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Vizio sued by other TV manufacturers for alleged patent infringement

Written by Rich Fiscus (Google+) @ 10 Jun 2008 5:45 User comments (9)

Vizio sued by other TV manufacturers for alleged patent infringement Over the last 2 years Vizio has become a powerful player in the HDTV market by selling low priced displays. Now it looks like some of the more established TV manufacturers have come up with a new strategy to compete with them. Last week a number of companies that hold MPEG-2 video related patents, including Mitsubishi, Samsung , and JVC, filed suit against them, claiming that Vizio owes licensing fees for components used in their TVs.
While acknowledging the use of the components, as well as the companies' right to collect patent royalties on them, Vizio claims their suppliers, the actual manufacturers of the parts, are responsible for the royalties.

"Vizio's suppliers have licenses for the MPEG-2 patents, and Vizio believes that these licenses extend to Vizio's products," the company said in a statement.

As long as the manufacturers are actually paying the royalties it would seem that Vizio is correct. Just a week after the suit was filed the US Supreme Court threw out a similar case filed by LG Electronics claiming a computer maker owed money for using parts covered by their patents, but for which royalties had already been paid by the manufacturer.

In that case, the court ruled patent holders are only entitled to collect royalties once on each componenent, and that companies which subsequently use the parts in other products aren't liable for any additional royalties. This is known as 'patent exhaustion,' and according to Justice Clarence Thomas it's been the rule in such cases "for over 150 years."

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9 user comments

110.6.2008 6:58
nobrainer
Inactive

If you can't compete eliminate the competition. well doesn't this just suck.

patents and copy-write are stifling our advancement because of greedy corporations. but things are changing slowly.

more on the LG ruling.

US Supremes limit royalty double dippage

Quote:
The US Supreme court has overturned a lower court ruling that let South Korea's LG Electronics double-dip on royalty licensing.

In a unanimous decision today, the court favored Taiwan's Quanta Computers, delivering a ruling that will limit a patent holder's ability to collect royalties from companies at different stages of the production process.

The case reverses a previous Federal appeals circuit decision on patent exhaustion. The high court agreed to review the licensing dispute last September at the urging of the Bush administration.

LG had licensed a set of patents to Intel for use in its chips and chipsets, but the agreement specifically barred Intel from mixing the technology with components from other manufacturers.

Intel then sold the chipsets to PC manufacturers such as Quanta which in turn used the chipsets to make computers for vendors such as Dell and Hewlett-Packard.

LG sued Quanta in 2000, accusing the manufacturer of infringing three patents because computers with the Intel chipsets also had kit from other companies.

A US District Court in California ruled in Quanta's favor, but an appellate court overturned the decision. The Bush administration then urged the Supremes to take the case on grounds the ruling went too far in letting patent holders extract royalties from down-stream companies.

The high court ruling today said LG couldn't extract royalties from Quanta because the initial sale to Intel had "exhausted" LG's ability to control how the technology was used.

"Nothing in the License Agreement limited Intel's ability to sell its products practicing the LGE Patents," wrote Justice Clarence Thomas for the court. "Intel's authorized sale to Quanta thus took its products outside the scope of the patent monopoly, and as a result, LGE can no longer assert its patent rights against Quanta."

However, the court did say Quanta's sale to computer vendors would not have been authorized if Intel had originally breached the contract with LG. So, although the ruling will limit downstream royalty collection, companies better hope everyone upstream read the fine print very carefully.

A copy of the ruling? That would be right over here (pdf).
a great pdf reader that doesn't send your private data back to adobe unlike acrobat is foxit.

This message has been edited since its posting. Latest edit was made on 10 Jun 2008 @ 7:02

210.6.2008 8:59

I own a Vizio and love it!!!

310.6.2008 9:52

Nobrainer, you hit the nail on the head. I too own a Vizio and they are killing the competition right now. So when you can't beat em, sue em!

410.6.2008 10:25
lynchGOP
Inactive

Vizio is going to be absolved on this one...............good for them.

Vizios are inexpensive for a reason................they don't last long, picture isn't nearly as good as a Samsung/Sony/Pioneer/Panasonic and is cheaply made. Kinda like a Buick is a poor man's Cadillac, Vizio is a Poor man's HD TV. I

510.6.2008 12:15

Originally posted by lynchGOP:
Vizio is going to be absolved on this one...............good for them.

Vizios are inexpensive for a reason................they don't last long, picture isn't nearly as good as a Samsung/Sony/Pioneer/Panasonic and is cheaply made. Kinda like a Buick is a poor man's Cadillac, Vizio is a Poor man's HD TV. I
Sounds like the same thing people used to say comparing Samsung to Sony, and now Samsung is the leading seller.

Vizio was basically an OEM manufacturer to some of the bigger companies, much in the same way Acer makes PC's, Vizio decided to go into business for themselves.

Vizio is also based in the United States. I know that most (or none) of their parts are made in the U.S., but that "American" company label still means something to a lot of folks.

Taken from Vizio's website:
Quote:
VIZIO, Inc. "Where Vision Meets Value," headquartered in Irvine, California, is a top ten North American flat panel television brand. Their VIZIO brand has been seen and heard on TV and radio, including NBC's Today Show, ABC's Good Morning America, won numerous awards from leading publications including Good Housekeeping's Best Big-Screens, CNET's Top 10 Holiday Gifts, PC World's Best Buy, Sound & Vision's Editors Choice, Home Theater Magazine's Rave Award, PC Magazine's Editors Choice, AVRev.com's #1 Product We Love the Best and The Perfect Vision's Products of the Year.

610.6.2008 12:35
lynchGOP
Inactive

Vizios aren't terrible. Not bad for the price. But their longevity is limited and quality is just not the same.

NEVER heard anyone dog Samsung. Known for years (at least to me) that they are tops. FYI.........Samsung is one of 3, AND ONLY 3, companies in the world to manufacture the "crystal" of a Liquid Crystal Display. Fujitsu too. That's why their stuff is awesome. Still boggled about people saying Samsung being sub-par...............never heard that except maybe 20 years ago.

710.6.2008 14:39

Quote:
Nobrainer, 1000 % on the money !!!

811.6.2008 1:07

vizio are actually great lcds for the price. pound for pound you get more bang for your buck.not to mention the bright/dead pixel guarantee
and in home warranty service on screens over 30".
samsungs are also great nothing wrong with them at all.

but all in all i know people that have had trouble with both brands gasp no it cant be samsung lcd with a problem !!shocking

face it no matter the brand you will find pro and cons.

but considering i picked up my vizio 37" 720p for just over $800 with 4 total years of on site service over 1 1/2 years ago. at that time the same size samsung was around $1399 i would say it was a steal have been happy from day one.
i hope they win this one. this is just a ploy from the competition to drive the prices up on vizio displays to put them on a even playing field because vizio has been gaining momentum in the last few years.
kind of sad really.

This message has been edited since its posting. Latest edit was made on 11 Jun 2008 @ 1:12

912.6.2008 19:30

i own a 42" LCD Vizio too for almost 2 years and so far not problem with it and the picture is very clear plus i got that 3 years protection plan for free and the price the best.

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