at 9. The judge eventually reduced the payout to $600 million. 2002); Mark A. Lemley, A Rational System of Design Patent Remedies, 17 STAN. Case No. MARKETING STRATEGY AND 4Ps ANALYSIS: APPLE VS. SAMSUNG I. ECF No. Though Samsung defended itself and the injunction was reduced to German markets, it was still a big win for Apple. 1117(a)). Apple vs Samsung Presentation - Free download as Powerpoint Presentation (.ppt / .pptx), PDF File (.pdf), Text File (.txt) or view presentation slides online. Be it flying, cooking, innovating, and even revolutionizing the whole world with unbelievable technology. Moreover, at the October 12, 2017 hearing, both parties stated that they found the United States' test acceptable. In Samsung's reply brief in support of its motion for judgment as a matter of law, Samsung argued that Apple "fail[ed] to offer any evidence that [the profits awarded in the instant case] are the profits from the 'article of manufacture' at issue, which is the phones' outer casings or GUI." The factors that the United States identified were: Notwithstanding the parties' apparent general agreement with the United States' proposed test during oral argument before the U.S. Supreme Court, both parties now advocate different tests, which only partially overlap with the United States' proposed test. The Court concludes that the plaintiff bears the burden of persuasion on identifying the relevant article of manufacture and proving the defendant's total profit on that article. The terms were not disclosed. Given that Samsung is one of Apples biggest suppliers, the companies had a strong incentive to move beyond their dispute and build on their ongoing partnership. Full title:APPLE INC., Plaintiff, v. SAMSUNG ELECTRONICS CO. LTD., et al., Defendants. 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. The Court addresses these arguments in turn, and then the Court assesses the United States' proposal. Id. Hearing Tr. Cal. 10 individuals based in Santa Clara, California, were selected as the jury from a. Assigning the defendant a burden of producing evidence to support its position is thus consistent with other disgorgement remedies, where the defendant bears the burden of proving any allowable deductions that decrease the amount of total profit. 1978); see Galdamez v. Potter, 415 F.3d 1015, 1023 (9th Cir. The Court has already determined that "Samsung objected to the exclusion of Proposed Jury Instruction 42.1 in a proper and timely manner that was in compliance with Rule 51." Samsung Elecs. iPhone vs Samsung Galaxy Design. Gershon, R 2013, 'Digital media innovation and the Apple iPad: Three . Apple 1 was the first computer handmade by Steve Wozniak (Apple co-founder) under the name Apple in 1976. Apple dominates in wearables Industry. At most, Apple says Samsung would be entitled to 0.0049 for each chip based on FRAND patent licensing terms (with FRAND referring to Fair, Reasonable and Non-Discriminatory). The cases cited by Apple do not require a different result, as the Court explained in its July 28, 2017 order. Cir. The plaintiff also bears a burden of production on both issues. See PX6.1 (commentary about Samsung's Galaxy S phone and its "all black, shiny plastic body" and the "minimal buttons on the phone's face"). at 18. 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After two jury trials and decisions by both the Federal Circuit and the United States Supreme Court, the instant case has been remanded for a determination of whether the jury's $399 million award in favor of Apple for design patent infringement should stand or whether a new damages trial is required. While Samsung could argue on the physical appearance being similar with iPhone but another thing the lawsuit included was trademark infringement. . It was not clear Wednesday how much more, if anything, Apple. Your email address will not be published. The Court does not read the U.S. Supreme Court's decision as narrowly as Samsung suggests. 4:17-4:18 (Apple's counsel: "I think adopting that test would be fine with Apple. The Court refers to Samsung Electronics Company, Samsung Electronics America, and Samsung Telecommunications America collectively as "Samsung" in this order. The U.S. Supreme Court interpreted the Federal Circuit's decision in the instant case as adopting a per se rule that "the relevant 'article of manufacture' must always be the end product sold to the consumer." Incorporated in 1977, the company was called " Apple computer". Moreover, Samsung argued that "[t]he record contains no evidence that the entire sales value of Samsung's products was attributable to their outer casings or GUI, as opposed to the numerous noninfringing technological components that enable the devices to function and drive consumer choice." Id. It widely talked against Apple and filed lawsuits claiming infringements of their company policies and patents. Apple argues that the Court did not err by declining to give Proposed Jury Instruction 42.1 because there was not an adequate