apple inc v samsung electronics company

So when you say what it’s applied to, you’re not talking about it in terms of the physical world, so what is — what are you talking about? 6. Security, Unique %PDF-1.3 Furthermore the Apple Pay has been made available in the Us market in 2014 October, will be launched by the start of 2015 calendar year. And we think that’s a mistake, and we understand all parties to agree with that now. Your Honor, in this case it is — there are three patents. Thank you very much, Your Honor. There is no — whatever you determine the right instruction should be, there is no basis to overturn the jury’s damages verdict in this case. And to be clear, I’m now stressing our article-of-manufacture argument, not the causation argument we gave as an alternative. The burden is on the plaintiff to show damages. Asserted claim 6 of the 604 patent is directed to a “unified search” that uses heuristic modules to search multiple data storage locations. We think Congress was entitled to exercise its fact-finding power to say that it is appropriate as a matter of causation to say that design causes value in a single article product like a rug. N.D. Cal. My preference, if — if I were just making another sensible rule, is we’d have market studies to see how the — the extent to which the design affected the consumer, and then the jury would have something to do that. We said very clearly article of manufacture is less than the total phone and profit should be limited to the profit from the article. Sometimes you — you might try to build up the share of the profits from the bottom up by saying, what’s the cost of each of these components, and then what share of the revenue is attributable to each of these components. Well, the design, by definition, applies to the outside. And if you don’t tell the jury that there is that distinction, I think you either disregard what Congress meant in its statute or you create the kind of absurd results that your brief is full of. But once you’ve identified the relevant article, then it seems to me necessarily what you’re doing is apportioning profits. And so what, besides the jury instruction — because I’m assuming that a proper instruction was given — what would have been the legal error? United States Court of Appeals,Federal Circuit. It is wrong as a matter of law to hold that the entire product is necessarily the article of manufacture from which you measure total profit. We’re claiming a very specific front face and surrounding bezel, and by the way, ignore everything that’s outside the dotted lines. The first is — the antecedent question is identify the relevant article of manufacture. Now, I look at this record, and they were claiming the profits on the whole phone. Then the third one is conceptually distinct innovations, and I think that one cuts the other way. That is correct, Your Honor. This is what they were arguing, and they put on an expert that gave total profits. You are on page 1 of 20. Three ways, Your Honor. Suppose the Volkswagen Beetle design was done in three days, and it was a stroke of genius and it identified the car. So we think that there’d be two factual questions in a case where that’s disputed. (Investor.apple.com, … For example, most importantly the identity of what it is that is typically consumed by purchasers. b5c��g�Iff:c]43�[�y�(û���R���ŞI�k��� ��D=���睍�(�/(�������ΠNt����b���$�G��5!�#�{��A�+I�����k5�aN�M�h�Q�Bnj�<6�7�!������ �@��->Jj"I��g���|L.�Ac��s�DU�;�j��욘�2������V8g����i�9ME&�e L0iK�9?�Q�Q�>H�jW����7�T��Ϣ�@�3�IkKX����fjyYe"��D�Y&�,��n�o�6, ��W�x�U��+��ʄ:��Ac���Ȳ%�_�3�D^��� �>I��mK�l�:O�f�_��&�D۵�� o����r$�E?Q�����Yt2��jm�恳�'Yoq@�9.䦱���OKj.��L�4 ����X-�������0��� What happened is we went to the court and we said please listen to us about article of manufacture, if you only get the total profit on the article. One was utility patent damages, as I described. It’s not applied to the — all the chips and wires, so why —. Because we know that district courts look at patents. In other words, as the government’s brief says, can the user or the seller physically separate it, or is it manufactured separately. Apple … The burden is on the plaintiff to show what the article of manufacture is. Once the fact-finder makes that judgment, that’s the test that we proposed, and that’s, I think, I took to be Justice Sotomayor’s question. That is, to — to disgorge the profits from the article to which the design was applied. Experts would come in and say, but it’s 90 percent of the profits. I said besides a properly instructed jury, could they have found in favor of Apple on the evidence presented? In April 2011, Apple Inc. (Apple) sued Samsung Electronics, Co., Ltd. (Samsung) and argued that certain design elements of Samsung’s smartphones infringed on specific patents for design elements in the iPhone that Apple holds. Is that because the district judge limited them? Apple Inc. v. Samsung Electronics Co. Ltd. et al, No. The jury held that Samsung had infringed on Apple’s patents and awarded over $1 billion in damages. Well, you can’t claim the design patent for a Volkswagen doesn’t cover the innards, but you just admitted that a jury could find its — could find that the consumers and others would perceive the Volkswagen to be a Volkswagen by its looks only. Just to summarize briefly, first, the court of appeals correctly held that Section 