Apple’s request for a US injunction against Samsung devices has been denied in a surprise twist
In a dramatic twist to Apple’s smartphone patent battle against Samsung, a US judge has denied the iPhone maker an injunction that would have blocked sales of particular Samsung models in that country, while also denying Samsung a retrial the company had sought on grounds of jury misconduct.
The two companies, which together control about half of the world’s smartphone sales, are battling in the US and elsewhere over who will dominate the massive market for connected devices. In the third quarter of this year Samsung shipped more than twice as many smartphones as Apple in that quarter, according to ABI Research.
“To the limited extent that Apple has been able to show that any of its harms were caused by Samsung’s illegal conduct… Apple has not established that the equities support an injunction. Accordingly, Apple’s motion for a permanent injunction is denied,” wrote Judge Lucy Koh in the decision handed down by the Northern District of California, the same court which in August ordered Samsung to pay Apple $1.05 billion (£650m).
While the fine is substantial, industry observers noted that it is not particularly relevant for a company with the cash reserves of Samsung – a sales ban was Apple’s real goal, and the fact that it has been denied is highly unusual, if not unprecedented, according to analysts.
“It may be unprecedented in the legal history of the United States for an injunction motion to be denied across the board despite such a large number of infringement findings (roughly half a dozen) by a jury,” wrote patent analyst Florian Mueller in an advisory, while Intellectual Asset Management (IAM) magazine’s Joff Wild called the decision “sensational and unexpected”.
Judge Koh’s decision, if upheld on appeal, would create a precedent that would make it almost impossible for a patent holder to prevail under similar circumstances, according to Mueller, arguing that this makes it unlikely that the decision will be upheld by an appeals court.
Strategic win for Samsung
However, the appeals process that Apple will certainly launch is likely to take at least a year to show results, which means that strategically Koh’s decision is “a huge defensive success for Samsung’s lawyers”, Mueller wrote.
“It doesn’t matter much that the products against which Apple was seeking this particular injunction have mostly become obsolete by now: there would have been different ways, through enforcement proceedings as well as (if necessary at all) new lawsuits, to extend the ruling to new products having the same infringing characteristics,” he wrote. “Samsung would have had to modify all of its products in order to work around an injunction.”
Judge Koh argued that in order to be granted an injunction, Apple needed to show that harm to its sales resulted specifically from Samsung’s patent infringement, rather than from the company’s overall competitive activity, and she said Apple failed to do so.
“Customer demand for a general feature of the type covered by a patent was not sufficient; Apple must instead show that consumers buy the infringing product specifically because it is equipped with the patented feature,” she wrote. “Though evidence that Samsung attempted to copy certain Apple features may offer some limited support for Apple’s theory, it does not establish that those features actually drove consumer demand.”
She found that Apple’s design-related allegations referred to qualities that Apple does not have a patent on, such as “glossiness, reinforced glass, black colour, metal edges and reflective screen”.
The decision also endorses Samsung’s position that its success relies, at least in part, on non-patentable qualities such as “fun” and “ease of use”, according to Mueller.
“When I reported on Samsung’s opposition to Apple’s motion, I highlighted the statement that ‘Apple can claim no patent on ‘fun’ and no monopoly over ‘ease of use”,” he wrote.
However, he argued that the decision sets the bar too high for patent holders seeking injunctions, which adds weight to the probability that the decision will not survive the appeals process.
“Under the current circumstances, prior to some kind of correction or clarification by the Federal Circuit, patent holders are increasingly going to choose jurisdictions such as Germany, where injunctive relief is a given once infringement has been proven (except under certain circumstances specific to standard-essential patents),” Mueller wrote.
Apple position weakened
IAM Magazine’s Wild argued that the decision dramatically alters Apple’s competitive situation.
“If Apple does not get the ruling overturned, the entire dynamic of the smartphone patent wars will have changed dramatically – with Apple’s position fundamentally weakened and its ability to dictate a winning settlement significantly undermined,” he wrote. “Not too long ago, the company’s management could well have dictated a very powerful and favourable deal with Samsung. Now, as Android is gaining increasing traction among consumers, they find themselves just one decision away from seeing their entire strategy blow up in their faces.”
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