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Apple Burning Through Cash in Failed Attempts to Crush Android

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Judging from the frequency in which Apple (AAPL) drags companies to court over copyright disputes, you'd think its name was Disney (DIS).

In the last two years alone, Cupertino has been embroiled in high-profile legal battles with major brands like HTC, Samsung, Motorola (MMI), Amazon (AMZN), Nokia (NOK), and others. And that's not counting its long history of targeting small-time entities for allegedly infringing on the Apple brand with such damning atrocities like using a lower case I in a product name or even an apple in a logo.

But as of late, the number one mission of Apple's legal team extends from Steve Jobs' life goal: to crush Android (GOOG). Unfortunately, Apple keeps getting dealt losses in the courtroom -- and it's starting to add up to a lot of money.

The company's bid to ban Samsung Galaxy Tabs in the Netherlands was denied once again in a Dutch appears court. This, after Apple was estimated to have spent $100 million to bring HTC to court over copyright infringement. And out of the 84 claims it filed throughout 10 patents, Apple won a ruling on only one.

With all these costly cases and very few wins, analysts and shareholders are beginning to question if Apple's litigious nature is reasonable, let alone profitable, even while sitting on a mountain of cash.

In his blog, Dan Lyons questioned the "victory" Apple earned in its fight against HTC. "[In] reality the infringement involved a relatively tiny software feature, one that lets you press on a phone number in an email or Web page and bring up a menu from which you can choose to call the number, send a text message, and so on."

Lyons added, "So Apple started out with 10 patents -- presumably its best ones -- and ended up with a tiny victory on just one. Was that worth $100 million?"

Speaking with Bloomberg, Kevin Rivette, a managing partner at IP firm 3LP Advisors LLC, remarked that, win or lose, Apple's ubiquitous presence in the courtroom is too expensive for its own good. If Apple wins a ban on infringing products, Rivette claimed, the competitors will just institute a workaround. Should Apple lose, it would've been better to have just reached a settlement and possibly profit from a competitor's success.

"A scorched-earth strategy is bad news because it doesn't optimize the value of their patents -- because people will get around them," Rivette told Bloomberg. "It's like a dam. Using their patents to keep rivals out of the market is like putting rocks in a stream. The stream is going to find a way around. Wouldn't it be better to direct where the water goes?"

It does, however, place greater emphasis on the need to overhaul tech patents. Highlighted in Google, Oracle (ORCL), and Microsoft's (MSFT) fight for the Novell and Nortell's old smartphone-related patents, the quest to gather as many claims on ideas has choked development and innovation throughout the industry. As I said last year, these patents "place the heart of competition not in development but in the courtroom -- thus becoming a significant source of revenue for companies who'd rather sue than stay competitive."

Perhaps with a few more costly losses for Apple, the industry will finally wise up, quit bickering over petty matters in court, and head back to the R&D department for some good ol', honest competition.

Eh, who am I kidding?

(See also: RIM Needs More Than Just a New CEO and iPhone Can't Match Android's Versatility, Says Steve Wozniak)

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