ECF No. Everything to Know about the New WIPO Sequence Listing Standard ST.26, Reasons to Hire an External Trademark Monitoring Services Partner, Direct and Indirect: Understanding the Types of Patent Infringement, How Patent Monitoring Service Can Safeguard Against Competition, Why Outsourcing to Trademark Search Companies is Recommended for Businesses, April 2011: In the actual legal action filed by Apple against Samsung, the former stated that Samsung had. at 6. Co. v. Apple Inc., 136 S. Ct. 1453 (2016) (granting certiorari). See Jury Instructions at 15-16, Columbia Sportswear N. Negotiation Training: Whats Special About Technology Negotiations? In response, Samsung sued Apple over 3G patents and stated that iPhone such as iPhone 4, iPhone 4S, and iPad 2 infringed its patents. The lesson? StartupTalky is top startup media platform for latest startup news, ideas, industry research and reports, inspiring startup stories. Had the Court agreed to give some version of Proposed Jury Instruction 42.1, Samsung could have identified a smaller article of manufacture in its closing argument. 1839 at 2088-92 (testimony of Apple's damages expert at 2012 trial); ECF No. It was a small company dealing in fried fish and noodles. According to a recent article by Steve Lohr of The New York Times, "Apple asserts that Samsung made 'a deliberate decision to copy' the iPhone and iPad."On the other side of the legal battle, Samsung contends . Supreme Court Decision, 137 S. Ct. at 432-33 (internal citation omitted) (quoting Dobson v. Hartford Carpet Co., 114 U.S. at 443). The U.S. Supreme Court's decision did not rule out the possibility that the relevant article of manufacture could be a multicomponent product. You might have noticed that brands launch a product that succeeds their existing product but, Why do brands cannibalize their products? 1, pp. In this case, Proposed Jury Instruction 42.1 raised the issue of whether the proper article of manufacture for Samsung's phones was the "product sold to a consumer [or] a component of that product." On March 21, 2016, the U.S. Supreme Court granted certiorari in this case. Cir. The Court does not read the U.S. Supreme Court's decision as narrowly as Samsung suggests. (emphasis added). Id. See 35 U.S.C. This turns the eyebrows up for Samsung. Apple was awarded $399 million in damagesSamsung's entire profit from the sale of its infringing smartphones. 2131 at 4. Do you side with Apple or Samsung in this dispute resolution case study? Court:UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA SAN JOSE DIVISION. Later the company saw the most profits from smartphone sales. Apple now advocates a test comprising four factors. This statement definitely rings true. After remand, the Federal Circuit remanded the case to this Court and held that "the trial court should consider the parties' arguments in light of the trial record and determine what additional proceedings, if any, are needed. In January 2007, Apple was ready to release their first iPhone to the world. 05 billion. We have grown from that time at a rapid scale and efficiency, we have seen multifold growth in technology. 2016). 1842 at 3165-68. "Absent some reason to believe that Congress intended otherwise . Throughout the proceedings, Samsung argued for apportionment. For example, the quoted sentence from PX25A1.16 and PX25F.16, Apple points out, actually reads: "The income approach to the value of the patent at issue is based on the future profitability of the products embodying the patented technology." for S. On September 8, 2017, the parties submitted cross-opening briefs on those issues. As the Court stated in its July 28, 2017 order, however, once an issue is raised to the district court, "[t]he fact that the proposed instruction was misleading does not alone permit the district judge to summarily refuse to give any instruction on the topic." "An error in instructing the jury in a civil case requires reversal unless the error is more probably than not harmless." Better screens for all its smartphones. Concerned that the Dobson cases weakened design patent law to the point of "'provid[ing] no effectual money recovery for infringement,'" Congress in 1887 enacted the predecessor to 289, which eliminated the "need to apportion the infringer's profits between the patented design and the article bearing the design." The plaintiff was also required to prove the defendant's total profit from the sale of the infringing article. at 22 (citation omitted). Accordingly, the defendant must bear the burden of production on any deductible costs that it argues should be subtracted from the profits proved by plaintiff. Although a design patent owner may recuperate the infringers total profits, the utility patent owner may recuperate his/her lost profits or a fair royalty. As we've mentioned, this involves comparing flagship phones by the two manufacturers. In its order on July 28, 2017, the Court held that "the jury was not provided an instruction that stated the law as provided by the United States Supreme Court decision in this case that an article of manufacture can be 'a product sold to a consumer [or] a component of that product.' 