Posts Tagged: "Apple v. Samsung"

On Wednesday, June 27th, a pair of orders of dismissal, one entered in the District of Delaware and the other entered in the Northern District of California, marked the official end of the patent war which played out between consumer tech giants Apple and Samsung for the better part of the past decade. This legal dispute, which was brought to courts in 10 different countries and even went to the U.S. Supreme Court, is notable because it undermines the argument that major patent infringement battles harm tech consumers through added costs and blocking innovation.

On May 14th the next chapter in the Samsung v. Apple smartphone design patent dispute will commence in the United States District Court for the Northern District of California with a retrial to determine a new award in the case. The most notable moment in this long winding history was the unanimous Supreme Court decision where the Supreme Court sided with Samsung in its appeal in late 2016. But while the Supreme Court’s ruling should have modernized our antiquated law governing design patents to fit into the modern 21st century world, that important outcome is still in doubt pending the retrial. A key question remains – namely, how to determine the “article of manufacture” and appropriate remedy for infringement of multifaceted products. And could this open up potential grounds of consideration for utility patent interpretation?

In Arctic Cat Inc. v. Bombardier Rec. Prods., after unsuccessfully defending a patent infringement lawsuit, Bombardier Recreational Products, Inc. (“BRP”) appealed the district court’s denial of its motion for judgment as a matter of law. BRP argued that the asserted claims of U.S. Patent Nos. 6,568,969 (“the ‘969 patent”) and 6,793,545 (“the ‘545 patent”) were obvious, that patentee Arctic Cat failed to mark patented products, that the jury based its royalty award on improper expert testimony, and that BRP did not willfully infringe the asserted claims. BRP also appealed the district court’s award of treble damages and the ongoing royalty to Artic Cat… While the burden of persuasion under the statute is always on the patentee… the alleged infringer who challenges the patentee’s compliance with the marking statute has the initial burden of production because placing the burden on the patentee “could lead to a large-scale fishing expedition.”

The Apple-Samsung case has dragged on for about six years so far, with no end in sight. The first case, involving design patents, has had a trial, gone to the Federal Circuit, up to the Supreme Court, where a unanimous Court sided with Samsung. The case is now back at the district court, which has to decide which “article of manufacture” on the infringing Samsung phones includes the patented design. Apple is continuing to try to salvage its $400 million damages award by any means necessary, including effectively nullifying the Supreme Court’s decision.

Patenting the distinctive technological features that drive demand for your products and services will make your patent portfolio more valuable by creating a link, or nexus, between your patent portfolio and your products. You can use this nexus to exploit your patents by preventing your competitors from including the most valuable features of your products in their own products without your permission; commanding a higher royalty if you license your patents; increasing your chances of getting an injunction if you need to enforce your patents;
increasing your damages base if you enforce your patents; and defending against an obviousness attack on your patents’ validity by showing that the patented features increased your market share.

Apple requested that the Federal Circuit keep the case and the panel review the decision in light of the Supreme Court’s ruling, while Samsung requested that the Federal Circuit remand the matter to the district court for a new trial on damages. The Federal Circuit adopted neither suggestion. Instead, the Federal Circuit chose to remand the case for further proceedings, which the panel explained may or may not include a new trial on damages. Judge Koh will decide whether a new trial on damages is necessary.

To come up with the list below I’ve reviewed all of our patent articles, and have come up with these top 10 patent stories for 2016. They appear in chronological order as they happened throughout the year. Just missing the top 10 cut were the Supreme Court denying cert. in Sequenom and the USPTO being sued for Director Lee declaring a federal holiday. As interesting as those stories may have been, there was far more consequential patent news in 2016. Also missing the cut, but particularly interesting were the rather egregious and insulting response filed in an Office Action in September, and the embarrassing concurring decision by Judge Mayer in Intellectual Ventures. While the latter two were truly train wreck moments, they were fleeting. Judge Mayer has completely marginalized himself on the Federal Circuit with no one embracing his extreme and inaccurate reading of Alice, and that type of albeit cringe-worthy and unprofessional response to an Office Action happens very rarely.

The relatively short opinion by Supreme Court standards – just over eight pages – puts it simply: “The text resolves this case. The term ‘article of manufacture,’ as used in §289, encompasses both a product sold to a consumer and a component of that product.”

On Tuesday, December 6, 2016, the U.S. Supreme Court issued a decision in Samsung Electronics Co. v. Apple which found by a unanimous 8-0 vote that a damages award for design patent infringement may be limited to revenues attributable to a component of an article of manufacture and not the entire article itself. Tuesday’s SCOTUS decision overturns a judgment reached in May 2015 at the U.S. Court of Appeals for the Federal Circuit, which would have awarded nearly $400 million in damages to Apple Inc. (NASDAQ:AAPL) for the infringement of three design patents by mobile devices marketed by Samsung Electronics (KRX:005930).

It is that time once again when we look back on the previous year in preparation to close the final chapter on 2016 and to look ahead toward 2017. With patent reform surprisingly stalled, the biggest news stories of the year may have been the Patent Trial and Appeal Board (PTAB)… As 2016 started and through at least the first half of 2016 it seemed as if the PTAB had become rather all-powerful and completely unsusceptible to judicial restraints. As we close 2016 and look forward to 2017 a decidedly different picture seems like it is emerging… The other big news story of 2016 was with respect to patent eligibility…

The Supreme Court need not wait for Congress to act. This is a case of first impression in interpreting the provision. Guided by its own law on design patent infringement and legislative history, the Court can reach the common sense result provided by the provision’s wording. Design owners should be made whole, but not unjustly enriched. Awarding the infringer’s total profits regardless of the contribution of the design to the end product’s value subverts patent law’s mandate to promote technological progress.

The Court found substantial evidence to support the jury’s finding of infringement. While Samsung’s expert offered conflicting testimony, a reasonable jury could have credited Apple’s expert. Thus, there was no error in the district court’s conclusion that substantial evidence supported the jury verdict of infringement… Note that the underlying dispute in this case does not concern design patents that were also asserted against Samsung, and which are currently being reviewed by the Supreme Court.

Much of the court’s line of questioning at times sought answers to whether a standard could be applied in a design patent infringement case in such a way that adequately identifies the amount of profit that could be attributed to a particular aspect of a product’s design. In the words of Justice Kennedy: “Once you’ve identified the relevant article, then it seems to me necessarily what you’re doing is apportioning profits. I just don’t see how we can get away from that word.” While it may have seemed that the oral arguments went well for Samsung, that is not always, or even usually, a good gauge of how the Court will ultimately decide. Of course, time will tell.

This decision reestablishes what should always have been the case; namely that the Federal Circuit is an appellate court that does not consider evidence outside the record or engage in fact finding on their own. The Federal Circuit has been increasingly out of control for years, acting as a trial court and jury rather than an appellate court. Hopefully that will end today.