Tech companies including Google, Hewlett-Packard, Dell and Facebook are backing Samsung Electronics as it appeals a court ruling to pay Apple almost $1 billion in damages in a patent infringement suit.
Samsung has already persuaded the U.S. Court of Appeals for the Federal Circuit to whittle the bill down to $548 million, but in June asked it to cut another $399 million. Apple, however, is not giving up, and on Monday filed a 24-page document asking the court to deny Samsung’s request.
Meanwhile, though, Google and others had filed a friend of the court brief arguing that upholding the ruling “will have significant detrimental consequences for the continued development of useful modern technologies.” The brief, filed July 1, was discovered by InsideSources on Monday.
The back story
The case dates back to a lawsuit filed by Apple in 2011, alleging that Samsung phones infringed on several iPhone patents. A U.S. court eventually awarded Apple damages of $930 million after a jury found that Samsung infringed its design and utility patents and diluted the trade dress, the overall look and packaging of a product. Samsung appealed the judgement and in May, a panel of three judges on the U.S. Court of Appeals for the Federal Circuit shaved off $382 million in damages related to trade dress dilution, as the panel disagreed with the jury, leaving $548 million in damages awarded for the design and utility patent infringements.
Samsung then asked for a full bench review of part of the court’s ruling relating to $399 million of the damages, its entire profits from products found to infringe three Apple design patents relating to a portion of the iPhone’s outer shell and one graphical user interface screen, saying that the damages should be limited to its profits from the infringing features.
The companies backing Samsung’s call for a rehearing noted in their brief that the appeals court panel concluded that the relevant statute “explicitly authorizes the award of total profit from the article of manufacture bearing the patented design” and that the smartphone was a single “article of manufacture” because the “innards of Samsung’s smartphones were not sold separately from their shells as distinct articles of manufacture to ordinary purchasers.”
That decision, they said, “will lead to absurd results and have a devastating impact on companies who spend billions of dollars annually on research and development for complex technologies and their components.”
It could for instance allow the owner of the design patent to take all profit from an infringing product, even if buyers didn’t care about the infringing element and bought the product for its many other features, they said.
Apple defended its claim to all the profit from the offending devices, saying that after Samsung copied its design, its share of the smartphone market jumped from five percent to 20 percent in two years, while Apple’s market share fell, bringing Samsung billions of dollars in revenue and profit from its infringing products.
This case is the last big legal fight between Apple and Samsung, which agreed last August to drop all patent lawsuits between them outside the U.S.