Patent News | "Apple Demands $2.75 Billion From Samsung's US Sales As Compensation For Patent Violation"

By: Kamakshi S
Cartegory: Patent News

Apple has claimed that over a quarter of Samsung Electronics' $30.4 billion in US smartphone and tablet sales have come out of the latter copying the looks and features of the iPhone and iPad, or by infringing other patents, reports Reuters. The company is demanding up to $2.75 billion in damages from its Korean rival, which includes lost profits. Samsung has sold over 87 million mobile devices from mid-2010 to March 2012, as per documents exhibited before the jury. Testifying as an expert witness for Apple, accountant Terry Musika, citing Samsung records estimated that $8.16 billion in revenue, or 22.7 million of total unit sales over that two-year period, came from products that infringed upon Apple patents, such as the first Galaxy S smartphone in July 2010.

Samsung earned roughly 35.5 percent gross profit margin on that revenue, between June 2010 through March 2012, Musika said. Apple's legal battle with its fiercest business rival, which has transfixed the global mobile industry, moved into a technical damages-estimate phase this week. The trial, which began in late July, has seen a procession of executives, designers, and patents experts testifying on behalf of the US company. Closing arguments should begin next week.

Inside Scoop
The trial continues to offer glimpses behind Apple's secretive operations, starting from its industrial design process, to its product marketing machine.

On Monday, an Apple executive testified that the company had licensed prized design patents to Microsoft Corp but with an "anti-cloning agreement" to prevent copying of its iPhone and iPad. Apple had reached out to Samsung in 2010, hoping to strike a similar agreement with its rival before their dispute hit the courts, patent licensing director Boris Teksler said.

Teksler testified that Apple offered several patents for licensing barring the crucially viewed patents related to what he called the "unique user experience" as a highly protected category. Those included design patents at issue in the lawsuit, covering the look and feel of the iPhone and iPad. Apple's decision to license its design patents to Microsoft was consistent with its corporate strategy, Teksler said, because the agreement prohibited Microsoft from manufacturing copies.

A few days ago, Samsung and Apple were both forced to reveal their original sales figures. Samsung has been known to declare only the number of products shipped, as opposed to actual devices sold. By the likes of it, Samsung has been inflating figures to paint a rosy picture. In hindsight though, I feel the strategy has worked in its favour: not only has it managed to get a steady fan following in the last few years (fan boys are a hard lot to convince), but now that the sales figure are actually far lesser than anticipated, they'd have to fork out a lot less in case the ruling goes against them.