Law360, New York (September 10, 2012, 12:50 PM ET) -- Design patents are rarely litigated, let alone at the heart of patent cases with large monetary awards. But they certainly were in the Apple Inc. v. Samsung Electronics Co. Ltd. smartphone/tablet case. The jury in the this case found overwhelmingly in favor of Apple and awarded it $1.05 billion, an amount that, if not reduced by the court, will increase with the addition of prejudgment interest. Because the jury also found willful infringement, the judge now has the discretion to declare the case "exceptional" and award enhanced damages and attorneys' fees.

Undoubtedly, there will be a plethora of post-trial motions and ultimately an appeal to the Federal Circuit. A petition for certiorari to the U.S. Supreme Court is also likely. In other words, the final say in this case is still a long way away. The jury's verdict, however, is quite interesting, and the issues decided by the jury will present the reviewing courts with opportunities to address important points of law not often addressed.

Although the jury appeared to have agreed with just about everything Apple asserted on the merits, it awarded well less than half the damages that Apple sought at trial ($2.525 billion). Apple had initially claimed infringement of quite a few patents and trademarks, but at trial alleged claims against Samsung for infringement of four design patents, three utility patents, and trade dress (one registered and three unregistered). Samsung counterclaimed for infringement on five of its patents.

Apple won on the majority of its claims. The jury found that the Samsung defendants infringed three of the four design patents and all three utility patents. Two of the four trade dress designs were found to be famous, and Samsung's dilution of them was found to be willful. Apple did not win, though, on its breach of contract and antitrust claims, and not all of the accused products were found to infringe. On the other side of the coin, Samsung's patents emerged as not invalid, but also not infringed, and two of Samsung's claims were barred by the doctrine of patent exhaustion (the allegedly infringing parts were previously bought by Apple from Intel Corp., who Apple alleged had a license with Samsung).

Apple's Intellectual Property and the Jury's Verdict

The jury's verdict on the specific claims was as follows:

Apple's Design Patents

  • U.S. Patent No. D504,889: iPad shape with rounded corners, glass front, flat and simple look. — Not invalid, no infringement.
  • U.S. Patent No. D604,305: Operating system graphical user interface with icon layout. — Not invalid, infringed and induced infringement, willful.
  • U.S. Patent No. D593,087: iPhone shape with rounded corners. — Not invalid, infringed and induced infringement, but not willful.
  • U.S. Patent No. D618,677: iPhone simplistic face, speaker and button locations, and large display area. — Not invalid, infringed and induced infringement, willful.

Apple's Trade Dress

  • U.S. Registration No. 3,470,983: iPhone's rectangular shape, rounded corners, the silver edges, the black face, and icons. — Protectable, famous, willful dilution.
  • Unregistered iPhone 3G Trade Dress. — Protectable, famous, willful dilution.
  • Unregistered Combination iPhone Trade Dress. — Not protectable.
  • Unregistered iPad/iPad 2 Trade Dress. — Not protectable.

Apple's Utility Patents

  • U.S. Patent No. 7,469,381: Display stretching and bounce back feature. — Not invalid, infringed and induced infringement, willful.
  • U.S. Patent No. 7844,915: Using two fingers to zoom. — Not invalid, infringed and induced infringement, willful.
  • U.S. Patent No. 7,864,163: The tap to zoom feature. — Not invalid, infringed and induced infringement, willful.

Samsung's Intellectual Property and the Jury's Verdict

Samsung Utility Patents

  • U.S. Patent Nos. 7,675,941 and 7,447,516: ("the declared-essential patents") are required to comply with two sections of the Universal Mobile Telecommunications System telecommunications standard. — Not invalid, not infringed, and claim barred by patent exhaustion.
  • U.S. Patent No. 7,577,460: A method of sending emails. — Not invalid, not infringed.
  • U.S. Patent No. 7,456,893: Displaying a last-viewed image rather than a last-captured image. — Not invalid, not infringed.
  • U.S. Patent No. 7,698,711: Using a software element called an "applet" to play music in the background. — Not invalid, not infringed.

The $1 Billion-Plus Verdict

Generally speaking, a utility patent is used to protect "the way an article is used and works," but a design patent just "protects the way an article looks."1 The public policy behind design patents is to incentivize inventors not only to make their inventions work well, but to also make their appearance attractive. Design patents and trade dress are one of the few areas in intellectual property law where there is some cross-over in terms of protectable subject matter.

Without question, the design patents and trade dress claims were where the value was in this case ($2 billion claimed by Apple). The utility patent damages claimed were less ($525 million) by comparison. Under 35 U.S.C. § 284, which applies to both utility and design patents, patent damages are supposed to compensate the injured party for the infringement and be no less than a "reasonable royalty."

Design patents however, have an additional remedy that utility patents do not have — a design patent holder can obtain the total profits made by the infringer for the accused products. Title 35, U.S.C. § 289 provides the additional remedy for infringement of a design patent that the infringer "shall be liable to the owner to the extent of his total profit."

Apple took full advantage of its design patents in this case, asked for Samsung's total profits that it estimated to be $2 billion.

What Happened

Apple created a narrative in the minds of the jurors that successfully led them to believe Samsung was a copycat. Apple compared pictures showing various designs of Samsung devices before the iPhone and iPad were released to Samsung's products after the release of the iPhone and iPad. The differences in the "before" compared to the similarities in the "after" were striking. These photos, along with the help of some damaging Samsung internal documents, successfully put Samsung in a negative light from which it could not escape.

Although Samsung presented evidence that could arguably invalidate some of Apple's patents, Apple's evidence of copying likely left an indelible initial impression on the jury that had a spillover impact on its consideration of the evidence of invalidity. Indeed, in addition to evidence of other designers and companies warning Samsung of the similarities between their products to Apple's, perhaps the most damning evidence was from the memo of a Samsung executive stating that the iPhone caused a "crisis of design" and that comparing the user experience of the two phones was like the "difference between heaven and earth."2 This evidence proved too much for Samsung to overcome.

The story Apple told, supported by Samsung's own internal documents, was that Samsung witnessed the remarkable advance and success of the iPhone and iPad, and then rushed to copy the designs in an effort to stay relevant in the marketplace. Though Samsung presented credible evidence on invalidity of the patents, it was not enough to overcome the jury's negative view of Samsung. The jury put the "black hat" on Samsung early on, and it stayed put. This was not a case hinging on claim construction or complex technology and patent terms; it was a case of the jury looking at the totality of the competitive products and asking themselves if they believed Samsung copied Apple. They certainly answered that question.

Impact

Consumers like to be able to go from one product to another without having to relearn how to work them and what the various icons mean. We all read the instructions only as a last resort. But, companies in the future are going to have to consider how much they want their products to look and feel like their competitors' products in terms of shape, size, the way it "feels," the way it looks, or how similar the icons are.

Also, design patents have historically been considered of lesser value than utility patents (indeed, some patent practitioners in the past have viewed them as not worth the effort or expense of obtaining them), but in the future design patents may prove more desirable. Given the ability to get the infringer's total profits, it may benefit companies to file more design patents on their products, especially if you make something iconic like Apple.

Footnotes

1. Manual of Patent Examining Procedure§ 1502.01 Distinction Between Design and Utility Patents (8th ed. 2001).

2. Mike Isaac, iPhone Caused "Crisis of Design" at Samsung (Memo), All Things D (Aug. 6, 2012, 6:27 PM), http://allthingsd.com/20120806/iphone-caused-crisis-of-design-at-samsung-memo/.

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