A U.S. trade agency is looking at Sonos Inc.'s claims that Alphabet Inc.'s Google infringes patents for home audio systems and is considering shutting down some Google smart home devices, phones and laptops out of the U.S. market.
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The International Trade Commission said it would review part of a judge's findings that Google infringed five Sonos patents and cleared product redesigns of any violation. Both companies asked the agency to review aspects of the judge's findings that went against them.
The commission will look into whether products accused of infringing two patents are infringed at the time of importation. The commission said it wouldn't review remaining issues in the judge's determination, but it will consider a possible remedy, which could mean an import ban. A final decision is expected to be made on January 6.
Sonos said the notice means that the administrative law judge's finding of a violation will stand.
The commission will confirm the ALJ's ruling that all five Sonos patents are valid and that Google infringes all five of those patents, the company said. We look forward to pursuing our damages case in District Court and engaging with the commission on the details of the remedy to which we are entitled. Good had no immediate comment.
Sonos claims that Google learned of Sonos's technology under the pseudonymous idea of a working partnership to integrate Google Play Music into Sonos'products, but instead used the patented ideas in its Home and Chromecast systems and Pixel phones and laptops. Google has filed a lawsuit in district court accusing Sonos of trying to take credit for work owned by Google.
Investors have been watching the ITC case closely, and seeing it as a test of Sonos' ability to enforce intellectual property, protect its market from competitors, and develop a new revenue stream in licensing. Sonos and Google have traded patent infringement allegations in the U.S. and Europe.
Sonos wants imports stopped at the border, as well as an order that prevents sales of any Google products already brought into the U.S. An import ban could be overturned by President Joe Biden on public policy grounds, though presidents have rarely used that power.
Google's gadget sales are a small portion of its business, and the company doesn't disclose revenue from devices. Sonos said Google is trying to evade a potential import ban by pointing out incomplete products that shouldn't have been considered by the judge.
Google acted to make sure it wouldn't be affected by an import ban by flooding the case with piecemeal, hypothetical redesigns, dashed off with no quality control, and never incorporated into any product through standard product design channels, Sonos told the commission.
Sonos has the backing of the Innovation Alliance, a group of patent owners, including Qualcomm and AbbVie Inc., which said big tech companies find it cheaper to use another company's inventions and worry about litigation later, a strategy known as efficient infringement. Centripetal Networks Inc., a cybersecurity company that won a $1.9 billion district court judgment against Cisco Systems Inc., wrote that if small companies can't look to the ITC to exclude articles unfairly competing in the marketplace, they may end up being pushed out of the market due to larger companies ability to use others patented innovations without major consequences.
Google said it spent considerable resources in designing products that worked around the Sonos patents, and that there was overwhelming evidence in its favor, even though Sonos threw the kitchen sink at Google's redesigns throughout the investigation. Two of the five patents involve techniques to synchronize audio playback and thereby eliminate minor differences that the ear can interpret as echoes. The others involve ways to pair up speakers to create stereo sounds, adjusting volumes of individual or groups of speakers with a single controller, and a way to easily connect the system to a home Wi-Fi.
The case is In the Matter of Certain Audio Players and Controllers, 337 -- 1191, U.S. International Trade Commission Washington None How Child Care Became the Most Broken Business in America
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