289’s provision for an award of total profits means that the patent-holder can recover all of the profits from the sale of the infringing articles and manufacture and not just the portion of the profits that the patent-holder can prove was caused by or attributable to the design as opposed to other features of the article. I see my time is expired. May he — may he complete his answer to my question? Your Honor, let me answer your question as precisely as I can. If you need this or any other sample, we So, Your Honor, if there had been a design patent on the entire case, then, yes, absolutely, Apple could have tried to get total profit on the entire case. Case: 14-1335 Document: 158-1 Page: 2 Filed: 05/18/2015 . What’s wrong with that analysis? Could I really quickly make sure I understand that, that in other words, you’re — you’re saying we should only look to what an article of manufacture is and not your other argument that there should be apportionment as to any particular article of manufacture. To be clear, we say that what the Federal Circuit held was wrong as a matter of law. Justice Breyer, this is not a difficult — the record in this case is not difficult. I assume in a case like this, Apple will say it’s the whole phone. And I don’t see that as a matter of law. There’s an article of manufacture here, but it may be less than the entire phone. Apple Inc. v. Samsung Electronics Co. Ltd. et al. The phones are the things that were infringed for purposes of sale, and here is what our evidence is on total profits from the phone. That is relatively straightforward when, in a contested case, the jury concludes that the article of manufacture is the product that’s sold. A design is applied to a thing. So why, if — we have a hard-enough question trying to figure out what the standard is. And if you get the profits from the spoon, that’s all right. So besides the jury instruction, what was the legal error? August 18, 2012: Filing 1828 Tentative Final Jury Instructions - Part … This isn’t one of Apple’s 13 other patents on other parts of the phone, or Apple’s other patent on the design of the entire case. SAMPLE. The first one would be what is the relevant article, and there may be a dispute on that as there is in this case. As has been discussed, it has two parts. So we can segregate article from other articles within the product. You ought to look at the patent because, Justice Ginsburg, the patent is going to be the best guide to what the design is applied to in many, many cases, as in this case. It may be that the article of manufacture to which the design patent is applied is just the exterior body of the car, but it may be that nobody really wants to pay much for the innards of the Corvette or the Beetle. Under your hypo, what — if Apple got almost all its profits from the exterior case, people were indifferent to whether they could read their e-mail, navigate, take photos, or any other functions. Apple Inc. v. Samsung Electronics Co., Ltd. was the first of a series of ongoing lawsuits between Apple Inc. and Samsung Electronics regarding the design of smartphones and tablet computers; between them, the companies made more than half of smartphones sold worldwide as of July 2012. This case was tried under the improper rule of law. And so that kind of standard, with perhaps examples to explain it to the jury, you know, wallpaper, you get the whole thing. The jury was not properly instructed here. Yes, Your Honor, you would. And you’re answering “no” to my question. The legal error was in the jury instruction —. And when they look at a patent for a claim construction, we’re asking for part of the test to be very similar. PETITIONER:Samsung Electronics Co., Ltd., et al. It’s an — it’s a — it’s a question of either fact or, as you said in Markman, a mongrel question of law and fact. If I’m the juror, I just don’t know what to do. That’s wrong as a matter of law, but we did not argue, Your Honor, that the test has to hold we’re right on the article as a matter of law. Then second step, determine the quantum of damages, quantum of profits in this case, from that article. And, in fact, Section 289 requires us to do that because it allows total profit only from that article of manufacture to which the design has applied. We tried over and over and over again to get the article of manufacture’s theory embraced, and we were rejected. Jump to Page . So I think the — the Sheldon case that’s cited on page 27 of our brief from this Court that was a Copyright Act case but discussed these problems sort of generally discussed how you apportion the portion — the profits from a movie that are attributable to the script as opposed to the actors or the directors or other things. A jury found that several Samsung smartphones did infringe … And Your Honor, the question for the jury was not did people think that the look and feel of an iPhone was great. But I have a question on the general issue, which I think is tough. Maybe it’s a good time to turn to Justice Breyer’s question. In two separate lawsuits, Apple accused Samsung of infringing on three utility patents (United States Patent Nos. But you mean it in a different sense, and I don’t really understand what — what that means. What if it got 2 miles per gallon? We’re getting a little more with article of manufacture than we do with a pure causation test, and