Apple has won the most publicized, if not the biggest Patent Battle of its life against Samsung as it relates to infringement on several of its design patents. The award of nearly US$1.05 billion or $1,051,855,000 exactly as stated in the article “Apple wins big: Samsung violated Apple patents, must pay $1.05 billion in damages, court rules (updated)” published AUGUST 24, 2012 BY ANDREW COUTS, Digitaltrendsas well as “Disaster for Samsung: Jury awards Apple $1.05 billion in patent case” published Aug 24, 2012 – 4:16PM PT By Jeff John Roberts, Gigaom is for violation of certain specific patents owned by Apple.
Good to note at this point that Samsung is also a supplier of components for the Apple iPhone and Apple iPad. so the case for patent Infringement is plausible, despite the contractual obligation to merely supply components for their products for assembly by Chinese electronics manufacturer Foxconn into products.
For Apple, a lot is at stake for them as stats from February analyst Nielsen indicate that in the First Quarter of 2012, 50% of Americans who own a mobile phone have swung towards smartphones as stated in the article “Smartphones now account for half of all mobile phones”, published March 29, 2012 2:23 PM PDT by Scott Webster, CNET News.
The Jury came to its decision rather quickly (bet you they’re all Apple fans!). Their 20-page summary judgment breaks down in a very skewed manner for Apple, offering compensation for infringement on its smartphones but no protection for later modes of their smartphones and its main showpiece product, the Apple iPad::
Software Design
1. Patent ‘381 (the “bounce back” action) – The jury ruled in Apple’s favor and found that all of Samsung’s accused products infringed on this patent. All Samsung devices were found for inducement (Samsung made its U.S. counterparts infringe on the patent). Samsung was also found guilty of willful infringing on this patent.
2. Patent ‘163 (the “double tap to zoom” action) – The jury ruled in Apple’s favor and found that with the exception of eight mobile devices, Samsung infringed on this patent. Samsung was also found guilty of willful infringing on this patent.
3. Patent ‘915 (the “pinch to zoom” and other zoom and scroll function actions): The jury ruled largely in Apple’s favor, saying the only Samsung devices exemptions are the Intercept, Replenish, and the Ace. Concerning this patent, all Samsung devices except the Replenish were found for inducement. Samsung was also found guilty of willful infringing on this patent.
Physical Design
1. Patent ‘087 (back of the iPhone) – All Samsung devices with the exception of the Galaxy S, 4G and Vibrant.
2. Patent ‘677 (front of the iPhone)- all Samsung devices were found to infringe on this patent except the Ace. Samsung was also found guilty of willful infringement on this patent.
3. Patent ‘305 (iOS app icon design) – All Samsung devices were found to infringe on this patent – this has been a much-talked-about point, and the jury came down hard on it, saying, basically, that Samsung should have known better. Samsung was also found guilty of willful infringement on this patent.
4. Patent ‘889 (iPad design – specifically, “clean front, edge-to-edge glass, thin bezel, thin outer border, and rounded corners”): Samsung and its Galaxy Tab devices were determined to not have infringed on Apple’s patent. Strangely, Apple is being given a monetary reward, a judgement by the Jury that is still being reviewed by the Supreme Courts
Trade dress (overall Aesthetic Feel)
Trade dress is basically the physical styling of the product, an aesthetic that is difficult to copyright unless it’s unique in some way. Samsung argued that patent D’893 was not protectable, but the jury ruled against this decision.
Apple won trade dress infringement for the iPhone 3G only, with the other models of the Apple iPhone and the Apple iPad not being protectable.
To be even clearer, the jury found the following phones diluted the apple iPhone 3G’s Trade Dress:
1. Samsung Fascinate
2. Galaxy S i9000
3. Galaxy S 4G
4. Showcase
5. Mesmerize
6. Vibrant
The jury found, however, that the following phones were not found to dilute or infringe upon the trade dress of the Apple iPhone 3G:
1. The Captivate
2. Continuum
3. Droid Charge
4. Epic 4G
5. Prevail, S2 (AT&T)
6. S2 i9100
7. S2 (T-Mobile)
8. Epic 4G Touch
9. Skyrocket
10. Infuse 4G
This award, albeit hefty, is a lot less than what Apple had wanted, which was US$2.5 billion.
Interestingly enough too, albeit a hefty sum, is a mere drop in the bucket for Samsung, whose gross earnings for 2011AD was US$145 billion, or 0.72% of their Gross 2011AD profit. Certainly won’t shake Samsung, which also has business interests in other areas other than making phone and Tablets.
More interesting stats for Samsung:
1. The South Korean tech giant Samsung earned a whopping £2.75bn in the First Quarter of 2012AD
2. Samsung sold 44.5 million smartphones, 22% more than the First Quarter of 2011AD.
3. Samsung has taken the No. 1 sport for phone sales overall from Nokia, a position it has held since 1998 Samsung’s sales figures beat Apple, who sold only 35 million iPhones
Their full spread of business, which includes a significant amount of spending on R&D (Research and Development) includes all ranges of consumer electronics, from Car Stereos to Blenders. They also make hard-drives, both the older Mechanical types and the newer SSD (Solid State Drives) hard-drives for PC’s, Laptops, smartphones and Tablets.
This interest in SSD is based on the US$1.375 billion deal brokered by Seagate Technology PLC and Samsung Electronics Co. on Tuesday April 19th2011AD as reported in my Geezam blogarticle entitled “Seagate – Samsung Swap Hard-Drive Assets – Profitable Cloudy Horizon”.
SSD’s are the new business area that they are positioning themselves, especially with the expansion of Cloud Computing and Cloud Storage.
So albeit a significant victory for Apple, it’s a mere drop in the bucket for Tech Giant Samsung, who also lost their countersuit case against Apple. Both Apple and Samsung are most likely to appeal the ruling; Apple is seeking to up the damages to US$2.5 billion and to have it include the Apple iPad and Samsung to appeal the whole ruling altogether, as this translates into royalties being paid over to Apple and slight increases in the cost of their smartphones and Tablets to consumers.
Worse, Apple may use this ruling to pursue further legal action in other smartphone and Tablet makers sold in markets where its products are compete and where it feels those competitor’s products infringed on its design.
So a pyrrhic victory that was a Premium Rush (2012) by the Apple-philic jury as its legal battle only winds up protecting the Apple iPhone 3G and leaves its newer Apple iPhone models and the Apple iPad unprotected. And albeit Apple is well within its right to defend its patents after years of having Microsoft and other copy and steal their designs with very significant legal little action, this outcome will go a long way to stifle innovation and foster the idea among tech companies that they can profit from having a treasure trove of patents.
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