Apple, Samsung patent spat reaches high court

Alexander Graham Bell’s invention of the telephone in 1876 sparked years of legal wrangling over patent rights. The jousting continues today at the U.S. Supreme Court, and the combatants are the two top smartphone manufacturers in the world: Apple and Samsung.

The law involved, both now and in the 1800s, applies to the design or look of a product, not the technology that makes it work. A jury found Samsung guilty of copying several design elements of Apple’s iPhone: the black glass face, the rectangle shape with rounded rims, its circular home button, and the multicolored display of icons.

For those violations, Samsung was ordered to pay nearly $1 billion in damages—its total profit from the design of the phone, as the law requires. The company appealed the verdict and presented arguments before the high court earlier this month.

“That result makes no sense. A single design patent on the portion of the appearance of the phone should not entitle the design patent holder to all the profit on the entire phone,” argued Samsung’s lawyer, Kathleen Sullivan.

But Apple lawyer Seth Waxman argued the law was on his client’s side. Waxman said Apple spent lots and lots of money developing those designs, and they are a big part of why people buy the iPhone.

But how do you put a dollar value on looks in a damages case?

“It seems to me neither side gives us an instruction to work with,” Justice Anthony Kennedy said. “Both parties kind of leave it up and say, oh, give it to the juror. If I were the juror, I simply wouldn’t know what to do.”

Sullivan suggested a two-pronged test. First, decide the specific thing covered by the design patent and then figure out the profit tied to just that aspect. But old patent law does not allow for apportioning damages that way.

Brian Fletcher of the U.S. Department of Justice argued on behalf of the government for a different approach. He suggested polling customers to see to what extent the look of the phone influenced their purchase and basing the decision on the survey results.

Most observers seem to agree current law overcompensates patent holders when they get total profits from complex products such as smartphones. Samsung’s lawyer asked the Supreme Court to remand the case to a lower court with whatever new standard the justices devise.

Listen to “Legal Docket” on the Oct. 31, 2016, episode of The World and Everything in It.