Apple and Samsung are back in court over the design of iPhone.

Mobile Phone
Samsung and Apple arrive to a San Jose, California district courtroom on Monday to resume a patent infringement dispute that dates back to 2011. The current chapter in the longstanding saga is about determining the financial damages which Samsung is indebt to Apple for infringing on design patents covering the iPhone, an outcome that could have a broad impact on intellectual property law.

Here is how we got there.

In December 2016, the U.S. Supreme Court denied the near $400 millionjudgement that Apple had won over allegations that Samsung replicated iPhone-designed features used in its own smartphones. The amount, based on Samsung’s profits from the sale of such smartphones, had already been whittled down through the courts from $1.05 billion that a jury rewarded Apple in 2012.

The fact that Apple is due financial damages from Samsung — which has already paid back $548 million to Apple — isn’t in dispute in this retrial. What the justices effectively did was kick the case back down to the lower courts to have a jury decide how those damages will be measured.

That is “the big deal as this case moves forward,” said Mark McK

As part of the previous verdict, it was determined that Samsung infringed on three of Apple's iPhone design patents covering a rectangular front face with rounded edges and a grid full of colorful icons on a black screen.

The current legal squabble will turn on what is referred to as the “article of manufacture” and whether in this case the relevant article means the entire phone, or merely design features within the smartphone that relates to the infringed patents.

The Supreme Court recorded the article of manufacturer is “broad enough to embrace both a product sold to a consumer and a component of that product, if sold separately or not.”

Apple has been pursuing the complete profits attributable to the sales of the infringed phones; Samsung has been arguing for smaller penalties which is directly related to the value of features impacted by the patents. Samsung has not sold the smartphones in question in more than five years.

Determining the outcome which won’t be easy for the jury, McKenna says, “The Supreme Court decision struck me as obviously right. But it had not do anybody a favor by punting on the hard question which is 'how can I identify those circumstances where this is worth less than the whole?’”

The 1887 patent law on which the current case relates to covered design patents back in the day for items such as carpets, wallpapers and oil cloths.

During the previous trial, Apple lawyer Seth Waxman argued that the design patent addressed to "the thing to which the design is applied" — meaning the whole smartphone. "Design is not a component," he stated.

Samsung's lawyer, Kathleen Sullivan, told the justices, "A smartphone is smart because it has hundreds of thousands of the technologies that makes it work.”

At the time, Justice Elena Kagan, seemed to offer something for both the sides. She said a Volkswagen Beetle's design is the example of "the thing that makes the product distinctive.” But she also also added that "the car has to run, and it has to do all the other things that cars can do."

Neel Chatterjee, an intellectual property litigator and Silicon Valley-based partner at Goodwin Procter, said that, "A computer without a power cord wouldn’t work, but the cord is not where the computer derives its primary value."

“Some people could go to court and say without a power cord that it wouldn’t work so I should get a bigger slice of the overall patent royalties due associated with the device. That’s a very extreme example. But you can possibly imagine when there are thousands of patents that cover something like a Samsung phone there’s going to be a lot of fight regarding relative importance, and what factors you look to determine their relative importance to value the patent.”

The latest trial is expected to last a number of days, with the jury to be selected Monday and initiating arguments to follow Monday or Tuesday. Neither Apple's CEO Tim Cook nor the company’s design chief Jony Ive is needed to testify. 

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