3524 ("Samsung Response"). The U.S. Supreme Court also said, "[R]eading 'article of manufacture' in 289 to cover only an end product sold to a consumer gives too narrow a meaning to the phrase." 2000)), abrogated on other grounds as recognized in Avid Tech., Inc. v. Harmonic, Inc., 812 F.3d 1040, 1047 (Fed. Sorry, something went wrong. Piano I, 222 F. at 904. However, the Court was unable to determine whether the jury instructions as given constituted prejudicial error until it resolved other issues, including the test for determining the relevant article of manufacture for the purpose of 289 and which party bore the burden of proving the relevant article of manufacture and the amount of total profits. Is Filing A Provisional Patent Application A Smart Decision? Cir. For which Apple was awarded $120 million, and Samsung with $160,000. See ECF No. The cases cited by Apple do not require a different result, as the Court explained in its July 28, 2017 order. 3490-2 at 17. As the U.S. Supreme Court has explained, Congress enacted the predecessor to 289 in 1887 in response to the U.S. Supreme Court's decisions in what are known as the Dobson cases. In 2011, when Apple was already embroiled with Motorola, it went after Samsung for tablet and smartphone designs. 3523 ("Apple Response"); ECF No. The jury in the partial retrial on damages awarded Apple $290,456,793, which the district court upheld over Samsung's second post-trial motion. The two companies had friendly relations with each other. . This Court also ordered a new trial on damages as to the infringing products for which Apple had been awarded damages for trade dress infringement and utility or design patent infringement to determine the damages for the utility or design patent infringement alone. On August 24, 2012, the first jury reached a verdict that numerous Samsung smartphones infringed and diluted Apple's patents and trade dresses in various combinations and awarded over $1 billion in damages. Koh conveyed that Apples request to prevent Galaxy Tab sales in the US had to wait until the completion of court procedures. Welcome back! ECF No. Am., Inc. v. Seirus Innovative Accessories, Inc., No. A US court has ordered South Korea's Samsung Electronics pay $539m (403m) in damages for copying features of Apple's original iPhone. Samsung relied on Bush & Lane Piano Co. v. Becker Bros., 222 F. 902 (2d Cir. at 11-12 (analogizing to the SEC enforcement and contract contexts). 3-4, pp. Id. Samsung however seemed like it was ignoring Apples claims of plagiarism and trying to put the burden on Apple themselves. Id. 378. A major part of Apple's revenue comes from them. In April 2011, Apple Inc. (Apple) sued Samsung Electronics, Co., Ltd. (Samsung) and argued that certain design elements of Samsung's smartphones infringed on specific patents for design elements in the iPhone that Apple holds. See id. A critical evaluation of the Competition between Samsung and Apple Samsung and Apple are among the largest manufacturers and suppliers of smartphones in the current global market. In fact, Samsung resisted attempts by Apple to obtain data about the costs of components of Samsung's infringing phones. 2) Accused of imitating the iconic iPhone's shape which in official terms is called as "tradedress" (e.g. The user market is much skewed in different directions. See ECF No. 17:12-17:20 ("[W]hat the sale might be relevant to is - might be relevant to - is step 2, what's the quantum of profit? 2007). "In Dobson v. Hartford Carpet Co., the lower courts had awarded the holders of design patents on carpets damages in the amount of 'the entire profit to the [patent holders], per yard, in the manufacture and sale of carpets of the patented designs, and not merely the value which the designs contributed to the carpets.'" The '647 patent discloses a system and method for de-tecting structures such as phone numbers, addresses, and dates in documents, and then linking actions or com-mands to those structures. The D'677 patent claims a design for a "black, rectangular front glass face with rounded corners" and does not claim the surrounding rim (bezel), the circular home button on the front, or the sides, top, bottom, or back of the device. On the other hand Samsung received zero damages for its . 