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Samsung, Apple, FRAND -- What's It All About? -- Samsung's Side~pj Updated
Thursday, July 26 2012 @ 10:48 PM EDT

As Samsung and Apple have been fighting over patents from one end of the earth to the other, most of the coverage, with few exceptions, seems to present Apple's point of view. [Example A, Example B, Example C, Example D, and Example E.] We know how much money Apple is asking for, we know it's claiming treble damages for willfulness, we know it thinks FRAND patents are not deserving of injunction enforcement, and that Samsung is asking too much money for them.

But now that we have the redacted trial briefs from the parties, I thought you'd like to see Samsung's side. Litigation has two sides, two stories, not just one.

Did you know that Apple wants a royalty rate of $24 per unit from Samsung for its alleged use of Apple's design patent, the notorious tablet shape with rounded corners? $24! But when Samsung asked Apple for a much lower amount per unit that everybody else in the market pays for Samsung's standards patents, Apple refused, offered no counter-offer, and sued instead. To date, it's paid nothing at all for those patents or for the other regular patents Samsung is accusing Apple of infringing. In its trial brief, Apple states in one header:

To The Extent That Samsung Is Entitled To Any Remedy, its FRAND Damages Cannot Exceed $0.0049 Per Unit for Each Infringed Patent
Less than a penny should be Samsung's lot for patents that are essential to even be in the mobile phone business, but Apple wants Samsung to pay $24 for rounded corners, plus from $2.02 and up to $3.10 per unit for its utility patents.

Did you know that Samsung claims to have prior art that knocks Apple's patents out?

Samsung does not infringe any of Apple‘s patents and has located dead-on prior art that invalidates them.
It says it hasn't infringed them anyhow, but that they are, in any case, invalid.

Trial briefs are filed when the trial is ready to get started, setting forth what each side plans to present at trial in the way of evidence and legal arguments, so the judge knows what they will be trying to establish and is prepared to rule on contested issues. What? You thought judges have all this in their heads every minute of every day? No. They have to do research too.

Having the trial briefs means we can know too what the parties see as their case. Here's Apple's [PDF] and here's Samsung's [PDF], and I've done the latter as text for you. That way, in case any one-sided story floats by, your nose will pick up the scent right away, because you will at least have been exposed to both sides.

Did you know that Apple is asking, among other things, for 100% of Samsung's profits from phones and tablets, because of the design of the *cases*? That's what Samsung's brief alleges:

According to Apple, the cases of Samsung‘s phones and tablets are infringing because those cases infringe Apple‘s patented designs. Yet Apple seeks all of Samsung‘s profits from sales of the accused phones and tablets on the grounds that 35 U.S.C. § 289 purportedly grants such a windfall – even if the non-infringing contents of Samsung‘s devices are in fact what creates Samsung‘s profits. Apple‘s request for a non-compensatory windfall overlooks Section 289‘s requirement that profits disgorgement be limited to the "article of manufacture" to which a patented design is applied, and is contrary to law....

Apple‘s attempt to assert its patents to monopolize the shape of an article irrespective of the surface details found in either the patent or the accused devices is contrary to law.

A central debate in the trial is going to be the proper standard for deciding whether a design patent is infringed or not. Samsung argues that the standard is if an ordinary consumer is deceived by the similarity of appearance to the degree that he buys one product thinking he's buying the other. Apple argues that no deception is required, that all it takes for it to get its $24 per unit is if the two products look substantially similar to the ordinary observer. That's a mighty low bar, if you think about how few choices there are in designing a tablet or a phone. They are all substantially similar, because they all do the same things and there aren't that many ways to design a tablet and have it still be one.

[ Update: Here's [PDF] a transcript of the deposition in this litigation of Roger Fidler, who designed and did mockups of tablets for Knight-Ridder Lab back in 1981 onward. Guess what they looked like? -- Thin rectangles with rounded corners and no buttons, just a touch screen and no ornamentation. And yet Apple wants $24 per unit for a rectangle design with rounded corners, no buttons, just a touch screen and no ornamentation? They do, plus 100% of Samsung's profits, and here's the opinion of their expert industrial designer, on page 9 of the document, telling why that Fidler tablet isn't the same, in his opinion, as the iPad or iPod design. And one of Apple's lawyers submitted an exhibit [PDF], a photograph of a Fidler mockup used at his deposition, with Apple arrows showing what they think are different design features. And it persuaded the appeals court, as you can see beginning on page 25 of this ruling [PDF] that Fidler does not render the Apple patent invalid as obvious, at least not at this preliminary stage.]

