michelle law USA

Centennial College

International Law

Group Project

Apple Inc. and Samsung Electronics Co International Lawsuits

Prepared for Professor

Michael Karambatos

By

Vanessa Arias

Michelle De Souza

Laura Coll

Elena Sidorkina

Camilo Camero

July 15, 2013

Apple, Inc. ( Plaintiff) v. Samsung Electronics Co., Ltd., Samsung

Electronics America, Inc., and Samsung Telecommunications

America, LLC. ( Defendants)

Appeal from the United States District Court for the Northern

District of California in Case No. 11-CV-1846, Judge Lucy H. Koh.

FACTS:

Apple filed a suit against the defendants stating that Samsung’s

Galaxy computer tablets and cell phones encroaches on Apple’s

trademarks, trade dress, and utility and design patents. The U.S.

Design Patent numbers D593,087 (“the D’087 patent”) and the

D618,677 (“the D’677 patent”) are generally embodied in Apple’s

iPhone smart phones. The U.S. Design Patent No. D504,889 (“the

D’889 patent”) is used in the Apple iPads. In addition, Apple has

a patent for utility, U.S. Patent No. 7,469,381(“the ‘381

patent”), that has a software feature known as the bounce-back

found in both the iPhone and iPad. Apple is seeking preliminary

injunction against Samsung Electronics, to prevent the

importation and sale of Samsung’s devices within the United

States. Apple’s appeal for injunction was not approved by the

courts because of their inability to demonstrate discretion.

Moreover, there will be further proceedings for the D’889 patent.

ISSUE:

Can Apple seek preliminary injunction for the products that

violates Apple’s patents that were produced by Samsung for sale

in the United States?

RULE:

The District court noted four factors that must be considered in

addressing the motion for a preliminary injunction - whether the

movant is likely to succeed on the merits, whether the movant is

likely to suffer irreparable harm in the absence of an

injunction, whether the balance of the equities favors the

movant, And whether the public interest would be served by the

grant of injunctive relief. Taking into account all the factors,

the courts initially denied Apple’s motion with regards to all

four patents. Claims on the D’087 and D’889 patents were denied

in the district court as Apple failed to show a likelihood of

success on the merits. Claims on the D’677 and ’381 patents were

also denied relief as Apple had failed to show that it would

suffer irreparable in the absence of a preliminary injunction

from Samsung’s continuing infringement.

ANALYSIS:

The court first examined the D’087 patent and held that the

patented design claimed only the front face of smart phone. The

front view was similar to the Japanese Patent No. 1,241,638 (“the

’638 patent”). Both the patents were substantially similar

because they both had “similar edges and rounded corners, a

bezel, a similarly shaped speaker, and similar proportions of

screen and border” as well as both had an overall simple and

minimalistic design. The court rejected Apple’s argument on the

basis of lack of merit which is needed for a preliminary

injunction for the D’087 patent.

The court then addressed the D’677 patent. It referenced back to

the ’638 patent and concluded that both the designs were

sufficiently different. Samsung has not raised enough validity of

the D’677 patent. The court found both the Galaxy S 4G and the

Infuse 4G phones were infringing. Despite the finding, Apple was

still denied their request for preliminary injunction as they

failed to show it was likely to suffer irreparable harm from the

importation and sale of Samsung’s infringing phones.

Apple argued that Samsung’s sales eroded Apple’s design and brand

distinctiveness which resulted in loss of goodwill and market

share. Further Apple stated that it would be difficult to

quantify the losses. The District court rejected both arguments.

The D’677 infringement injunction was denied as Apple failed to

establish an association between loos of customers and loss of

market share due to Samsung’s violation. The courts said that the

design of the smart phone was not a key factor in a consumer’s

purchase decision even though it is considered.

The court noted that Apple stated that Samsung had been copying

its designs and trade dress since 2007. The court found that

Apple’s failure to file a suit until 2011 undermined its claim of

irreparable harm.

In addition the court held that the balance of hardships favoured

Samsung and would not significantly benefit Apple. The court did

not grant Apple preliminary injunction against Samsung for the

D’087 and D’677 patent infringements.