3509. As the United States explained, "the scope of the design claimed in the plaintiff's patent . Your billing info has been updated. Apple Cir. Samsung overtakes Nokia in a handset market 7 Conclusion 9 Reference 10 Introduction . One of Samsung's expert reports written by Michael Wagner, which Samsung filed as part of its motion for summary judgment, included a damages theory that would have awarded Apple less profit than the entire profit on Samsung's infringing phones. Samsung then cited to the Piano cases, which Samsung argued applied the causation principle by "limiting [the] infringer's profits to those attributable to [the] design of [the] piano case rather than [the] whole piano." The question for which certiorari was granted was: "Where a design patent is applied to only a component of a product, should an award of infringer's profits be limited to those profits attributable to the component?" It tops in shipment volume & market share. In Samsung's view, the text of the statute is determinative. This market kind of seems like a fashion innovation. 2947 at 16 n.8. More specifically, a judgment may be altered based on an erroneous jury instruction by a party if "(1) [the party] made a proper and timely objection to the jury instructions, (2) those instructions were legally erroneous, (3) the errors had prejudicial effect, and (4) [the party] requested alternative instructions that would have remedied the error." As a result, on March 22, 2016, this Court vacated the March 28, 2016 trial and stayed the case. Consider a design patent for the decorative rim of a dinner plate. Your email address will not be published. The Instructions Were Legally Erroneous. This discussion was held at the 3 day executive education workshop for senior executives at the Program on Negotiation at Harvard Law School. Supreme Court Decision, 137 S. Ct. at 434. NTP, Inc. v. Research In Motion, Ltd., 418 F.3d 1282, 1311-12 (Fed. Samsung Opening Br. Corp., 890 F.2d 1215, 1232 (D.C. Cir. Samsung raised two theories to support its argument that design patent damages should have been less than Samsung's "entire profits on its infringing smartphones." Two years later, in 2009 Samsung came up with a touchscreen device for their market running on Google's android system. Id. Samsung, as it saw handsome revenues in the smartphones segment, mocked Apple in many ways. CONCLUSION Both of the Apple against/compared to/or Samsung lawsuits were a proof that design patent became a center of the modern fight. Apple and Samsung have finally settled a seven-year-long patent dispute, bringing to an end the long-running battle over the design of their rival smartphones. . See Burstein, supra n.4, at 59-61; Sarah Burstein, The "Article of Manufacture" in 1887, 32 BERKELEY TECH. A higher appeals court was also required to formally, July 2012: The dispute between the two firms which started in San Jose, California, was estimated to be resolved in four weeks. 3289. v. Sel-O-Rak Corp., 270 F.2d 635, 643 (5th Cir. In 1938, Lee Byung-Chul dropped out of college and founded a small business he named Samsung Trading Co. 2014) ("Where the smallest salable unit is, in fact, a multi-component product containing several non-infringing features with no relation to the patented feature . See ECF No. Id. After the succession of third heir Kun-hee, the company saw an opportunity in technology and he invested heavily in semiconductor technologies and transformed Samsung from a manufacturer into a global technology powerhouse. The Court next finds that the plaintiff initially bears the burden of production on identifying the relevant article of manufacture and proving the total profit on that article. In response, Apple accuses Samsung of misstating the evidence. But. Legal Case Review Apple vs. Samsung by Michel Andreas Kroeze BIA512 A legal case review submitted in partial fulfillment of the requirements for the degree of BACHELOR OF ARTS IN INTERACTIVE ANIMATION At SAE Institute Amsterdam 29/04/2013 Word count: 4332 Table of contents 1. . According to Samsung, "[t]he 'ordinary default rule' is that 'plaintiffs bear the burden of persuasion regarding the essential aspects of their claims,'" and there is no reason to stray from that rule in the instant case. Supreme Court Decision, 137 S. Ct. at 433 (quoting 24 Stat. Id. Samsung Response at 3, 8. The number of cases reached four dozen by mid-2012, wherein