Hop On promises aggressive defense of MP3 phone patent

If you've already got yourself a music phone, you might wanna hold onto it for awhile, because some forthcoming patent "extortion" promises to jack up prices on any model with side-mounted speakers. You probably remember handset manufacturer Hop On from some of its low end wares that we've covered, and now the company has just received a design patent on an "MP3 Phone with speakers on the side, in addition to front and side buttons to activate its camera/video features." No big deal, except for the fact that Hop On plans to seek royalties for all past and future cellphones that it considers to be infringing on its IP -- in other words, millions upon millions of units. So keep your eyes open, because if the Moto's, Nokia's, and LG's of the world aren't down with Hop On's licensing proposals, it's likely we'll see a whole slew of lawsuits in an industry that already has more than its fair share of squabbling players.

[Via Electronista]

[James @ Apr 5th 2007 3:09PM]

The blurb mentioned a design patent. Design patents are a completely different animal from a utility patent. Utility patents are more common and are normally what people are talking about when they say "patent." Design patents are extremely narrow and they protect only the specific shape of an object. If the shape is changed by enough so that a consumer wouldn't be confused by one product thinking that it is another, there is no infringement problem. If Hop On has a design patent, then it should be simple for all competitors to avoid it. They won't be collecting many royalties. Design patents are really only useful for preventing a Chinese copy from hitting the market.

[Nick @ Apr 5th 2007 3:26PM]

Hey, I have a great idea!!!

I'll invent a device that lets me have a great idea and patent it, that way all you suckers who come up with a great idea using a device (typewriter, calculator, computer, whatever) have to pay up.

I'm a genius!!!



And now for something completely different....a bit of realism. Does anyone else think the whole patent system needs a long-overdue overhaul?

[dub @ Apr 5th 2007 3:48PM]

roflmao. this coming from a company that blatantly ripped off the iPod's design? pot, kettle, black, wha? looks like their design team also like ripping off phone designs from Moto, Nokia, Sony-Ericcson...

[balt @ Apr 5th 2007 3:52PM]

No patent number, and a search of the USPTO site only turns up a patent on a universal cell phone charger. Including a patent number in the PR wire would have been helpful.

BUT, from the USPTO: "A design patent protects only the appearance of the article and not its structural or utilitarian features."

This appears to be a (weak) attempt at FUD.

[PreGHz @ Apr 5th 2007 4:04PM]

I'm not too sure, but wouldn't prior art help the defense on this case?

[gopi @ Apr 5th 2007 4:21PM]

The Hop-On press release does not mention any details about the design patent in question.

The press release speaks highly of the likelihood of them getting large royalties. They seem more interested in explaining how good the design patent is, rather than showing you what it is.

I'm not sure how they're going to get back-royalties, unless issuance of the patent was delayed for a long time.

You can check out how they're doing financially:
http://www.americanbulls.com/StockPage.asp?CompanyTicker=HPNN&MarketTicker=OTC&Typ=S

It looks like in 2004, their net loss was ~$7m. Looks to be worth under a penny a share right now.

They got a lot of press coverage for their disposable cellphone in 2002:
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2002/03/29/BU13539.DTL

The prototype that the San Francisco Chronicle says they looked at was actually a normal Nokia phone in a custom case.

They introduced their next-generation phone in 2005:
http://www.geekzone.co.nz/content.asp?contentid=3868

I'd be interested in hearing of any reports of the phones actually reaching retail sales - so far I haven't found out where I can buy one.

[anonymouspimp @ Apr 5th 2007 4:37PM]

On the USPTO site, I did a search on "MP3 Phone" and got this: US D536,685 S

I don't know much about design patents... but there isn't much to a design patent from what I can see. There's like 11 drawings that don't show much at all. I find it REALLY hard to believe someone could get millions and millions in royalties from some thing like this...

BUT, if they really did design this, as the USPTO seems to believe (believe it or not, the USPTO doesn't just give patents to anyone for anything, its expensive, takes forever, and they do a large amount of research before allowing an application)... I say more power to them.

