By: Rashi Mangalick
Technology (“tech”) companies have taken over public recognition in the realm of innovation and new ideas. This follows logically, given that their sole purpose is to research and innovate new ways to learn and communicate. Even so, other players have entered the new tech game. Research universities have given us a lot of innovation and advancements that we rely on every day. The Swiss Federal Institute of Technology produces between sixty to eighty patents each year, and schools like The California Institute of Technology houses the Jet Propulsion Laboratory for NASA. Students at Purdue University have school-specific applications (“apps”), which allow them to ask questions in the classroom, schedule study groups, and capture and share lectures videos.
People likely do not realize how much of the tech arena research universities have taken. Recently, Apple lost patent ownership to the University of Wisconsin-Madison (UW-Madison). The university found that Apple was using patent technology owned by the licensing arm of the university, Wisconsin Alumni Research Foundation (WARF), and sued for patent infringement. Apple denied the claim, instead arguing that the patent was invalid. The trial court in Madison, Wisconsin found in favor of the university. Now, all that is left is to talk damages. The patent at issue was one used to improve efficiency in some of Apple’s newest and most popular products: the iPhone 5s, 6, and 6 Plus. Apple toppled its own sales record by releasing these phones earlier this year.
This loss of patent may not seem like a huge issue. Even a fully assessed fine will be damaging but not devastating to Apple’s current profit margin. Universities exist to educate young minds, whereas tech companies can focus more efforts on technological advancement. Further, these companies clearly have experienced success, as seen by Apple’s and Android’s sheer market power and reach. Apple alone controls about 44% of the market share. Having almost half of the mobile market in your back pocket is not a bad place to be.
Apart from the $860 million that Apple could potentially lose in damages due to this case, however, this trial brings to light a larger issue for tech companies. Educational institutions are gaining traction along the same track as tech giants, which means a tech company’s creativity and originality have become increasingly important. This type of competition requires more from the tech company that needs those patents to function than from research universities like UW-Madison; it requires negotiation and contractual agreements with groups like WARF to continue its products, or attempt to create a different chip altogether.
Rashi Mangalick is a staff member on the Journal of High Technology Law and a 3L focusing her efforts on health law. She obtained an undergraduate degree from the University of Wisconsin-Madison in Economics and Sociology.
