Chinese Tech Company Squares Off with Portuguese Inventor in US Court: Media Paints Dispute as a Modern David v. Goliath, but Questions Remain

March 31, 2019

Disputes over patent infringement frequently spill into the courts, but sometimes parties seek to bolster their chances—and their leverage—by litigating such disagreements in the court of public opinion. This has been the case for a recent dispute involving Huawei and a Portuguese inventor, Rui Pedro Oliveira, who has alleged that the company has infringed his patents through the provision of its EnVizion 360, a 360-degree smartphone camera accessory. After Huawei declined to take a license, Oliveira allegedly sold his family home to afford a US patent attorney in order to further pursue his case—and through a series of interviews with news outlets not traditionally focused on patent law, has received favorable media coverage portraying him as the underdog. However, Huawei has now pushed back with a declaratory judgment suit, alleging that Oliveira has used the threat of further negative media coverage as leverage to force a settlement. Meanwhile, an analysis of recent media coverage reveals certain key misconceptions about patent law, while questions remain as to the actual merits of Oliveira’s infringement case.

•   Unraveling Problematic Assumptions
•   Oliveira’s Utility Patents
•   Oliveira’s Design Patent
•   Huawei’s Accused Product
•   Oliveira and Huawei Meet
•   Oliveira’s Media Campaign…and the Media’s Early Response
•   Huawei’s Turn to the US Justice System
•   Remaining Questions

Unraveling Problematic Assumptions

Some of the most prominent media coverage of this dispute—in particular, content from publications that do not typically cover patent law—has framed this story as Huawei having stolen the idea for Oliveira’s invention. However, both parties have more narrowly cast the dispute as focused on the inventor’s patents; indeed, Oliveira himself once corrected an online commenter by stating that he does not claim that Huawei stole an idea—he alleges that it stole a patent.

Furthermore, those same articles also offer an oversimplified summary of what Oliveira’s patents cover and the nature of the protection afforded to him. For one, they appear to conflate the utility patent and design patent at issue in this case, treating both functional and ornamental elements from each as part of the same “design”. This misconception oversimplifies the underlying dispute, as those two types of patent provide distinct and legally separate forms of protection: generally, a utility patent “protects the way an article [of manufacture] is used and works”, while a design patent “protects the way an article looks” (MPEP 1502.01). A given invention may have both useful and ornamental characteristics, enabling both utility and design patent protection for certain aspects of the same article, but in such cases the resulting utility and design patents are not interchangeable.

In addition, those news articles and related commentary have ignored another key aspect of this dispute: when Oliveira’s patents actually issued. As detailed further below, the articles cited by Huawei, and reader commentary offered in support of Oliveira, suggest that the inventor’s invention was patent-protected by the time the parties first met over his infringement allegations—whereas in reality, he had only just filed the first of his non-provisional applications by the time the parties allegedly met for the first time.

Oliveira’s Utility Patents

Given the ambiguities described above, an overview of Oliveira’s patents and their prosecution history provides some useful context.

Both of the patents at issue in this case claim priority to a two-page provisional application filed pro se by Oliveira in April 2013 (after which he appears to have hired an attorney to prosecute the application). The inventor then filed a follow-on application for a utility patent in April 2014, of which the sole independent claim (claim 1) read as follows:

“1.     A camera system, comprising:

a camera housing;

a lens mounted in the housing and configured to direct light onto an image sensor disposed within the housing; and

a mobile device connector configured to mechanically and electrically couple the camera system to a mobile device;

wherein the camera system does not include a user interface.”

After a 2.6-year prosecution, the USPTO issued Oliveira his first patent in November 2016 (9,503,625), with claim 1 amended as follows (new limitations are underlined):

“1.     A camera system, comprising:

a camera housing;

a lens mounted in the housing and configured to direct light onto an image sensor disposed within the housing, the lens having an adjustable focal length, aperture, and shutter speed and being positionable in at least a fully-retracted position and a fully-extended position; and

a power source configured to power extension and retraction of the lens, wherein the power source automatically retracts the lens when the camera system is disconnected from a mobile device, the power source comprising at least one of a battery and a capacitor;

a cradle configured to receive at least a portion of a mobile device, the cradle comprising a base and four sidewalls that define a recess which is negative of at least a portion of a mobile device and being configured to receive a mobile device in an interference fit; and

a mobile device connector at least partially disposed within the cradle and configured to mechanically and electrically couple the camera system to a mobile device;

wherein the housing has a length of 1 cm greater than an external diameter of the lens and wherein the housing has a width of 1 cm greater than the external diameter of the lens; and

wherein the camera system does not include a user interface.”