foundation in the evidence for it. In Negotiation, How Much Authority Do They Have? This is in part because "historically, the concept encompassed two distinct burdens: the 'burden of persuasion,' i.e., which party loses if the evidence is closely balanced, and the 'burden of production,' i.e., which party bears the obligation to come forward with the evidence at different points in the proceeding." "While it is unnecessary to give instructions unsupported by the evidence, a litigant is entitled to have the jury charged concerning his theory of the case if there is any direct or circumstantial evidence to support it." at 23. at 10-11 (citing, e.g., Concrete Pipe & Prod. ECF No. The burden then shifts to the party opposing the new trial "to demonstrate 'that it is more probable than not that the jury would have reached the same verdict' had it been properly instructed." The United States advocates a different burden-shifting regime. of Oral Arg. This article is the dissection of the silent raging war between Apple and Samsung. However, the Court granted judgment as a matter of law as to the 2012 jury verdict on the theory that Apple's utility and design patent infringement damages numbers relied on improper notice dates. The history of 289 provides important context for understanding the progression of the litigation in the instant case, as well as the competing policy considerations implicated by the formulation of a test for determining the relevant article of manufacture under 289. The Court then analyzes the various approaches. Humans are amazing animals, I mean we are smart and can do almost anything. 3509. It was their first computer that supported GUI or Graphic user interface, which allows the user to communicate with the computer in graphical mode. We can custom-write anything as well! After releasing the iPhone in 2007, Apple obtained design patents on a number of phone design features. However, there have been some production or distribution wins as well. Cir. In 2011, when Apple was already embroiled with Motorola, it went after Samsung for tablet and smartphone designs. 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. See ECF No. How to Find the ZOPA in Business Negotiations. Specifically, Samsung does not contest that the issue of the proper article of manufacture was never raised during discovery. See Apple Opening Br. Samsung paid $1 billion in compensation to the iPhone designer. For instance, in August 2011, a German court ordered an injunction on the Samsung Galaxy Tab 10.1 across the EU for infringing Apples interface patent. 3509 at 27 n.5. at 9. See Apple Opening Br. Id. See Hearing Tr. See, e.g., U.S. Patent No. 302, 312 (1832)). On August 24, 2012, the first trial of the Apple vs. Samsung case took place. See DX2519 at 5-11. 2131 at 4. According to Apple, this test would mean that a complex multicomponent product could never be the relevant article of manufacture, because a design patent may only cover the "ornamental appearance of an article of manufacture," not "internal or functional features." In 2016, the Supreme Court reviewed this case and held that the net profit damages for infringing design patents need not be calculated based on the product sold to the consumer. "At that point, the plaintiff has made out a prima facie case under 289," and the "burden then shifts to the defendant, if it so chooses, to prove that the damages should be reduced" by proving a lesser article of manufacture or identifying deductible costs. See, e.g., ECF No. It also goes through the case of Apple Vs Samsung and the judgement given by the court. The Court Rule and Afterwards As a result, on March 22, 2016, this Court vacated the March 28, 2016 trial and stayed the case. Negotiation in Business Without a BATNA Is It Possible? | Apple Tax Avoidance Strategy. 504 and 15 U.S.C. Samsung cites three categories of evidence to show that the jury could have found an article of manufacture that was less than the entirety of each infringing Samsung phone. In the October 12, 2017 hearing, Samsung conceded that evidence of how a product is sold would be relevant to determining the amount of total profit on the relevant article of manufacture. Both sides had said they hoped to avoid a legal battle. Samsung Response at 7-13. ECF No. With respect to design patent damages, Samsung argued on appeal that "the district court legally erred in allowing the jury to award Samsung's entire profits on its infringing smartphones as damages." To remove him, Steve initiated a move that backfired and ended up removing himself from the board. As explained above, Samsung advocates that the factfinder should "compar[e] the claimed attributes of the design patent to the accused product to identify the specific part, portion, or component of the product that corresponds to the patent's claim." Whatever it will be, humans are fascinated and the future is exciting. 