plaintiffs should be happy for that. And when that is the case, all parties now agree that the patent-holder is entitled only to the profits from that infringing article and not to all —. Second trial happens on certain phones. Ms. Sullivan, you seem to be arguing, as when you opened, that as a matter of law, you were right. The factors are helpful in making the determination. The jury evaluated the case and found that Samsung had truly violated Apple… And the evidence came out of Apple’s own witnesses, which we’re certainly entitled to rely on. Juries should be instructed that the article of manufacture either is the Beetle exterior or there might be, Justice Breyer, still today, there might be cases of unitary articles, just like the Dobson rugs. See Apple Inc. v. Samsung Elecs. So there should — there shouldn’t be profits awarded based on the entire price of the phone. Apportionment is what their expert, Mr. Wagner, tried to do in his report saying the total profits on the phone are X hundreds of millions of dollars, but I find that only one percent of consumers buy phones because of the front face of the phone either off or on. This is a case very much like global tech, when you found that the lower court had applied the wrong standard for intentional infringement, and then found that the record — even — but under the correct higher standard, the record admitted no other conclusion. They never said that to the jury. The jury held that Samsung had infringed on Apple’s patents and awarded over $1 billion in damages. Section 289 does not require that result, and as this case comes to the Court on the briefing, Apple and the government now agree that Section 289 does not require that result. Now, the test that we ask the Court to announce on remand. It would seem to me the higher the cost, the less it contributed to profits. Article of manufacture is the article of manufacture. But we think that courts could sensibly look to the way that courts have handled other analogous questions, and I point to two areas of law where that’s happened. 1 Tech Company With More Patent Prowess Than Apple Inc. or Samsung Electronics This company was awarded the most U.S. patents for the 22nd consecutive year -- … It has to be applied to the outside of an article. I don’t know where in the record you would have enough to survive your argument. One 2005 design patent"at the heart of the dispute is Design Patent 504,889", which consists of a one-sentence claim about the ornam… Once you get beyond the pure — where is the design applied? But somebody who looked at the exterior of a Jeep that copied the iconic side profile of the VW Beetle might very well say that, and a jury would take that into account. Now, the difficulty with that — I mean, I think that’s what courts have generally done. He wanted — he calculated total profits based on the phone. The district court can look at the patent and say, oh, this is Apple’s front face patent. Your Honor, let’s go back to the proper instruction. Congress said you can’t apportion the value of the design in relation to the article. They said we’re claiming a very specific front face, and by the way, ignore the home button. This case sort of stopped at the first step. Another factor is whether the design is conceptually different from the product as a whole, as, for example, a design on a book binding is different from the intellectual property reflected in the copyright material in the book. We’ll hear argument first this morning in Case No. The district court upheld the jury’s findings. Do you agree with that? I’m not going to the — I’m sticking with the test. You can’t really have apportionment, so it seems to me you leave us with no — one choice is to have a de minimis exception, like the cup-holder example that’s in the car — maybe the boat windshield, which is a little more difficult — and just follow the — and just follow the words of the statute. No. The article to — to which the law applies? APPLE INC., A California Corporation, Plaintiff–Appellant v. SAMSUNG ELECTRONICS CO., LTD., A Korean Corporation, Samsung Electronics America, Inc., A New York Corporation, Samsung Telecommunications America, LLC, A Delaware Limited Liability Company, Defendants–Appellees. That’s the government’s test in a nutshell. See Apple Inc. v. Sam-sung ElecsCo. And the point we’re making with the VW Bug example is that in some cases, that’s going to be very easy. And as to that question, we haven’t briefed it in a lot of detail, but I was trying to explain to Justice Ginsburg that there are analogous problems that courts have confronted in other areas of law. There were two trials below. Because the entire outside of a Samsung phone does not look substantially similar to the entire outside of a Samsung phone. Sometimes instead they’ve — they’ve done a more impressionistic approximation and said the total profits on this product are $10 million, and we think that the component at issue here, based on expert testimony, is responsible for a quarter or 25 percent. It also directed the jury to apportion, and the judge didn’t approve it. Obviously, it’s not a transistor or some circuit or the software. 