While a cradle and a lens with an adjustable focal length had been described in certain dependent claims found in the application, the limitation in the issued patent describing a power source comprised of a battery and capacitor was a new addition and contradicted a subsequently cancelled claim from the application (claim 2) that explicitly omitted a power source: “The camera system of claim 1, wherein the camera system does not include a power source and is instead configured to receive power through the connector from a mobile device when the camera system is coupled to the mobile device” (emphasis added).

Overall, the ‘625 patent generally relates to a camera attachment for mobile devices, where the camera has a variable-focal-length lens, uses an internal power source with a battery and capacitor that retracts the lens when the camera is disconnected, and attaches to a mobile device using a recessed cradle. A continuation filed in October 2016 issued in May 2018 as the 9,961,243 patent, which claims similar subject matter.

With respect to priority, it is worth noting that the provisional application may lack support for certain claim limitations ultimately present in the issued patent, including limitations related to shutter speed, a battery and capacitor, lens extension and retraction, a cradle, and the size of the housing.

Oliveira’s Design Patent

Oliveira filed an application for a design patent in April 2014, the same day that he filed his utility patent application. The design patent issued to the inventor in July 2017 (D792,497), claiming an ornamental design for an attachable camera that appears to include a single, adjustable lens and a somewhat angular body. The news articles cited by Huawei notably cite certain illustrations from the ‘625 utility patent rather than the design patent, including a curved design not present in the design patent that lacks the utility patent’s recessed cradle limitation.

Huawei’s Accused Product

As described by Huawei in its complaint, the device accused of infringement by Oliveira is the EnVizion 360, “a 360-degree camera . . . which can be connected to Android smartphones”. The device captures 360-degree photos using two fixed-focal-length lenses, receives its power from a smartphone through USB, and attaches to the smartphone through a standard male USB-C connection. Huawei pleads that the EnVizion 360 was designed by Huawei Device Co., Ltd., a Chinese affiliate of the two named US declaratory judgment coplaintiffs (Huawei Technologies USA and Huawei Device USA; collectively, “Huawei USA”). The product was allegedly announced in September 2017, and Huawei Device USA began selling it “in or about March 2018”.

Oliveira and Huawei Meet

The parties’ interactions allegedly began in May 2014, just over a month after Oliveira filed the US application that would later issue as the ‘625 utility patent here at issue (9,503,625), when the inventor met with representatives of Huawei subsidiary Huawei USA in Plano, Texas to “discuss his patents and business plan and offer a license”—an offer Huawei declined, according to the complaint. From April to June 2018, after the issuance of the ‘625 patent and the ‘497 design patent, Oliveira then “repeatedly charged Huawei USA, via correspondence sent to multiple recipients in the Eastern District of Texas, with infringement” of those two patents, Huawei alleges.

Oliveira’s Media Campaign…and the Media’s Early Response

Starting on March 4, 2019, Huawei further pleads, a series of articles began to appear in which Oliveira publicly asserted his claims of patent infringement and alleged that the company improperly used information that it obtained from the parties’ 2014 meetings. These articles included two specifically cited in the complaint: an “exclusive” interview with Oliveira published on photography website Fstoppers.com and another published on English-language Portuguese website Gamer4K.com, which covers entertainment, gaming, technology, and sports. In his interview with Fstoppers, Oliveira claimed that Huawei representatives refused to continue discussing the case with him because at the time he did not “have an American attorney”. Oliveira states that he then sold his family home to hire a US attorney, Boston-based patent lawyer George W. Neuner, in September 2018, only to see little progress in his attempts to further negotiate.