both firms claimed billions of dollars in damages. . The same with Apple, Samsung has its downsides as well. See Supreme Court Decision, 137 S. Ct. at 432-33. at 994-96. For the reasons below, the Court disagrees. The Federal Circuit held that Apple's claimed trade dress was not protectable under Ninth Circuit law and vacated the jury verdict as to Apple's trade dress claims. The Court now turns to which party bears the burden to establish the relevant article of manufacture and to prove the total profit on the sale of that article of manufacture. This explains why the jurys award based on infringement of a design patent was 100X the award based on infringement of a utility patent. There Was an Adequate Foundation in Evidence. Samsung ofcourse declined the offer, stating that the company hasn't done anything wrong and is not involved in copying Apple or violating any of the trademarks mentioned in the lawsuit. In this video, Professor Guhan Subramanian discusses a real world example of how seating arrangements can influence a negotiators success. In 2007, the word "computer" dropped to reflect the company's ongoing expansion into the consumer electronics market in addition to its traditional focus on . Instead of Proposed Jury Instruction 42.1, the Court gave Final Jury Instruction No. See Supreme Court Decision, 137 S. Ct. at 436; Federal Circuit Remand Decision, 678 F. App'x at 1014. They have not factored out, for example, the technology and what drives those profits." All rights reserved. After the 2013 trial, Samsung repeated verbatim in its Rule 50(b) motion for judgment as a matter of law the arguments Samsung made in its Rule 50(b) motion for judgment as a matter of law after the 2012 trial. Gershon, R 2013, 'Digital media innovation and the Apple iPad: Three . -Dhani, Adeena, Shubham, Rishabh (ICT Licensing) and the Editorial Team, Your email address will not be published. at 10; see Virnetx, Inc. v. Cisco Systems, Inc., 767 F.3d 1308, 1327 (Fed. The precedent is already set, however, and Apple is likely to use it to go after other Android phone makers. While Samsung could argue on the physical appearance being similar with iPhone but another thing the lawsuit included was trademark infringement. Behemoth organizations Samsung and Apple are the pioneers in this segment and one of the most famous rivals in the world. Check your inbox and click the link. However, the court case wasnt the first guard of Apple against Samsung. Id. If the court determines that a new damages trial is necessary, it will have the opportunity to set forth a test for identifying the relevant article of manufacture for purpose of 289, and to apply that test to this case." Galdamez, 415 F.3d at 1025 (quoting Obrey v. Johnson, 400 F.3d 691, 701 (9th Cir. See ECF No. applies the patented design . The first time Samsung raised its article of manufacture theory was in a trial brief filed on July 24, 2012, 6 days before the 2012 trial, which began on July 30, 2012. Writing as amicus curiae in support of neither party before the U.S. Supreme Court, the United States described the article of manufacture inquiry as "a case-specific analysis of the relationship among the design, the product, and any components." All through 2010 to August 2014, a bloody patent war transpired between two of the biggest companies in IT and the smartphone industry. The Court denied Samsung's motion on the same grounds as the motion for judgment as a matter of law following the 2012 trial. Once again, those factors are: Among the various proposals before the U.S. Supreme Court and this Court, this Court finds that the United States' proposal is the most likely to help the factfinder perform its task of identifying the article of manufacture to which the patented design was applied, "without unnecessarily sweeping in aspects of the product that are unrelated to that design." It widely talked against Apple and filed lawsuits claiming infringements of their company policies and patents. You can still see those commercials on YouTube. Id. at 10-11. Great! See Catalina Lighting, Inc. v. Lamps Plus, Inc., 295 F.3d 1277, 1290 (Fed. Samsung argued that Apple should have "limit[ed] its calculations of Samsung's profits to those attributable to use of the patented designs," which "violate[d] the causation requirement" that exists in "all patent infringement litigation." This Five Forces analysis (Porter's model) of external factors in Apple Inc.'s industry environment points to competitive rivalry or intensity of competition, and the bargaining power of buyers or customers as the primary forces for consideration in the company's strategic formulation. STRONG, 2 MCCORMICK ON EVIDENCE 342, p.433 (5th ed. The court in Columbia Sportswear assigned the plaintiff "the initial burden of producing evidence identifying the article of manufacture for which it seeks profits." 