The Supreme Court will hear oral arguments in the case of Apple v. Samsung on Tuesday regarding whether Samsung infringed upon the design of Apple's iPhone. The court will either maintain or reverse a $548 million fine that a lower court required Samsung pay Apple.
Ultimately, the court won't decide whether or not Samsung infringed – that argument has largely been ceded. Rather, the court will decide whether the infringed design – in this case a rectangular face with a grid of icons – should account for the entirety of Samsung's profits from its Galaxy line of phones.
Many attorneys that have filed amicus briefs with the court believe it should not. Lawyers like Professor Daryl Lim, the Director of the John Marshall Law School’s Center for Intellectual Property, Information and Privacy Law, believe that the court should instead set an apportionment precedent, wherein infringing parties would have to pay only an amount equivalent to the contribution of the infringing part.
“Design owners should be made whole, but not unjustly enriched. Awarding the infringer’s total profits regardless of the contribution of the design to the end product’s value subverts patent law’s mandate to promote technological progress,” Lim said in a statement. “Apple’s three infringed designs patents in this case protect a black, rectangular, a round-cornered front face, and the colorful grid of sixteen icons on the screen. To conclude that one of these designs drives purchasing decisions implies that none of the other contributions from Samsung or other innovators matter.”
The court's decision on this matter will therefore have far-reaching implications. Congress is unlikely to act on reforming patent law, especially in an election year. Therefore the precedent set by SCOTUS will define the landscape for the foreseeable future.
Some observers worry that maintaining the lower court's ruling – and setting a precedent wherein the infringing party must hand over 100 percent of its profits – would stifle innovation in emerging technologies, where new products often include hundreds of thousands of patents.
“If the Supreme Court does not reverse the lower court's ruling, it will have consequences for any individual or company that brings a product to the market,” said National Grange Executive Committee Member Leroy Watson in a statement. “The most immediate impact will be to the mobile technology industry, which includes many promising agri-tech start-ups.”
A related concern posits that such a precedent could enable patent trolls – people or entities who buy up thousands of patents in the hope of pursuing a lucrative lawsuit down the road. Design patents are currently very flexible for the patent-holder, making the area ripe for trolling.
“Our existing design patent law has been stretched too far. The Supreme Court should reverse this ruling and set the precedent now, otherwise it’s going to be a field day for patent trolls. Small businesses and startups are going to suffer the worst because they don’t have the money or the lawyers to fight off these trolls,” said Tim Sparapani, founder and principal of SPQR strategies, in a statement.
The court has been considering amicus briefs and will be hearing its first oral arguments tomorrow. Although the court is currently still at eight members due to continued Senate inaction on Merrick Garland's confirmation, a 4-4 tie on Apple v. Samsung is generally considered unlikely. In recent patent cases, the court is been able to reach unanimous decisions.