Koh: Apple's Racially Charged Argument ‘Troubling' But No New Trial for Samsung

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By Tamlin H. Bason

Feb. 10 --Comments made by Apple's counsel during closing argument were “troubling” because they seemed intended to highlight the fact that Samsung is a foreign company, but Samsung is nonetheless not entitled to a new trial on claims that it infringed Apple's patents, the U.S. District Court for the Northern District of California held Feb. 7 (Apple, Inc. v. Samsung Elecs. Co., N.D. Cal., No. 5:11-cv-01846-LHK, 2/7/14).

“Counsel's argument clearly suggested an us-versus-them, American-versus-non-American theme to the jury, which could have evoked national origin prejudice,” the court said of the comments. However, “while the comments were troubling, a new trial is not warranted under the applicable standard” under Fed. R. Civ. P 59, the court found. It therefore denied Samsung's motion for a new trial.

The court also denied both parties' motions for judgment as a matter of law. Specifically, Apple sought additur, supplemental damages and prejudgment interest whereas Samsung sought remittitur. But the court said that neither party had introduced sufficient evidence that would warrant an increase or reduction of the jury's damages award.

Closing Argument Spurs Controversy

The “troubling” statements were made to a jury just before it began deliberations on whether a number of different models of Samsung Electronics Co.'s Android-based smart phones and tablets infringed Apple Inc.'s patents. It was the second jury to have faced the issue after an earlier award of $1.05 billion (166 PTD, 8/28/12)was reduced by Judge Lucy Koh (43 PTD, 3/5/13). The second jury awarded Apple $290 million in damages for Samsung's infringement of three utility patents and two design patents (227 PTD, 11/25/13). Samsung again moved for a new trial, in part based on the argument that statements made by Apple's counsel prejudiced the jury.

The following portion of Apple's closing argument was what Samsung objected to:

We are extremely fortunate to live in what I'll call the Greater Bay Area. Not only is it beautiful, but we live in the center of one of the most vibrant economies in the world. Intel, Yahoo, Oracle, Facebook, eBay, and hundreds and hundreds of other companies, including Google, and including Apple, and these companies attract talented employees at every level. Even, we heard, Samsung has opened a research center here so that they can take advantage of the talent in this area.

The companies provide jobs. They create technology that improves the way people work. And the company -- and this economy supports an education system that is second to none in the world, Berkeley, Stanford, San Jose State, U.S. [sic] Santa Cruz, even Santa Clara where I went to school.

These educational institutions interact with this economy, interact with these companies and create a place that the whole world knows as Silicon Valley.

But let's be equally clear about one thing. Our vibrant economy absolutely depends on fair competition. It depends on a patent system that encourages inventors to invent, it encourages investors to invest, and it encourages employers to hire.

If we allow that system of law to decay, investors will not invest, people will not take risks, and our economy will disappear.

When I was young, I used to watch television on televisions that were manufactured in the United States. Magnavox, Motorola, RCA. These were real companies. They were well known and they were famous. They were creators. They were inventors. They were like the Apple and Google today.

But they didn't protect their intellectual property. They couldn't protect their ideas. And you all know the result. There are no American television manufacturers today.

 

Samsung's counsel objected to the statements at the time and the court asked Apple's counsel to move on. After the jury left the courtroom, the court offered Samsung a number of remedies. Ultimately, the court decided to send the jury a note reminding it that it “must not be influenced by any personal likes or dislikes, opinions, prejudices, or sympathy, and any appeal by any of the parties to any prejudice or sympathy is not proper.”

Comments 'Troubling,' Not Prejudicial

In its motion for a new trial, Samsung argued that the corrective note did not cure the prejudice. The court eventually disagreed, but not before harshly criticizing Apple's counsel. Koh said:

Counsel's argument clearly suggested an us-versus-them, American-versus-non-American theme to the jury, which could have evoked national origin prejudice. This effect is minimized by the cold transcript, which elides counsel's strategic and effective pauses, timed in a way that created silence for listeners to connect the dots and make troubling inferences. The transcript further does not capture the broader context of the courtroom and the trial, during which the immediate rows behind the attorneys were filled with client representatives with obvious differences in terms of racial and ethnic backgrounds. Therefore, an American-versus-non-American theme, which might not be troubling in every case given Americans and non-Americans are of diverse backgrounds, in the context of this trial also could have been perceived as invoking racial or ethnic prejudice.

 

The court went on to note that empirical data collected by Judge Kimberly Moore before she joined the U.S. Court of Appeals for the Federal Circuit shows that foreign patent owners are much less likely to prevail in U.S. federal courts against American defendants than are American patent owners against foreign defendants.

“Particularly in light of this empirical context and the high-profile nature of this litigation, the Court expresses its disapproval and disappointment in the comments that led to the instant motion,” the court said, adding that it had “no doubt that counsel carefully chose each theme before presenting it to the jury in closing arguments.”

However, the court concluded that the prejudice did not rise to the level of warranting a new trial under Rule 59 in part because the statements “were confined to a few seconds of the closing argument, which quickly came to an end upon Samsung's objection and this Court's admonishment to Apple's counsel to move on.” Indeed, “there is no evidence that the jury was influenced by Apple's problematic comments during closing argument,” the court said. It accordingly declined to order a new trial.

Samsung is represented by Quinn Emanuel Urquhart Oliver & Hedges, LLP. Apple is represented by Wilmer Cutler Pickering Hale and Dorr LLP.


Text is available at http://www.bloomberglaw.com/public/document/Apple_Inc_v_Samsung_Electronics_Co_Ltd_et_al_Docket_No_511cv01846/5.

 

To contact the reporter on this story: Tamlin Bason in Washington at tbason@bna.com

To contact the editor responsible for this story: Naresh Sritharan at nsritharan@bna.com