The ITC ruling puts the fate of HTC and smartphones such as the AT&T Status, the first smartphone with an integrated Facebook button, up in the air.
(Credit: Josh Miller)The Taiwanese manufacturer of smartphones continued to suffer from an administrative law judge's initial ruling from the U.S. International Trade Commission, which found HTC in violation of two of Apple's patents. HTC's stock in retreated more than 4% to their lowest level in six months, Bloomberg reports.
While an administrative law judge's initial decision doesn't represent a death blow, it doesn't bode well for the final decision. If the six-member ITC panel find agree with the decision, it could impose an embargo preventing the importation of HTC smartphones.
HTC has vowed to fight the decision, and would appeal to the commission before it makes its final ruling. Apple referred to its initial statement from March 2010 when the first complaint was filed.
"We think competition is healthy, but competitors should create their own original technology, not steal ours," Apple CEO Steve Jobs said in the release at the time.
Giving HTC some hope is its recent decision to acquire S3 Graphics for $300 million. S3 holds crucial patents that an ITC administrative law judge had determined in an initial ruling that Apple was violating. While investors initially lambasted the acquisition, criticizing the fact that HTC Chairwoman Cher Wang was a shareholder in S3, the patents are invaluable if the ITC decides to favor Apple.
Foss Patents has an interesting--if somewhat complex--graphic illustrating HTC and Apple's respective patent positions.
In positions where companies own valuable intellectual property, a settlement is typically reached, especially if the threat of an embargo hangs over one of the companies. But Foss's Florian Miller said he doesn't see a settlement as a foregone conclusion yet. Unless Apple truly needs all of HTC's patents, it may attempt to enforce the embargo, which would greatly hurt the progress of HTC and all Android supporters.
The next couple of months will likely prove to be turbulent ones for HTC.
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