Yes. Apple also wants infringer's profits up to their eyeballs, and that's the same approach you saw the same law firm, Morrison & Foerster, take in the Oracle v. Google trial, not that it worked there. Same law firm here, with the same astronomical demands. They want, not to put too fine a point on it, to put Samsung out of business, to hear Samsung tell it, and if they get all they are asking for, I'd have to agree.

Now, I haven't been following this case, so I can't take a position on who is right and who is wrong. I don't know who copied whom. I see Samsung claims that Apple actually copied Sony ("Contrary to the image it has cultivated in the popular press, Apple has admitted in internal documents that its strength is not in developing new technologies first, but in successfully commercializing them."), but I have no idea if that or any of this is so. Most litigation happens because both sides are somewhat right and somewhat wrong. So, don't look for predictions or even siding with anybody. I haven't analyzed the litigation with the granularity that would be required to even know who *should* win, let alone who will. I'll just be telling Samsung's side, because it's so hard to find out what Samsung's position is. The media isn't telling much. So let me try to fill in that blank.

The most important information is that we finally get to see what the FRAND issue is all about. It's the first time I actually understand the FRAND dispute. If I had to put it into a single sentence, it'd be this:

Companies who like to get patent royalties from competitors, like Apple and Microsoft, and who use patents aggressively, have noticed that if everyone who was in the mobile phone business before they were sues them over their patents, they won't be able to make a phone anyone can afford, so they want to get the courts to force folks like Samsung and Motorola to accept less than a penny per handset for their standards patents, while still charging the regular price for their own later-issued patents.
In other words, they want to disarm the companies that got there first, built the standards, and created the field, while the come-later types clean up on patents on things like slide to unlock or a tablet shape with rounded corners.

Then the money flows to Apple and Microsoft, and away from Android -- and isn't that really the point of all this, to destroy Android by hook or by crook? The parties who were in the mobile phone business years before Apple or Microsoft even thought about doing it thus get nothing much for their earlier issued patents that have become standards. Apple and Microsoft can't compete on an even field, because the patent system rewards the first to invent (or now, after the recent patent reform, the first to file). Neither Apple nor Microsoft got there first. Samsung *was* there, since the '90s:

That Samsung is able to offer such a wide variety of quality mobile telecommunications devices is no coincidence. Samsung has been researching and developing mobile telecommunications technology since at least as early as 1991 and invented much of the technology for today‘s smartphones. Indeed, Apple, which sold its first iPhone nearly twenty years after Samsung started developing mobile phone technology, could not have sold a single iPhone without the benefit of Samsung‘s patented technology. Even as Apple has carried out a coordinated campaign of dragging Samsung‘s name through the mud in this lawsuit and in the media, it has used Samsung‘s patented technology while flatly refusing to pay for its use.
"Coordinated campaign" -- do they mean Florian Mueller, by any chance? He certainly has put out endless streams of anti-Samsung articles. Whoever they mean, they believe it's coordinated by Apple, evidently.

Samsung invested in its tech, contributed to and offered its patented technologies to standards bodies, under FRAND terms, meaning without discrimination and on fair and reasonable terms. Andy Updegrove explains FRAND terms and how it has worked traditionally, in case it's a new term to you. And here's a lengthy article on Patently O on the FRAND wars.

Here's how Samsung puts it:

Unlike Apple, which was not a participant in the mobile communications industry until it released the first iPhone in mid-2007, Samsung began developing mobile communications technology in 1991.

Samsung has since invested billions of dollars in developing the backbone of the industry and the wireless standards necessary for smartphones. Between 2005 and 2010 alone, Samsung invested $35 billion in research and development relating to telecommunications technology, with over 20,000 engineers worldwide dedicated to telecommunications research and development.

Apple relied heavily on Samsung‘s technology to enter the telecommunications space, and it continues to use Samsung‘s technology to this day in its iPhone and iPad products. For example, Samsung supplies the flash memory, main memory, and application processor for the iPhone. Samsung also manufactures Apple‘s A5X processor and is the sole supplier of the Retina display used in the new iPad. But Apple also uses patented Samsung technology that it has not paid for. This includes standards-essential technology required for Apple‘s products to interact with products from other manufacturers, and several device features that Samsung developed for use in its products.

