Qualcomm escalated its legal battle with Apple, filing a countersuit on claims Apple made “false statements” against Qualcomm and was in breach of agreements with the smartphone chip firm. It followed Apple's January lawsuit against Qualcomm claiming Qualcomm gouged Apple for billions of dollars in patent royalties on technologies it didn't own (see 1701230067). Qualcomm sought dismissal last week of the FTC's complaint against the company alleging Qualcomm had a monopoly in baseband processors used in cellphones and other devices (see 1701170065, 1704040040 and 1704040037). Qualcomm filed its countersuit in response to the Apple suit in the U.S. District Court in San Diego. Apple “chose not to utilize certain high-performance features of the Qualcomm chipsets for the iPhone 7 (preventing consumers from enjoying the full extent of Qualcomm’s innovation)” and “falsely claimed there was 'no difference' between” the performance of iPhones that contained Intel and Qualcomm chips, Qualcomm said in its complaint: Apple “threatened” to not publicize the differences in chip performance, which would make “public comparisons about the superior performance of the Qualcomm-powered iPhones.” Qualcomm claimed Monday Apple made false statements about Qualcomm to undermine its reputation. Apple “has launched a global attack on Qualcomm and is attempting to use its enormous market power to coerce unfair and unreasonable license terms from” the company, said Qualcomm General Counsel Don Rosenberg in a statement. An Apple spokesman pointed to its statement on the January suit. The company said then that “despite being just one of over a dozen companies who contributed to basic cellular standards, Qualcomm insists on charging Apple at least five times more in payments than all the other cellular patent licensors we have agreements with combined.”

The Patent and Trademark Office said it began an initiative to use five years of data from Patent Trial and Appeal Board proceedings to improve the PTAB process. The data, particularly feedback on inter partes review proceedings, will “ensure that the proceedings are as effective and fair as possible within [PTO’s] congressional mandate to provide administrative review of the patentability of patent claims after they issue,” PTO said in a Monday news release. “This initiative will examine procedures including, but not limited to, procedures relating to multiple petitions, motions to amend, claim construction, and decisions to institute. It will evaluate the input already received from small and large businesses, startups and individual inventors, IP law associations, trade associations, and patent practitioners, and will seek to obtain more feedback regarding potential procedural enhancements.” PTO Senior Advisor Coke Morgan Stewart will lead the effort, the office said.

Moderators can be considered to have enough knowledge of copyright infringement on a website to undermine an ISP’s Digital Millennium Copyright Act Section 512 safe harbors, the 9th U.S. Circuit Court of Appeals ruled in Mavrix Photographs v. LiveJournal. Paparazzi company Mavrix sued in 2014 over posts on LiveJournal’s “Oh No They Didn’t!” gossip blog that contained its photos of Beyonce and other celebrities. LiveJournal argued it qualified for DMCA safe harbor protections because it didn’t have direct knowledge of the infringing blog posts. Mavrix contended LiveJournal’s team of volunteer moderators, who had the power to review blog posts for compliance with the platform’s terms of service, would have been aware of the infringing content. U.S. District Court in Santa Ana, California, ruled in 2014 that LiveJournal qualified for safe harbor protections because the blog posts were user generated and not solicited by the platform. The 9th Circuit disagreed. “The moderators performed a vital function in LiveJournal’s business model,” said Judge Richard Paez for the three-judge panel. “There is evidence in the record that LiveJournal gave moderators express directions about their screening functions, including criteria for accepting or rejecting posts. Unlike other sites where users may independently post content, LiveJournal relies on moderators as an integral part of its screening and posting business model.” Judges Morgan Christen and Harry Pregerson also heard the case. Posts “are at the direction of the user if the service provider played no role in posting them on its site or if the service provider carried out activities that were 'narrowly directed' toward enhancing the accessibility of the posts,” Paez ruled. "The ONTD moderators manually review submissions and publicly post only about one-third of submissions. The moderators review the substance of posts; only those posts relevant to new and exciting celebrity gossip are approved. The question for the fact finder is whether the moderators’ acts were merely accessibility-enhancing activities or whether instead their extensive, manual, and substantive activities went beyond the automatic and limited manual activities we have approved as accessibility-enhancing.” The 9th Circuit remanded the case to the district court for a jury trial using their safe harbors threshold test. “That moderators reviewed those submissions shouldn’t change the analysis,” said Electronic Frontier Foundation Legal Director Corynne McSherry in a Saturday blog post. “The DMCA does not forbid service providers from using moderators.” Many “online services have employees (or volunteers) who review content posted on their services, to determine (for example) whether the content violates community guidelines or terms of service,” McSherry said. “Others lack the technical or human resources to do so. Access to DMCA protections does not and should not turn on this choice.” LiveJournal and Mavrix didn’t comment.

