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Apple vs Samsung - The battle fought with Patents – Who is the real loser?

According to a recent Cisco report, global technological growth will continue to be drives by smart connected devices; the number of mobile-connected devices will exceed the world’s population during 2012 as there will be over 10 billion smart connected devices in 2016. According to Hans Vestberg, CEO of Ericsson, there are 3X as many smart phones being activated every minute around the world than there are babies being born; a sign of time. Smart phones are being adopted at incredible rates in developed worlds and even in many developing countries as well.

Over the stage of Smart phones, Samsung Electronics and Apple Inc. dominate with nearly half of the worldwide market with a 32.6 and 16.9 percent share respectively. Samsung was founded in 1938 by Lee Byung-chull, a wealthy Korean from a large landowning family, as a small trading firm that dealt in groceries and produced its own noodles. But over the past seven decades it has transformed into a vast network of companies, dominating a wide range of industries. Samsung Heavy Industries is the world’s second largest shipbuilder, and Samsung Everland is the country’s oldest theme park, attracting 8.6 million visitors a year. Samsung Life Insurance is a huge global business, while Samsung-owned Cheil is one of the top 20 advertising companies globally.

In telecommunications business, Samsung has become the world’s largest phone-maker by unit sales, overtaking long-term market leaders such as Nokia. Its ambition is beyond doubt: the company recently had a fleet of buses to promote its latest Galaxy phones in London while also sponsoring Olympics.

On the other side, Apple is the world’s largest technology company by revenue and profit – worth more than Google, Microsoft, HP, Yahoo and Face book combined. During July 2011, during the debt-ceiling crisis, its financial reserves were greater than those held by US government.

However, Apple is about much more than just finance. It has league of devoted fans, who wait and queue up for hours to be the first to get their hands on new products. The company’s founder, Steve Jobs, who launched the business in the late 1970s, holds a mythical status among technology fanatics– scarcely diminished by his death from cancer last October.

Over the past few time, the world is witnessing an epic battle between these two giants, a battle been fought in law courts. Probably later winner of this battle is Apple Inc with a U.S. court's ruling on August 24 stating Samsung had violated numerous patents and got hit with USD 1.05 billion penalty in damages. However, the fight is far from over.

The clash can be traced back to April, 2011, when Apple filed a lawsuit against Samsung stating that Samsung had created iPhone clones that ripped off Apple's technology and designs. Apple also claimed that Samsung did the same thing after the iPad was released. Samsung in response counter sued Apple for patent infringements.

 

This battle goes around the globe. Specifically, Apple is slugging it out with Samsung in a minimum of 19 lawsuits i....

Here is the list in terms of all the cases that were filed so far.

North America

United States of America

  • U.S. District Court for the Northern District of California
    • Apple Inc. v. Samsung Electronics Co., Ltd. et al. (case no. 5:11-cv-01846; includes substance of formerly separate case no. 5:11-cv-2079)
  • U.S. International Trade Commission
    • In the Matter of Certain Mobile Electronic Devices (Samsung v. Apple; investigation no. 337-TA-794)
    • In the Matter of Certain Electronic Digital Media Devices and Components Thereof
      (Apple v. Samsung; investigation no. 337-TA-796)
  • U.S. District Court for the District of Delaware
    • Samsung Electronics Co., Ltd. et al. v. Apple Inc. (case no. 1:11-cv-00573)

Europe

Germany

  • Landgericht (regional court) Mannheim
    • Samsung Electronics GmbH v. Apple, Inc. and Apple GmbH (case no. 7 O 247/11)
    • Apple Inc. v. Samsung Electronics GmbH (case no. 7 O 166/11)
  • Landgericht (regional court) Düsseldorf
    • Apple Inc. v. Samsung Electronics GmbH (case no. 14c O 194/11)

United Kingdom

  • UK High Court of Justice, Chancery Div., Patents Court
    • Samsung Electronics Co., Ltd. v.
      Apple Retail UK et al. (case no. HC 11 CO 2180)

France

  • Tribunal de Grande Instance de Paris
    (the only first-instance court in all of France
    authorized to hear patent cases)
    • Samsung Electronics Co. Ltd and Samsung Electronics France v. Apple France et al. (case no. 11/10464)

Italy

  • Tribunale di Milano (Milan first-instance court)
    • Samsung Electronics Italia s.p.a. v. Apple Inc. (case no. unknown)

 

Netherlands

  • Rechtbank 's-Gravenhage (The Hague Court of Justice)
    • Apple Inc. v. Samsung Electronics Co., Ltd. (case no. KG 11-730)
    • Apple Inc. v. Samsung Electronics Co., Ltd. (case no. KG 11-731)

Asia

Japan

  • 東京地方裁判所 (Tokyo District Court)
    • Samsung Electronics Co., Ltd. v. Apple Japan, Inc.
      (case no. 2011 (Yo) No. 22027)
    • Samsung Electronics Co., Ltd. v. Apple Japan, Inc.
      (case no. 2011 (Yo) No. 22028)
    • Apple Inc. v. Samsung Japan Corp.
      (case no. 2011 (Yo) No. 22048)
    • Apple Inc. v. Samsung Japan Corp.
      (case no. 2011 (Yo) No. 22049)

South Korea

  •  (Seoul Central District Court)
    • Samsung Electronics Co., Ltd. v. Apple Korea Ltd (case no. 2011 Kahap 39552)
    • Apple Inc. v. Samsung Electronics Co., Ltd. (case no. 2011 Gahap 63647)

Australia (continent and country)

  • Federal Court of Australia, New South Wales District Registry, General Division (Sydney)
    • Apple Inc. v. Samsung Electronics Ltd. Co. (case no. NSD1243/2011)

If we explore the decisions made by the respective courts so far; In Australia, Samsung won. In Germany, Samsung redesigns the tablet in an attempt to avoid a European Unio.... In California, Apple won while being awarded a little over USD 1 billion in their patent dispute with Samsung – though Apple was looking for USD 2 billion and the latest decision was made by a court in Tokyo in the favor of Samsung Electronics.

