Out-Law News 3 min. read

Apple awarded $1bn in damages at US court for Samsung's patent violations

A jury in the US has awarded Apple over $1 billion in damages from Samsung following its claims that the rival consumer electronics manufacturer violated a series of its patents on mobile devices.

The verdict at the US District Court for the Northern District of California (NDCA), which required the nine jurors to answer more than 700 questions in relation to the manufacturers' software and designs, showed that Samsung violated Apple's patents on several of its products. Apple, on the other hand, did not violate any of its rival's patents.

In an internal memo published on the company's official blog, Samsung said that it would ask the court to overturn the verdict and appeal if it was unsuccessful.

"The judge's final ruling remains, along with a number of other procedures," the company said. "We will continue to do our utmost until our arguments have been accepted. The NDCA verdict starkly contrasts decisions made by courts in a number of other countries ... which have previously ruled that we did not copy Apple's designs. These courts also recognised our arguments concerning our standards patents."

Some of the patents infringed by Samsung on "at least one phone or tablet" in relation to software included a 'bounce-back' effect when a user tries to scroll beyond the end of a list or image, "scrolling, pinching and zooming" to re-size content and tapping the screen of a device to 'zoom in' on text. Samsung also imitated the "trade dress", or basic design, of Apple's iPhone; including face, screen and speaker slot and the device's "rounded corners and bezel". It was, however, cleared of copying the "rectangular shape and rounded corners" of Apple's tablet computer, the iPad, on its own devices.

In almost every case, the South Korean company "knew or should have known" that its actions infringed Apple's patents, according to the jury's verdict. Samsung's actions were also, in many cases, "wilful" – a condition which allows US courts to increase the amount of damages owed.

Katie Cotton at Apple said that the court had sent a "clear message that stealing isn't right", adding that the Californian company made its products to "delight our customers, not for our competitors to copy".

The company will seek injunctions to block US sales of Samsung's products at the companies' next hearing, on 20 September, according to the BBC.

IP law expert David Woods of Pinsent Masons, the law firm behind Out-Law.com, said that regardless of the final outcome the decision would likely make players in the global smartphone markets "pause for thought" when designing new products.

"From an innovation point of view this may be a good thing – designers will be making the effort to come up with designs that Apple won't complain about, although the downside is that it will take more time to produce these innovations, which is not so good for the consumer," he said.

Apple could decide to pursue its other competitors in the smartphone market, in particular Motorola and HTC, following the judgment, or could also raise further claims against Samsung in relation to some of its other products that were not included in the current case, he said. "However, if the decision stands post-appeal and even if it doesn't, I would expect that most of the other disputes that may develop are likely to end in a settlement rather than fully contested court actions," he added.

The two companies have been involved in patent litigation in several courts across the world. Last week, just before the jury's verdict was made public in the US case, a court in South Korea fined both companies for patent violations and banned sales of products made by both companies, according to the Guardian.

Last month, the High Court in the UK ruled that the design of three versions of Samsung's Galaxy Tablet device did not infringe on registered design rights belonging to Apple. Mr Justice Birss QC said that although he had initially thought the Samsung products looked "similar" to Apple's protected design, an 'informed user' would not have thought the same. Samsung's products were not as "cool" as Apple's, he said, as they lacked the same "understated and extreme simplicity".

A German court issued a preliminary pan-EU injunction banning Samsung tablet computers being sold due to their infringing Apple's design rights last year; however that was overturned on appeal. However, a preliminary injunction banning Samsung tablets from sale in Germany was issued by the court under unfair competition laws. Apple has also failed to obtain bans against Samsung tablets in the Netherlands, where two courts have rejected the company's claim in preliminary proceedings that Samsung has infringed on its rights.

The European Commission is currently investigating whether Samsung abused a dominant market position in the mobile phone industry. The Commission said that Samsung was obliged to license the use of patents relating to 3G mobile and wireless technology to rivals on fair, reasonable and non-discriminatory (FRAND) terms but may have breached this requirement when trying to enforce its patent rights against those rivals, including Apple, in court.

The NDCA jury was asked to consider whether Apple had violated Samsung's 3G patents as part of the case, but found in favour of Apple.

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