With a 10-year licensing agreement with HTC Corp. (TPE:2498) ironed out — and with two-way lawsuits with Motorola Mobility dismissed with prejudice not once, not twice, but three times — the war between Apple, Inc. (AAPL) and Android hinges on one final battle. That battle is the ongoing litigation between Samsung Electronics Comp., Ltd. (KSC:005930) and Apple, the two most profitable smartphone makers.
I. Ban on the Galaxy Note II, Galaxy S III?
On Sunday, Reuters reported that Apple has filed to tack on six new Samsung products to its second major court battle with Samsung. Among the products is the popular phone-cum-tablet, the Galaxy Note II. Apple also wants to tack on the 4.8-inch Samsung Galaxy S III, running the new Android “Jelly Bean” operating system, the Samsung Galaxy Tab 8.9 Wi-Fi, the Samsung Galaxy Tab 2 10.1, the Samsung Rugby Pro, and the Samsung Galaxy S III Mini.
Last week Judge Paul S. Grewal of the U.S. District Court for the Northern District of California’s San Jose courtroom ruled that Samsung could add Apple’s flagship iPhone 5 to the suit. He also ruled that Apple could add a number of Samsung products to their suit.
At first it appeared that the Galaxy S III — Samsung’s flagship phone-form-factor device — might be on that list. Now it appears Apple is still fighting to get that one tacked on.
The Galaxy Note II is among the devices targeted by Apple’s latest ban request.
Last week, despite Judge Grewal expressing skepticism of Samsung’s justifications, he handed the Asian OEM a key win, ordering that Apple must disclose copies of its licensing agreement with HTC. However, the disclosure is under a strict seal of privacy meaning the media will not be privy to it.
II. War Continues Even as Both Sides Look to Shift Last Round in Their Favor
Apple alleges that Google Inc.’s (GOOG) Jelly Bean operating system, along with Samsung’s proprietary user interface enhancements illegally borrow patented technologies from iOS — mostly in terms of designs, animations, or software mechanisms. Apple has stirred up controversy by patenting a number of its features in iOS; most recently it won a design patent on animating turning pages, despite Hewlett-Packard Comp. (HPQ) offering a visually identical technology in 2002 (which is still live), prior to Apple’s filing.
Samsung, meanwhile, alleges that Apple refuses to license and stole its communications and video standards patents, along with a handful of user interface patents. Samsung’s claims have also sparked controversy, as some argue it should be required to license those patents to Apple and should not be allowed to use them to pursue litigation against Apple, under the so-called “fair, reasonable, and non-discriminatory” (FRAND) licensing rules that govern such standards patents.
Whichever side you are on, it’s hard to deny that the first round when entirely to Apple. Apple scored a $1.05B USD verdict in the first jury trial, while it was found innocent of all of Samsung’s counter-claims.
The verdict in the first trial cost Samsung $12B USD in value.
[Image Source: SeongJoon Cho/Bloomberg]
Samsung feels that victory was unjust and has appealed. It believes the jury foreman — who did not disclose his involvement in a prior legal dispute with a Samsung subsidiary — misled fellow jurors. It has also questioned potential juror bias, as Judge Lucy Koh allowed some jurors to serve who had family members who held significant amounts of Apple stock and would profit off Samsung’s misfortune. Judge Koh reasoned that this was okay, as the jurors themselves were not shareholders.
Apple meanwhile is looking to capitalize. While its push to ban Samsung’s product from U.S. sales has been stymied by some of its key patents in the case being engaged in various stages of invalidation, it has moved to make the best of its win by looking to triple the damages to $3.15B USD. Apple could potentially triple the damages as the jury found the infringement to be “willful”.
Overseas Apple has fared worse; in the UK Apple lost a major case to Samsung and was forced to print an apology ad. In South Korea, Samsung’s home nation, Apple was found guilty of minor infringements, as was Apple. So far the U.S. verdict is somewhat of a red herring amidst the general international legal community, which has — by and large — pushed the pair to solve their differences via some manner of cross-licensing deal, rather than by wasting court time and requesting consumers be denied access to products.