2271 at 12-13 (citing Nike, 138 F.3d at 1441 ("'It is expedient that the infringer's entire profit on the article should be recoverable,' for 'it is not apportionable' . Samsung argues that Apple's proposed test is defective because it omits fundamental considerations, such as the scope of the design patent, and introduces considerations that have no relationship to the text of 289, such as the infringer's intent. The Court denied Samsung's motion for judgment as a matter of law under Nike and the Federal Circuit's precedent forbidding the apportionment of design patent damages. The Samsung that we know today, wasnt this when it started. 1300 at 19-22. Apple and Samsung are very different companies, although they both produce smartphones. Co., Ltd. v. Apple Inc., 137 S. Ct. 429 (2016) (No. Make your practice more effective and efficient with Casetexts legal research suite. Samsung only raised its article of manufacture theory days before trial. See Henry Hanger & Display Fixture Corp. of Am. To come out of this deep pit, Something that will hopefully revolutionize personal computing. Type of paper: Essay. 3528 at 22:9-22:18, 23:2-23:7, 23:19-23:23, 24:8-24:10 ("Hearing Tr. . 1915) ("Piano I"), and Bush & Lane Piano Co. v. Becker Bros., 234 F. 79 (2d Cir. But with its S23 series, and more specifically the Galaxy S23 Ultra, Samsung upped its game quite significantly. at 436. The Federal Circuit affirmed the damages award, rejecting Samsung's argument that damages should be limited because the relevant articles of manufacture were the front face or screen rather than the entire smartphone. Accordingly, the Court addresses those factors in the next section. We can custom-write anything as well! ECF No. This setting should only be used on your home or work computer. Since then, iPhones have been the most popular phones in the world. 1959) (stating that the "burden of establishing" deductible overhead costs "rested upon the defendants"); Rocket Jewelry Box, Inc. v. Quality Int'l Packaging, Ltd., 250 F. Supp. Id. Conclusion In conclusion the issues or problems has been shown . Samsung also contends that some of Apple's proposed factors contradict the U.S. Supreme Court's decision in the instant case. Notably, 99 percent of the jury verdict was based on Samsung's infringement of design patents, with only about 1 percent (around $5 million of the approximately $540 million jury award) based on Samsung's infringement of utility patents. An appeals court ruled Apple could not legally trademark the iPhone's appearance in May of 2015, which meant Samsung was forced to pay only around $548 million. UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA SAN JOSE DIVISION. Hearing Tr. At the same time, Apple concedes that it bears "the ultimate burden of persuasion on the issue of damages." On March 6, 2014, the Court entered final judgment in favor of Apple in the amount of $929,780,039 on its design patent, utility patent, and trade dress claims. A federal court in Australia, December 2011 April 2012: Apple failed to block Samsung from selling some 4G-enabled products to US consumers. So at this time, it was in good economic condition. 1612 at 1367 (Apple expert Susan Kare stating that the D'305 patent is limited to "the rectangular area" represented by the phone's screen). The test for determining the article of manufacture for the purpose of 289 shall be the following four factors: The plaintiff shall bear the burden of persuasion on identifying the relevant article of manufacture and proving the amount of total profit on the sale of that article. Id. Lost your password? TECH. Apple Inc. v. Samsung Elecs. Essays Topics > Essay on Business. Exclusive Webinar Series. Apple initially sued Samsung on grounds of patent infringement. From that event, Samsung dared from being a supplier of technological equipment to a competitor in market share. Samsung contends that this is precisely the reasoning that the Federal Circuit adopted in the instant case, and it is also the reasoning that the U.S. Supreme Court rejected. So did Apple. Each company won numerous decisions against the other during 2012-2015, quite often in contradictory rulings from German, American, Japanese, South Korean, Italian, French, British, Dutch, and Australian courts. Adopting the United States' test is also consistent with actions of the only other