So far, however, Apple has paid nothing, not even some token payment to acknowledge that it certainly owes *something*, and this fight is going on for years and years. So Apple is currently free-riding. Instead of paying anything, or even negotiating for a lower price, Samsung says Apple brought this, and other, cases, trying to get the courts to lower the price for standards patents and also to rule that those holding standards patents can't use injunctions as an enforcement mechanism. I note that a few weeks ago, Nokia, who was also there in the early days, offered an amicus brief in a letter [PDF] to the ITC in support of Microsoft, but it did not support the view that no injunctions should ever issue for standards patents. On page 3, in a footnote, it wrote:
Nokia owns thousands of patents that have been declared essential to various industry standards. Yet in spite of the fact that Nokia has participated in several International Trade Commission investigations as both complainant and respondent, Nokia has never sought an exclusionary order before this Commission based on the infringement of a declared-essential patent. In Nokia’s view, the RAND commitment would not require the relinquishment of the right to seek or enforce an injunction in exceptional circumstances such as the total refusal to negotiate with the holder of an essential patent or the complete refusal to fulfill, or even acknowledge the existence of, a party’s FRAND payment obligations on patents that are valid, essential, and infringed.
That's how Samsung is describing Apple, is it not? If a party simply refuses to pay anything at all and refuses to negotiate, then what can the patent holder do? Nothing? Sue and wait for a decade to get paid, considering all the likely appeals? You could go out of business that way before you see any money.

And so rather than fixing the broken patent system, Apple would prefer to "reform" it in its own image of what would benefit Apple via the courts, telling them that what's reasonable is essentially nothing for these standards patents, so they end up winning due to playing on a field that tilts all their way. Apple in this litigation wants billions for its later patents, including penalties, but it wants to pay close to nothing for Samsung's, as if Samsung had donated their R&D to the world for nothing. I wish. But in reality, that's not how standards patents work currently.

Apple also wants a permanent injunction, while wanting to deny Samsung the right to even ask for one, so Samsung can't compete against it any more, although I notice that Apple's brief says that Samsung claims it can work around all of Apple's patents in a month. Did you know that? Me either. There is so much we haven't heard, I guess because of the coordinated campaign to spin it Apple's way.

Samsung puts it like this, when discussing what Apple wants in damages:

Apple‘s overreaching claim for damages is a natural extension of its attempt to monopolize the marketplace. It demands the entirety of Samsung‘s revenues on the accused phones and tablets for the alleged infringement of a design patent that shows little more than a blank rectangle with rounded corners. It seeks to collect "lost profits" despite the fact that no one buys phones because they have "bounce back" feature or other manifestations of Apple‘s alleged inventions asserted in this case. Damages are meant to compensate, not confer an absurd windfall at the expense of competitions and consumers worldwide....

Apple seeks to recover windfall profits that bear no proportion to any claimed harm to Apple or alleged wrongful gains by Samsung.

And meanwhile, instead of negotiating a price or paying the patent owners for using the patents, they pay nothing at all. And of course Samsung has to deal with the costs of litigation over something that ought to have been negotiated instead, even according to the judge in this case.

So much for Most Holy Patents. I've come to the conclusion that they are only Most Holy when you own them. If someone else owns some, then they are worthless or they cost too much. A cynic might think that what this is really about is the Samsung is beating Apple in the market. And here's how Samsung says it does it:

Also contrary to Apple‘s accusations, Samsung does not need or want to copy; rather, it strives to best the competition by developing multiple, unique products.
Update 2: Wired's David Kravetz has an article about this litigation, and the article includes this:
Some legal experts suggest the legal flap might involve intellectual property that should never have been patented.

“Regardless of the outcome of the trial, we might want to step back and consider whether society should be granting such powerful rights so easily. Are the features at issue here really deserving of so much protection?” asked Robin Feldman, a legal scholar at UC Hastings College of the Law and author of Rethinking Patent Law. “On the whole, the trial is one more indication of a patent system that has lost its bearings, with litigation rather than innovation leading the way.”

Amen. Wired also links to Justia, which has made the documents available for free. *Now* they tell me.

