Apple-S3 patent case to be reviewed

A finding that Apple Inc's Mac OS X computer system violates patents held by S3 Graphics Co will be reviewed by the US International Trade Commission. The commission said in a notice on Friday it will review "in its entirety" ITC Judge James Gildea's July 1 determination that some Apple Macs infringed two S3 patents related to graphics chips, while the mobile platform for the iPhone didn't infringe. The Washington-based trade agency laid out 13 questions it wants answered, including some related to patent validity and licences S3 has with Intel Corp and Nvidia Corp. Phonemaker HTC Corp which agreed to buy closely held S3 for $300 million (Dh1.1 billion) less than a week after the ruling, is counting on a victory to bolster its patent battles with Apple. HTC and Apple are part of a struggle among smartphone makers, including Samsung Electronics Co and Motorola Mobility Holdings Inc, looking to fight copycats and thwart competition in a market projected by researcher IHS Inc to be $206.6 billion this year. HTC lost a case in July in which a commission judge determined that some of the company's devices running on Google Inc's Android operating system infringed two Apple patents. Apple has an additional complaint filed in July that also targets HTC's Flyer tablets. HTC has two cases it brought against Apple at the Washington-based trade agency, one submitted last year and another last month. The ITC is an arbiter of trade disputes with the power to block imports of products found to infringe US patents. The agency is scheduled to complete the review by November 1. Amy Bessette, a spokeswoman for Apple, declined to comment. Taoyuan, Taiwan-based HTC, Asia's second-biggest maker of smartphones, had no immediate comment. The commission said it will examine validity and licensing, as well as the agency's authority when finding infringement under US trade statutes. The agency also asked the companies to submit legal arguments on whether an import ban should be imposed if the panel ultimately finds a violation of S3's patent rights. Among the considerations are US consumers, public health and "competitive conditions in the US economy." The initial ruling didn't apply to Apple mobile devices or Mac computers with Nvidia graphics processing units, which have an implied licence to the patents, the judge determined. Gildea also found that two other S3 patents were invalid, as were aspects of the two patents found to be infringed. Mac sales Macs generated $17.5 billion in sales last fiscal year, or 27 per cent of Apple's revenue. The company, the world's biggest smartphone maker, gets about 68 per cent of its revenue from the iPhone and iPad tablet, according to data from Apple's most recent fiscal quarter. HTC said that it generated about $5 billion in US sales last year.