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Appeal of $400M Award In Apple-Samsung Patent War

The U.S. Supreme Court recently decided to hear Samsung’s appeal of a $400 million judgment that Apple won in a smartphone patent suit.  The Supreme Court agreed to consider Samsung’s argument that the damages test for design patents results in “unjustified windfalls” for patent owners.

The Supreme Court granted Samsung’s petition for a writ of certiorari, which challenged a lower court’s decision that the tech giant must pay Apple its entire profits from smartphones found to infringe Apple’s design patents on the look of the iPhone.

Samsung told the justices that the Federal Circuit misread the law and argued that requiring companies to pay their entire profits when they are found to infringe design patents results in exorbitant awards and gives design patents too much power.

“The decision below is thus an open invitation to litigation abuse, and has already prompted grave concern across a range of U.S. companies about a new flood of extortionate patent litigation, especially in the field of high technology,” Samsung said.

In 2012, a jury found that Samsung infringed Apple’s patents and awarded more than $1 billion in damages, but a damages retrial reduced the award to $548 million. Samsung elected not to appeal the portion of that award dealing with utility patents, and focused its Supreme Court petition on the $399 million in damages related to the jury’s finding of design patent infringement.

Samsung noted that the justices had not heard a case dealing with design patents in more than 120 years. The rule that companies must pay their “total profit” from expensive products like smartphones found to have infringed design patents makes no sense in the modern world, the company argued.

“With the recent explosion of design patents in complex products like smartphones, the time is ripe for this court to again take up the issue,” it said.

Apple told the Supreme Court that the law “could not be clearer” that infringers must pay their total profits for design patent infringement, so there was no need to hear the case.

“Samsung had its day in court — many days, in fact — and the properly instructed jury was well-justified in finding that Samsung copied Apple’s designs and should pay the damages that the statute expressly authorizes,” Apple said.

“We welcome the court’s decision to hear our case. We thank the many large technology companies, 37 intellectual property professors, and several groups representing small business, which have supported our position,” Samsung said. “The court’s review of this case can lead to a fair interpretation of patent law that will support creativity and reward innovation.”

For more information, see Law360.



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