: )

Here's Samsung's trial brief, as text:

***************************

QUINN EMANUEL URQUHART & SULLIVAN, LLP
Charles K. Verhoeven (Cal. Bar No. 170151)
[email]
[address, phone fax]

Kevin P.B. Johnson (Cal. Bar No. 177129)
[email]
Victoria F. Maroulis (Cal. Bar No. 202603)
[email]
[address, phone fax]

Michael T. Zeller (Cal. Bar No. 196417)
[email]
[address, phone fax]

Attorneys for SAMSUNG ELECTRONICS
CO., LTD., SAMSUNG ELECTRONICS
AMERICA, INC. and SAMSUNG
TELECOMMUNICATIONS AMERICA, LLC

____________

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF CALIFORNIA, SAN JOSE DIVISION

APPLE INC., a California corporation,

Plaintiff, vs.

SAMSUNG ELECTRONICS CO., LTD., a
Korean business entity; SAMSUNG
ELECTRONICS AMERICA, INC., a New
York corporation; SAMSUNG
TELECOMMUNICATIONS AMERICA,
LLC, a Delaware limited liability company,

Defendants.

_______________

CASE NO. 11-cv-01846-LHK

SAMSUNG’S TRIAL BRIEF

PUBLIC REDACTED VERSION

I. INTRODUCTION

In this lawsuit, Apple seeks to stifle legitimate competition and limit consumer choice to maintain its historically exorbitant profits. Android phones manufactured by Samsung and other companies – all of which Apple has also serially sued in numerous forums worldwide -- offer consumers a more flexible, open operating system with greater product choices at a variety of price points as an alternative to Apple‘s single, expensive and closed-system devices.

That Samsung is able to offer such a wide variety of quality mobile telecommunications devices is no coincidence. Samsung has been researching and developing mobile telecommunications technology since at least as early as 1991 and invented much of the technology for today‘s smartphones. Indeed, Apple, which sold its first iPhone nearly twenty years after Samsung started developing mobile phone technology, could not have sold a single iPhone without the benefit of Samsung‘s patented technology. Even as Apple has carried out a coordinated campaign of dragging Samsung‘s name through the mud in this lawsuit and in the media, it has used Samsung‘s patented technology while flatly refusing to pay for its use.

For good measure, Apple seeks to exclude Samsung from the market, based on its complaints that Samsung has used the very same public domain design concepts that Apple borrowed from other competitors, including Sony, to develop the iPhone. Apple‘s own internal documents show this. In February 2006, before the claimed iPhone design was conceived of, Apple executive Tony Fadell circulated a news article that contained an interview of a Sony designer to Steve Jobs, Jonathan Ive and others. In the article, the Sony designer discussed Sony portable electronic device designs that lacked "excessive ornamentation" such as buttons, fit in the hand, were "square with a screen" and had "corners [which] have been rounded out." Ex. 18 (DX 649). 1 Immediately after this article was circulated internally, Apple industrial designer Shin Nishibori was directed to prepare a [redacted] design for an Apple phone and had CAD drawings and a three-dimensional model prepared. See Exs. 1-2 (DX 623; DX 562).

1

Eliminating any doubt about the origin of the design‘s inspiration, Apple‘s internal CAD drawings [redacted] on the phone design. Id. Only days later, Apple designer Richard Howarth reported that, in contrast to another internal design that was then under consideration, Mr. Nishibori‘s [redacted]. As Mr. Nishibori has confirmed, his [redacted] design changed the direction of the project that yielded the final iPhone designs.

Contrary to the image it has cultivated in the popular press, Apple has admitted in internal documents that its strength is not in developing new technologies first, but in successfully commercializing them. When Apple was developing its campaign to promote the first iPhone, it considered – and rejected – advertisements that touted alleged Apple "firsts" with the iPhone. As one Apple employee explained to an overly exuberant Apple marketer, [redacted].

Also contrary to Apple‘s accusations, Samsung does not need or want to copy; rather, it strives to best the competition by developing multiple, unique products. Samsung internal documents from 2006, well before the iPhone was announced, show rectangular phones with rounded corners, large displays, flat front faces, and graphic interfaces with icons with grid layouts. Furthermore, much of what Apple complains of is the "benchmarking" of competitive products by Samsung. But this is a universal practice in the smartphone, tablet and other consumer electronics markets. It involves doing side-by-side product comparisons of competitors‘ products. Samsung certainly does this; so does Apple, and so does any company interested in continually improving its products for the benefit of consumers. There is nothing wrong with this common industry practice. That Apple itself zealously engages in the same type of benchmarking says everything about the disingenuous nature of Apple‘s allegation that this evidences "copying."

2

Apple‘s anticompetitive lawsuit should not be rewarded, and Apple should pay Samsung for Apple‘s use of Samsung‘s patented technology, without which Apple could not have become a successful participant in the mobile telecommunications industry.