[John Bell @ Apr 6th 2007 3:59AM]

Even IF they somehow managed to trick a court into awarding royalties based on a DESIGN patent (which I think is unlikely), the patent specifically states "mp3 speakers on the side IN ADDITION TO...", meaning "infringers" would have to have all components (including speakers on the side) to be infringing.

[Andreas Cetinski @ Apr 17th 2007 4:33PM]

Hop-on claims they have signed Motorola to a contract extension...

April 16, 2007 - 12:21 PM EDT

Hop-on's Design Patent Shakes up Industry
US Patent Office Approval Delivers Licensing Agreement

HOP-ON, INC. (OTC:HPNN) announced today they have granted a non-exclusive licensing agreement to Motorola which extends the party's prior contract in 2001. The national patent license will include Hop-on's Design patent (D536,685) and (D536,320), known as the “Mp3 speaker phone” and “flip phone”. The Irvine based company values the integrity of Motorola in the marketplace and decided to grant the license without any formal litigation. The confidential agreement and financial terms are undisclosed. The Mp3 and flip phone designs are currently used market wide by all major carriers and manufacturers on numerous products.

The news earlier last week of potential infringement of Hop-on's designs received harsh statements from industry rivals. Robert Katz, patent attorney for Nokia, commented Hop-on was attempting an “industry shakedown” by claims of US Patent approval. Katz opined, “Design patents don’t cover function…the products in question need to look enough alike.” Nokia’s long standing legal battles with Qualcomm recently resulted in accusations Qualcomm was a serial litigator. Peter Michaels, President of Hop-on, stated, “Nokia simply does not want to continue to pay Qualcomm for the use of their patents. The harsh reality of our industry requires the company who uses other’s designs or technology to pay a fair price to compensate for that idea. I think the irony of Nokia’s latest release of their 'isync' (any relation to the iphone?) shows controversy by the past five years 'speed of light' technology race and leaves an uncertain future of who will pay for these blatant violations of patent and trademark laws. In the end it is simple, if these carriers want to continue to use my design they will need to compensate us for that design.”

Hop-on's patent attorney Robert T. Braun is doubtful any major carrier or manufacturer will risk the potential cost of Hop-on prevailing on these claims. Mr. Braun explains, “The use of another company’s patent or trademark carries risk to the using party. The cost of any potential infringement can be very high to the infringing company.”

As to all the hype surrounding Michaels' claim of market wide patent infringement, Michaels and his company are on a roll, stating, “Willful infringement is factual, if companies are doubtful of our claim, we will pursue all remedies. I am confident current negotiations will provide closure for the four major carriers in the U.S.” There is no sympathy for Nokia in their losing battle against Qualcomm. “I think the tables have turned on Nokia and all they can do is citing the tremendous difficulty of prevailing on a patent claim. I can assure Robert Katz the only market shakedown which has occurred here are manufacturers like his believing they can use any design they choose. The monopoly is crumbling.” Hop-on is moving fast and promises future surprises for people like Katz. “I am confident our US Patent Design approval will not be viewed by the Federal courts as meaningless.” Says Michaels, “If so, I assure you, we will be releasing the next Hop-on iphone.” For more information, visit http://www.Hop-on.com.

This news release includes forward-looking statements regarding, among other things, the Company's business and financial plans, strategies and prospects. Although the Company believes that its plans, intentions and expectations reflected in or suggested by these forward-looking statements are reasonable, it cannot provide assurance that it will achieve or realize these plans, intentions or expectations. Forward-looking statements are inherently subject to risks, uncertainties and assumptions. Many of the forward-looking statements contained in this news release may be identified by the use of forward-looking words such as: believe, expect, anticipate, should, planned, will, may, intend, estimated, and potential, among others. Important factors that could cause actual results to differ materially from the forward-looking statements made in this news release include market conditions and those set forth in any reports or documents that the Company may publicly file from time to time. All forward-looking statements attributable to the company or a person acting on its behalf are expressly qualified in their entirety by this cautionary language.

Hop-on, Inc.
Danny Coleman, 949-756-9008



Source: Business Wire (April 16, 2007 - 12:21 PM EDT)

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