Apple v Samsung: lawyers torn on which way SCOTUS will rule

The US Supreme Court is due to hear the Apple v Samsung design patent case tomorrow, with lawyers finding it hard to predict which way the court will rule.

It comes as an en banc US Court of Appeals for the Federal Circuit, ruling on a separate patent dispute between the companies, decided on Friday, October 7 to affirm and reinstate a US District Court for the Northern District of California decision that handed Apple $120 million.

At play in the Supreme Court case are patents D618,677, D593,087 and D604,305, which are owned by Apple.

The ‘677 patent covers the rectangular front face of a smartphone with curved corners. The ‘087 patent introduces a rim surrounding the bottom of the device, and the ‘305 patent relates to the shape of the grid displaying app icons on the screen.

In 2015, the Federal Circuit awarded Apple $548 million in damages for Samsung’s infringement, calculating the damages based on total profits made from the products.

The Federal Circuit’s ruling affirmed an earlier 2012 decision at the Northern District of California.

However, the damages were reduced from $930 million because trade dress dilution was vacated by the court.

Section 289 of the US Patent Code states that a party is liable for the total profit of a product that infringes another party’s design patent.

However, Samsung rejected the notion of applying damages based on total profits and said the decision would create a “sea-change” in the law of design patents.

In December 2015, Samsung filed a writ of certiorari, which was granted by the Supreme Court in March this year.

In June, the US Department of Justice (DoJ) filed an amicus brief at the Supreme Court and asked it to return the case to a district court for more litigation.

Since that time, Nike, the Internet Association, the Hispanic Leadership Fund, which is a non-partisan advocacy organisation, and several other groups have filed amicus briefs in the case.

The Supreme Court will assess the question of: “Whether where a design patent is applied to only a component of a product, an award of infringer’s profits should be limited to those profits attributable to the component.”

On July 29, Apple argued that: “Unless you find that a portion of the profit from the sale of the infringing product is attributable to factors other than use of the infringed design, you shall find that the total profit is attributable to the infringement.”

Samsung replied a month later, saying: “The Federal Circuit’s misinterpretation of section 289 necessitates reversal. On the existing record, no reasonable jury could find that the relevant articles of manufacture were Samsung’s entire phones.”

WIPR spoke to patent lawyers about the upcoming case.

David Kappos, partner at law firm Cravath, Swaine & Moore and former head of the US Patent and Trademark Office, told WIPR that hecan’t predict what the Supreme Court will do in this case.

But he said that “this is an important case for the field of design. Excellent design does not happen by accident—it happens through tremendous investments of talent, technology, and intellect.

“Excellent design becomes more and more important as the world gets more complicated—it is excellent design that enables ordinary people to work effectively with complicated technology. In view of all this, it is hard to over-emphasise the need to incentivise and reward excellent design with a strong level of protection.”

He added: “I do hope the Supreme Court’s decision will take all of this into account, because we’re not really talking about legal documents (patents) in the end—we’re talking about people having effective access to the world around them, through excellent design.”

Michael Sandonato, partner at Fitzpatrick, Cella, Harper & Scinto, said: “Design patents have had nowhere near the prominence of utility patents in the litigation landscape. But if the Supreme Court affirms the Federal Circuit’s decision outright, it is possible that we could start to see design patent owners assert their property rights more aggressively.

“On the other hand, if the Supreme Court rules in a manner more in line with the DoJ’s position, I think that it’s likely we’ll see the status quo maintained.”

Sandonato addressed the question of how likely it is that the Supreme Court will listen to the DoJ’s view.

“The DoJ’s brief wisely treats the issue [of totality of profits] as one of statutory interpretation as well, but focuses on the question of what the relevant ‘article of manufacture’ is, and argues that it sometimes may be a component of the finished product.

“It is difficult to predict what the Supreme Court will do, but to the extent that they view the case as a choice between a more flexible rule on the one hand and a more rigid rule on the other, I think that they will land somewhere closer to the DoJ,” he said.

In the Federal Circuit ruling on October 7, the patents in dispute are US numbers 8,074,172, 5,946,647 and 8,046,721, owned by Apple.

In 2014, Samsung’s Android-based devices were found to infringe the patents, which protect technology including the auto completion of words when typing on a keyboard.

Earlier this year, a panel at the  Federal Circuit reversed the $120 million ruling.

But the full Federal Circuit has now ruled 8-3 in favour of the district court’s decision.