The American Society of Composers, Authors and Publishers collected almost $1.6 billion in revenue in 2016 and distributed $918 million to its songwriter, composer and music publisher members, the performing rights organization (PRO) said Wednesday. ASCAP said its licensing revenue increased almost 6 percent year-over-year to $759 million because of a 41 percent increase in revenue from audio streaming services and increased revenue from satellite radio services. The PRO's foreign revenue increased to $300 million, up $1.5 million over its 2015 foreign revenue total. ASCAP's “record high revenues and distributions in 2016 are a testament to the amazing repertory of music we are privileged to represent, and to our investment in innovations that enable us to continue to grow revenues, leverage our scale and increase efficiencies in our operations,” said CEO Elizabeth Matthews in a news release.

Qualcomm formally asked the U.S. District Court in San Jose Monday to dismiss the FTC's complaint against the company, in which the agency alleges the smartphone chip firm had a monopoly in baseband processors used in cellphones and other devices. The FTC voted 2-1 to file the complaint in January, shortly before then-President Barack Obama left office (see 1701170065). Then-Commissioner Maureen Ohlhausen dissented in that vote and since being named the FTC's acting chairman said the action was flawed (see 1701230043 and 1702230012). The FTC's complaint “does not plead facts supporting the basic elements of an antitrust claim and does not allege a plausible antitrust theory,” Qualcomm said in its motion (in Pacer). “Most strikingly, the Complaint does not contain any factual allegations of anticompetitive harm to Qualcomm’s rivals in the supply of modem chips. Moreover, the Complaint’s theories of harm to competition are foreclosed by governing law and are implausible on their face. Each of these fundamental flaws is independently sufficient to warrant dismissal.” District Judge Lucy Koh set a May 12 deadline for the FTC to respond to Qualcomm's motion. The agency didn't comment.

IBM scientists got a patent for a machine learning system that can contribute to crash protection in autonomous vehicles, the company announced. The system can dynamically shift control of an autonomous vehicle between driver and vehicle control processor in the event of potential emergency. It uses sensors and artificial intelligence to determine potential safety concerns and control whether self-driving vehicles operate autonomously or relinquish control.

Digital Millennium Copyright Act Section 512 safe harbor provisions let YouTube evade paying market music licensing rates, costing the U.S. music industry between $650 million and $1 billion in annual royalty revenue during 2015, the Phoenix Center reported. The group did its study using “accepted economy modeling techniques” to simulate how YouTube's service affects revenue. There's a “sizeable effect [which] lends credence to the recording industry's complaints about YouTube's use of the safe harbor,” said Chief Economist George Ford in a Wednesday news release. YouTube owner Google didn't comment.

Director Michelle Lee highlighted Patent and Trademark Office work on its patent prosecution highway footprint in Latin America, during a Wednesday speech at the Trilateral Conference in Seville, Spain. PTO, the European Patent Office and Japan Patent Office jointly lead the Trilateral Co-operation, which oversees global filing of patents. PTO expanded the PPH program to Argentina in early March, more than a year after the program began in Brazil, Lee said. PTO hopes to extend the program, currently set to expire next year, and broaden “the scope of the arrangement,” Lee said in prepared remarks. She continued to tout PTO's work on improving patent quality via its Enhanced Patent Quality Initiative. The speech was Lee's first international appearance since the Department of Commerce and PTO confirmed earlier this month that Lee is still PTO director. Then-President Barack Obama nominated Lee to lead PTO in 2014.

Nearly one in five mobile phones and one in four videogame consoles shipped internationally are counterfeit, the Organisation for Economic Co-operation and Development said Tuesday. “Smartphone batteries, chargers, memory cards, magnetic stripe cards, solid state drives and music players are also increasingly falling prey to counterfeiters,” OECD said in a news release. On average, 6.5 percent of global trade in information and communication technology (ICT) goods consists of counterfeit products, according to an analysis of 2013 customs data, OECD said. That's significantly higher than the 2.5 percent of overall goods found to be counterfeit, in a 2016 report. “Launched just ahead of the 2017 OECD Global Anti-Corruption and Integrity Forum on March 30-31, the report says the high value of smartphones and ICT accessories and insatiable demand makes them a lucrative target for counterfeiters, and cautions that the number and range of affected products is growing,” the organization said. “Counterfeit ICT goods entail health and safety risks, service outages and loss of income for companies and governments.”

The Electronic Frontier Foundation criticized the Register of Copyrights Selection and Accountability Act (HR-1695) Monday, as expected (see 1703240051). The bill, which the House Judiciary Committee plans to mark up Wednesday (see 1703270041), would make the register a presidentially appointed, Senate-confirmed position with a 10-year term of office. EFF believes HR-1695 will “allow powerful incumbent interests to use their lobbying power to control this increasingly politicized office,” said Policy Fellow Kerry Sheehan in a blog post. “No president is going to select an appointee that will be shot down by special interests. And while the Librarian of Congress still oversees the Copyright Office, the Librarian of Congress would not be able to remove the Register no matter how poorly they perform their job.” The register already has “gone from being a neutral expert to a political player” over the past decade and HR-1695 “will inevitably accelerate the politicization” of the Copyright Office, Sheehan said.