Patent agreements, over-charging & consumer protection (Microsoft "Android tax")

Question

TL;DR: if a majority of companies in an industry have entered into a patent licensing agreement with a patent troll on exhorbitant terms, and I as a consumer of their products am directly affected (paying extra for "bogus" patents), do I have legal recourse?

The long story: As an Android tablet and smartphone user (Samsung & HTC), I am obviously affected by what is known as the "Microsoft tax", wherein Redmond is charging the smartphone maker $10-$15 per Android phone sold.

To me, $10-$15 per device is extraordinarily high; in fact, it amounts to daylight robbery! But because the patent agreements between Microsoft and the phone makers are under NDA and secret, we don't know the exact terms of the deal. Barnes & Noble was the only one who fought against this tactic long and hard, but it was bought out by a Microsoft investment.

Long story short: as an end-user and consumer (and Android fanboi, I must admit), I find this outrageous ... and even more outrageous that no one can do anything about it.

What we can do about it: I went as far as consulting with a lawyer on whether we consumers could directly do anything about it. My understanding of his reply (IANAL, just paraphrasing) was that putting together the case docs would cost only a few hundreds (USD $), but filing it as a class-action or an anti-trust case would cost into the tens of thousands, up to a hundred thousand.

That obviously puts it beyond my grasp; any other ways to approach this? I find it maddening that nothing can be done about this.

Answer 1

Let me summarize what I see as your contentions to support this case.

You contend:

1. ... that cell phone vendors are paying Microsoft
2. ... how much that is
3. ... that it's affecting the price you pay for a phone
4. ... that it's to license patents
5. ... that those patents are invalid

The US Federal (civil) courts operate under the Federal Rules of Civil Procedure. Rule 11 states (in part):

(3) the factual contentions have evidentiary support or, if specifically so identified, will likely have evidentiary support after a reasonable opportunity for further investigation or discovery;

Now, as far as I can see, you don't have factual support for any of those contentions, nor do you have some sort of indirect/circumstantial evidence that a court would be likely to accept as reason to give you an opportunity for further investigation or discovery.

Worse, even if you had factual support for all those contentions, I'm not sure you'd really have a case. Even if the patents really are invalid, if they've been issued, Microsoft has a right to presume that they are valid -- and, in fact, courts are legally required to give any issued patent a presumption of validity as well.

Likewise, the cell phone vendors presuming those patents are valid is perfectly reasonable (since the courts are required to grant that presumption, it would be pretty ridiculous for them to blame companies for doing the same).

As such, it appears to me that to have any real case, you'd have to also contend that Microsoft knew their patents were invalid before they negotiated the contract, but decided to carry forward anyway. Unless you could show something on the order of evidence that Microsoft had bribed a patent examiner to get a patent approved, I can hardly imagine how you'd be able to support such a contention.

The problem here is that validity of a patent is a legal question, so essentially the only opinion that can possibly carry any weight in the matter is that of a court or at least an attorney. First of all, I can hardly imagine an attorney being stupid enough to say such a thing, even if it reflected his honest opinion. Second, if one of Microsoft's attorney's had told them such a thing, it would almost certainly fall under attorney-client privilege, so getting it admitted as evidence would be next to impossible anyway.

As such, essentially the only way I can see that you could show wrong-doing on anybody's part would be if you could show something like Microsoft having litigated the patent(s) in question previously, and either the claims based on those patents had been dismissed with prejudice, or else the jury in the previous case had found the patents invalid.

Right now, however, it seems to me that:

1. you don't have evidence to support your allegations
2. even if you did, it's unlikely they would support a law suit
3. allegations to support a suit can't be supported

Bottom line: Unless you have a lot more than you've posted, I can hardly imagine how even the best, brightest, most skillful attorney in the world could turn this into a real case that should really succeed in court.