BreakingNews: Jury Awards Apple Damages of $1.05 billion

:SAN JOSE, Calif.—A federal court jury delivered a big
win to Apple Inc., finding that Samsung Electronics
Co. infringed six of the Silicon Valley company’s
patents and awarding $1.05 billion in damages in a
closely watched case over mobile devices.
The jury also found that Apple’s iPhone and iPad
tablet didn’t infringe any of the patents that
Samsung had presented in the trial.
The award from the nine-member jury is shy of
Apple’s request for more than $2.5 billion, but much
larger than Samsung’s estimates and still ranking
among the largest intellectual-property awards on
record.
Jurors found that Samsung infringed all but one of
the seven patents at issue in the case–a patent
covering the physical design of the iPad. The found
willful infringement by Samsung in five cases, a
finding that can affect the size of damage verdicts.
They found all seven of Apple’s patents valid,
despite, Samsung’s attempts to have them thrown
out.
The jury reached its verdict after about 22 hours of
deliberation spanning three days—a quick decision
for such a complex case.
The verdict ends a nearly month-long trial that pitted
two of the world’s largest and most recognizable
companies—and their high-priced legal teams. While
the ruling won’t affect any of the companies’ latest
products, it could shape how smartphones and
tablets are designed and the fortunes of companies
that make them.
During the trial, Apple and Samsung considered
much of the evidence so sensitive that their lawyers
fought fiercely to exclude them from the case,
arguing they would divulge corporate secrets or
weren’t relevant.
The two women and seven men sorted through 28
different Samsung devices that Apple alleges
Samsung infringed as many as seven patents and
two other related claims, which cover innovations
ranging range from the look of on-screen icons to the
detection of finger gestures on the touch-screen.
Samsung has countered by accusing the iPhone, iPad
and iPod Touch of infringing as many as five patents,
two of which are related to how the iPhone and iPad
send data.
Apple, which sued Samsung last year, is leaning
heavily on the South Korean technology firm’s
internal strategy documents to prove Samsung
deliberately copied the iPhone. “Samsung was the
iPhone’s biggest fan,” said Harold McElhinny, Apple’s
lead trial lawyer, during closing arguments on
Tuesday. “They tried to compete with it, and when
they couldn’t, they copied it.”
The Cupertino, Calif., company has frequently
referenced a 132-page internal Samsung strategy
document entitled “Relative Evaluation Report on S1,
iPhone,” dated March 2, 2010. It contains grids
comparing a range of features of the iPhone and
Samsung’s Galaxy S1 smartphone, and lists
“directions for improvement”—many of which entail
mimicking a feature on the iPhone. Another 2010
email cited by Apple lawyers contains notes from the
head of Samsung’s mobile device division lamenting
in a meeting how its phones fell short of the iPhone,
calling it “a difference between heaven and Earth.
It’s a crisis of design.”
Samsung lawyers argued that being inspired by
one’s competitors isn’t illegal. They cite an email
from Jan. 24, 2011, sent by Apple senior vice
president Eddy Cue to Chief Executive Tim Cook and
other executives expressing praise for a 7-inch
Samsung tablet, a smaller size than the iPad. The
email, providing a rare glimpse of opinion inside
Apple’s highest ranks, lent credence to earlier
reports that the company will soon introduce a
product in a class of devices it has previously
dismissed.
But Samsung’s case hung on the belief that Apple’s
design ideas weren’t original. Devices introduced as
evidence took the jury on a trip back in time.
There is the DiamondTouch, a computerized table
with a touch-screen dating to about 2005. Samsung
argues the little-noticed product and applications
running on it beat Apple to the market with “pinch-
to-zoom” and “bounce-back” functions and makes
two key patents invalid.
Samsung urged the jury to consider the “Fidler
Tablet,” a device for reading e-newspapers
conceived around 1994. Roger Fidler testified via
video during the trial about the device, which has
rounded corners like the iPad, and was never sold.
Samsung contends the device was similar enough to
Apple’s to throw out one of the design patents in the
case.
Another important document: a sketch of a Samsung
tablet that appeared in an email dated Jan 6, 2010,
three weeks before the first iPad was announced.
Samsung argues the black-and-white mock-up—
embedded in an email to a senior Samsung industrial
designer, Jin Soo Kim—proves it conceived of its
Galaxy tablet design before the iPad was unveiled.
Mr. Kim and another Samsung designer testified that
they didn’t copy Apple’s products.

Lawyers following the case say that Apple has to do
more than show Samsung wanted to make its
products more like the iPhone.
“The real question is whether Samsung’s designs are
close enough to Apple’s to be infringing,” said Jorge
Contreras, an associate professor at American
University Washington College of Law.
For determining whether the devices infringe Apple’s
design patents or dilute its trade dress—the overall
appearance of the device—a key issue is whether
consumers could confuse Samsung and Apple
products. To prove they could, Apple introduced a
report from Best Buy Co. that mentions people
returning Samsung’s Galaxy Tab because they had
been looking for an iPad.
Judge Koh earlier issued an injunction against one of
the disputed products, the Samsung Galaxy Tab 10.1,
on the grounds that Apple had a strong case.
Jurors, who had access to devices during
deliberations, were expected to study them feature
by feature, judging whether their thickness, rounded
edges, fronts, backs and icons are “substantially the
same” as those cited in Apple design patents. They
must come to a unanimous decision to find any
device infringes a patent.
In his final remarks Tuesday, Charles Verhoeven, a
Samsung lawyer who works for Quinn Emanuel
Urquhart & Sullivan LLP, showed close up drawings
of the iPhone’s bezel—the casing that runs around
the rim of the phone—from a related patent, and the
Galaxy S 4G’s bezel. He noted that the iPhone’s
casing was a uniform thickness and the Galaxy’s
wasn’t. “It is a completely different design style,” he
said.