Apple’s claim on the ‘381patent infringement on the ‘bounce bank’

feature was also denied by the courts as Apple had failed to

establish the likelihood of irreparable harm even though the

balance of hardships favoured Apple.

The D’889 patent was considered to be a “broad, simple design

that gives the overall visual impression of a rectangular shape

with four evenly rounded corners”. Apple had shown the likelihood

of irreparable harm as there were only two major tablet

manufacturers, Apple and Samsung. Initially Apple’s patent claim

was denied due to lack of merit. Apple’s tablet design was

similar to a design prototype developed by Roger Fidler in 1994.

The Appeals Court found that the District Court had made an error

in differentiating the Fidler design to Apple’s D’889 patent. In

addition, Apple showed that Samsung’s infringement of the D’889

patent has hurt Apple’s market share after Samsung introduced the

Galaxy Tab 10.1 tablet. Samsung violated Apple’s patents and

caused Apple irreparable harm because an ordinary consumer would

perceive the designs to be similar. Judge Lucky Koh remanded the

matter to the District Court for further proceedings where the

court should conduct a balance of hardships with respect to the

D’889 patent.

CONCLUSION:

The United States District Court for the Northern District of

California and the Appeals court both agreed on the denial of

preliminary injunction in regards to the D’087, D’0677 and ’381

patents. However, the D’889 patent will require future

proceedings in the District Court if it is to be considered for

preliminary relief by Apple.

Apple Inc versus Samsung in Australia

FACTS:

Since 2011, there is a cross claim between Apple and Samsung in

Australia.

On 2011 in the Federal court of Australia, Samsung claimed that

Apple used their patents related to their technology without

their permission, specifically regarding baseband chip which are

needed for electronic equipment such as mobile phones and tablets

computers, their used to connect that kind of electronic devices

to a base station. According to (ETSI) which is the European

Telecommunication Standards Institutes, the kind of patents that

Samsung is disputing, is important because it gives the rights

(license) to implement and meet the communication standards known

as the UMTS 3GPP to mobile phone manufacturers, without this

standards mobile phones cannot operate on UMTS 3G networks, which

are used on Australia and also all over the world.

Samsung is requiring the court to confirm that there was a

violation of their patent by Apple and also they informed to ETSI

that they were ready to license the patents, but they still have

not reached any settlement with Apple on this matter.

On other hand Apple disagrees on what Samsung is claiming, they

believe that they are not violating the patent and that their

invalid on different aspects, and their accusing Samsung of

violation of some of its patents related to touch screen

technology in Samsung’s Galaxy smart phones and tablets.

During the trial many documents and affidavits have been

presented by each one of the external law firms that represents

them in this trial.

Both cases are being heard as just one case in the Federal court

of Australia and as “Mark Summerfield, a patent lawyer and senior

associate with Melbourne-based law firm Watermark, said that

unless the two companies come to a global settlement, the

Australian case is likely to run until well into 2014 as an

appeal to any ruling at the end of the current trial "is a 100

percent certainty”. (Reuters, 2012).

The case has become so complex that for the first time in the

Australian Federal Court, two judges are hearing the case at the

same time and in the same court room.

Australia is not the only country were Apple and Samsung have a

trials against themselves, since April 2011, they have similar

situations on more than ten countries.

ISSUE:

The issue here is whether Apple is violating patents that belong

to Samsung related to technology for smart phones and tablets,

and if Samsung is doing the same with 13 patents that belongs to

Apple.

RULES:

The Federal Court of Australia, by the end of last year applied

the following rules for this case:

Article 50 of the Federal Court Act 1976 Cth, which states that

the court can consent or ban the publication of evidence or the

name of a witness or party that participates on this case,

because it could inhibit the administration of justice.

Patents Act 1990: Is the rule that guides the Federal Court in

Australia on cases related to patents. Is “An Act relating to

patents of invention”.

Competition and Consumer Act 2010 (Cth): “An Act relating to

competition, fair trading and consumer protection, and for other

purposes”, the object of this Act is to enhance the welfare of

Australians through the promotion of competition and fair trading

and provision for consumer protection”.

