With a 20-page verdict form and 100 pages of instructions to explain it, many figured it would take longer for the jury to render a decision. But, the tech trial of the century has concluded, with Apple scoring a not-quite-flawless victory over its rival Samsung. While the company didn't win on every count, its cadre of lawyers did convince the nine jurors to award Apple over $1 billion in damages for Samsung's IP transgressions. Join us after the break and we'll hit you with the legal math that gave Apple a ten-figure bump to its bottom line -- and served as a shot across the bow of every other mobile phone manufacturer.
First things first, let's explain a little bit of the law that's put Samsung on the hook for such a sizable sum. A company's liable for patent infringement under Title 35 of the US Code, Section 271, for making, using or selling a patented invention in the US without authority from the patent owner. So, Samsung's US subsidiaries were accused as direct infringers for selling phones and tablets here in America. Samsung Korea, however, doesn't do business in the US, but is still liable under another part of Section 271. The pertinent statutory language states that "whoever actively induces infringement of a patent shall be liable as an infringer."
The jurors were tasked with determining if Samsung's devices at issue infringed Apple's IP, and whether Samsung Korea induced its US subsidiaries to sell those infringing devices. Additionally, the jury had to decide if Samsung did so willfully, as such a finding gives Judge Koh the discretion to triple the damages and award attorneys fees to Apple. Lastly, the nine jurors had to make a call as to whether Apple's patents were even valid -- if a patent isn't valid, then it doesn't matter, damages-wise, whether it's infringed.
Apple brought three utility and four design patents to bear against Samsung. Patent number 7,469,381 is for the bounce back that occurs when you scroll beyond the edge of a webpage or document in iOS. Patent number 7,844,915 is for single-finger scrolling and two-finger zooming, while number 7,864,163 claims tap-to-zoom technology. As for the design patents, D618,677 claims the iPhone's edge-to-edge glass, speaker slot and display border, while D593,087 claims its rounded corners and home button, and D604,305 claims the grid-style icon layout in iOS. The last design patent, D504,889 is for the iPad's edge-to-edge glass, rounded corners, and thin bezel.
Apple hit a home run with the '381 bounce-back patent -- the jurors found that all 21 Samsung devices at issue infringed
Apple hit a home run with the '381 bounce-back patent -- the jurors found that all 21 Samsung devices at issue infringed and that Samsung Korea induced its subsidiaries to sell those infringing devices as well. As for the '915 and '163 zooming and scrolling patents, team Cupertino was also successful, albeit not completely: the jury found that most, but not all of the devices infringed and that Samsung Korea was, once again, guilty of inducement. Apple enjoyed similar success with its design patents, with the jury finding that every Samsung phone at issue infringed the D'305 iOS icon grid patent. Meanwhile, the D'677 edge-to-edge glass patent was infringed upon by every handset except for the Galaxy Ace, and the D'087 rounded corners patent was infringed by the Galaxy S, Galaxy S 4G, and the Vibrant. The D'889 patent turned out to be Apple's sole loser, as the jury found that the Galaxy Tab 10.1 WiFi and 4G LTE didn't infringe the iPad's design. To top things off, the jury found that all of the infringement was willful except for the infringement of the D'087 patent, and that all of Apple's patents are valid.
Apple's patent portfolio didn't provide its only victory, however, the company also won on a trade dress claim. As a (very) brief refresher for those not familiar, trade dress is a means of protecting a business's image and overall appearance and how that image is perceived by consumers. The most common example used to explain trade dress is the shape and design of the Coca-Cola bottle: people recognize the bottle and associate it with Coke. Similarly, consumers see the design of the iPhone and associate it with Apple. The jury had to determine if Apple's iPhone and iPad had protectable trade dress, and if their designs were famous enough to have their value diluted by Samsung's devices. Once again, the jury found in Apple's favor, deciding that the iPhone 3G's (but not the iPad's) trade dress was valid and that several Samsung handsets had diluted Apple's brand.
As for Samsung, well, it struck out. On everything. It alleged that Apple was infringing five of its patents, and while the jury found those patents to be valid, it decided that Apple wasn't infringing them. So, it had no wins to offset its considerable losses, which resulted in a resounding courtroom victory and a $1,049,393,540 windfall for Tim Cook's crew.