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Thursday, August 16, 2012, 04:22 pm PT (07:22 pm ET)

Samsung rests it case, says Apple could owe nearly $422M in royalties

Samsung on Thursday rested its case in the Apple v. Samsung trial, concluding its phase of the trial with a pair of expert witnesses who believe Apple could owe $421.8 million in royalties over five patents owned by the South Korean company.

Samsung called to the stand damages expert Vincent O'Brien, who testified that his calculations show Apple owes the Galaxy maker $22.8 million based on three patent infringement claims, reports Bloomberg. The patents in question were presented on Tuesday and cover mobile device usability features regarding photos, email attachments and playing music in the background

O'Brien arrived at the $22.8 million figure by estimating reasonable royalty rates based in part on previous Apple payouts. Samsung can't claim it lost sales to the alleged infringement so royalties are the only avenue of calculating damages.

In a follow-up to O'Brien's testimony, University of California, Berkeley professor David Teece said Apple's alleged infringement of two separate Samsung patents relating to standards-essential UMTS patents could bring damages in the range of $290 million to $399 million. The royalty rates were calculated as 2 percent and 2.75 percent, though how Samsung arrived at those numbers is unclear.

In cross-examination, Teece was presented with a letter from Samsung dated July 25, 2011, in which the company proposed Apple pay a 2.4 percent royalty rate to license technology from any of 86 patents. Because the Samsung patents in question are deemed standards-essential, they should be licensed under fair, reasonable and non-discriminatory (FRAND) terms, but the 2.4 percent rate was never before levied to a licensee.

David Teece

Expert witness David Teece. | Source: Wikipedia


Apple's lawyer was able to get Teece to admit he didn't know how Samsung arrived at the proposed royalty rate, which the Cupertino company claimed was “unfair, unreasonable, and discriminatory” in a pre-trial filing. In a subsequent Samsung filing, the electronics giant noted it offered a fair and reasonable rate to “virtually every major player in the mobile phone industry," but Apple rejected the terms and "to this day has not paid Samsung a dime for Apple’s use of Samsung’s standards-essential technology.”

Apple v. Samsung continues on Thursday with testimony from Apple witnesses intended to rebut the arguments Samsung asserted over the week. Apple is looking to squeeze in over 20 witnesses in the brief time it has left, a move that earned the ire of presiding Judge Lucy Koh earlier today.