MVDDS dispute
Encyclopedia
The MVDDS dispute refers to several legal disputes and political controversies that surrounded Federal Communications Commission
(FCC) approval of MVDDS
terrestrial wireless broadband technology. The controversy arose over the lobbying
efforts of Northpoint Technology, a developer of MVDDS, to receive approval and licensing for the technology. The dispute later transformed into several court cases against the FCC and satellite television
providers, as well as a patent infringement
case against MDS America and MDS International. As a result of the dispute, Northpoint lost the patents.
) is a land-based system for sending wireless
broadband signals over a part of the electromagnetic spectrum
usually reserved for satellite television (within the frequency
range of 12.2 to 12.7 GHz
). The technology allows sharing the spectrum with the satellite signals without interference
.
MDSA began developing an MVDDS technology in the mid-1980s which it later called HyperCable. The CEO of MDS America
, the company that was to be the product's distributor in the United States
and the primary investor in MDS International, showed in 2001 that the technology had been used in 20 locations worldwide since 1996.
Meanwhile, American company Northpoint Technology, Ltd. began developing its own MVDDS system in the early 1990s. It filed its first patent applications by 1994, using ideas from engineers Saleem and Carmen Tawil, and was formally founded in 1996 with investment money from various prominent individuals. The Chair of Northpoint was Sophia Collier, also the head of Citizen's Advisers. The Executive Vice President was Antoinette Cook Bush, the stepdaughter of prominent Democratic activist Vernon Jordan. In addition, the Tawils and Katherine (Chula) Reynolds, a member of the King Ranch
family, were directors.
(FCC) for permission to provide MVDDS service. Northpoint filed its application in a filing window for non-geostationary satellite systems, and claimed that its terrestrial system was entitled to the same rights given to other applications filed in that window, which employed the same frequency range. Pressed by satellite firms uneager at the prospect of sharing their spectrum with other providers, Congress passed language requiring the FCC to select an independent engineering firm to perform tests that would protect the fact to ensure that MVDDS would not interfere with satellite transmissions. The MITRE Corporation
, a not-for-profit engineering company that studies engineering issues for the government, was hired by the FCC to make the determination. Since MDS America did not file a proposal to use the spectrum within the time period the FCC specified, their technology was not tested by MITRE.
MITRE's report concluded that the MVDDS spectrum sharing technology it tested did pose a "significant threat" of interference with satellite television signals, but that a wide variety of mitigation techniques could potentially be used to reduce the interference and make bandsharing feasible. Based on this analysis, in 2002 the FCC adopted rules that allowed for MVDDS bandsharing. However, the FCC rejected Northpoint's petition for a license, and instead decided to hold a public auction
to sell off the land-based use of the spectrum.
Northpoint claimed the FCC's decision was unfair, since satellite companies had received a special exemption from Congress from having to bid for spectrum. Through the political connections of its founders and paid lobbyists, the company succeeded in having language that would block the auction inserted into a Senate
spending bill
. This provoked criticism from Senator John McCain
, who called it "an example of the power of money and special interests", and others, including the Bush administration
. After other charges of influence peddling surfaced, the language in the bill was eventually dropped.
Northpoint sought other avenues to challenge the FCC decision. It filed several petitions with the FCC to reconsider the auction, but they were all denied. The MVDDS auction took place in January 2004 without Northpoint's participation, and ten licenses were awarded for the 12 GHz bandwidth. The company continued its challenge in the United States court of appeals
, but the court rejected Northpoint's claim that it had been treated unfairly.
.
The case revolved around the question of how easily the technology described in Northpoint's patents—specifically, the directional antenna
—could be implemented. The defendants argued that the patent did not fully disclose how the antenna would avoid receiving undesired signals, and that besides the antenna's physical direction, many additional parameters must be fine-tuned. Additionally, the defense introduced a 1970 paper which they claimed showed Northpoint's patented physical direction idea constituted prior art
.
The jury for the case, which was filed in the Southern Florida district court
, determined that though MDS America (but not MDS International) had infringed Northpoint's patent claims, the patent claims were invalid to begin with. On appeal, the Federal circuit court
affirmed the jury's decisions. The case attracted attention in the media, with even an official at the French embassy weighing in. Lawyers have noted that the results of the case show that as much detail as possible on implementation should be included by patent prosecutors.
The invalidation of the MVDDS patents ended all Northpoint's actions in MVDDS and their website is no longer online.
Federal Communications Commission
The Federal Communications Commission is an independent agency of the United States government, created, Congressional statute , and with the majority of its commissioners appointed by the current President. The FCC works towards six goals in the areas of broadband, competition, the spectrum, the...
