Euro ban on Samsung Galaxy smartphones could be warm-up for U.S.
A Dutch court handed down a formal ban on Samsung Galaxy smartphones that would cover most of Europe.
The reason? Much like the Galaxy Tab 10.1 -- which is not included in this specific ban -- Apple has sued Samsung on the grounds of patent infringement. (Apple thinks the Galaxy smartphones look too much like the iPhone.) The injunction would prohibit the sale of the current Galaxy S, Galaxy S II and Galaxy Ace models if certain adjustments aren't made within the next seven weeks. Yet it would not have any effect on future generations of these models.
Additionally, it wasn't a complete victory for Apple as the judge in this case rejected the claim that Samsung had stolen many of Apple's design ideas -- at least for these devices in particular.
FOSS Patents' Florian Mueller writes that Apple won't actually achieve an injunction in as many European countries as it would have liked because it didn't follow through on patent applications in over a dozen nations that are included in the European Patent Organization:
Apple would now have a much more impactful decision in its hands if it had pursued the European registration of that patent more thoroughly. Also, Samsung may be able to work around that particular patent without a huge degradation of the usability of its devices because it appears to relate to the way users flip through the pictures in a photo gallery. However, regardless of how Samsung may be able to work around this decision in Europe, it's a setback for Android, a platform that is at issue in more than 50 lawsuits worldwide.
In the short term, this isn't actually that detrimental to Samsung. Not only because the judge agreed with the Korean company that its designs aren't copies of something else, but Samsung also has been given a reasonable time frame to modify the some of its software in question.
Nevertheless, this doesn't mean that the battle will end here. It's quite possible that with this victory, Apple will now seek a ban against Galaxy-branded products in the United States, which would be the worst case scenario possible for Samsung.
Morgan Stanley analysts wrote earlier this month after the Galaxy Tab 10.1 was banned by a German court that this "specific sales ban does not impact Samsung’s earnings materially in the near term. But, the risks will rise if the appeal is unsuccessful, if the sales ban broadens out beyond Europe, and if relationship between [Apple] and Samsung deteriorates meaningfully to begin impacting sales of components."
Now, although those analysts assert that concerns over Samsung's future are "overblown and the current share price more than offsets the worst of plausible outcomes," this is still a risky situation for both parties.
Morgan Stanley acknowledges that a lawsuit in the U.S. would be the "most important court case," and if an "injunction is granted, investor concerns would rise that other courts outside the US could use the US decision as a precedent."
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