Bloomberg News

Samsung Seeks Ban on Apple IPhone 4S Sales in France, Italy

October 05, 2011

(Updates with Samsung statement in the second paragraph.)

Oct. 6 (Bloomberg) -- Samsung Electronics Co. aims to stop sales of Apple Inc.’s iPhone 4S in France and Italy, claiming the handset infringes on its patents, escalating the dispute between the two biggest makers of smartphones and tablets.

Samsung filed motions seeking the ban in courts in Paris and Milan, each citing two patent infringements related to wireless telecommunications technology, the Suwon, South Korea- based company said in an e-mailed statement today. Apple unveiled the iPhone 4S in Cupertino, California, this week and aims to start sales later this month.

The move adds to legal disputes that began in April, when Apple claimed Samsung’s Galaxy devices ‘‘slavishly” copied the iPad and iPhone. At stake is dominance in the fastest-growing segment of the $207 billion mobile-phone market, where Apple is competing against makers of handsets powered by Google Inc.’s Android operating system.

“It’s clearly part of this increasing mobile patent war that we’ve been seeing in recent months,” said James Cordwell, a London-based analyst at Atlantic Equities Service who rates Apple’s shares “overweight” and doesn’t own any. “What’s at stake is your long-term strategic position. It’s less about the country-by-country blockade.”

Steve Park, a Seoul-based spokesman for Apple, declined to comment on Samsung’s statement.

‘Flagrantly Violate’

Samsung plans to file preliminary injunctions in other countries after further review, it said in the statement. Apple, maker of the iMac computer and the iPad tablet, is also one of the South Korean company’s biggest buyers of chips and displays.

“Apple has continued to flagrantly violate our intellectual property rights and free ride on our technology,” Samsung said. “IPhone 4S should be barred from sales.”

Samsung gained 3.9 percent to 875,000 won as of 10:38 a.m. in Seoul. Apple rose 1.5 percent to $378.25 yesterday in New York trading.

Apple introduced the iPhone 4S, equipped with a faster processor, a higher-resolution camera and a new software interface this week to help it vie with Google’s Android, which powers Samsung’s Galaxy phone and tablets.

Smartphone Sales

At stake is leadership in the market for smartphones, which is projected to double by 2015, when 1 billion of the handsets will be sold, according to research firm IDC. While Apple is the single biggest smartphone maker, the Android coalition leads the market, accounting for 41.7 percent. The iPhone accounted for almost half of Apple’s sales in the most recent quarter.

“If Samsung just sits there doing nothing, they will end up letting Apple label them as a copycat,” said Choi Do Yeon, an analyst at LIG Investment & Securities Co. in Seoul. “Samsung will want to win something from any court, whether it’s a ban or an agreement from Apple to pay royalties.”

Apple earlier won backing from a Dusseldorf court that upheld a temporary ban on sales of the Galaxy Tab 10.1 in Germany, which Strategy Analytics forecasts will be Europe’s third-largest market for tablets this year. Samsung filed an appeal against the ruling.

In Australia, Apple has delayed the release of the product for two months by seeking a temporary judicial ban.

Samsung will abandon plans to sell the Galaxy Tab 10.1 in Australia if it doesn’t win approval to sell it in the next two weeks, Neil Young, a Samsung lawyer, told Federal Court Justice Annabelle Bennett in Sydney this week. Missing the Christmas season would result in the new tablet being “dead,” he said.

Samsung avoided an injunction on its tablet computers in the Netherlands, where it was ordered by a court in The Hague to halt some sales of the Galaxy S, S II and Ace smartphones.

--With assistance from Simon Thiel in London, Chiara Remondini in Milan and Heather Smith in Paris. Editors: Anand Krishnamoorthy, Simon Thiel.

To contact the reporters on this story: Jun Yang in Seoul at jyang180@bloomberg.net; Amy Thomson in London at athomson6@bloomberg.net

To contact the editors responsible for this story: Young-Sam Cho at ycho2@bloomberg.net; Kenneth Wong at kwong11@bloomberg.net


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