(FCC) approval of MVDDS
MVDDS
MVDDS ' is a type of television and Internet delivery technology licensed for use in the United States by the Federal Communications Commission . This was subsequently tested by The MITRE Corporation for the FCC...
terrestrial wireless broadband technology. The controversy arose over the lobbying
Lobbying
Lobbying is the act of attempting to influence decisions made by officials in the government, most often legislators or members of regulatory agencies. Lobbying is done by various people or groups, from private-sector individuals or corporations, fellow legislators or government officials, or...
efforts of Northpoint Technology, a developer of MVDDS, to receive approval and licensing for the technology. The dispute later transformed into several court cases against the FCC and satellite television
Direct broadcast satellite
Direct broadcast satellite is a term used to refer to satellite television broadcasts intended for home reception.A designation broader than DBS would be direct-to-home signals, or DTH. This has initially distinguished the transmissions directly intended for home viewers from cable television...
providers, as well as a patent infringement
Patent infringement
Patent infringement is the commission of a prohibited act with respect to a patented invention without permission from the patent holder. Permission may typically be granted in the form of a license. The definition of patent infringement may vary by jurisdiction, but it typically includes using or...
case against MDS America and MDS International. As a result of the dispute, Northpoint lost the patents.
Development of MVDDS
Multichannel Video Distribution and Data Service (MVDDSMVDDS
MVDDS ' is a type of television and Internet delivery technology licensed for use in the United States by the Federal Communications Commission . This was subsequently tested by The MITRE Corporation for the FCC...
) is a land-based system for sending wireless
Wireless
Wireless telecommunications is the transfer of information between two or more points that are not physically connected. Distances can be short, such as a few meters for television remote control, or as far as thousands or even millions of kilometers for deep-space radio communications...
broadband signals over a part of the electromagnetic spectrum
Electromagnetic spectrum
The electromagnetic spectrum is the range of all possible frequencies of electromagnetic radiation. The "electromagnetic spectrum" of an object is the characteristic distribution of electromagnetic radiation emitted or absorbed by that particular object....
usually reserved for satellite television (within the frequency
Frequency
Frequency is the number of occurrences of a repeating event per unit time. It is also referred to as temporal frequency.The period is the duration of one cycle in a repeating event, so the period is the reciprocal of the frequency...
range of 12.2 to 12.7 GHz
GHZ
GHZ or GHz may refer to:# Gigahertz .# Greenberger-Horne-Zeilinger state — a quantum entanglement of three particles.# Galactic Habitable Zone — the region of a galaxy that is favorable to the formation of life....
). The technology allows sharing the spectrum with the satellite signals without interference
Electromagnetic interference
Electromagnetic interference is disturbance that affects an electrical circuit due to either electromagnetic induction or electromagnetic radiation emitted from an external source. The disturbance may interrupt, obstruct, or otherwise degrade or limit the effective performance of the circuit...
.
MDSA began developing an MVDDS technology in the mid-1980s which it later called HyperCable. The CEO of MDS America
MDS America
MDS America, Inc is a wireless Internet and wireless cable TV technology provider based in Stuart, Florida. MDS America was the primary party responsible for the invalidation of Northpoint Technology Inc's patents having to do with terrestrial rebroadcast of satellite signals.MDS Operations, an...
, the company that was to be the product's distributor in the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
and the primary investor in MDS International, showed in 2001 that the technology had been used in 20 locations worldwide since 1996.
Meanwhile, American company Northpoint Technology, Ltd. began developing its own MVDDS system in the early 1990s. It filed its first patent applications by 1994, using ideas from engineers Saleem and Carmen Tawil, and was formally founded in 1996 with investment money from various prominent individuals. The Chair of Northpoint was Sophia Collier, also the head of Citizen's Advisers. The Executive Vice President was Antoinette Cook Bush, the stepdaughter of prominent Democratic activist Vernon Jordan. In addition, the Tawils and Katherine (Chula) Reynolds, a member of the King Ranch
King Ranch
King Ranch, located in south Texas between Corpus Christi and Brownsville, is one of the world's largest ranches. The ranch, founded in 1853 by Captain Richard King and Gideon K. Lewis, includes portions of six Texas counties, including most of Kleberg County and much of Kenedy County, with...
family, were directors.
FCC licensing controversy
In 1999, Northpoint and two other companies applied to the Federal Communications CommissionFederal Communications Commission
The Federal Communications Commission is an independent agency of the United States government, created, Congressional statute , and with the majority of its commissioners appointed by the current President. The FCC works towards six goals in the areas of broadband, competition, the spectrum, the...
(FCC) for permission to provide MVDDS service. Northpoint filed its application in a filing window for non-geostationary satellite systems, and claimed that its terrestrial system was entitled to the same rights given to other applications filed in that window, which employed the same frequency range. Pressed by satellite firms uneager at the prospect of sharing their spectrum with other providers, Congress passed language requiring the FCC to select an independent engineering firm to perform tests that would protect the fact to ensure that MVDDS would not interfere with satellite transmissions. The MITRE Corporation
MITRE
The Mitre Corporation is a not-for-profit organization based in Bedford, Massachusetts and McLean, Virginia...