The core accusing statement from Apple holds Samsung for stealing some of the ideas and technology behind the iPhone and iPad. Samsung on the other hand also blames Apple for violating some of its patents.

Some of the key answers of last month’s USD 1.05 billion infringement penalty slapped on Samsung Electronics are:

How much longer it last? July 30 – August 24 (24 days)

Samsung had to stop shipping some of its handsets and computer tablets in the United States in case of losing the case.

Who was on the jury? Seven men and two women.

Apple's best evidence - Apple presented internal e-mails and documents that show Samsung closely studied the iPhone and knew that its own handsets were inferior to Apple's.

Samsung's best evidence - Samsung claimed that two-finger touch on computer screens and tablets existed prior to the release of the iPhone and iPad.

 

Apple's patent claims:

Utility patents:

  • '381 patent: Relates to the "bounce-back" feature when scrolling beyond the edge of a photo or document.
  • 915 patent: Relates to a device capable of distinguishing between a single-touch scroll operation and a multitouch "pinch-to-zoom" operation.
  • '163 patent: Relates to touch to double-tapping to enlarge and center portions of an electronic document.

Design patents:

  • D '677 patent and D '087 patent: Relates to the front face of an electronic device, as embodied by the iPhone.
  • D '305 patent: Relates to a user-interface design depicting a grid of rounded square icons against a black background.
  • D '889 patent: Relates to the industrial design of a tablet computer.

Trade dress (a legal term that refers to a product's physical appearance, including its size, shape, color, design, and texture):

  • Dilution: Apple asserts that Samsung's smartphones dilute its iPhone trade dresses (one registered, two unregistered), and that the Galaxy Tab 10.1 dilutes its unregistered iPad and iPad 2 trade dresses.
  • Infringement: Apple alleges that the Galaxy Tab 10.1 infringes its unregistered iPad and iPad 2 trade dresses.
  • Antitrust: Apple alleges that Samsung's assertion of patents that are essential to 3G standards constitutes a violation of federal and California antitrust law.

Samsung's Patent Claims


Standards-essential patents:

  • '516 patent: Directed to scaling down the transmit power of certain radio broadcast channels before other channels, to give priority to the most important data channels.
  • '941 patent: Describes a more efficient use of radio resources by reducing overhead associated with transmitting a particular type of data unit.

Features patents:

  • '711 patent: Allows a user to play music while the user multitasks and accesses other programs and menus.
  • '460 patent: Allows a user to take a picture on a phone/tablet, immediately review the picture in a gallery mode, and then seamlessly e-mail it along with a message.
  • '893 patent: Allows a user of a phone/tablet to browse pictures in the gallery, switch to the camera mode, take a picture, and then switch back to the last picture viewed in the gallery.

 

          Round one of the Apple/Samsung patent dispute is over, with Apple in the dominance.

 

In just a span a day, it was observed that Samsung’s market value plunged 7.5 percent after the ruling. That’s more than $12 billion in market value that just vanished over fears of Samsung’s products being banned in the U.S. Those fears are not unfounded as reports say that a judge will be hearing Apple’s argument to have the Galaxy S and S II banned next month.

Even though the case was about Apple and Samsung, we can’t forget about Google. There are some who suggest that Apple was only using Samsung to get to Google. Well how Google does fits in all of this? Google may not have been listed as a defendant, but Samsung was in part a stalking horse for the entire Android platform. Samsung may have made the devices, but many of the infringements are endemic to the Android operating system itself. For that matter, the fondle-slab design for phone and tablets, which the jury decided Apple owns, is a fundamental part of Google’s mobile platform. Losing Samsung – or even just raising the company’s costs – is a huge blow to Google.

One thing that should come as a surprise to everyone is that Apple is being sued the most out of any other company. They are also one the winner side for doing most of the suing. In total, Apple is suing four companies – Samsung, Motorola, Nokia and HTC. Their case with Nokia has been resolved, but the other three have filed countersuits against Apple. It is also learnt that Kodak is also suing Apple.  

History says that this type of battle for Apple is not a new one, for much of the 1980s; Apple battled Microsoft in court, trying to prove that early versions of Windows illegally copied the look and feel of Apple’s Macintosh operating system.

The million dollar question being asked is that who is the real loser behind this war? Probably, secondary losers include the other manufacturers of Android devices as many of them are likely immune to the dress-code charges but can be hit with parallel suits over the user-interface issues.

The bigger losers may be the telecommunications companies that sell mobile phone plans. These operators have had a love-hate relationship with the iPhone for years. Consumers on the other hand would also suffer in a big way; possible ban of Samsung galaxy in US would result in no would will hurt the subscribers wish to buy Samsung Smartphone. Consumers will surely be among the real losers, even in a trickle-down fashion. It might not be soon, but it will happen.

Patent wars between technology companies are going to make the market somewhat tumultuous for the time being. Investors in Apple are the big winners today, but a future verdict may hurt them somewhat. It’s hard to see Apple or Google for that matter, losing major market value, but smaller players like Samsung have much more to lose. Hope we can find a solution to the endless patent trolling and litigation before it really causes some harm.

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