Apple's swift victory in defense of its iconic iPad and iPhone designs with a jury verdict of patent infringement against Samsung will have repercussions throughout the mobile industry and for consumers.
DAMIEN MEYER, AFP/Getty Images
Apple's victory in a landmark patent case will have ripples across the industry.
DAMIEN MEYER, AFP/Getty Images
Apple's victory in a landmark patent case will have ripples across the industry.
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Cupertino, Calif.-based Apple's patent win, which slaps the South Korean company with more than $1 billion in damages, is likely to have wide-ranging effects on other device makers that run Google's popular Android operating system â€" and on their customers.
Nine jurors late Friday found the electronics giant violated six out of seven of Apple's patents at issue. Three key patents cover familiar touch functions that allow Apple device users to easily scroll pages, zoom out on images or tap to enlarge text, all with fingers.
Should Samsung not be able to win an appeal, it will have to remove or work around those shortcuts, which Apple says took years to develop and three months for Samsung to copy.
If the $1.05 billion damage award survives, it will be one of the largest verdicts in patent history. Two larger verdicts were reversed, according to Stanford University law professor Mark Lemley.
"It's a huge win for Apple," says Lemley. "But this is one lawsuit among 50 in the smartphone market, and Apple's real target may be the Android ecosystem."
U.S. District Court Judge Lucy Koh has the power to triple the damages to more than $3 billion, because Samsung's infringement was found to be willful.
Key Apple patents at issue
• 381. Covers touch-screen interactions such as dragging documents, pinch-to-zoom, twist-to-rotate and scroll “bounce†at bottom of lists.
• 915. Covers technology used to scroll through documents.
• 163. Covers touch-screen tap-to-zoom features.
"We applaud the court for finding Samsung's behavior willful and for sending a loud and clear message that stealing isn't right," Apple spokeswoman Kristin Huguet said in a statement.
The quick jury verdict after deliberations began Wednesday was a surprise. Jurors had to answer hundreds of questions and had more than a hundred pages of instructions from the judge.
It appears likely the group was able to easily grasp the hero-and-villain narrative told by Apple's lawyers and also that the Silicon Valley-based jurors were more well-versed in tech than others might be.
The judge will now consider Apple's request for injunctions that would force Samsung to pull patent-infringing products from stores, as well as whether to treble the damages. A hearing is set for Sept. 20, and Koh's rulings are expected within six to eight weeks after that.
Consumers also may lose
Many Samsung devices could disappear.
Last month, the judge awarded Apple a preliminary injunction pending outcome of the trial that could force Samsung to remove its Galaxy Tab 10.1 tablet from stores.
"I think she's going to grant an injunction and a fairly broad one," says Lemley.
Apple's software and design infringement claims also extend to a wide range of Samsung smartphones, including its Nexus S 4G and S II. Apple could request injunctions and possibly get a ruling barring those from sale.
According to the verdict, Samsung violated the design patent for the front of the iPhone on all but one of its phones. On the home screen patent, Samsung was in violation with all of its phones, the jury found. However, Samsung did not violate a particular Apple iPad design patent, the jury found.
Jurors, meanwhile, rejected Samsung's claims that Apple infringed on some of its patents.
Samsung's troubles will turn into costs for consumers, says Vivek Wadhwa, a fellow at Stanford Law School. "You've taken a major competitor out of the marketplace."
Samsung said in a statement that the "verdict should not be viewed as a win for Apple, but as a loss for the American consumer."
It also could lead to higher costs and diminished user experiences on Android-based phones from all makers, says Jefferson Wang of IBB Consulting Group. "Consumers may pay more for these devices. Consumers may have a device that solves the same issues in a less elegant feature set."
The next step for Samsung is to appeal the case to the federal court of appeals in Washington, D.C., a process that could take a year or more.
"The smart money is going to say this is the end of Act One, we've teed it up for the federal circuit, and we'll see what's on for Act Two," says Robert Merges of Boalt Law School at the University of California, Berkeley.