ANALYSIS:

Throughout the case we can see that several times Apple asks the

court for revision of documents presented by Samsung, because

they believe they are not enough evidence, and also they accuse

them of submitting only the documents that they consider it can

give them advantage in the case, furthermore they say that

documents were elaborated after litigation was already started.

Also they say that there is a lack of personal knowledge due to

the witness presented by Samsung did not prepare the information

and does not have sufficient knowledge about the patents and its

analysis, they say there were done by technical analysts and non-

legal staff.

After the court reviewed the documents presented by Samsung, they

considered that more than a half of them were claimed to

privileged, and also ratified that the documents were elaborated

before the litigation started, so they refused Apples arguments.

They ratified that documents were prepared for legal and not

commercial matters, so the court will use them for the case.

On other hand we can see that the Rules of Civil Procedure

applies, referring to the part where is stated that both parties

are obligated to make use of all documents that were produced,

and that are relevant to the case, so the process could be

considered as advanced, and it is being done for the truth-

seeking.

Apple declared that Samsung is engaged in monopolistic conduct,

opposing provisions of the Competition and Consumer Act 2010

(Cth) by negating to license the patents to Apple and

consequently making them loose the opportunity of selling three

of its products, known as iPhone 4, iPhone 4S and iPad 2.

Pursuant to s 50 of the Federal Court Act 1976 (Cth) the court

gave the opportunity to both parties to amend any portion of the

judgment, if they considered it was neccesary, they did and

amendment to the draft reasons.

Apple states that there is also a lack of independence, related

to Mr. Kim, which is the in-house lawyer of Samsung, and which

was responsible for handing all the documents related to Samsung,

and also responsible for preparing the affidavit of discovery

that were neccesary for the court to analyze the case.

CONCLUSION:

We can see that by October 2011 Apple won the battle related to

patents for the tablets, and the Federal Court of Australia gave

an interim injunction concerning Samsung's Galaxy Tab 10.1

product, meaning that there is a prohibition of an action by a

party to lawsuit before there is a trial or other court action,

this is to avoid damage before a final legal decision is made, at

the end the interim injunction can be changed to permanent

injunction or be canceled.

“On 9 December 2011, the interim dispute ended in Samsung’s favor

concerning Samsung's Galaxy Tab 10.1 product, with the High Court

refusing Apple special leave to appeal the Full Federal Court’s

decision. The Court found that Apple had insufficiently

demonstrated error by the Full Federal Court.” (King & Wood

Mallesons , 2012).

Samsung Electronics Co. Limited v

Apple Retail UK Limited and Apple Sales International

UK HIGH COURT OF JUSTICE

Chancery Division

Patents Court

(March 2013)

FACTS:

As of April 2011 Samsung and Apple have been suing each other in

the courts around the world. The most recent case Samsung v.

Apple in UK was heard in English High Court in 2012-2013. The UK

lawsuit is a part of the two companies’ global patent battle over

technology used on mobile devices. Samsung attempted to protect

patents that are considered “essential” to 3G data transmission

standards. 

In these trials the claimant, Samsung Electronics Co. Limited,

claimed in court that the defendants, Apple Retail UK Limited and

Apple Sales International Limited, infringed three of its

European patents covering coding, sending and receiving data over

3G mobile networks. Samsung alleged that in its devices Apple

used the technology that allows phones to send and receive data

over 3G networks without proper compensation to Samsung. Samsung

claimed that namely Apple’s iPhone 4, iPhone 4S and iPad 2 3G

models breached these patents, and was looking for royalties from

sales of these models in EU as a compensation. Samsung claimed

that Apple has not licensed these patents. Apple, in its turn,

denied infringement and argued that these three patents were

invalid and counter-claimed for revocation. Apple said the

patents were invalid and, regardless, Samsung was required to

license the technology under fair terms if it’s vital for

connecting to modern networks.

Samsung argued at two separate trials and, therefore, the trial

of this case fell into two separate parts. Although the two cases

are part of the same claim, they were heard on different dates

and disputed by different counsel.

The first part was related to the two European patents (UK):

1. EP1005726 “Turbo encoding/decoding device and method for

processing frame data according to QOS”.

2. EP1357675 “Apparatus and method for channel coding and

multiplexing in a CDMA communication system”.

