As bleak a house
It is as it ever was when it comes to litigation, especially in the world of IT
Blogs | 05 Jul 2012 :
If you've never read "Bleak House" by Charles Dickens, I can heartily recommend it although I should warn you it is over 900 pages long. The epicentre of the novel is a tortuous, long running legal case: Jarndyce v Jarndyce. The reason I bring up Bleak House in an article about technology is because there seems to be an awful lot of litigation in the IT industry right now.
Apple and Samsung are at each other's throats in courts all over the world, suing and counter-suing over alleged patent violations. Someone could make a career out of trying to decipher which company is in the right and which is wrong (especially as I'd guess that it changes from one patent to the other). There are many other cases of course, such as the Oracle/HP spat and the Oracle/Google one so I'd be very surprised if there weren't a few lawyers out there making their own (very lucrative) living out of litigation in the IT sphere.
And these things can drag on forever. Look at the European Commission's judgement against Intel when it slapped a €1.06 billion fine against the chip giant for anti-competitive behaviour, illegally using rebates and implementing contract conditions with OEMs to effectively elbow AMD out of the market. That judgement came after an initial complaint filed by AMD in 2000 and then a supplementary filing in November 2003. It took the EC five years from the start of its investigation in May 2004 to hand down its judgement in July 2009.
By that stage, whatever the punishment handed down, the objective of what the EC found to be Intel's anti-competitive behaviour had already been achieved: AMD's viability as a potential challenger to Intel in the PC market had been seriously damaged.
As an outsider, I can't help feeling that if Intel is guilty as charged, then if I was Intel I'd think €1.06 billion was a price well worth paying to maintain domination of the PC processor market. But Intel obviously felt it wasn't guilty as charged and CEO Paul Otellini was very quick out of the blocks when the fine was announced to attack the decision as "wrong" and to signal the chip giant's intention to appeal. "There has been absolutely zero harm to consumers. Intel will appeal," he said.
Remember, that was back in 2009. We are now in July 2012 and Intel's appeal has finally been launched. Reuters reports that the company has accused the EC of relying on evidence that was "profoundly inadequate. The evidence is hopelessly and irretrievably defective in the case," according to Intel lawyer Nicholas Green. "The Commission's case turns on what customers' subjective understanding is."
It's interesting to note, in the light of this appeal, that Intel settled a similar antitrust battle with AMD in the US and Japan just five months after the EC's judgement. Intel insisted it had done nothing wrong but decided it was better to settle because, in the words of Otellini, antitrust cases could be "extremely expensive, and the risk is very high".
He said it made a lot of sense for both companies "to stipulate that we won't do things that we both agree are wrong-and we did so in this agreement...We won't do those things, we haven't done those things, and therefore there's no difference carrying forward". Oh, and Intel agreed to pay AMD $1.25 billion even though it had done nothing wrong.
I freely confess I'm no lawyer which is why it looks a bit odd to me that a company pays a rival business $1.25 billion for doing nothing wrong but refuses to pay a €1.06 billion fine to the EC after being found guilty of doing something wrong. I can't help wonder why Intel paid such a vast sum to avoid a jury trial in the US but is appealing a fine handed down by an institution which investigates businesses for anti-competitive behaviour on behalf of consumers and businesses in Europe. In other words, the people that make up juries in Europe.
It's precisely this kind of reasoning that keeps the lawyers busy (and rich). Of course, you could argue that if Intel's appeal is successful, it will be saved from paying a €1.06 billion fine. But if it fails, the only people making any more money will be the lawyers-as usual. And that's something Dickens recognised when he started to write Bleak House, way back in 1852, 160 years ago.