Apple v. Samsung: The legal aftershocks
At first glance, it looks like Apple cracked Samsung like an egg in their US patent court victory. Lawyers don't see it as being that clear-cut.
Besides, questions about the jury's rush to judgment --they didn't even bother to read their court instructions--and the simple fact that the case will be appealed for years to come, there are concerns that the jury was in over its head from the start.
In an AP story, Robin Feldman, an intellectual property professor at the University of California Hastings Law School said "This case is unmanageable for a jury. There are more than 100 pages of jury instructions. I don't give that much reading to my law students. They can't possible digest it."
Daniel Ravicher, executive director of the Public Patent Foundation (PUBPAT) thinks that “Apple tried the 'kitchen sink" strategy and throwing everything at Samsung they could, hoping something would stick. They only got 1B of the 2.5B they were asking for. It's a win in one sense, but not a blow out as some have said, especially since Apple had home court advantage. I actually thought they'd get a stronger win.”
The home-town jury and the sheer mass of accusations aside, Thomas Carey, a partner at Sunstein, a major intellectual property (IP) law firm and chair of its Business Practice Group, said, “Clearly there will be an appeal to the Federal Circuit. Among other things, the challenge will likely include the question of whether the "look and feel" patents involve eligible subject matter, or whether they are too much akin to a mathematical algorithm to warrant patentability. The principal patent claims all involve 'a computer implemented method,' which to some folks strays over the line into unpatentable material.”
Samsung smartphones/tablets ruled in violation of Apple patents (images)
Andrew “Andy” Updegrove, a founding partner of Gesmer Updegrove, a top technology law firm, agreed. “I think it's a given that Samsung will appeal. Given the damages awarded and the obvious determination of Apple to defend its patents, Samsung has little choice but to press forward wherever it can in court.”
But, Updegrove continued, “This doesn't necessarily mean that it's ultimate goal is to prevail through litigation, because it will constantly be running into existing and new Apple patents for so long as they remain competitors in the marketplace. Ultimately, what should make the best sense for Samsung is to negotiate the most comprehensive patent cross license with Apple that it can, and maintaining a full court press throughout the world's legal venues is the best way to ensure that it can get the best terms possible in such a license.”
Unfortunately, Apple has shown no sign of wanting to license some of its technologies to potential rivals at any price.
Updegrove said, “Apple is different, because Apple (unlike most companies) may not be willing to license its most innovative features. Indeed, if Steve Jobs was still at the helm, I think that there would be little doubt that this would be the case. Presumably, this would be the right decision for Tim Cook as well, because it is Apple's innovation and style sense that justifies its premium prices. Plus, it has boatloads of cash in the bank, and the number of devices pouring into the market place would generate more than enough to recover legal costs if Apple is successful only part of the time."
Updegrove added, “Throw the iOS vs. Android aspect into the mix, and it's hard to see how this won't be in the courts for quite a while to come. Indeed, Samsung has little choice, because almost any price in legal fees would be less than having its existing products barred from the marketplace. The longer it can forestall that result, the better its bottom line, even if ultimately it has to pay up on those damages. Indeed, filing an appeal is like forcing Apple to license its patents if the result is to stay a bar on the sale of Samsung's infringing products. All in all, it's a very cynical but pragmatic game.”
As Carey points out though, “It is possible that the Federal Circuit will reverse. If they do not, there is a decent chance that the Supreme Court will take an interest in this. SCOTUS [Supreme Court of the United States] has been all over the map lately concerning what is and is not protectable; and this may be a chance for them to clarify (or further confuse) the subject.” If that were the case, Apple could ultimately lose big.
In the meantime, though, Updegrove observed that while “Lately, we've all gotten used to analogizing patents to nuclear weapons, and equating patent strategies to those that would have led to mutually assured destruction. But in the case of the current patent wars focusing on mobile devices, trench war may provide a more apt metaphor”
“Why? He continued, “Because most legal processes move so slowly, and at such great expense. It seems as if there's always another motion and another appeal, with neither side often holding any ground gained for very long. By the time all remedies have been exhausted, the technology in question may have been leapfrogged by new innovations - and perhaps new legal actions as well. In the meantime, wave after wave of lawyers and stockholder equity are thrown into the breach, while each company otherwise goes on with business, and sales, as usual.”
Apple may yet live to regret its current victory though. Ravicher pointed out that “This verdict may come back to haunt Apple, since it is much more often a defendant in patent infringement cases, than a plaintiff. Now, the non-practicing entities that sue them in 0the U.S. District Court in] Eastern Texas can trump out Apple's own verdict as showing that $1B in damages is a far amount for patents relating to the iPhone/iPad. Companies that VirnetX, which has a patent infringement trial against Apple this November, may actually be able to use Apple's win against it.”
In other words, while an Apple and a Samsung can battle with each other and continue with businesses as usual, the patent trolls, whose only business is shaking down corporations and their stock holders for payoffs, may end up being the only long-term winners.
Indeed, days before Apple's “win,” VimetX refiled its patent infringement case against Apple. VimetX was already successful in 2010 in shaking Microsoft down for $200-million. Perhaps they'll ask for $2-billion this time from Apple.
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Samsung's Apple patent loss: The financial hit is manageable