Daily Management Review

Apple’s victory in court over Samsung over issues on the smartphone market


The constant legal battles between Apple and Samsung have now reached a somewhat middle ground with the recent judgement drawing a line in between. Samsung now has to pay less damages and Apple has been stopped from creating a monopoly in the designing of Smartphones sector.

An appeals court on Monday upheld the bulk of Apple’s patent victory against Samsung Electronics in 2012, but overturned part of the decision and said that a lower court should reduce the total amount that Samsung would have to pay. Samsung is now not liable to pay 1 billion dollars in fines but is supposed to pay almost 40% less at around $547 million if their appeals are to be passed judgement on.

The United States Court of Appeals for the Federal Circuit, which deals with patent lawsuit appeals, said that the overall aesthetic of the iPhone — a rectangular product with rounded corners, black borders and a flat, clear surface — could not be protected and part of the damages would have to be recalculated.

Apple had accused Samsung of diluting its brand by copying the overall look of its iPhones and breaking several trademark rules. For example, Apple argued that the trademark rectangular design of the iPhone being part of its trade dress could not and should not have been ripped off by Samsung. But the court said Apple failed to prove that the iPhone aesthetic was not “functional.” In other words, giving Apple protection for the overall look and shape of a Smartphone would essentially grant it a perpetual monopoly over making smartphones work better, and the three-judge panel decided not to go in that direction.

“We therefore vacate the jury’s damages awards against the Samsung products that were found liable for trade dress dilution and remand for further proceedings consistent with this opinion,” the appeals court wrote in its decision. Josh Rosenstock, an Apple spokesman, lauded the decision as having “confirmed Samsung blatantly copied Apple products”. Rosenstock went ahead and said, “This is a victory for design and those who respect it”.

This judgement was sort of a breather for Samsung who have been facing one defeat after another in American courts by Apple’s appeals. Samsung welcomed the recent judgement and said in an email statement, “Today’s decision shows that Apple’s claims over trade dress and damages lack merit and are grossly exaggerated.”

In 2012, a jury unanimously decided that Samsung had violated a series of Apple patents and needed to pay more than $1 billion in damages, an amount that was recalculated to $930 million by another jury in a separate trial in 2013. The lawsuit was prominent, pitting two of the world’s top smartphone makers against each other. The two companies have gone on to duel in other legal entanglements, before calling something of a truce. Last year, in a separate case, a federal jury found that Apple and Samsung had infringed on each other’s patents in some smartphone devices and awarded most of the damages to Apple. In August, however, the companies said they agreed to drop suits against each other outside the United States. This marks the almost end of three years of constant legal back and forth between the two tech giants.
Separately on Monday, Carl C. Icahn, the activist investor, published an open letter to Apple. In the 2,200-word letter, he said Apple’s shares were still “dramatically undervalued,” and urged Timothy D. Cook, the chief executive, to buy back more of Apple’s stock because the company was sitting on too much cash.