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By Tony Dutra
June 9 — The courts got it wrong and need to rethink how much Samsung owes Apple for design patent infringement, the U.S. government told the Supreme Court June 8 ( Samsung Elecs. Co. v. Apple Inc., U.S., No. 15-777, gov't amicus brief 6/8/16 ).
The brief filed by Solicitor General Donald B. Verrilli Jr. stated unequivocally that a court can award the infringer's “total profits” to the design patent owner. However, it said, those profits should only be on the particular “article of manufacture” to which the design is applied—and that is not necessarily an entire infringing smartphone or tablet.
The government recommended that the high court send the case back to the U.S. District Court for the Northern District of California for a possible retrial, depending on whether Samsung has already been given sufficient opportunity to identify a lesser article of manufacture such as a component of a smartphone or tablet.
The Supreme Court is set to hear the case in the fall. The prior $399 million damages award hangs in the balance.Source Material:
Opinion below: 786 F.3d 983 (Fed. Cir. 2015)
The jury awarded that amount after an instruction by Judge Lucy H. Koh on Section 289 of the Patent Act. The provision allows courts to award damages, “to the extent of [Samsung Electronics Co.'s] total profit,” if it “sells or exposes for sale any article of manufacture” that infringes Apple Inc.'s design patents. But, the government said, the instruction equated the term “article of manufacture” with the finished smartphones, which may not be the case here.
Apple's design patents cover the shape, corners, translucent screen and colorful icon arrangement relevant to the iPhone and the iPad. Samsung's merits briefs, filed June 1, argued that Apple's patents are not “applied” to the “circuits, microchips, speakers, processors and other internal, non-design features that give a smartphone its functionality.”
But Samsung wants the high court to say that Section 289's second paragraph is key. It refers to “profit made from the infringement,” and Samsung wants courts to be able to allocate profit “attributable to the infringing design.”
The government's brief argued against that view. It considered the possibility that the result of looking for the profit on the infringing component and Samsung's “causation and equity” approach might end up with the same result. However, it said, there is “a significant conceptual and practical difference” in the analysis.
The U.S. Court of Appeals for the Federal Circuit affirmed the jury award by saying that the “innards” of Samsung's devices are not sold separately from the case or from the icon arrangement. Apple Inc. v. Samsung Elecs. Co., 786 F.3d 983, 114 U.S.P.Q.2d 1953 (Fed. Cir. 2015)(96 PTD, 5/19/15). Consequently, there was no smaller unit of “sale” to consider.
But the government said that even a “unitary” product may contain separable articles of manufacture. It used the example of a Volkswagen Beetle to make the point: A design patent might be said to cover the appearance of the automobile body or the appearance of the car as a whole, and fact finders will have to decide in each case whether the infringer appropriated the body design—with profits limited to the shell—or the design of a car.
To make that decision, the government said, fact finders should consider the patent claim itself and the distinctiveness of the design visually, conceptually and physically.
Wilmer Cutler Pickering Hale & Dorr LLP represents Apple, whose own brief on the merits is due July 29. Quinn Emanuel Urquhart & Sullivan LLP represents Samsung.
At least two additional briefs supporting Samsung's position were filed June 8.
The Internet Association and Software & Information Industry Association were backed by Google, Facebook and other high tech firms. Public Knowledge and the Electronic Frontier Foundation and three other user rights associations filed the other supporting brief.
To contact the reporter on this story: Tony Dutra in Washington at email@example.com
To contact the editor responsible for this story: Mike Wilczek in Washington at firstname.lastname@example.org
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