2014-1335, 2014-1368, 2014 WL 2586819 (Fed. The precedent is already set, however, and Apple is likely to use it to go after other Android phone makers. The testimony about the various components of the phones at issue, together with the design patents themselves, is enough to support Proposed Jury Instruction 42.1. c. Legal Error in the Proposed Instruction Would Not Have Excused the Court From Properly Instructing the Jury. StartupTalky is top startup media platform for latest startup news, ideas, industry research and reports, inspiring startup stories. Id. ECF No. However, the U.S. Supreme Court has confirmed that the "superior knowledge" burden-shifting principle is "far from being universal, and has many qualifications upon its application." How Apple avoided Billions of Dollars of Taxes? Supreme Court Decision at 434. Id. As explained above, the U.S. Supreme Court and the Federal Circuit declined to specify how courts or juries are to identify the relevant article of manufacture for the purpose of 289. Id. 289, instead appealing only to procedural and policy arguments for allowing apportionment in this case."). When the system detects a Moreover, the U.S. Supreme Court did not hold that how a product is sold is irrelevant to the article of manufacture inquiry. See Micro Chem., 318 F.3d at 1122. It went from being an ally to a fierce enemy. Samsung and some commentators have expressed concern about the administrability of a multifactor test, which they contend is vague and will yield unpredictable results. For two days in late May 2012, Apple CEO Tim Cook and Samsung CEO Gee-Sung Choi met with a judge in the U.S. District Court of Northern California in an attempt to reach a settlement in a high-profile U.S. patent case, a sobering example of negotiation in business. 2784 at 39 (same for 2013 trial); Opening Brief for Defendants-Appellants, Apple Inc. v. Samsung Elecs. "), the dinner plate example shows that Samsung's test as written does not produce a logical result, even when applied to a simple unitary product. Great! Id. Schaffer v. Weast, 546 U.S. 49, 56 (2005) (quoting J. The Court held a hearing on October 12, 2017. 3524 ("Samsung Response"). . Galdamez, 415 F.3d at 1025 (quoting Obrey v. Johnson, 400 F.3d 691, 701 (9th Cir. As we've mentioned, this involves comparing flagship phones by the two manufacturers. 17:8-17:9. What is Crisis Management in Negotiation? The number of cases reached four dozen by mid-2012, wherein both firms claimed billions of dollars in damages. Apple argues that "[i]f the defendant typically sells its asserted article of manufacture as part of a unitary product, the factfinder may reasonably infer that the defendant has applied the patented design to the product as a whole." . The strategies used by Apple Inc. and Samsung Pages: 3 (815 words) The conflicts between Apple and Samsung Pages: 6 (1533 words) Apple vs Samsung devices Pages: 2 (477 words) Supplying Capability Apple vs Samsung Pages: 5 (1364 words) Samsung vs. Apple - The smartphone wars Pages: 6 (1605 words) Victory for Apple or Samsung Pages: 5 (1496 words) On remand, Samsung sought a new trial on design patent damages on the ground that, in light of the U.S. Supreme Court's interpretation of "article of manufacture" in this case, this Court provided legally erroneous instructions to the jury that prejudiced Samsung. The Court then examines the burden of production on these same issues. This disparity in demographics is a good indicator of the product market. Co., 678 F. App'x 1012, 1014 (Fed. While tech hulks like these two fight for global dominance and the crown of the most innovative technology pioneer, it is sure that smartphones are a hot topic. 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. The defendant then bore "the burden of proving that the article of manufacture [wa]s something less than the entire product." Apple Opening Br. The Court gave Final Jury Instruction 31 on design patent damages, which was substantially the same as the 2012 trial's Final Jury Instruction 54, edited only to reflect the fact that liability had already been determined. In addition, the United States' fourth proposed factor includes whether "the design is embodied in a component that is manufactured separately from the rest of the product, or if the component can be sold separately." The titans are involved in the battle that aims to take off each other's product off the shelve, where billions of dollar are on the line. Apple says. Save my name, email, and website in this browser for the next time I comment. Its CEO at that time did meet several times with Steve jobs for advice or negotiations. The question before us is whether that reading is consistent with 289. On September 8, 2017, the parties submitted cross-opening briefs on those issues. 2316 at 2. The most famous Samsung phones are Galaxy, after the first launch in 2009. 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. . Surprisingly, the company was not even in the technology business at its inception in 1938. The Court addresses these issues in turn. However, Samsung's argument had two parts. 