The argument was made on the second day of a trial in one of the main arenas for the gladiatorial Apple-Samsung battle, Australia. Here, Samsung is alleging, in a countersuit, that Apple infringes three of its 3G patents in the iPhone 4 and 4S and the iPad 2. Apple said it uses but does not infringe on one of the items – “a method and apparatus for data transmission in a mobile telecommunication system supporting enhanced uplink service.”
Apple lawyer Stephen Burley said the IPR was used via Qualcomm's baseband chips, but that Samsung had failed to check how the device actually performs the function at issue. The standard is open to interpretation in this case and Apple has not taken the same approach as Samsung in implementing, he said.
Burley also denied Samsung's claims that Apple had rejected further negotiations to license its IPR on a fair, reasonable and non-discriminatory (FRAND) basis. “Apple has not refused to negotiate with Samsung. Apple continues to be willing to negotiate on FRAND terms for Samsung's standards essential patents, including the three involved in this suit," he said. The case will continue in late August.
Another twist in the saga emerged from the Australian hearings, when Samsung admitted it had ended a patents truce with Qualcomm once the Apple war kicked off. Previously, the Korean firm had signed a deal not to sue Qualcomm or its customers for using Samsung 3G IPR, but that was called off when Apple filed its lawsuit against the Galaxy Tab. According to court documents in Australia, this pact was first made back in 1993.
“There was an agreement between Samsung and Qualcomm. That agreement was not a license agreement. It contains a contractual provision that Samsung would not sue Qualcomm or customers of Qualcomm who apply [the 3G patents].”
Apple seeks billions in damages
Meanwhile, over in the US, Apple has decided that Samsung owes it $2.5 billion to settle American infringement claims. According to Florian Mueller of Foss Patents, the amount is based on per-unit royalties for several technologies - $2.02 for an “over scroll bounce” patent, $3.10 for the “scrolling API” technology, $2.02 for “tap to zoom and navigate,” and in addition, $24 to cover the use of any of Apple's “design patents or trade dress rights.” That, once again, puts design rather than technology IPR at the heart of the claims, a controversial tactic which has been a hallmark of Apple’s assault on its arch-rival.
As summarized by Mueller, Apple's argument goes that Samsung set itself the goal of being the leader in smartphone and tablets and “it chose to compete by copying Apple. Samsung's infringing sales have enabled Samsung to overtake Apple as the largest manufacturer of smartphones in the world. Samsung has reaped billions of dollars in profits and caused Apple to lose hundreds of millions of dollars through its violation of Apple's intellectual property. Apple conservatively estimates that as of March 31, 2012, Samsung has been unjustly enriched by about [redacted; presumably $2 billion] and has additionally cost Apple about $500 million in lost profits. Apple also conservatively estimates that it is entitled to over $25 million in reasonable royalty damages on the proportionately small set of remaining sales for which it cannot obtain an award of Samsung's profits or Apple's own lost profits, for a combined total of $2.525 billion.”
As the stakes get higher, top executives from both firms – Apple chief Tim Cook and Samsung vice chairman Choi Gee-sung – met for the second time last week to try to reach an agreement before a key trial starts in California. According to Reuters, no agreement was reached and the trial is scheduled to begin in San Jose on July 30.
And Samsung has suffered another blow in Germany, where a Dusseldorf court has ruled that an existing ban on the Galaxy Tab 7.7 can be extended across the whole European Union, though it also ruled that the Tab 10.1N (which was amended to get round Apple design patents) could remain on sale.
The smaller model was banned in Germany last September and the injunction is now applied to all 27 EU states. But the EU judgement may conflict with a recent decision in the UK High Court, which said three Samsung products, including the Tab 7.7, did not infringe Apple's design IPR (because they were “not cool enough”). All these rulings are preliminary and full trials on the alleged violations still await, but vendors are increasingly seeking to remove their rivals' gadgets from the stores while they wait for the court proceedings to take place.
In another of Apple's US patent fights, this one with Google/Motorola, both firms have appealed against Judge Richard Posner's decision to dismiss their case in Chicago – a ruling which some believed could lead to a shake-up of the whole IPR litigation process.
Posner cancelled a jury trial on June 22, saying neither vendor had been able to prove they would be damaged by the claimed infringements, and he also forbade them from bringing the tit-for-tat case back again. Posner has also been critical of the whole process of using patent litigation as a competitive weapon.