Apple suffered only a small reduction in the amount of damages it can claim from Samsung following the rivals’ patent trial in Silicon Valley last year. The original award, when a jury ruled that Samsung had infringed various Apple patents, was $1.05bn, but Judge Lucy Koh ordered that almost half of that sum ($450m) should be reviewed, as she believed the jury had miscalculated. In the retrial, which ended last week, a new jury said that Samsung should pay almost $290m of the amount under review, or a total of about $890m.
In a trial which rehashed many of the arguments of the original case, in the same courtroom in San Jose, Samsung had argued that it should only have to pay $52m out of the $450m at issue, while Apple had asked for $380m. Many of the issues around royalty levels, lost profits and the importance of the disputed patents to Samsung’s success were argued again, although this case did not deal with actual infringement, since that had been decided in the first process.
Samsung tried various tactics to halt or overturn the retrial. It called for a mistrial on the grounds that an Apple attorney was being racist, in some of his arguments about protecting US intellectual property from foreigners. This failed, and the judge also denied its motion to suspend the procedure while the Patent Office examined the validity of one of the pieces of IPR at issue. The US Patent Office is questioning the validity of perhaps the most important item at issue, patent No. 7,844,915, also known as ‘pinch to zoom’.
This is the only patent involved in the trial for which Apple can collect money for lost profits. Apple estimates it would have sold 360,000 additional devices if Samsung had not released rivals which use the infringing patents at issue. But Samsung expert witness Michael Wagner argued that there was no evidence that anyone has chosen a Samsung device because of the most important of these, related to the pinch to zoom capability, enshrined in US patent 7,844,915. “I believe people bought these phones for other features,” he said, citing technologies in which Samsung leads development, such as large AMOLED screens, faster processors and LTE support.
Wagner disputed calculations made by Apple’s expert accountant, Julie Davis, claiming she attached too much value to the lost profits from patent ‘915, a calculation which lies at the heart of the case. One expert, MIT professor John Hauser, said three Apple patents, including ‘915, together added about $100 in value to a $199 smartphone or $90 in value to a $499 tablet, and Davis used those figures as the basis for claiming that Apple lost out on $114m in profits from Samsung ‘copycats’. She then estimated Samsung’s profits to be $231m, which led her to a figure of $35m in reasonable royalties connected to these patents.
Despite the importance of ‘915, Koh ruled that it would be more efficient for a final judgment to be rendered in her case so that the Federal Circuit could review the entire case and the validity of the patents involved as soon as possible. That court will hear any appeal that Samsung may lodge against the retrial and will review other issues too. Indeed, it already said last week that Koh’s court had abused its discretion last December when it denied Apple an injunction against several infringing Samsung devices. Koh said the iPhone maker had not presented enough evidence that the disputed patents were critical to consumer demand for the iPhone, and therefore a ban on imports of the Samsung devices would be unjustified and excessive. However, the Federal Circuit appeals court, while accepting the decision not to impose a ban over design patent infringements, said an injunction based on the utility patents should be reconsidered. The utility patents include double-tap to zoom, bounceback when scrolling, and multitouch display.
That may strengthen Apple’s resolve as it goes into a new patents case, which will be heard in April, if the companies do not succeed in settling out of court ‘ something Koh is pressurizing them to do. It could improve its case for an injunction should it win that trial, and such a ban would be more hurtful to its rival, since the new case centers on newer products, while those addressed in the 2012 hearing are now almost obsolete (of course, the same may be true of the new models, if the process drags on).