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." case was pending in the district court. However, because the Court finds the United States' articulation of this factor preferable, the Court declines to adopt Apple's first factor as written and instead adopts the United States' fourth factor, as explained in more detail below. Samsung paid that amount in. Hearing Tr. 1931. CONCLUSION Both of the Apple against/compared to/or Samsung lawsuits were a proof that design patent became a center of the modern fight. ECF No. 1999)). v. Citrix Sys., Inc., 769 F.3d 1073, 1082 (Fed. REP. NO. Id. 2840 at 704-08 (testimony of Apple's damages expert at 2013 trial); PX25A1.16 (Apple's 2012 trial exhibit summarizing its damages contentions); PX25F.16 (same for 2013 trial)). . Apple being the biggest tech company earns billions of dollars in revenue but it doesnt pay billions in tax. Cir. The Negotiation Journal Wants to Hear From You! All these were some specific irks for Samsung. August 2011: Apple sued Samsung for patent infringement through its products, including the Samsung Galaxy Tab 10.1. For example, 284 does not mention burden shifting, but the Federal Circuit endorses burden-shifting in the lost profits context under 284, as discussed above. The reason is that it is already a brand, a valuable brand which has managed to make a place in the hearts of people all around the world. Apple Inc. v. Samsung Elecs. The U.S. Supreme Court framed the question before it as follows: "[T]he Federal Circuit identified the entire smartphone as the only permissible 'article of manufacture' for the purpose of calculating 289 damages because consumers could not separately purchase components of the smartphones. On the other hand Samsung received zero damages for its . Apple is one of Samsung's biggest phone component customers and Samsung is one of Apple's biggest suppliers. ECF No. The U.S. Supreme Court's decision did not rule out the possibility that the relevant article of manufacture could be a multicomponent product. See ECF No. Oct. 22, 2017). While Samsung Galaxy phones have punch-holes, flat or curved screens, and rear camera modules with four or more camera sensors. 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?" Thus, Apple bears the burden of proving that it is more probable than not that the jury would have awarded profits on the entire phones had it been properly instructed. The entire spat began when Apple documented suit against Samsung in April 2011, blaming its opponent for duplicating the look and feel of its iPhones and iPads. Better screens for all its smartphones. Samsung contends that, as a matter of law, the "relevant article of manufacture does not include any part, portion, or component of a product that is disclaimed by the patent." (internal quotation marks omitted)). However, the U.S. Supreme Court "decline[d] to lay out a test for the first step of the 289 damages inquiry in the absence of adequate briefing by the parties." Samsung relied on Bush & Lane Piano Co. v. Becker Bros., 222 F. 902 (2d Cir. It faced overheating issues. Apple vs.Samsung Apple and Samsung are the world's two largest high-end mobile providers.Apple and Samsung are major competitors but are also business partners.Apple is one of Samsung's biggest phone component customers and Samsung is one of Apple's biggest suppliers. Overall, the Court's allocation of the burdens of persuasion and production is consistent with how the court in Columbia Sportswear instructed the jury in that case. . 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." Apple and the United States argue that a burden-shifting framework would be consistent with the principle that the party with superior knowledge of or access to the relevant facts should bear the burden of proving those facts. Moreover, Apple offers no reason why ordinary discovery would not be sufficient to allow a design patent plaintiff to carry its burden of persuasion on identifying the relevant article of manufacture. This default rule applies to proving infringement and damages in patent cases. The Federal Circuit noted that this theory essentially advocated "apportionment," which would "require[] [the patentee] to show what portion of the infringer's profit, or of his own lost profit, was due to the design and what portion was due to the article itself." ECF No. APPLE INC. v. SAMSUNG ELECTRONICS CO., LTD. 7 . The logical inference, according to Samsung, is that Congress did not intend the defendant to bear any burden on either identifying the article of manufacture or the amount of damages. The same thing vise versa, people who choose Samsung are mostly looking for a cheaper phone, wider choice, expandable storage, easily customized, and an open-source. The plaintiff also bears an initial burden of production on both of these issues. Laborers Pension Tr. 54, which read in relevant part: After a thirteen day jury trial from July 30, 2012 to August 24, 2012 (the "2012 trial") and approximately