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By Jo Best
Posted on ZDNet News: Mar 7, 2005 8:08:00 PM

A Hong-Kong based company wants 12 percent of all profits from iTunes and iPod sales, claiming it holds the patents to the DRM technology that governs the use of downloads through Apple Computer's online music service.

According to a post on the Pat-rights company Web site, the patent governs the verification of a single user before permitting the user to download tracks.

iTunes' "computer registration involves a process of identity verification in which a user is required to key into the computer the correct Apple ID and password he used to purchase the song....This is certainly a patentable technology. If iTunes does not patent it, there must be a very good reason for them not to do so--someone else has patented this," the post says.

Though Apple declined to comment, the company has been in negotiations with Pat-rights for some time, according to Joseph J. Zito, the patent lawyer representing Pat-rights.

"We expect to be successful in licensing negotiations with Apple. They're a good company that understands intellectual-property rights, and we think they'll be reasonable," he said. "My client was first in touch with Apple during the months of December and January, so Apple has been aware of the issue for a couple of months."

Zito declined to comment on whether the patent is a working implementation or purely a design. "That's going to be an important issue in this case, as it is in all such cases. This case will hinge on a lot of things, so I'd rather not comment on what our plan is," he said.

Zito said that the patent may be applicable to a variety of DRM schemes but said he isn't aware of any plans to take action against other companies.

Currently, Pat-rights is gunning for 12 percent of Apple iPod and iTunes profits, but if the matter comes to court, the payoff could be equally lucrative for the patent holder. If Apple is found to have willfully infringed the patent, damages could be tripled.

If the issue is not settled by March 21, Pat-rights intends to file suit.

Apple is currently involved in another patent battle, with Advanced Audio Devices, which claims iTunes violates its patent, filed in 2003, on a "music jukebox which is configured for storing a music library therein."

David Berlind, of ZDNet, reported from Cambridge, Mass. Jo Best, of Silicon.com, reported from London. A Hong-Kong based company wants 12 percent of all profits from iTunes and iPod sales, claiming it holds the patents to the DRM technology that governs the use of downloads through Apple Computer's online music service.

According to a post on the Pat-rights company Web site, the patent governs the verification of a single user before permitting the user to download tracks.

iTunes' "computer registration involves a process of identity verification in which a user is required to key into the computer the correct Apple ID and password he used to purchase the song....This is certainly a patentable technology. If iTunes does not patent it, there must be a very good reason for them not to do so--someone else has patented this," the post says.

Though Apple declined to comment, the company has been in negotiations with Pat-rights for some time, according to Joseph J. Zito, the patent lawyer representing Pat-rights.

"We expect to be successful in licensing negotiations with Apple. They're a good company that understands intellectual-property rights, and we think they'll be reasonable," he said. "My client was first in touch with Apple during the months of December and January, so Apple has been aware of the issue for a couple of months."

Zito declined to comment on whether the patent is a working implementation or purely a design. "That's going to be an important issue in this case, as it is in all such cases. This case will hinge on a lot of things, so I'd rather not comment on what our plan is," he said.

Zito said that the patent may be applicable to a variety of DRM schemes but said he isn't aware of any plans to take action against other companies.

Currently, Pat-rights is gunning for 12 percent of Apple iPod and iTunes profits, but if the matter comes to court, the payoff could be equally lucrative for the patent holder. If Apple is found to have willfully infringed the patent, damages could be tripled.

If the issue is not settled by March 21, Pat-rights intends to file suit.

Apple is currently involved in another patent battle, with Advanced Audio Devices, which claims iTunes violates its patent, filed in 2003, on a "music jukebox which is configured for storing a music library therein."

David Berlind, of ZDNet, reported from Cambridge, Mass. Jo Best, of Silicon.com, reported from London.