II. APPLE’S COPYING ALLEGATIONS ARE BASELESS

In order to distract from the weakness of its infringement claims, Apple offers misguided allegations of copying that are refuted by evidence of Samsung‘s independent creation. Prior to the iPhone‘s announcement in January 2007, Samsung was already developing numerous products and models with the same design features that Apple now claims were copied from the iPhone. In the summer of 2006, Samsung began designing its next generation of mobile phones, based on the market trend of ever-increasing screen size. At that time, Samsung‘s designers envisioned a basic design: a simple, rounded rectangular body dominated by a display screen with a single physical button on the face. See, e.g.,Exs. 5-6 (DX 522; DX 625). For example, internal Samsung design presentations from the summer of 2006 showed the following designs Samsung was considering:

Id. One of these designs became the Samsung F700 phone, which was the subject of a Korean design registration application in December 2006, a month before Apple unveiled the iPhone. Ex. 7 (DX 519). Tellingly, Apple at first included Samsung‘s F700 in its indiscriminant "copying" allegations, but later withdrew its infringement charges once Samsung‘s prior,

3

independent creation left Apple no choice but to concede that its copying accusations against that device were false.

Also during this time period during the Summer and Fall of 2006, Samsung designers envisioned a simple icon interface, with rounded rectangular icons arranged in a grid format, appropriately spaced for the size of the screen and the human hand. See, e.g., Ex. 8 (DX 566). As one example, an internal Samsung design presentation dated September 14, 2006 showed the following GUI layouts and adjustable orientations:

Id. As these documents confirm, Samsung independently developed the allegedly copied design features months before Apple had even announced the iPhone. It did not switch its design direction because of the iPhone. Contrary to Apple‘s cherry-picked "pre" and "post" iPhone choices of Samsung‘s phones, Samsung designed and developed large screen smartphones before the iPhone—as well as bar type phones, sliders, and folder phones. Samsung continued to do so after the iPhone as well:

4

Ex. 9 (DX 684).

In contrast, Apple‘s supposed proof of copying consists of competitive benchmarking and analysis documents created by Samsung. Apple itself, however, regularly conducts the same types of detailed competitor analyses that it now contends proves copying. For example, Apple conducted tear-downs of Samsung products—such as the Vibrant, Galaxy Tab 10.1, Juke, and YP- R1 MP3 player—to analyze [redacted] Exs. 10-13 (DX 708; DX 714; DX 715; DX 717). Apple maintains and regularly circulates a "competitive tracker," which keeps close tabs on competing smartphones and tablets, compiling data on [redacted]

5

For its part, Apple‘s "revolutionary" iPhone design was derived from the designs of a competitor—Sony. In February 2006, before the claimed iPhone design was conceived of, Apple executive Tony Fadell circulated a news article to Steve Jobs, Jonathan Ive and others. In the article, a Sony designer discussed Sony designs for portable electronic devices that lacked buttons and other "excessive ornamentation," fit in the hand, were "square with a screen" and had "corners [which] have been rounded out." Ex. 18 (DX 649). Right after this article was circulated internally, Apple industrial designer Shin Nishibori was directed to prepare a [redacted] design for an Apple phone and then had CAD drawings and a three-dimensional model prepared. See Exs. 1-3 (DX 623; DX 690; DX 562). Confirming the origin of the design, these internal Apple CAD drawings prepared at Mr. Nishibori‘s direction even had [redacted] on the phone design, as the below images from Apple‘s internal documents show:

[redacted image]

Soon afterward, on March 8, 2006, Apple designer Richard Howarth reported that, in contrast to another internal design that was then under consideration, Mr. Nishibori‘s [redacted] design enabled [redacted] As Mr. Nishibori has confirmed in deposition testimony, this [redacted] design he prepared changed the course of the project that yielded the final iPhone design.

Design was not the only thing Apple took from other companies in developing the iPhone. While Apple touts itself in the popular press as a company of "firsts," it recognizes the opposite internally. As Apple admitted in internal emails, Apple was not the first [redacted]

6

[Redacted] Ex. 4 (DX 578). Nor was it [redacted] Id. Indeed, as one Apple employee explained to an overly enthusiastic marketer, [redacted] Id.

III. APPLE’S UTILITY PATENTS

Apple‘s utility patents relate to ancillary features that allow users to perform trivial touch screen functions, even though these technologies were developed and in widespread use well before Apple entered the mobile device market in 2007. Samsung does not infringe any of Apple‘s patents and has located dead-on prior art that invalidates them.