three full days of deliberation, the jury reached a verdict. Samsung Opening Br. At oral argument on October 11, 2016, Samsung abandoned its apportionment argument, and thus interpretation of the term "article of manufacture" was the only issue before the U.S. Supreme Court. As explained above, Samsung contends that a new trial is warranted because the jury instructions given inaccurately stated the law on the article of manufacture issue. This makes the rivalry public and leads to polarisation in the market. .") The Billion Dollar Samsung Apple Lawsuit Don't miss the opportunity, Register Now. 1839 at 201-02. May 23, 2014). A powerful and more affordable mid-range device. Id. ECF No. Supreme Court Decision, 137 S. Ct. at 433 (quoting 24 Stat. 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." 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. But in the case of a unitary object such as a dinner plate, the object must be the relevant article of manufacture, even where the design patent disclaims part of the object. v. First City Fin. Supreme Court Decision, 137 S. Ct. at 432-33 (internal citation omitted) (quoting Dobson v. Hartford Carpet Co., 114 U.S. at 443). In the 284 lost profits context, the patentee "must show that 'but for' infringement it reasonably would have made the additional profits enjoyed by the infringer." Since then, iPhones have been the most popular phones in the world. The jury held that Samsung had infringed on Apple's patents and awarded over $1 billion in damages. Moreover, the longer they spend fighting each other, the more contentious and uncooperative they are likely to become. 4. The Instructions Did Not Properly State the Law. An appeal is expected. Apple Inc. v. Samsung Elecs. 2014) ("Where the smallest salable unit is, in fact, a multi-component product containing several non-infringing features with no relation to the patented feature . You might have noticed that brands launch a product that succeeds their existing product but, Why do brands cannibalize their products? . Your billing info has been updated. at 679. 287(a) (predicating infringement damages in certain circumstances on proof that "the infringer was notified of the infringement and continued to infringe thereafter"). Apple spends billions on Samsung flash memory, screens, processors, and other components. Accordingly, the Court addresses those factors in the next section. In the ongoing war between Apple and Samsung, no matter who emerges as the winner, the consumer will continue to lose unless the companies agree on having a healthy competition and offering their best products. Lost your password? It filed a lawsuit against Samsung in serious violations of patents and trademarks of Apples property rights. Since then, the number of patents under dispute has skyrocketed, according to the Korea Times, as has the number of courts involved in various countries. Samsung argued that "Apple [has not] made any effort to limit the profits it's seeking to the article to which the design is applied. The document stated that Samsung will pay 30$ on selling every smartphone and 40$ on every tablet. Lets find out. Cir. Id. 41:22-23; Apple Response at 9. Without such an instruction, Final Jury Instructions 53 and 54 would direct a jury to find that the article of manufacture and product are the same." Samsung owes Apple $539M for infringing iPhone patents, jury finds Samsung scores unanimous Supreme Court win over Apple Apple, Samsung agree to bury overseas litigation ax The initial. In 2011, when Apple was already embroiled with Motorola, it went after Samsung for tablet and smartphone designs. As this example of negotiation in business suggests, mediation as a dispute resolution technique between business negotiators is far less likely to succeed when the parties are grudging participants than when they are actively engaged in finding a solution. See 35 U.S.C. Apple and Samsung are major competitors but are also business partners. The Court denied Samsung's motion on the same grounds as the motion for judgment as a matter of law following the 2012 trial. 2842 at 113. The jury awarded approximately $1.049 billion to Apple on its infringement and trade dress claims. Accordingly, Samsung urges the Court to "keep how the product is sold totally out of the test for determining the relevant article of manufacture. All Rights Reserved. Later the company saw the most profits from smartphone sales. Id. at 7-9; Samsung Opening Br. Then followed by Apple 2 which was more successful than the predecessor. For the foregoing reasons, the Court orders a new trial on damages for the D'677, D'087, and D'305 patents. Apple iPhones have big notches on the front, flat screens, and rear camera modules with three or fewer rings. Second, other courts in design patent cases have assigned the burden on deductible expenses to the defendant. Performance is often better than the technical specifications suggest. See ECF No.
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