Patent Wars

Apple vs. Samsung: Shaping the Mobile Battlefield


Apple vs. Samsung: Shaping the Mobile Battlefield

Photograph by Scott Eells/Bloomberg

On July 9, a British judge named Colin Birss ruled that Samsung’s tablet computers were unlikely to be confused with Apple’s iPad because they’re “not as cool.” In the often-bizarre world of intellectual property law, this was bad news for Apple (AAPL).

The two companies, along with several other rivals, are battling it out in what can appear at times like a globe-spanning courtroom free-for-all over who invented what in smartphones and tablets. In fact, there is a shape to the struggle for domination in the booming $312 billion mobile device market: Apple has gone after HTC and other competitors that it sees as proxies for another foe—Android, the operating system Google (GOOG) gives away to manufacturers. Google’s open approach threatens Apple’s pitch to consumers that its exclusive, “walled garden” offerings are different and better.

While everyone in the tech business wants to be seen as hip, Judge Birss’s determination, in the U.K. front of the IP world war, meant the Korean company’s products were distinctive (uncool) enough not to infringe Apple’s registered designs. Score that round for Samsung (005930).

This is, however, a marathon bout, or perhaps cage match. Having fought over the past two years on four continents, lawyers for Apple and Samsung will for the first time take their fracas before an American jury in a trial scheduled to start Monday morning in federal court in San Jose, Calif. Once U.S. Judge Lucy Koh, herself a former Silicon Valley litigator, has empaneled the jurors, the laypeople drawn from Apple’s backyard will have to sort through each company’s reams of claims that its rival infringed patents covering designs and technology. Billions of dollars in potential damages are at stake. (Between them, Samsung and Apple control almost half of the smartphone market; Apple alone has more than two-thirds of the tablet business.)

As complicated as this may all seem, Apple will try to convince jurors of one essential idea: Samsung is a copycat.

“Samsung is on trial because it made a deliberate decision to copy Apple’s iPhone and iPad,” the Cupertino (Calif.)-based company declared in the opening line of its key pretrial filing with the court. “Try as it might,” the filing added, “Samsung cannot deflect attention from its own copying by the patents it has asserted against Apple.”

Look, Samsung answered in its filing, a lot of competing products appear similar. “In this lawsuit,” the Korean company said, “Apple seeks to stifle legitimate competition and limit consumer choice to maintain its historically exorbitant profits. Android phones manufactured by Samsung and other companies—all of which Apple has also serially sued in numerous forums worldwide—offer consumers a more flexible, open operating system with greater product choices at a variety of price points as an alternative to Apple’s single, expensive, and closed-system devices.”

The trial may well boil down to whether a little copying is such a bad thing. Samsung’s filings indicate that it will acknowledge that it closely studies its rival’s products. That some Samsung phones and tablets imitate the look and features of Apple’s versions is pretty much beyond question.

So what? Samsung will ask. Apple’s innovations are built on earlier products made by numerous rivals, the Korean company will contend, and the late Steve Jobs’s real genius was for marketing those innovations , not coming up with them in the first place.

Jobs’s successor as Apple’s chief executive officer, Tim Cook, summed up his company’s rejoinder during an interview in June at the All Things D conference. “It is important,” Cook said, “for Apple not to be the developer for the world.” He added: “We just want other people to invent their own stuff.”

Initiated by Apple, this battle may be determined more by how Judge Koh explains the relevant law to the jurors than any loyalty they have to the home team. One crucial question is the legal standard for design patent infringement. Drawing on various precedents, Samsung said in its pretrial filing that Apple must prove that an ordinary consumer would be “deceived” into buying a Samsung tablet or phone, thinking that it was made by Apple. “Infringement requires deceptive similarity,” according to the Korean company.

Apple, according to its filing, maintains that the judge should tell jurors that “deception” is not necessary. All Apple believes it has to prove is “substantial similarity”—the copycat theory.

Apple’s Cook and Choi Gee Sung, the former CEO of Samsung, had tried and failed to settle the case in court-ordered mediation. Hanging over the conflict is the confounding fact that, apart from their legal hostilities, the two companies rely heavily on each other—Samsung being one of Apple’s main suppliers of flash memory chips, display screens, and other components.

The animus driving the litigation runs deep, however, especially on Apple’s side. In the last 18 months of his life, Jobs, who died on Oct. 5 at age 56, was obsessed with crushing Android. According to his authorized biographer, Walter Isaacson, Jobs swore: “I’m going to destroy Android, because it’s a stolen product. I’m willing to go to thermonuclear war on this.”


Barrett_190
Barrett is an assistant managing editor and senior writer at Bloomberg Businessweek. His new book, Law of the Jungle, tells the story of the Chevron oil pollution case in Ecuador.

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