Still, this sweeping victory with major implications on future designs is an enormous win for Apple and likely will put the brakes on copycat-minded mobile companies.
But it also may cause consumers to have to adapt to changed workings in their future tablets and smartphones â€" or even, via updates, in their current devices.
That's because jurors found that Samsung infringed on Apple's scrolling bounce-back patent on all its phones and tablets. On the pinch-and-zoom patent, which resizes images or text, the jury found Samsung infringed with all but three.
That means that Google's Android updates â€" needed to address these issues and get Samsung out of trouble â€" will have to alter some functions.
But the devices won't become paperweights. "Some people who aren't sure what this ruling means might think if they have an Android device that it will stop working â€" that's not going to happen. It may affect their future purchases," says Mark McKenna, University of Notre Dame law professor.
Apple and Samsung are fierce mobile rivals, particularly in smartphones. Apple dominates the tablet market, but Samsung is the No. 1 seller of mobile phones worldwide, with 21.6% of the market, according to Gartner, while Apple is No. 3, with 6.9% of the market.
The favorable verdict comes at an auspicious moment for Apple. It's expected to launch its next iPhone as early as next month, a move that comes as Samsung has extended its lead in smartphones in the past year.
Mobile industry at war
It's unknown whether Apple would agree to license some infringed functions to other makers, though it would be out of character with its past. "Now, Google and other players will have to provide license fees to Apple," says Wadhwa.
But Apple founder Steve Jobs, who died in October, was intent on hobbling Google with lawsuits. Trouble began when Google jumped into the smartphone market while former Google CEO Eric Schmidt was on Apple's board. Schmidt resigned from the board in 2009.
"I'm going to destroy Android, because it's a stolen product," Apple co-founder Jobs told biographer Walter Isaacson in the book Steve Jobs. "I'm willing to go thermonuclear war on this."
Apple first sued about the resemblance between Google's HTC Nexus and the iPhone.
"That was the seminal case for this wave of disputes," says legal consultant Florian Mueller.
Apple's scorched-earth policy on Android device makers has scored at least five preliminary injunctions against Samsung, two against Motorola and two against HTC, he says.
Today, Apple and Samsung are embroiled in more than 50 lawsuits in 10 countries. Samsung has won no injunctions against Apple, though it has tried.
"The bottom line is (that Apple has) shown the world that they are going to use these patents, and you better keep a wide berth, or get out of the mobile market," says Merges.
Makers of Android devices designing their next products likely are steering a wide path around Apple's litigation and will take the Samsung verdict into account.
"The other device manufacturers have seen what's happened here, and so has Google. Having had a court hear those objections and rule in Apple's favor, that's got to make some of them nervous," says McKenna.
Future devices may "look and feel different from today's Samsung devices" as a result of this, says Mueller.
Apple's end goal is to keep the iPhone and iPad as distinctive as possible, says Merges. The more design elements that the other guys can knock off, the more Apple's industry-coveted profit margins are threatened. "If you want to charge twice as much as the other guy, your phone has to be twice as cool and distinctive," says Merges.
It's an open question as to whether Apple will take aim directly at Google next.
Competition between the two has grown fierce, ranging from competing online mapping services and mobile ad platforms to media stores and cloud storage. Google added another one in June, taking on a new title: hardware maker. It launched its in-house designed Nexus 7 tablet, as well as the now temporarily discontinued Nexus Q music device.
Google's Android operating system holds 64.1% of the world's mobile phone market, according to researcher Gartner, and Apple's iOS holds 18.8%.
Still, Apple's iPad is forecast to take 62.5% of the worldwide market, vs. 36.2% for Android-based tablets in 2012, according to researcher IDC, which predicts 222 million tablets will ship by 2016.
Patents, says Merges, ultimately are the way for Apple to take advantage of innovations to differentiate itself for as long as it can to keep a "coolness" edge.
"Hopefully, you can milk that for as long as possible, and the guys in the back rooms are coming up with the next big thing."
Contributing: Jon Swartz
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