court to have instructed a jury on 289 after the U.S. Supreme Court's decision in the instant case. Samsung countersued Apple for not paying royalties for using its wireless transmission technology. Famous Negotiations Cases NBA and the Power of Deadlines at the Bargaining Table, Power Tactics in Negotiation: How to Gain Leverage with Stronger Parties, No One is Really in Charge Hostage Taking and the Risks of No-Negotiation Policies, Examples of Difficult Situations at Work: Consensus and Negotiated Agreements. Second, it argued that Samsung's sales took sales away from Apple and resulted in Apple's losing market share. Conclusion: In conclusion, both devices come at a close tie and both are recommended for productivity users who need a business tablet. See generally GEORGE E. DIX ET AL., 2 MCCORMICK ON EVIDENCE 337 (7th ed.). As relevant here, Apple obtained the following three design patents: (1) the D618,677 patent (the "D'677 patent"), which covers a black rectangular front face of a phone with rounded corners; (2) the D593,087 patent (the "D'087 patent"), which covers a rectangular front face of a phone with rounded corners and a raised rim; and (3) the D604,305 patent (the "D'305 patent"), which covers a grid of 16 colorful icons on a black screen. at 23. J. L. & TECH. With regard to the scope of the design patent, the Court agrees with Apple that the relevant article of manufacture may extend beyond the scope of the claimed design. Apple was extremely infuriated with this and dragged the matter into court, showcasing that the company is super sensitive about this issue. Id. Id. Id. The following article discusses the design patent litigations and the battle of power between Apple and Samsung. 2607-5 at 16 (Apple's damages expert noting that he relied on "a file that reflects detailed information on [Samsung's] material costs for the Accused Products"). Specifically, Proposed Jury Instruction 42.1 included Samsung's now-abandoned apportionment theory and also defined the article of manufacture as invariably less than the entire product as sold. Samsung Response at 4. should have been limited to the profit attributable to the infringement" and that "consumers chose Samsung [products] based on a host of other factors [besides the infringed designs]." 4:17-4:18 (Apple's counsel: "I think adopting that test would be fine with Apple. Third, Samsung points to consumer survey evidence discussing the outer shape of Samsung's phones. After releasing the iPhone in 2007, Apple obtained design patents on a number of phone design features. 543 F.3d at 678, 681, 683. The jury ended up siding with Apple, agreeing that Samsung copied the black rectangle. In fact, the predecessor to 289 contained a knowledge requirement, but Congress removed the knowledge requirement when it passed the 1952 Patent Act. at 57-58. He explained that while Apple could be considered an "innovation" company, as its focus was with the design and the user interface, and Samsung could be considered a "manufacture" company. Hunter v. Cty. Samsung argues that there was a sufficient foundation in evidence to instruct the jury on the possibility of a lesser article of manufacture based on evidence that was presented to the jury as part of the parties' infringement and invalidity cases. Of misstating the evidence was awarded $ 120 million, and Samsung with $ 160,000 executive workshop!, 767 F.3d 1308, 1327 ( Fed, as it saw handsome revenues in the world Sarah,! Will hopefully revolutionize personal computing Jury ended up siding with Apple, agreeing that Samsung copied the black.! 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Super sensitive about this issue instant case Apple themselves ( `` Apple Response )... Shape of Samsung 's motion on the issue of damages. grounds as the motion for judgment as result!, No market is much skewed in different directions burden on Apple themselves at. Ultimate burden of persuasion on the same time, it was in good economic condition 11-12 ( analogizing to world... Devices come at a close tie and both are recommended for productivity users who a! Conclusion in conclusion, both devices come at a rapid scale and efficiency, have... Relied on Bush & Lane Piano co. v. Becker Bros., 222 F. (. The infringing article a matter of Law following the 2012 trial infringing smartphones design! Lawsuit included was trademark infringement product but, Why conclusion of apple vs samsung case brands cannibalize their products, 767 1308. Until the completion of Court procedures and noodles kind of seems like a fashion.. 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