These are the patents for inventions associated with channel

coding, a method of determining errors in digital transmissions

(Hodges, 2013).

The second part involved the third patent:

3. EP1714404 “Apparatus and method for allocating OVSF codes

and I/Q channels for reducing peak-to-average power ratio in

transmitting data via enhanced up-link dedicated channels in

WCDMA systems”. This is the patent related to the structuring of

data streams (Hodges, 2013).

The Judge Christopher Floyd announced verdict for both cases on

March 7, 2013.

These three European patents (UK) claimed priority dates based on

South Korean national patent applications:

1. EP1005726 from Korean patent # 11380/98

2. EP1357675 from Korean patent # 9926221

3. EP1714404 from Korean patent # 2004045127

ISSUE:

This case’s issue is whether Apple can be held liable for

violation of the three Samsung’s European patents (UK), if these

patents, held by Samsung, are valid at all and if they are

entitled to the priority dates claimed in Samsung’s applications.

Another issue is if these three patents are obvious to the person

“skilled in the art” or do they require an invention.

The judge determined the tasks for the court as follows:

1. “To read and understand, through the eyes of the skilled

person, the disclosure of the priority document as a whole

2. To determine the subject matter of the relevant claim

3. To decide whether, as a matter of substance not of form, the

subject matter of the claim can be derived directly and

unambiguously from the disclosure of the priority document.”

(UK High Court Of Justice, 2013)

RULE:

When an organization is seeking patent protection for its

invention in several countries, the principle of priority is very

important, as it doesn’t not have to file its application in

several countries at the same time. Thus, for Samsung, who

already had its technology patented in South Korea, it was

essential to prove its patents’ priority in UK as well.

The judge in this case applies the law that refers to the

entitlement to priority of the patents. This subject is regulated

by Section 5 of the Patents Act 1977 and Article 87(1) of the

European Patent Convention.

According to this legislation, once you file an application in

one country (e.g. in South Korea), you are entitled to claim

priority for a period of twelve months and the filing date of

that first application is considered the “priority date”.

Therefore, when you apply for protection in other countries

during those twelve months, the filing date of your first

application is considered to have “priority” over other

applications filed after that date (UK Intellectual Property

Office, 2011).

Section 5(2)(a) of the Patents Act suggests that “An invention is

entitled to priority if it is supported by matter disclosed in

the priority document”. By section 130(7) of the same Act,

section 5 is to be treated as having the same effect as the

corresponding regulations of Article 87(1) of the European Patent

Convention. Article 87(1) says that “Priority may be derived from

an earlier application in respect of the same invention” (UK High

Court Of Justice, 2013).

The condition of claiming priority of the same invention, as said

in Article 87(1) European Patent Convention, means that “Priority

of a previous application in respect of a claim in a European

patent application in accordance with Article 88 EPC is to be

acknowledged only if the skilled person can derive the subject-

matter of the claim directly and unambiguously, using common

general knowledge, from the previous application as a whole” (UK

High Court Of Justice, 2013).

All further conclusions are based on the Patents Act 1977 and

previously held similar patent cases. The judge considers the

approach of previous Courts and their judgments on similar cases.

ANALYSIS:

Validity

To determine validity of the patents the judge first considered

the law on entitlement to priority. The judge then compared

the subject matter of each of the three patents and studied

whether they were created “directly and unambiguously” from the

disclosure of the South Korean grant.

In regard to EP1005726 the Judge found that the subject matter of

this claim was not “directly and unambiguously” originated from

the priority document (South Korean grant). The judge made a

similar comparison between EP1357675 and the Korean patent based

on which it claimed priority and came to the same conclusion.

The Judge came to the conclusion that the priority document only

discloses some information related to data transmission over 3G

channels and that it does not disclose some other parameters

necessary for the data stream transmission, although this aspects

are substantial part of the claim.

Samsung admitted that if the claims of the patents were not

entitled to priority, then the patents can be declared invalid.

As the Judge has held that those claims were not entitled to

priority, then it followed that they were invalid.

In a case of the third patent, the judge concluded that EP1714404

would be invalid for lack of novelty if it was not entitled to

priority. He then found that it was not entitled to the priority

dates claimed in Samsung’s applications.