A. Claim 19 of U.S. Patent No. 7,469,381 Patent is Invalid and Not Infringed

Apple asserts that 23 Samsung products infringe claim 19 of the '381 patent, which claims a touch screen device capable of performing a "bounce-back" function. Samsung‘s products do not infringe claim 19. As an initial matter, Apple and its expert‘s infringement analysis is improperly limited to "representative" products and source code, and generalizations that other products running the same major release of the Android operating system behave in the same way. Products running the same Android release often behave differently, however. Thus, Apple‘s reliance on "representative" products and source code cannot meet its burden of proving infringement by many of the accused products.

In addition, Samsung‘s products exhibit numerous features that do not meet the limitations of the '381 patent, as interpreted by the Court. These non-infringing features include (1) a "hold still" behavior, where Samsung‘s products do not translate the electronic document in a second direction; (2) a general snapping behavior, where Samsung‘s products snap forward, not backward, if the user scrolls beyond a threshold point; and (3) a "hard stop" behavior, where Samsung‘s products do not display an area beyond the edge of the electronic document.

Furthermore, the '381 patent is invalid in light of the prior art that discloses the same "bounce-back" feature. These references include the Tablecloth program installed on the

7

DiamondTouch system developed by Mitsubishi Electric Research Laboratory ("MERL"), the LaunchTile and XNav programs developed by Dr. Benjamin Bederson, and International Publication Number WO 03/081458. 2

B. Claim 8 of U.S. Patent No. 7,844,915 Is Invalid and Not Infringed

Apple asserts that 25 Samsung products infringe claim 8 of the ̳915 patent, which claims a touchscreen device capable of distinguishing between single-input scroll operations and multi-input gesture operations. Samsung‘s products do not infringe claim 8 for at least two reasons. First, Samsung‘s products do not include an "event object" that "invokes a scroll" or gesture operation. 3 Apple identifies a MotionEvent object in the accused products as the "event object" created in response to detecting user input. Apple concedes, however, that a completely different object—the WebView object, which is not an "event object"—is the only object that causes scrolling or scaling. Second, Samsung‘s products permit multi-finger scrolling, and therefore distinguish between scrolling and gesture operations based on criteria other than the number of inputs, as required by claim 8.

Moreover, Apple did not invent multi-touch gesture recognition. The '915 patent is invalid in light of prior art such as the Mandelbrot program installed on MERL‘s DiamondTouch system, Japanese Patent Publication Number 2000-163031, and Jefferson Han‘s multi-touch system from the 2005 SIGGRAPH conference.

C. Claim 50 of U.S. Patent No. 7,864,163 Is Invalid and Not Infringed

Apple asserts that 25 Samsung products infringe claim 50 of the '163 patent, which claims a touch screen device capable of enlarging and translating a "structured electronic document." Apple cannot carry its burden of proving infringement of claim 50, however. For example,

8

Apple fails to identify how Samsung‘s products display a structured electronic document with a plurality of boxes of content; instead, Apple‘s expert merely superimposes rectangles on logical regions of a webpage. Apple also fails to show that the accused products "determin[e] a first box in the plurality of boxes at the location of the first gesture," because Apple only addresses cases involving a single box – not a plurality of boxes – at the location of the first gesture. Finally, Apple fails to show that the accused products translate the structured electronic document so that the first and second boxes are substantially centered, because the instances of alleged infringement only show centering in one direction or no direction at all, or cases where no "translating" occurs because the box is already centered prior to the gesture.

Moreover, the '163 patent discloses the use of techniques (zooming and panning) that were well-known, as shown by references. For instance, Dr. Bederson‘s LaunchTile and XNav programs publicly disclosed each limitation of claim 50 prior to Apple‘s asserted conception date. The '163 patent is also anticipated by Bryan Agnetta‘s prior invention, described in a provisional patent application, No. 60/718,187. Finally, U.S. Patent Publication No. 2002/0030609 reinforces the '163 patent‘s lack of novelty by showing a motivation to combine techniques used in application management systems with browser applications on portable electronic devices.

IV. APPLE’S DESIGN PATENT CLAIMS

Apple persists in misstating the legal standards for design patent infringement, including as it seeks to present them to the jury during trial.