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  • Most Recent of 65 Talkback(s)
Regardless, they don't lead to quality
Quotas are about achieving quantity in results, not quality. It encourages shoddy work that's done quickly, poor review, etc. There are better approaches than the current "pass everything and let the courts figure it out".... (Read the rest)
Posted by: tic swayback Posted on: 03/09/05 You are currently: a Guest | | Terms of Use
"music jukebox which is configured for storing a music library therein." ??  rpmyers1 | 03/07/05
How can that be patented  voska | 03/07/05
Guess this just another example on why software patents are flawed  voska | 03/07/05
Plus, mp3 players were already on the market  tic swayback | 03/07/05
The servers at The WB have more space...  The King's Servant | 03/07/05
Definitions  Roger Ramjet | 03/08/05
More informative article  tic swayback | 03/07/05
Ah, I love the smell of a lawsuit in the morning!  Confused by religion | 03/07/05
Hey, it's the American way  Jeff Spicoli | 03/07/05
What exactly pray tell ...  ShadeTree | 03/07/05
Apple's profits, in these cases  tic swayback | 03/07/05
Assumes facts not in evidence.  ShadeTree | 03/07/05
Obviously  tic swayback | 03/07/05
Misuse of the word stealing again, fraud maybe  voska | 03/07/05
Why are you assuming that the company ...  ShadeTree | 03/07/05
Why are you assuming a limit of the concept to just this case?  tic swayback | 03/07/05
No Jeffs post was a ...  ShadeTree | 03/07/05
I took it as a bigger picture statement  tic swayback | 03/07/05
RE: Tic  ShadeTree | 03/08/05
If we don't offer opinions, what use is this forum?  tic swayback | 03/08/05
Have you seen the patent?  Patrick Jones | 03/08/05
Anyone can take a piece out of a patent ...  ShadeTree | 03/08/05
True, the courts will decide...  Patrick Jones | 03/08/05
It's definitely not on the up and up  voska | 03/08/05
RE: Opinions  ShadeTree | 03/08/05
What qualifies a patent office employees  voska | 03/08/05
Cluelessness is deliberate  tic swayback | 03/08/05
I don'y believe it is helpfull ...  ShadeTree | 03/08/05
Criticism can be helpful  tic swayback | 03/08/05
RE: Criticism  ShadeTree | 03/08/05
I guess you missed the part about quotas  tic swayback | 03/08/05
RE: Quotas  ShadeTree | 03/09/05
Regardless, they don't lead to quality  tic swayback | 03/09/05
Apparently its the Hong Kong way as well  FilledOut | 03/08/05
I live in..  Jeff Spicoli | 03/08/05
Well good day then  FilledOut | 03/08/05
It's not the high tech companies, it's the weasel lawyers  tic swayback | 03/07/05
Thanks for that - I didn't know...  Confused by religion | 03/07/05
The patents shouldn't have been issued to begin with  htotten | 03/07/05
Asking for 12% of SALES, not PROFITS  rdwhitti | 03/07/05
Good point, but....  htotten | 03/07/05
See it works both ways  Nigel Johnstone | 03/07/05
Apple is going to CRUSH them. Smells like another  Laff | 03/07/05
I don't think it'll get that far  tic swayback | 03/07/05
When exactly did you take up patent law.  ShadeTree | 03/08/05
I didn't know a talkback opinion was a ruling  voska | 03/08/05
Look my statement was opinioin butt opinion based  Laff | 03/08/05
Thats the thing about experts....  Dave F_z | 03/08/05
Shade has forbidden us to discuss this case  tic swayback | 03/08/05
Merely pointing out that ...  ShadeTree | 03/08/05
We've given our reasons  tic swayback | 03/08/05
What?  Fred Fredrickson | 03/08/05
Perfect example  Joe Blow_z | 03/07/05
Perfect example of the liuttle guy using patents  No_Ax_to_Grind | 03/08/05
The little guy?  tic swayback | 03/08/05
"right" to monopolize is not good for anybody, big or small (nt)  CobraA1 | 03/09/05
A fool with a gun, still a fool.  mabricen | 03/08/05
That was my point to ShadeTree  Patrick Jones | 03/08/05
No anger here!  ShadeTree | 03/08/05
Face it Shade, you're FULL of rage  Jeff Spicoli | 03/08/05
Actually I think ...  ShadeTree | 03/08/05
Maybe angry was the wrong word..  Patrick Jones | 03/08/05
How can the patent office do it's job  voska | 03/08/05
You really need to read...  Rick_K | 03/08/05
From their website  Rick_K | 03/08/05

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