Obviousness

The determination of obviousness is based on whether it would be

obvious to the “skilled person, on the basis of the prior art”,

how to come to that technical solution. Such person “skilled in

the art and the common general knowledge” was identified for

every case (UK High Court Of Justice, 2013).

Apple argued that all mentioned Samsung patents were obvious due

to prior existing art research and citations. Meaning that this

subject matter was already obvious before the patents were

granted. The citation that Apple referenced in this case are as

follows:

1. EP1005726 patent was obvious over two prior art citations. The

first is an article by Bomer and others entitled “A CDMA Radio

Link with ‘Turbo-Decoding’: Concept and Performance Evaluation

(“Bomer”). The second is an article by Valenti and Woerner

entitled “Variable Latency Turbo Codes for Wireless Multimedia

Communications” (“Valenti”).

2. EP1357675 was obvious over TS 25.212, which is the 3GPP

standard that deals with multiplexing and channel coding.

3. EP1714404 was obvious over Ericsson’s submission to the

relevant working group for the UMTS project (Proposal R1 –

040562) titled “Enhanced Uplink – Physical Channel Structure”

(“Ericsson”) (UK High Court Of Justice, 2013).

Applying this rule of the prior art works in respect to each

patent with the help of persons skilled in the art, the Judge

concluded that each patent was invalid for obviousness.

CONCLUSION:

The judge ruled that Apple's mobile devices do not infringe on

Samsung's patents on 3G data transmission. Moreover, Samsung

patents were found invalid on the grounds that they were not

entitled to the priority dates claimed.

The judge concluded that:

1. All the three patents are not entitled to priority.

2. Even if EP1005726 and EP1714404 had been entitled to their

priority dates, they would have been yet invalid for

obviousness of the subject matter.

3. As for EP1357675, the judge said that if it was entitled to

priority dates, it would have been considered valid.

4. EP1005726 and EP1714404 would have been infringed by Apple

devices if they were not found invalid (UK High Court Of

Justice, 2013).

This ruling only applies within the UK. And, therefore, Apple is

free to further sell its products in this particular country.

This case brought the number of standards-essential patent claims

failed by Samsung to Apple to 25 cases. This is also the second

time Samsung has lost a case over its European patent

EP1005726 after similar case in Mannheim, Germany (World

Intellectual Property Review, 2013).

Apple Inc. vs. Samsung Electronics Co., Ltd. Japan

“Samsung Electronics Co., Ltd. vs. Apple Japan, Inc. case No.

2011, No. 22027, 2011 and No. 22028” (Foss-Patent, 2011).

FACTS:

Although both are successful companies and have dominion in the

production and sales of smart phones in the world, there are

major conflicts between them. In the year 2011 Apple Inc., a

company leader in the development and production of mobile

phones, began to sue in international courts the company Samsung

Electronics Co. for patent infringement. According with Ray

August the definition of patent is “An incorporeal statutory

right that gives and inventor, for a limited period, the

exclusive right to use or sell a patented method or process”

(August, 2004).

In Japan, the first accusation of Apple Inc. against Samsung

electronics Co. was made to the court of Tokyo concerning the

design of the tablet, PC and smartphones. Time later, in the same

way Samsung Electronics Co, appealed against the demands imposed

by Apple and in turn litigating against Apple claiming that the

iPhone and iPad invade Samsung Electronics Co. Patents (News-24,

2013).

Apple accused Samsung for violated the patent 516 and the patent

941 belonging to Apple which details Apple’s process for data

transmission in cell phones and tablets that regulates the

technology for synchronizing music and video channels with iPhone

4 3G variant and the iPad 2 (Foss-Patent, 2011).

ISSUE:

Is Apple accusing Samsung of infringing copyright on a system

that synchronizes videos and music with a computer in the tablets

and cell phones? Is Samsung infringing on Apple patent related to

process for data transmission in smart phones and tablets? Is the

court of Tokyo defending the protection of invention? Have Apple

and Samsung presented mutual accusations and disrespect for

patent violation in the courts of Japan?

