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Thursday, August 23, 2012, 03:33 pm PT (06:33 pm ET)

Apple, Samsung portray different visions of the future given jury's decision


Apple defends billions in damages

"Samsung makes fun of us for asking for billions," McElhinny stated, but noted that the company sold 22.7 infringing products between June 2010 and today, and generated $8.160 billion in revenue. Apple's expert calculated that Samsung directly profited $2.4 billion from the sale of its accused devices.

Apple can only make demands for Samsung's profits if the jury finds that its design patents were infringed. Otherwise, Apple is left with lost profits of $488 million in "missing sales."

McElhinny said Apple had capacity to make an additional two million sales even in periods of high demand and supply constraints. He also noted that company was "careful not to double count damages," and that the jury will have to determine what damages are paid in each of three buckets: Samsung's profits, Apple's $488 million in lost profits and $20 million in "reasonable royalties" on the use of Apple's patents.



Samsung argues it did not deceive the public in copying, warns damages will stifle competition

Rather than addressing what happened in the past, Samsung's attorney Charles Verhoeven focused on the future, insisting that Apple didn't present convincing evidence that Samsung had deceived customers in copying Apple's patented designs "because there isn't any."

Verhoeven said Apple is only "stopping its largest competitors from giving customers what they want: smartphones with big screens," and argued that "Apple's seeking a competitive edge through the court," describing the outcome of the case as potentially changing "the way competition works in this country," exchanging "vigorous competition between competitors" with deals involving patent portfolios.

Verhoeven appealed to the jury in saying "consumers deserve a choice between a lot of different products," and noted "is not against the law to be inspired by your competitors," and "it is not against the law to benchmark and ask 'how can we do better?'"

He argued that HDTVs on display in big box retailers today "all look the same" and lack the knobs and buttons of older televisions because "form followed function," creating a parallel between that and the smartphone design introduced by Apple's iPhone.

Verhoeven added that users initially wanted a full keyboard like RIM's once Blackberry, which was "extremely successful" and subsequently, "everyone came out with full keyboard mobile phone."

Now, users all want a smartphone that is a phone, a computer, capable of playing video games and "you can talk to you family on FaceTime," all features that dictate "a large rectangular shape."

There is "nothing nefarious about this" Verhoeven stated, adding that it is simply "how smartphones evolved." In contrast, Apple is "interpreting its patents to say" that it is "entitled to a monopoly on rounded rectangles," Verhoeven stated, echoing the definition of a design patent.

Samsung: no evidence of confusion

Verhoeven then cited a "paid expert on Apple's side" as being questioned "if anyone is confused or deceived if they are buying an Apple phone," and stating he didn't know if consumers were confused.

"You'd think," Verhoeven stated, "if people were buying a two year contract, they'd know what they were buying," redefining the legal test of infringement from intentional confusion and dilution by a vendor to the complete unawareness of brand names by end users.

Verhoeven then ran through a series of differences between Samsung's accused devices and Apple's design patents and pictures of the iPhone or iPad, noting that corner radii are not exactly the same, that there was a slight edge on the front face of some phones, that the speaker opening is not centered vertically on the bezel. and that the Galaxy Tab had two materials on its back, and was black, not shiny, polished or translucent as described in Apple's iPad patent.

As for Apple's user interface design infringement claims, Verhoeven stepped through the process of turning on an Android-based Samsung phone, noting that the user would have to power it on, watch a "droid" animation and unlock the screen, all before touching the apps button to arrive at the screen Apple says is an infringing copy of the iOS Home menu.

Verhoeven then repeated the same steps on the Galaxy Tab, apparently to suggest that entering the accused apps screen was a laborious and hidden path few users would ever come across, let alone associate with Apple's products. Essentially, Samsung is arguing that copying isn't illegal and Apple can't be awarded any damages unless there is documented confusion by buyers, which he says Apple did not sufficiently produce.

On page 4 of 4: Samsung: Apple is trying to confuse you