The Fstopppers author, photographer Robert K. Baggs, concluded his article by acknowledging the emotional appeal of Oliveira’s narrative, admitting that he had struggled to “come at the claims objectively”. However, Baggs also included a caveat with respect to the patent’s claimed subject matter, noting that “there have been attachable smartphone cameras before” and that he recalled owning a Sony Ericsson phone in the early 2000s with an attachable camera accessory. The dispute has since been covered in patent-centric publications after the filing of Huawei’s lawsuit—including IAM, which in a recent article framed the dispute in terms of the disparity in resources between the company and Oliveira, without commenting on the actual merits of the inventor’s infringement case.

While Baggs’s observation was not accompanied by a response from Oliveira within the body of the Fstoppers article, the inventor himself appears to have posted a variety of comments on the Fstoppers website in response to reader feedback about the merits of his case. In one such reply, Oliveira pushed back against a user who also recounted owning a similar phone and camera attachment as the ones cited by Baggs—with the user identifying the devices through a posted photo as the Sony Ericsson T300, one of the first cell phones with a color screen; and its companion camera attachment, the CommuniCam. Oliveira replied to the user directly and asserted that the CommuniCam device was not prior art, implying that the device did not qualify as a “a camera or a lens that was attached to a smartphone”. Oliveira further argued that the CommuniCam was distinct in that it could function independently of the T300 (“That was a camera that worked . . . even without [the] Ericsson mobile phone”), although the devices’ combined user manual does not indicate that such independent usage was possible (nor that the CommuniCam had its own battery).

Additionally, in response to another comment that Oliveira appears to have interpreted as skeptical toward his case, the inventor offered to reveal the individual email addresses of the people he dealt with at Huawei: “Do you want my personal email and the Huawei email [of] persons involved [with] this issue so you can get the right answers[,] since you don’t believe [me] on this? Feel free. Thanks a lot for your comment”.

Also commenting on the article was an individual holding himself out as Dr. Jose Salcedo, who stated that he has a “PhD in Photonics (EE) from Stanford University” and that he assisted Oliveira in preparing his US patent applications. Salcedo claims that he participated in multiple meetings between Oliveira and Huawei and asserted that those meetings—ostensibly, the ones in 2014—“were held during a period . . . of full IP protection as granted by US law”. However, Oliveira’s utility patent would not issue for another two years, and its design patent a year after that. Salcedo appears to have previously founded Multiwave Photonics, a Portuguese company specializing in high-power pulsed fiber lasers that sold its assets and technology to Datalogic in 2013.

Huawei’s Turn to the US Justice System

On March 26, 2019, Huawei USA filed a declaratory judgment action against Oliveira in the Eastern District of Texas, seeking a judgment that the Envizion 360 does not infringe the ‘625 utility patent and the ‘497 design patent (4:19-cv-00229). The company alleges that venue is proper as to Oliveira—a resident of Porto, Portugal—under 28 USC Section 1391(c)(3), which allow a nonresident defendant to be sued in any judicial district.

In his communications with Huawei’s US affiliates, the company pleads, Oliveira or his counsel have represented “that the press is interested in Defendant Oliveira’s allegations”, but that the inventor “will agree not to talk about it” if the parties were to resolve the matter. As a result, Huawei USA seeks a finding that the case is exceptional under 35 Section 285 due to Oliveira’s representations, characterizing them as “express or implied threats to harm Huawei USA’s reputation in the press unless Huawei USA pays money to settle the dispute”.

Remaining Questions

As this litigation proceeds, it is by no means certain whether a Texas judge or jury will be convinced that certain features of Huawei’s EnVision 360 product satisfy the limitations of Oliveira’s patent claims—particularly those found in his utility patent that require a variable-focal-length lens, an internal power source with a battery and capacitor, and a recessed cradle used to connect a mobile device. It is also not immediately clear where Oliveira might argue that his issued utility claims find support for those limitations in the inventor’s provisional application. Whether those arguments are sufficiently convincing could affect the body of prior art for the claims of the ‘625 utility patent; indeed, Oliveira has acknowledged the need to avoid prior art through his comments on the Fstoppers piece.

Ultimately, negotiations between patentholders and product manufacturers can break down for a host of reasons. While delay can certainly be a tactic used to stretch the bargaining over a period of time so extended that it can scuttle the negotiations entirely, some negotiations end simply because one party’s position lacks sufficient credibility. Oliveira may have turned to the media to push matters past the parties’ impasse here, but it seems that the American justice system will now have the final word.