5. If, as sometimes happens within a company, one division makes the glass front face and another division makes the innards of the phone, you would find out the transfer pricing between the divisions. So, Your Honor, that’s a little bit overinclusive. Apple Inc. v. Samsung Electronics Co., Ltd. Cases 14-1802 14-1802 14-1802 14-1802 Venue Federal Circuit ... America, Inc., a New York corporation; and Samsung Telecommunications America, LLC, a Delaware limited liability company Case 5:12-cv … On August 21, 2012, a jury returned a verdict that 26 Samsung products infringed Apple’s patents or diluted That is very much our position. I’ll answer Justice Ginsburg first and then Justice Breyer. The court reasoned that such a limit was not required because the … Controversy. So I think, Mr. Chief Justice, it will depend on the case. This hypothetical is not helpful to me, because I can’t get over the thought that nobody buys a car, even a Beetle, just because they like the way it looks. Suppose — suppose you had a case where it’s a stroke of genius, the design. But that’s the principal reason why the product has been successful. In the case of a wall hanging, there’s really not much dispute. And we were shut down over and over again on that. Now, really, to understand it, you have to have examples — but antitrust cases are hard to understand — and our rule of reason and people do use examples. Who has the burden of showing what is the relevant article? Justice Breyer, if this were difficult, it would be entirely appropriate for this Court simply to announce what the law is, which I think there is a great need for this Court to do. The real difficulty is in calculating a hundred percent of the profits from that article of manufacture. Apple disclaimed everything outside the solid line. That’s the article of manufacture. If the jury credited them, could you — and you were properly — it was a properly instructed jury, could you overturn that finding? The — the test — and I want to agree with Your Honor. Coverage of federal case Apple Inc. v. Samsung Electronics Co., Ltd., case number 15-1171, from Appellate - Federal Circuit Court. Now, why can’t we just ask the lower courts to listen to your arguments and theirs, and work it out? APPLE INC. v. SAMSUNG ELECTRONICS CO., LTD. 786 F.3d 983 (CAFC 2015) PROST, Chief Judge. What is the thing, the article of manufacture, to which the design is applied for purposes of sale in order to give it a distinctive and pleasing appearance. We think our test is more administrable, and it can often be done, Justice Kennedy, by judges as they do in Markman, who will then instruct the jury and give them guidance. That is correct, Your Honor. Among other things, Samsung argued that Apple’s trade dresses could not be protected under trademark law because they were functional. The second question, once the fact-finder identifies the relevant article, is the question that you asked, which is how much of the total profits from the device are attributable to the infringing article? apple vs samsung. There’s no doubt the steam engine had plenty of working components, but a design is not a component. As to the second factor, how prominent is the design feature, I think that’s one that cuts in favor of finding that the design does cover the whole article. With respect, we request that you remand — vacate and remand. 7,469,381, 7,844,915, and 7,864,163) and four design patents (United States Patent Nos. We’re not — never going to be able to get to certainty, but on these sorts of profits questions and these sorts of remedies questions, a reasonable approximation is good enough, and it’s certainly better than awarding all or nothing. They want the car that has a certain trunk. In other words, suppose I think that people who buy VW Bugs buy them because of the look of the car. Apple Inc. appeals from an order of the U.S. District Court for the Northern District of California denying Apple's request for a permanent injunction against Samsung Electronics Company, Ltd., Samsung Electronics America, Inc., and Samsung Telecommunications America, LLC (collectively, “Samsung”). They cannot, by definition, cover the innards of the phone. Listing factors is not helpful unless the jury or whoever the fact finder is knows what the determination must — what determination must be made. And, Your Honor, the statute does support our test because the statute asks us to look at the article of manufacture to which the design has been applied. Another factor in the government’s test is the physical relationship between the patented design and the rest of the product. Your Honor, what we respectfully suggest is that there are two parts to the test for what constitutes an article of manufacture. So I thought — and that’s why I pointed to the brief I did point to — that history is matters here, and we’re talking here about a multicomponent product. And then again in our 50A and the key rulings on 50A at the close of evidence, we again said article is separate from apportionment, and the article here is less than the phone. I’d like to reserve the balance of my time, Mr. Chief Justice. Somebody just — some engineer or some graphic artist or whatever woke up one day and said I just have this great idea for an appearance. Published. And the crisis of design was reflected, the documents show, in the telephone company saying, you have to create something like the iPhone, and a directive came out to create something like the iPhone so we can stop use — losing sales. 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