A. Design Patent Infringement Requires Deceptive Similarity

Apple must prove that an ordinary observer, conversant with the prior art, would be deceived into buying the accused product thinking that it was the same design as the patented design. The Supreme Court so held in Gorham Co. v. White, 81 U.S. 511, 528 (1872): "We hold, therefore, that if, in the eye of an ordinary observer, giving such attention as a purchaser usually gives, two designs are substantially the same, if the resemblance is such as to deceive such an observer, inducing him to purchase one supposing it to be the other, the first one patented is infringed by the other." (emphasis added). As the Court explained, deception is required and is fundamental to the purpose of design patent protection:

9

It is persons of the latter class [i.e., ordinary observers] who are the principal purchasers of the articles to which designs have given novel appearances, and if they are misled, and induced to purchase what is not the article they supposed it to be, if, for example, they are led to purchase forks or spoons, deceived by an apparent resemblance into the belief that they bear the "cottage" design, and, therefore, are the production of the [patent holder] ..., when in fact they are not, the patentees are injured, and that advantage of a market which the patent was granted to secure is destroyed.
Id. (emphasis added). Gorham remains binding precedent, and the Federal Circuit‘s en banc decision in Egyptian Goddess, Inc. v. Swisa, Inc., 543 F.3d 665 (Fed. Cir. 2008), reiterated that Gorham is the sole test for infringement. "In the language used by the Supreme Court in Gorham, 81 U.S. at 528, we hold that the accused design could not reasonably be viewed as so similar to the claimed design that a purchaser familiar with the prior art would be deceived by the similarity between the claimed and accused designs, 'inducing him to purchase one supposing it to be the other.'" 543 F.3d at 681. The Federal Circuit has recited and applied this standard time and time again — both before and after Egyptian Goddess. See, e.g., Crocs v. ITC, 598 F.3d 1294, 1303 (Fed Cir. 2010) ("To show infringement under the proper test, an ordinary observer, familiar with the prior art designs, would be deceived into believing that the accused product is the same as the patented design.") (emphasis added); Richardson v. Stanley Works, Inc., 597 F.3d 1288, 1295 (Fed. Cir. 2010) (infringement occurs where "an ordinary observer would be deceived into thinking that any of the [accused] designs were the same as [the] patented design") (emphasis added); Amini Innovation Corp. v. Anthony California, Inc., 439 F.3d 1365, 1371 (Fed. Cir. 2006) ("If a design includes both functional and ornamental features, infringement occurs if an ordinary person ‘would be deceived by reason of the common features in the claimed and accused designs which are ornamental.‘"(quoting Read Corp. v. Portec, Inc., 970 F.2d 816, 825 (Fed. Cir. 1992)) (emphasis added)).

Apple concedes that Gorham‘s "such as to deceive" language is "an elaboration on how similar two designs must be to be 'substantially the same.'" See Disputed Jury Instructions, Dkt No. 1232 at 164. Yet, Apple advocates withholding from the jury this indispensable aspect of the legal test. Id. Apple likewise seeks to truncate Gorham‘s language that deception must be

10

considered in the purchasing context. Dkt No. 1232 at 165. As its justification, Apple contends that Samsung supposedly uses the phrase "to suggest that there needs to be evidence of deception of a consumer purchasing a Samsung product for an Apple product in order to prove infringement." Dkt No. 1232 at 164. Tellingly, Apple cites nothing where Samsung has advocated such a requirement. Also contrary to Apple‘s suggestion, courts have repeatedly found evidence of deception — or lack thereof — in the real world purchasing context to be relevant to the inquiry. See, e.g., L.A. Gear, Inc. v. Thom McAn Shoe Co., 988 F.2d 1117, 1125-26 (upholding a design patent infringement ruling based on evidence of real world confusion between products); Arminak & Assocs. Inc. v. Saint-Gobain Calmar, Inc., 501 F.3d 1314, 1324 (Fed. Cir. 2007) (relying on expert and lay testimony there would be no confusion between patentee‘s product and accused product); OddzOn Prods, Inc. v. Just Toys, Inc., 122 F.3d 1396, 1405-07 (Fed. Cir. 1997) (finding real world confusion evidence relevant but insufficient because it did not factor out functional features).

