How This New Lawsuit Could Affect This Tech Giant

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What's happening in the headlines can affect you as an investor. Here's what's going on, what you need to know, and what you should do.

The cold, hard facts
The Financial Times is reporting that U.K. telecom company BT has commenced legal action against search giant Google (NAS: GOOG) for patent infringement, touching on a number of areas crucial to the company's products and services, including map, music, search, and the Android smartphone operating system.

Some context
BT is alleging infringement of one or more of its patents and has asked for a trial by jury, as well as unspecified damages. In a statement, Google said BT's claims were "without merit" and that it will defend itself "vigorously against them." In its own statement, BT said it had made "a well-considered claim" and that there was "a strong case of infringement."

BT has a worldwide portfolio of about 5,600 patents and applications. During the past year, BT filed for patent protection on 62 inventions. Google is currently involved in a number of patent disputes with companies such as Apple (NAS: AAPL) , Microsoft (NAS: MSFT) , and Oracle (NAS: ORCL) over its Android platform.

What you need to know
Patent issues in any industry can be very complicated, but few can match the complexity and ambiguity at play in the telecom sector, with cases often coming down to finely nuanced and highly subjective interpretations of what a piece of hardware or software does or doesn't do.

The fast-growing and hugely profitable smartphone industry has only raised the patent stakes further, enticing companies to comb through their patent vaults to see what may or may not be being "infringed" upon. Some call this "trolling," others a perfectly defendable right of any business to guard, and gain remuneration for, its hard inventive work and R&D dollars spent.

What's next
The steady stream of lawsuits between players in the mobile arena shows how high the stakes are to win the mobile batter. This area is poised to undergo incredible growth over the next decade and beyond, and investors need to know which stocks will fare the best. Fortunately, The Motley Fool recently compiled a research report detailing 3 Hidden Winners of the iPhone, iPad, and Android Revolution and made it totally free to our readers. The mobile boom, much like the Internet revolution before it, will usher in an entirely new set of big-time winners. I invite you to grab your free copy of this report today.

At the time this article was published Fool contributorJohn Grgurichloves the smell of newsprint in the morning, but he owns no shares of any of the companies mentioned in this column. The Motley Fool, however, owns shares of Google, Oracle, Apple, and Microsoft.Motley Fool newsletter serviceshave recommended buying shares of Microsoft, Google, and Apple and creating bull call spread positions in Apple and Microsoft. Try any of our Foolish newsletter servicesfree for 30 days. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has a scintillatingdisclosure policy.

Copyright © 1995 - 2011 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

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