Speaking on the issue in public for the first time, the company’s IP chief said Philips wanted to share its technology to grow the LED lighting market and wasn’t in the business of ‘going around trolling with invalid patents’.
Responding to criticism that the company was bullying luminaire makers, Arian Duijvestijn told the International Fixture Design conference in London that Philips wanted to treat all companies in the same way and that its contentious use of non-disclosure agreements was to protect smaller firms, not Philips.
‘The first letter [to firms suspected of infringing Philips IP] is a very friendly letter,’ he told the London audience of luminaire manufacturers. ‘We want an NDA to protect you. We think that an NDA is important. This is to protect the [potential] licensee. Then we can have an open discussion.
‘We can’t work with companies without an NDA. Then we can have confidential discussions about products and sales.’
Philips has led the way in developing and acquiring technology, Duijvestijn argued, and sharing it through a licensing programme is good for the market.
‘We have not recovered our investment [in acquiring firms with significant IP]. We spend €0.5 billion every year on R&D; we funded Zigbee for 14 years. In shavers, we had the whole market in rotary shavers and no-one else can enter the market. That is not the situation in the lighting market.’
He said the licensing costs – a percentage of licensees’ turnover – were fair as ‘you pay only as much as you sell’.
However, independent lighting IP consultant Henrik Villumsen told the same Lux-organised event: ‘There are defences out there which means that you shouldn’t just pay up.
‘You have to push them back. You need to buy time, investigate all possible defences and maybe counter attack. You’ll get a discount and maybe not even pay for the period of the dispute’.
However, Philips disputed this. ‘We don’t discriminate,’ said Duijvestijn. ‘If you push harder, you won’t get a different rate.’
‘It’s all about leverage,’ explained Villumsen. ‘Investigate all possible defences. US patents issued before 2007 are now subject to an ‘obviousness test’. Look also for inequitable conduct, such as an excessive number of patent registrations. Get the patent office to investigate the standards again. Complain to the competition and the anti-trust authorities if a large company may be abusing its market domination.
‘The big patent holders know the defences and they are expecting them – so don’t disappoint them’.
Joe Ruston of Remote Controlled Lighting believes some of the Philips patents are not genuine intellectual property. ‘I’ve had the visits from the Men in Black,’ he said, ‘but I have a problem with two patents that Philips holds.
‘The first is for pulse-width-modulation dimming of LEDs, a patent which was granted in the US, where patent scrutiny is not good. So if you buy a driver using PWM then you may be infringing Philips’ patents.
‘The second patent is secondary optics, but to me there has to be some kind of inventive step, and I feel unhappy because when Philips come to me and complain about using secondary optics, you feel hard done by.’
But Duijvestijn argued that the patents were legitimately awarded. ‘If it’s so easy,’ he said, ‘go to the UK patent office and ask them to invalidate the patent.’
‘It reminds me of how children try to get what they want. They don’t want to do the necessary work so they get emotional instead.’