In late August the jury was in, and Samsung was out.
US$1.05 billion (NZ$1.28b) out - of pocket, that is. The South Korean manufacturer, which still maintains that a phone manufacturer shouldn't own the "rectangle phones with rounded corners", was ordered to pay Apple for patent infringement. Apple's claim was simple - it believed its iPhone technology and design have been copied numerous times, and Samsung was determined to "illegally cash in on the success of the revolutionary device".
Apple pioneered a new wave of smartphone back in 2007 with the first model iPhone. And Samsung, like many other manufacturers, responded to market demand with alternatives. This is how technology has developed throughout recent history.
The first clamshell laptop was made in 1979 by a company called GriD. Four years later Microsoft's TRS-80 Model 100 followed, as did the Macintosh Portable, Compaq's LTE, and so on. Sony made its first Walkman in 1980; Panasonic and others later followed. Philips introduced the first 42-inch plasma screen in 1997, Pioneer followed with a similar television, and others soon jumped on board. Patent lawsuits have followed all of the above inventions in one way or another, normally resulting in back-royalties, payouts and cross licensing of respective technology. Why now, then, has Apple's lawsuit against Samsung been so prolific? Aren't Samsung's developments just a part of the technological growth?
Theoretically, yes they are. However Apple runs its brand as a cartel - it creates addictive products, keeps them at high prices, and restricts competition. And while Apple won't wipe out Samsung, it'll do its best to knock its products off shelves - filing requests that many of the 21 accused Samsung devices be taken off United States shelves, including network-specific versions of the Galaxy S II, plus the Galaxy 4G, Galaxy S Showcase, Galaxy Prevail, Epic 4G, Fascinate, and Droid Charge.
In reality, Apple got what it wanted from Samsung before the trial even began - it forced a form of self-censorship on the brand. The newer Galaxy S III had a wholly distinctive design to avoid any suggestion of design patent infringement. HTC, Motorola and others have done the same - their latest phone models differentiate with little changes such as asymmetric trim on bezels, non- rounded rectangles and different trim colours.
What does this mean for the future of phone design? Does Apple forever own the "rectangle phone with rounded corners"? The mud slinging will go back and forth as appeals are expected before we have an answer. And there will be many more lawsuits - as software patents are written to make them "as broad as possible", said a lawyer from San Francisco's Electronic Frontier Foundation. "This creates a world where not only are litigation costs out of control, but the parties feel like they really need to build up their patent portfolios."
Most people don't realise that product patents come in the form of specific areas or sides of a product, not just the product as a whole. Apple's D'677 iPhone patent covers its "front" design, which 12 Samsung models were found to infringe. Similarly, the D'087 patent covers the "back" design, infringed by three Samsung models. Even the industry pros are bewildered by Apple's fastidiousness - Google vice-president David Lawee said he didn't know something as normal as "rounded corners" could be patentable.
In order to prevent future patent violations, manufacturers are likely to steer clear away from what Forbes magazine calls "Apple's sword of Damocles" by creating definitively inimitable designs.
Patent right distinctions are complex. "That's why patents are purposefully vague; whether or not a patent is infringed depends first on the scope of the patent," says Jeremy Johnson, senior associate at Wynn Williams. "From there the court looks at technical evidence to determine if there has been any infringement."
A patent grants "a monopoly to the patent holder to prevent other manufacturers from using what was invented", Johnson continues. "In an infringement action, no loss needs to have been suffered necessarily. So, in this case, Apple needs to have lost no business due to the alleged infringement; it has an absolute right to stop others from using its invention."
The unanswered question is whether, as a matter of public policy, Apple's patents should be protected in this way. "Patents grant patent holders considerable monopoly rights," says Johnson. "In theory that is to provide for an economic incentive to inventors. But is that economic incentive stifled when Apple, or any other phone maker, can monopolise rounded corners on phones?"
"Apple v Samsung" and "Samsung v Apple" court cases are currently proceeding in nine different countries. They stand to continue for the foreseeable future.
- © Fairfax NZ News
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