims of a patent, the entire patent is unenforceable. Kingsdown Med. Consultants, Ltd. v. Hollister, Inc., 863 F.2d 867, 877 (Fed. Cir. 1988) (en banc). "The materiality of information withheld during prosecution may be judged by the 'reasonable examiner' standard." McKesson Information Solutions, Inc. v. Bridge Medical, Inc., 487 F.3d 897, 913 (Fed. Cir. 2007) ("Materiality embraces any information that a reasonable examiner would substantially likely consider important in deciding whether to allow an application to issue as a patent."). However, a patentee need not disclose material information that is merely cumulative of other information already before the examiner. Baxter Int'l, Inc. v. McGaw, Inc., 149 F.3d 1321, 1328 (Fed. Cir. 1998); 37 C.F.R. 1.56(b). "Direct evidence of intent or proof of deliberate scheming is rarely available in instances of inequitable conduct, but intent may be inferred from the surrounding circumstances." 487 Critikon, Inc. v. Becton Dickinson Vascular Access, Inc., 120 F.3d 1253, 1256 (Fed. Cir. 1997). However, intent may not be inferred from materiality. Therasense, Inc. v. Becton, Dickinson and Co., 649 F.3d 1276 (Fed. Cir. 2011) ("Therasense"). Once the materiality of the withheld information and the patentee's intent to mislead have been established, the administrative law judge "must weigh them to determine whether the equities warrant a conclusion that inequitable conduct occurred." Bristol-Myers Squibb C0. v. Rhone-Poulenc Rorer, Inc., 326 F.3d 1226, 1234 (Fed. Cir. 2003) (quoting Molins PLC v. Textron, Inc., 48 F.3d 1172, 1178 (Fed. Cir. 1995)). inequitable conduct Apple contends that the '644 patent is unenforceable because of inequitable conduct committed by Samsung in the course of prosecuting the application for the patent. (Id.) Apple argues that, at the time that the named inventors of the '644 patent were telling the 3GPP that they "took" their '644 rate-matching pattern form Siemens's HS-SCCH, they and those involved with them in the prosecution of the patent application that resulted in the '644 patent, deliberately kept this fact, as well as the R1-02-0604 and R1-041520 proposals, previously discussed, from the USPTO. (Id.) These references were unquestionably material for the reasons already discussed, argues Apple, citing Aventis Pharma S.A. v. Hospira, Inc., No. 2011-1018, 2012 U.S. App. LEXIS 7095 (Fed. Cir. Apr. 9. 2012) at *20 (defining materiality).) Apple points to Dr. Stark's testimony that none of the art that was before the USPTO was even close to being as material as Siemens's R1-02-0604 and R1-041520 proposals, and Apple says that his testimony in this regard was un-rebutted. (Id. (citing Tr. (Stark) at 2257-61).) Apple says that Figure 24 of Siemens's R1-41520 proposal admittedly disclosed every limitation of claims 1, 9, and 13, except the specific rate-matching puncturing positions. (Id. (citing RX-927; Tr. (Kim) at 488 339-42, (Min) at 3080-81).) Apple argues that those puncturing positions were obvious from the teaching of Siemens's Rl1-02-0406. (Id. (citing RX-54; RX-1527C).) Apple says that Mr. Kim admitted at the hearing that his '644 rate-matching pattern was {[redacted]}. (Id. (citing Tr. (Kim) at 344).) There was no way, argues Apple, for the USPTO to have considered Mr. Kim's derivation of the '644 pattern from the prior invention of Siemens other than through disclosure by the named inventors of the '644 patent. (Id.) Apple says that Mr. Kim admitted he had a duty to disclose prior art like R1-02-0604 and R1-041520 to the USPTO, yet these prior art references and the facts of derivation of the '644 invention were intentionally withheld. (Id.) The named '644 inventors' own correspondence, just weeks before they filed their first patent applications respecting the claimed invention, { [redacted]}, says Apple. (Id. at l3l-132 (citing CX-1857C at 2 (questioning patentability); RX-739C).) According to Apple, the named inventors and Samsung's "patent team" were motivated to withhold these important references because of Samsung's {[redacted]}. (Id.) In order to achieve Samsung's {[redacted] }, the named '644 inventors executed a plan that was calculated to ensure that the pattern they derived from Siemens was both patented and adopted by 3GPP. (Id.) According to Apple, in order to get their Siemens- 488 derived pattern adopted as the standard, the named inventors misled the 3GPP both by withholding the existence of their patent applications in the face of a known duty to disclose them to ETSI and by actively assuring the other RAN 1 delegates that the rate-matching pattern that they were proposing was old technology taken from Siemens, and by implication, was not patentable. (Id. (citing Tr. (Kim) at 380 (admitting failure to disclose); RX-125 at 1 (representing to RAN 1 that "we took the similar concept as used for the HS-SCCH"); RX-893C ("{[redacted]}").) Moreover, according to Apple, the named inventors of the '644 patent lobbied against adoption of Motorola's better-performing "tail-biting" technology by misstating both the efficacy of Motorola's technology and its complexity. (Id.) Apple claims that Samsung told an entirely different story to the USPTO and rather than acknowledge that they had taken the invention from the