RULE:

“Act (patent law Tokyo) of Japan. Article 2. "Patented invention"

the invention for which a patent has been granted in this Act. By

promoting the use and protection of the invention, this law is

intended to encourage invention” (Supreme-Court-of-Japan, 2013).

ANALYSIS:

These two leading manufacturers in technology are constantly

accusing each other. Although both maintained the dominion of the

global market of mobile devices, Apple was the first to sue

Samsung arguing that they copied and plagiarized deliberately

their applications. Currently, both companies carry several

battles won and lost in court in Japan (Apple-vs-Samsung, 2013).

Apple recurred to a ruling by a court in Tokyo, which rejects and

rules in favor of Samsung in August 2012; the lawsuit is filed

where Apple accuses Samsung for damages. The creators of the

IPhone initially made a complaint to Samsung Electronics Co,

accusing the company of infringing copyright on a system that

synchronizes videos and music with a computer in the tablets and

cell phones. Apple requires a payment by Samsung for 100 million

Yen (an estimated $ 1.02 million) arguing that Samsung has copied

viciously and used without their permission their patented

technology in eight of its smart phones models Galaxy series

which sold in Japan as mobile NTT DoCoMo and KDDI models (Rivera,

2013)

Tamotsu Shoji, a judge of district of Tokyo, dictated in August

2012 a judgment against Apple’s claim of Samsung infringing their

process server to synchronize videos and music. This helped

Samsung increase their reliability and shares in the Tablets and

Smart phones market.

A panel composed of three Japanese judges argued that mobile

devices and tablets represented by Samsung Electronics Co have a

different technology from that presented by Apple Inc., for this

reason rejected the allegations made by the plaintiff company

Apple Inc. Given this ruling Samsung issued a statement which

says "We welcome the court's decision, which confirmed our

position when it comes to defending our products do not infringe

Apple's intellectual property" (News-24, 2013)

After this result, the company Apple Inc. has filed other

lawsuits against Samsung Electrics Co. in the courts of Japan.

This conflict between these companies has generated increases in

the sales of tablets and smartphones in Japan that have benefited

Samsung. According to Tokyo MM Research Institute Ltd. Tokyo

Apple maintained a control of 53% of sales. For 2011 the company

Samsung did not have an important position in the handset sales

in the Japanese market, but for 2012 Samsung occupied the fifth

place and was able to lower the control of his main rival Apple

to 40% of market sales (News-24, 2013).

These are some of the fault and verdicts that have been Claimed

by a Tokyo court in favor and against of these two eternal rivals

and pioneers in technology Apple Inc. and Samsung Electronics

Co., Ltd

In 2011, a judge in Tokyo gave a final verdict in which Samsung’s

smart phones and tablets violated Apple's patent in accordance

with the visual and sensory effects perceived by the touch of the

screen. Leading Apple Inc. to win this dispute.

On the other hand, in February 2013 the Tokyo District Court

rejected a request by Samsung for Apple to stop selling iPads and

iPods in Japan (Apple-vs-Samsung, 2013)

The Tokyo court rejected an appeal in June 2013 made by Apple

Inc. This maintained a ruling in favor of Samsung which claims

that Samsung Electronics Co. does not violate any patents of

Apple Inc. referenced to the system that synchronizes videos and

music with a computer in the tablets and smart phones (Apple-vs-

Samsung, 2013).

Another judgment claimed in June 2013 by the court of Tokyo

accuses Samsung of disrespecting Apple’s patent over the

technology that creates a visual effect when the action of moving

horizontally a tab is performed, this visual effect is known as

"bounce-back" (News-24, 2013).

CONCLUSION:

In August 31, 2012 in Japan the judge Tamotsu Shoji from Tokyo

District Court ruled that tablet and smart phones from Samsung

did not infringed copyright in the patents on an apple invention

a system that synchronizes videos and music with a computer in

the tablets and smart phones (Yasu, 2012).

The creator of the IPhone is welcome to appeal the decision.

Apple Inc. and Samsung Electronics Co. have a long legal battle

and have presented mutual accusations and disrespect for patent

violation in the courts of Japan. Apple still maintains that

Samsung has taken advantage in sales disrespecting copyright and

copying patents on several of its models of tables and smart

phones.

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