Trade

Did Obama Just Pick Sides in the Apple-Samsung Patent War?


Samsung's Galaxy Mega phone is not affected by the U.S. import ban

Photograph by David Paul Morris/Bloomberg

Samsung's Galaxy Mega phone is not affected by the U.S. import ban

If South Korea is looking for evidence that the Obama administration is playing favorites in the patent war between Apple (AAPL) and Samsung (005930:KS), it got some discomfiting signals on Tuesday.

The White House decided against overruling a ban on certain Samsung products imposed by the International Trade Commission in August after the panel ruled that some older Samsung mobile devices violated Apple’s patents. The immediate practical implications aren’t significant, and Samsung will likely seek to delay a ban by appealing in U.S. courts. Even if the South Korean manufacturer were ultimately to stop selling the banned products in the U.S., the affected models are older and not popular.

By letting the ban stand, however, the White House failed to give Samsung the same benefit it gave Apple following the ITC’s move to likewise ban some older Apple products from entering the U.S. In that case, the White House issued the first veto of an ITC ban (PDF) since the Reagan administration. At that time, the South Korean government immediately complained that the U.S. was putting a finger on the scale to help a domestic business. Seoul now might see Obama’s disinclination to offer the same relief to Samsung as further proof that the U.S. government is playing favorites.

The cases are somewhat different, though. The patents Apple was found to have violated were so-called standard essential patents, meaning they are related to the basic functions of a device. As a result, Samsung was required to license them to Apple under reasonable terms. The patents in the more recent case aren’t required to be licensed. In addition, U.S. Trade Representative Michael Froman, who represents the Obama administration in these issues, said that there isn’t enough impact on consumers and competition to justify a veto.

The ITC has become a key battleground in patent disputes, both because it has been relatively friendly to plaintiffs and because an import ban is such a serious penalty. But the White House has been indicating that it is fed up with the commission. The administration has asked Congress to make it harder for companies to win import bans in front of the commission and to make sure that the ITC is hiring qualified judges.

The White House took an unusually confrontational stance by slapping down the ban against Apple products. Letting this one stand seems to dial that down.

Brustein is a writer for Businessweek.com in New York.

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Companies Mentioned

  • AAPL
    (Apple Inc)
    • $95.22 USD
    • 0.18
    • 0.19%
  • 005930:KS
    (Samsung Electronics Co Ltd)
    • $1293000.0 KRW
    • 9000.00
    • 0.7%
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