Friday, May 25, 2018

Jury Awards Apple $539 Million for Design Patent Infringement

The award in Apple Inc. v. Samsung Elecs. Co., Civil Action No. 5:11-cv-01846-LHK, was announced yesterday.  As others have noted, the amount is higher than the $399 million judgment entered after the first trial, though it's lower than the amount the jury initially awarded in the first trial in 2012 (which Judge Koh later reduced to $399 million, to exclude damages for trade dress infringement) and lower than the $1 billion-plus that Apple sought this time around (though quite a lot higher than the $25 million proposed by Samsung).  In between the first trial, of course, and the one that concluded yesterday the U.S. Supreme Court in 2016 held that under section 289 of the U.S. Patent Act the prevailing design patent owner is entitled to recover only the total profit from the relevant "article of manufacture," which is not necessarily the total profit from the entire product (though it could be, depending on whether the relevant article of manufacture is the entire product or just a component of it).  The Court didn't explain how to determine what the relevant article of manufacture is, however, and on remand Judge Koh instructed the jury to consider the four factors proposed in the 2016 case by the Solicitor General.  (For previous insightful commentary on these issues on this blog, see this guest post by Professor Sarah Burstein.)  According to FOSS Patents, a juror explained to a reporter for Law360 that for one of the three design patents at issue (the D'305 Patent, which covers the iPhone's graphical user interface (GUI)), the jury concluded that the entire phone constituted the relevant article of manufacture. 

We'll see what happens next; unless the case settles, I would expect Samsung to appeal, in which case perhaps the Federal Circuit will offer some guidance on what the appropriate factors are for determining the article of manufacture (and how to apportion the profit attributable to that article); or maybe, though I'm not sure off the top of my head whether this is an issue a court may raise sua sponte, it will consider whether this is an appropriate matter for a jury determination at all (see previous post here, expressing doubts).

For coverage elsewhere, see also these articles in Bloomberg, Law360, the New York Times, Reuters, and the Wall Street Journal.

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