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Apple, Samsung Whip Out Calculators in Patent Penalty Redux

Apple, Samsung Whip Out Calculators in Patent Penalty Redux

It may not yet be time for Samsung to pay the piper, but it soon will get the piper's bill. Having been found liable for infringing five Apple patents in a landmark case, the question at issue now is how much it should fork over to its nemesis. Coming up with the magic number won't be the end of it, though. The case is likely to be mired in the appeals process for years.

Apple and Samsung are in U.S. District Judge Lucy Koh's court again, this time revisiting how much Samsung should pay Apple for violating its patents.

Apple is seeking US$379.8 million for violation of five of its patents; Samsung wants to pay Apple $52.7 million.

The proceedings, which began Wednesday, became necessary after Koh set aside a portion of the original $1 billion-plus award because the jury erred in making its calculations.

After reducing the jury award to $598.9 million, Koh ordered a new trial to determine how much more Apple should receive from Samsung for its infringing behavior.

During the opening session of the trial, attorneys for Apple and Samsung sparred over the penalty. Apple couldn't be made whole for less than $379.8 million, attorney Harold McElhinny argued.

Samsung's offer to Apple, $52.7 million, wasn't an inconsiderable amount for ideas that weren't new, countered Samsung lawyer William Price.

Posturing Phase

During the trial, which is expected to last six days, legal fireworks are a definite possibility.

"Typically in patent cases, damages are one of the most contentious issues," David Mixon, a patent attorney with Bradley Arant Boult Cummings, told MacNewsWorld.

When wrangling over damages, both sides will dig in their heels at the start.

"Damages are not typically a cut-and-dried issue," Mixon said. "Parties will posture a lot -- even a side, like Samsung, which has been found to infringe patents."

That's because Samsung always has a powerful card in its hand.

"If they receive an unfavorable verdict on how much damages they owe, they can string out the proceedings through numerous appeals that could go on for years," Mixon explained.

Although it's difficult to determine who will present the stronger case to the six women and two men sitting on the jury, Apple appears to have an advantage entering the courtroom.

"Apple has a stronger position because it has a verdict in hand that says Samsung infringed Apple's patents, that Samsung did do something wrong," Mixon said. "Now the court is trying to judge how big that wrong was and attach a value to it."

Global Struggle

The size of that wrong may be mitigated by Koh's decision to rebuff Apple's request that all devices containing infringing technology be barred from sale in the United States.

"That decision is currently being appealed, but if the judge had ruled the other way, that would have given Apple a big club in the case and it would have likely settled very quickly," Mixon noted.

As the case stands now, even if Samsung wants to settle, Apple has no incentive to do so.

"Apple has a stronger position because the question isn't will it get paid, but how much it'll get paid," David Newman, an attorney with Arnstein & Lehr, told MacNewsWorld.

Whatever the outcome of the trial, Apple wins.

"If you're in Apple's shoes, your downside is the damages might be decreased," Michael Lasky, a patent attorney with Schwegman Lundberg Woessner, told MacNewsWorld.

"They're still going to come out with 'You're a bad guy, Samsung,'" he said.

"From a public relations point of view, which you have to consider is probably more important than anything else in this whole case, Apple can't lose," Lasky added.

To some extent, the strategy in the current proceeding is being influenced by a much bigger struggle between the companies for supremacy over the $300 billion worldwide smartphone market.

"You're not seeing any settlements because this is such an important marketplace that both companies want to stake their position for the future," said Arnstein & Lehr's Newman.

"The mobile market is extremely important territory for any technology company to be in," he noted, "which is why you're seeing so much litigation overall."


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