, a not-for-profit engineering company that studies engineering issues for the government, was hired by the FCC to make the determination. Since MDS America did not file a proposal to use the spectrum within the time period the FCC specified, their technology was not tested by MITRE.
MITRE's report concluded that the MVDDS spectrum sharing technology it tested did pose a "significant threat" of interference with satellite television signals, but that a wide variety of mitigation techniques could potentially be used to reduce the interference and make bandsharing feasible. Based on this analysis, in 2002 the FCC adopted rules that allowed for MVDDS bandsharing. However, the FCC rejected Northpoint's petition for a license, and instead decided to hold a public auction
Spectrum auction
A spectrum auction is a process whereby a government uses an auction system to sell the rights to transmit signals over specific bands of the electromagnetic spectrum and to assign scarce spectrum resources. Depending on the specific auction format used, a spectrum auction can last from a single...
to sell off the land-based use of the spectrum.
Northpoint claimed the FCC's decision was unfair, since satellite companies had received a special exemption from Congress from having to bid for spectrum. Through the political connections of its founders and paid lobbyists, the company succeeded in having language that would block the auction inserted into a Senate
United States Senate
The United States Senate is the upper house of the bicameral legislature of the United States, and together with the United States House of Representatives comprises the United States Congress. The composition and powers of the Senate are established in Article One of the U.S. Constitution. Each...
spending bill
Omnibus spending bill
An omnibus spending bill is a bill that sets the budget of many departments of the United States government at once. It is one possible outcome of the budget process in the U.S....
. This provoked criticism from Senator John McCain
John McCain
John Sidney McCain III is the senior United States Senator from Arizona. He was the Republican nominee for president in the 2008 United States election....
, who called it "an example of the power of money and special interests", and others, including the Bush administration
George W. Bush administration
The presidency of George W. Bush began on January 20, 2001, when he was inaugurated as the 43rd President of the United States of America. The oldest son of former president George H. W. Bush, George W...
. After other charges of influence peddling surfaced, the language in the bill was eventually dropped.
Northpoint sought other avenues to challenge the FCC decision. It filed several petitions with the FCC to reconsider the auction, but they were all denied. The MVDDS auction took place in January 2004 without Northpoint's participation, and ten licenses were awarded for the 12 GHz bandwidth. The company continued its challenge in the United States court of appeals
United States court of appeals
The United States courts of appeals are the intermediate appellate courts of the United States federal court system...
, but the court rejected Northpoint's claim that it had been treated unfairly.
Northpoint v. MDSA and MDSI
After the FCC decision in 2002, MDS America asked permission of the FCC to test and prove its own MVDDS system. The FCC granted it an experimental license, and the company arranged for tests to be held in Florida using equipment furnished by its subsidiary, MDS International. When Northpoint became aware of this, it informed MDS America that performing the tests would infringe its patents. After the tests were concluded, Northpoint sued MDS America and MDS International for patent infringementPatent infringement
Patent infringement is the commission of a prohibited act with respect to a patented invention without permission from the patent holder. Permission may typically be granted in the form of a license. The definition of patent infringement may vary by jurisdiction, but it typically includes using or...
.
The case revolved around the question of how easily the technology described in Northpoint's patents—specifically, the directional antenna
Directional antenna
A directional antenna or beam antenna is an antenna which radiates greater power in one or more directions allowing for increased performance on transmit and receive and reduced interference from unwanted sources....
—could be implemented. The defendants argued that the patent did not fully disclose how the antenna would avoid receiving undesired signals, and that besides the antenna's physical direction, many additional parameters must be fine-tuned. Additionally, the defense introduced a 1970 paper which they claimed showed Northpoint's patented physical direction idea constituted prior art
Prior art
Prior art , in most systems of patent law, constitutes all information that has been made available to the public in any form before a given date that might be relevant to a patent's claims of originality...
.
The jury for the case, which was filed in the Southern Florida district court
United States district court
The United States district courts are the general trial courts of the United States federal court system. Both civil and criminal cases are filed in the district court, which is a court of law, equity, and admiralty. There is a United States bankruptcy court associated with each United States...
, determined that though MDS America (but not MDS International) had infringed Northpoint's patent claims, the patent claims were invalid to begin with. On appeal, the Federal circuit court
United States court of appeals
The United States courts of appeals are the intermediate appellate courts of the United States federal court system...
affirmed the jury's decisions. The case attracted attention in the media, with even an official at the French embassy weighing in. Lawyers have noted that the results of the case show that as much detail as possible on implementation should be included by patent prosecutors.
The invalidation of the MVDDS patents ended all Northpoint's actions in MVDDS and their website is no longer online.