Apple iPhone app developers hit by patent claims

A company is claiming to have a patent on Apple's in-app purchase system,
and has contacted at least five developers of iOS apps in the US and UK
demanding that they license it.

The move has worried app developers who are uncertain whether Apple will
cover any legal costs relating to their apps, even though they have used the
company's developer kit and associated tools to create the apps.

One claim was served on Friday by hand on James Thomson, a Glasgow-based
developer who wrote the apps PCalc and DragThing. Another who received the
couriered legal package was Matt Braun, a developer based in Toledo, Ohio,
author of the best-selling iPhone kids game MASH who runs a mobile app
development company, Magnate Interactive. Patrick McCarron of MobileAge,
based in Chicago, has also received a demand.

The claims come from a Texas-based company called Lodsys, which said it has
four patents relating to in-app purchases, interactive online ads, online
help and subscription renewals. They are cited on its website.

Lodsys is a patent licensing company for inventions developed by Dan Abelow,
a Harvard graduate who sold five of his patents outright in 2004: four went
to Lodsys and one to a company called Webvention.

Abelow told the Guardian that he has no knowledge of which companies have
licensed the patents. His site said the licensees of his patents include
Apple, Google, Microsoft and Nokia along with roughly 200 other companies.

"The concept of the Lodsys-owned patents predates the internet," Abelow told
the Guardian. "The idea was that if you're sitting and holding in your hand
a product and you use it, why shouldn't it be aware of your behaviour,
digitally, and conduct your needs to the vendor, who could interact with
you." He filed for the patent in 1992 and it was granted in 1999, making it
valid for at least another 15 years.

The Guardian attempted to contact Mark Small of Lodsys by phone and email,
without success, to seek an answer to whether Apple had ever licensed any of
the named patents, and what validity was claimed against the apps
developers.

A number of the developers, including Thomson, have referred the claims to
Apple's legal department, on the basis that they have built their apps using
Apple's developer toolkit.

Apple's iOS Paid Apps agreement says that developers will be reponsible for
"claims that any of the licensed applications and/or the end-user's
possession or use of those licensed applications infringes the copyright or
other intellectual property rights of any third party".

But it is seen as highly likely that Apple will fight Lodsys's claim,
because it would destabilise its App Store, which is an essential element in
maintaining the attraction of its iPhone.

The move is a worrying one for developers, and follows a similar filing at
the end of March by another Texas-based company, H-W Technology, which
asserted a patent on an "internet phone with search and advertising
capability".

Florian Mueller, who closely watches developents in smartphones and patent
claims, analysed the claims by H-W Technology and commented: "What's really
disconcerting about this lawsuit is that it's the first such lawsuit to
attack – besides operating system vendors and device makers, which are
routinely sued by patent holders – a number of companies because of their
smartphone apps. I'm really afraid we're now going to see more patent
lawsuits against application developers. Hopefully this won't ever affect
little guys who can't afford to defend themselves, but if there's a major
company behind an app, or if an app is commercially very successful, it can
happen and it has now apparently started to happen."