AAPL Apple Inc

By Tripp Mickle 

This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (May 25, 2018).

Samsung Electronics Co. must pay Apple Inc. $539 million for infringing patents related to the iPhone's design, a federal jury found Thursday, a new victory for Apple in a seven-year-old legal battle over the spoils of the smartphone market's boom.

The jury's decision in the U.S. District Court in San Jose, Calif., increases the amount that Samsung previously was ordered to pay Apple for the patents under dispute from $399 million to $539 million. The bulk of the new damages award, $533.3 million, was for infringing three Apple design patents on the iPhone. An additional $5.3 million was for infringing two utility patents.

The legal fight has progressed through multiple rounds since Apple sued Samsung in 2011, claiming it stole key elements of the iPhone's design -- and it likely isn't over. Meanwhile, the explosion in smartphone use has benefited both companies enormously, with Apple's huge iPhone profits helping make it the world's most valuable company. The jury's new award is equivalent to only about 3.5 days of Apple's net profit in the first three months of this year.

The jury's new award was in the middle of the possible range. Samsung, which was found six years ago to have infringed Apple's patents, had argued in the current case that it should have to pay a penalty of only $28 million. Apple sought $1.05 billion.

The two companies were back in court in San Jose because Samsung challenged a $399 million award jurors granted Apple in 2012 when they found 11 smartphone models from the South Korean electronics giant infringed Apple's design patents.

Samsung took that challenge all the way to the Supreme Court, which determined in 2016 that the holder of a design patent wasn't always entitled to the total profit of an infringing product sold to consumers. However, it left a lower court to determine whether Samsung must pay its total profit on the 11 phones or just its profit attributable to the screen and case design of those products, which the patents covered.

"Today's decision flies in the face of a unanimous Supreme Court ruling in favor of Samsung on the scope of design patent damages," a Samsung spokesman said Thursday. "We will consider all options to obtain an outcome that does not hinder creativity and fair competition for all companies and consumers."

Apple said it was pleased the jury agreed that Samsung should pay damages for patent infringement, saying "Samsung blatantly copied our design."

Thomas Engellenner, an intellectual-property attorney with Pepper Hamilton LLP, said he expects Samsung to appeal the latest decision all the way to the Supreme Court, challenging Judge Lucy Koh's direction that the jury make a decision using a four-point test. That test sought to determine damages by looking at the scope of the design patents, the prominence of the design, the design's conceptual distinctiveness and the physical relationship between the patented design and the product, he said.

"Unless the parties settle, this case is likely to be litigated for the better part of the next decade," Mr. Engellenner said.

(END) Dow Jones Newswires

May 25, 2018 02:47 ET (06:47 GMT)

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