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  • The Apple/Samsung Lawsuits: Time for Sanity?

    May 7th, 2014

    I understand why some of my colleagues didn't pay a whole lot of attention to the latest legal skirmish between Apple and Samsung. It did get a lot of play in the mainstream media, but I understand why the rest of us have become very bored at this never-ending process.

    Now in case you've just tuned in, the verdict last week was somewhat mixed. Apple won some, lost one. Samsung was ordered to pay almost $120 million in damages, and Apple was ordered to pay Samsung a pittance for violating a patent that the company only recently bought from Hitachi. In other words, Samsung had to buy something to get even a token victory.

    That result ought to be sufficient to bring this sorry intellectual property war to a close. Samsung has had no notable victories, and Apple has won most times, but has yet to collect any money. Isn't it time for saner, calmer heads to prevail?

    Instead, Samsung is simply going to appeal, believing that the award was too high. Indeed, during the trial before Judge Lucy Koh and a jury of eight in a California Federal Court, Samsung didn't argue so much against violating any patents, only that the patents really weren't worth anything. So I suppose the verdict, awarding just 5.5% of the $2.2 billion that Apple sought, was a reasonable compromise.

    Or simply logical, since the violations consisted of individual features that could hardly be valued at more than a few dollars for each unit sold that infringed on the technology. I mean is Apple Data Detectors really worth anything more despite being a really useful feature? That's just one example.

    Some members of the media regarded it as a hollow victory for Apple, since Samsung wasn't assessed billions of dollars. But that doesn't mean the jury's award can't be changed. The violations were, they ruled, "willful," which means Judge Koh could triple the damages. But her conduct during the entire affair was focused on restricting the number of patents to be tried, and the amount of time the two sides could spend in presenting their cases.

    That, to me, says "let's just get this over with, please!"

    But there's more. You see, the jury foreman, Tom Dunham, whose work experience included working on patent-related issues at IBM, said that Apple should be suing Google, not the handset makers. According to a Wall Street Journal report, Dunham said, "If you really feel that Google is the cause behind this, as I think everybody has observed, then don’t beat around the bush. Let the courts decide. But a more direct approach may be something to think about."

    Maybe, but it's also true that Samsung earns far more money from selling Android gear than Google earns from offering the free OS. The latter's revenue stream is all about ad clicks. But it's also reported that Google apparently agreed to pay some of Samsung's legal expenses. This is indeed a proxy war, and maybe the message here is that, where the violation involves an Android-specific feature — and that was only true for two of the infringed patents — Apple should ask Google to make good on paying for the violation. This doesn't mean that an Android licensee isn't also responsible, simply because the feature is used in the OS shipped with the handset, but it may take this fight directly to the source.

    You wonder why Apple hasn't made that move, and I don't think it's about not having the courage to fight Google directly. Indeed, Google still earns a lot of money from Apple's desktop and mobile platforms, so I suppose it's possible that a direct legal battle between the two might just be the ticket to resolve these disputes once and for all.

    Meantime, Samsung is evidently going to fight this war until the end whenever that is, which seems a foolish move. How long do they expect to continue to hold off a final decision before it no longer makes sense? Well, that point has probably already been reached. HTC, which doesn't have near the resources of Samsung, took the sensible approach and made a deal. Apple and Samsung were ordered to negotiate by Judge Koh, but no settlement was reached, though I wouldn't presume to guess which party was responsible. Maybe both.

    As many of you know, Apple and Microsoft settled their long-term intellectual property disputes long ago. They are frenemies, competing in some areas, working together in others, and the association has been productive for both. Office for the iPad, for example, appears successful, and the iPad platform has more credibility in the enterprise as a result.

    Samsung, however, has a hard-won reputation has being ruthless and not always above board in dealing with others. So maybe that's part of the corporate DNA. But with billions of dollars of component sales with Apple at stake, you wonder what purpose is served in dragging this out yet again. Maybe if Judge Koh does grant triple damages, Samsung will change its tune, but I wouldn't bet on it.



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