Wednesday, October 30, 2013

Damages Experts Test the Court in Apple and Samsung Patent Dispute

Some of the interest in the long running patent dispute between Apple and Samsung has waned in the wake of the August, 2012 jury verdict awarding Apple more than one billion dollars in damages for Samsung’s infringement of a combination of utility patents, design patents and a assorted registered and unregistered trade dress. The case is ongoing, however, and new developments have occurred in the past few weeks.

On March 1, 2013, Samsung obtained a temporary reprieve in the form of an order from United States District Judge Lucy Koh, striking $450,514,650 from Apple’s jury award and requiring a new trial on damages for fourteen infringing Samsung products. The jury, as Judge Koh determined, had improperly awarded damages against these products from the earliest date Samsung had received notice of any of the patents-in-suit, rather than the date that Samsung received notice of the specific patent their products were accused of infringing. Because the court could not reasonably adjust the award while still effectuating the intent of the jury, the new trial would be necessary to recalculate the affected damages based on the proper notice date.

Because Apple’s damages expert had passed away in the intervening time period, the court permitted Apple to substitute a new damages expert and report, and further agreed to allow Samsung to submit an updated expert report rebutting the opinions of Apple’s new expert. The court nevertheless attempted to rein in the parties by prohibiting either side from relying on new sales data, new products and new methodologies or theories, preferring instead to hew as closely as possible to the evidence and opinions presented at the original trial.

As suggested by Judge Koh’s instant Order Granting in Part and Denying in Part Motions to Strike Portions of Updated Expert Reports on Damages, both parties pushed the boundaries of the courts prohibitions. Apple, Inc. v. Samsung Elecs. Co., Civ. A. No. 11-cv-01846-LHK (N.D. Cal. Oct. 22, 2013), ECF No. 2575. The court struck multiple sections from both reports, including a novel damages theory propounded by Apple based on a new calculation of incremental profits for Samsung’s accused products, as well as new royalty calculations offered by Samsung for two of the design patents their products had previous been found to infringe. The court left intact sections of each report believed by the opposing parties to contain “new” evidence, conceding that the narrower focus of this retrial permitted each expert to elaborate more narrowly and precisely on the specific products at issue.

A five day retrial of these issues is set to begin November 12, 2013. In the meantime, Samsung and Apple continue their battle in the marketplace, where Samsung’s Galaxy smartphones and tablets continue to compete against Apple’s iPhone and iPad product lines. A second suit is also pending in the Northern District of California concerning Samsung’s more recent product offerings. Apple, Inc. v. Samsung Elecs. Co., Civ. A. No. 12-cv-00630-LHK (N.D. Cal. Filed Feb. 8, 2012).

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