work of Siemens, as they had admitted to the 3GPP, the named inventors and Samsung studiously withheld all of Siemens's rate- matching prior art from the USPTO, art they admittedly not only possessed, but had used to derive their E-AGCH pattern. (Id. at 132-133.) Apple says that named inventor Kim testified that he {[redacted]}. (Id. at 133 (citing JX-18 (Kim Dep.) at 67-68; JX-11C (Gha Dep.) at 61-62).) Apple says that Mr. Gha testified that one purpose of the {[redacted] }. (Id. (citing JX- 11C at 93-94).) Apple argues that, because of Mr. Kim's extensive use of Siemens's R1-041520 and R1-02-0604 to derive his '644 rate-matching pattern, these prior art references should have 490 been the first documents that Mr. Kim {[redacted] } Mr. Gha; however, it is clear that Mr. Kim did not submit either one. (Id.) To the contrary, argues Apple, Mr. Gha testified that he had never seen Siemens's R1-02-0604 before being confronted with it at his deposition, and neither R1-02-0604 nor R1-041520 were ever revealed to the USPTO. (ld. (citing JXM-3 cover; Tr. (Kim) at 371-372).) Apple says that, uncertain of the patentability of their work in light of Siemens's invention, Mr. Kim and his co-inventors should have made sure that R1-02-0604 and R1-041520 were presented to every patent office that considered their claims, but, instead, what the named inventors and Samsung did was make sure that no patent office ever found out about the very prior art that they had used to derive their claims, out of fear that disclosure of this art would ruin their chances of obtaining a "standards patent." (Id. at 133-134.) Faced with competing technology that {[redacted] }, Mr. Kim, his co-inventors, and Samsung should have presented all of the facts (including that they had applied for patents on their rate-matching proposal) to RAN 1 and thereby let the best technology prevail. (Id. at 134.) Instead, what the named inventors and Samsung did was mislead members of RAN 1 about both the performance and complexity of Motorola's proposal, and fail to disclose their Korean patent application, lest disclosure of these applications hamper their attempt to standardize their patent. Samsung points out that Apple's burden to prove inequitable conduct is particularly high, citing Therasense. Samsung says that Apple must show that, but for the failure to disclose a particular reference, the patent would not have issued, and Apple's argument and its cited evidence do not come close to meeting this high burden. (Id.) Moreover, argues Samsung, Apple has pointed to no evidence of intent to deceive, but instead, relies on fabricated stories 491 which are not supported by the evidence. (Id. (citing RBr. at 131-134).) To start with, Samsung says that at the hearing Dr. Stark only opined regarding materiality for R1-02-0604, which is Siemens's HS-SCCH proposal, and R1-041520, which is Siemens's E-DCH proposal. (Id. (citing Tr. (Stark) at 2257, 2261). Because these references are missing many of the claimed limitations, including the claimed rate-matching pattern, they cannot possibly rise to the level of "but for" materiality that is required for inequitable conduct. (Id.) Also, Mr. Young-Bum Kim testified that the HS-SCCH proposal did not even work as it applied to the E-AGCH. (Id. at 75-76 (citing Tr. (Kim) at 288).) Therefore, it cannot possibly be material to claims related to the E-AGCH. (Id. (citing Tr. (Min) at 3042-43).) Samsung says that Apple has pointed to no evidence but relies solely on attorney argument in its attempt to show that the claims would not have issued but for these references being before the patent office. (Id. at 76.) Samsung says that Apple's accusation that the cited references were "intentionally" withheld is conclusory and that Apple has proffered as its support a discussion between the inventors relating to {[redacted] } that occurred before they had begun to work on the '644 invention. (Id. (citing RBr. at 131-134; RX-793C).) Samsung notes that the inventors did not invent anything related to the HS-SCCH, but instead, spent {[redacted]}. (Id. (citing Tr. (Kim) at 296-298; RX-0153; RPX-031C).) As a result, says Samsung, RX-739C fails to support Apple's assertion that the inventors believed the HS-SCCH invention was material to the '644 patent. By the time the invention was complete and the claimed rate-matching pattern was developed, the inventors knew that the HS-SCCH proposal was not related to the '644 invention. (Id. (citing Tr. (Kim) at 296-98).) Samsung argues that, despite Apple's assertion, there is actually no evidence that the inventors did not submit any of the prior art to their patent attorneys; and although Apple claims 492 that it is clear that Mr. Kim did not submit these references, Apple points to no evidence that shows that he did not, only pointing to testimony of Mr. Gha, who was {[redacted]}. (Id. at 76-77 (citing JX-11C (Gha Dep.) at 61-62).) Samsung argues that it is possible that, given that the alleged inequitable-conduct references do not disclose any of the claimed limitations, it was determined that more material references had already been disclosed. According to Samsung, there is no evidence to support Apple's allegations, and the evidence fails to show that the inventors and Samsung ha