As another justification for its misstatements of the Gorham test, Apple complains that "emphasis on the 'purchase‘ phrase in Gorham may mislead the jury away from focusing on and comparing the claimed designs." Id. at 165 (emphasis in original). But informing the jury about the proper legal standard as articulated by binding precedent is scarcely a distraction or misleading. Indeed, the very definition of what makes two designs "substantially the same" is that the ordinary observer would be deceived in purchasing. "Two designs are substantially the same if their resemblance is deceptive to the extent that it would induce an ordinary observer, giving such attention as a purchaser usually gives, to purchase an article having one design supposing it to be the other." Door-Master Corp. v. Yorktowne, Inc., 256 F.3d 1308, 1313-14 (Fed. Cir. 2001) (emphasis added); see also Arminak, 501 F.3d at 1321 ("This test requires an objective evaluation of the question of whether a hypothetical person called the 'ordinary observer‘ would find substantial similarities between the patented design and the accused design, so as to be deceived into purchasing the accused design believing it is the patented design.") (emphasis added). This Court has recognized this as well, expressly ruling that "designs are 'substantially the same, if the resemblance is such as to deceive [an ordinary observer], inducing

11

him to purchase one supposing it to be the other.‘" Dkt No. 449 at 9-10 (quoting Egyptian Goddess, 543 F.3d at 670).4

B. Minor Differences Matter

Apple argues that "[m]inor differences should not prevent a finding of infringement." Dkt No. 1232 at 157. But this is contrary to law. The hypothetical ordinary observer is assumed to be familiar with the prior art. Egyptian Goddess, 543 at 681-83. Here, the crowded field of art includes a spectrum of rectangular devices with rounded corners, flat surfaces, bezels, display screens with borders around them, and lozenge shapes above display screens. Accordingly, the hypothetical ordinary observer will readily identify and take into account differences that may go unnoticed in the abstract, such as the specific roundness of a corner, thickness of a border, or shape of a bezel. "[D]ifferences between the claimed and accused designs that might not be noticeable in the abstract can become significant to the hypothetical ordinary observer who is conversant with the prior art." Egyptian Goddess, 543 F.3d at 678; see also id. ("[W]hen the claimed design is close to the prior art designs, small differences between the accused design and the claimed design are likely to be important to the eye of the hypothetical ordinary observer.") (emphasis added). This Court too has recognized this already, noting that

12

"the prior art references identified by Samsung, as well as the overall simplicity of the D‘677 patent, may make minor differences between the patent-in-suit and the front view of the Infuse 4 — for example, the addition of buttons and writing on the Samsung Infuse 4 that are not present in the Apple patents — take on greater significance in the eyes of the ordinary observer." Dkt No. 449 at 27; see also id at 26 ("Moreover, given the simplicity of the design at issue, and the fact that consumers purchasing this product are purchasing an expensive electronic device, minor differences between the patent and the accused device are likely to take on greater significance in the eyes of the ordinary observer.").

Minor differences that are important to the ordinary observer conversant with the prior art can certainly prevent a finding of infringement. For example, in Smith v. Whitman Saddle Co., 148 U.S. 674 (1893), a case heavily relied on in Egyptian Goddess, the hypothetical ordinary observer was held to distinguish the accused and claimed saddle designs based solely on the angle of the drop at the rear of the pommel because a combination of prior art designs yielded a design having all but that feature. Id. at 682; see also Arminak v. Saint-Gobain, 501 F.3d 1314, 1324-25 (Fed. Cir. 2007) (finding ordinary observer would not be deceived where only minor differences existed). As another example, in Goodyear Tire & Rubber Co. v. Hercules Tire & Rubber Co., 162 F.3d 1113, 1115 (Fed. Cir. 1998), the plaintiff asserted infringement of the patent on the left below by the design on the right.

The court held that "[a]lthough there are apparent similarities in the overall appearance of the designs, we affirm the conclusion that the trucker as ordinary observer would notice the differences in the designs and recognize that they are not colorably the same." Id. at 1121-22. Any generalized argument by Apple that minor differences must preclude a finding of non-

13

infringement is therefore unsupported by law and misleading. This is especially true where, as here, Apple is claiming only parts of a hand-held device with minimal features.

C. Design Patents Do Not Protect The Shape Or Configuration Of A Design
Absent The Surface Ornamentation

Apple urges that its design patents cover the shape or configuration of an article regardless of the surface ornamentation. This is contrary to precedent as well as legislative amendments to the Patent Act, which currently permits design patents only for the "new, original, and ornamental design for an article of manufacture." 35 U.S.C. 171 (emphasis added).

The Patent Act previously offered protection for shapes, but that provision was removed over a century ago. Before then, the Patent Act protected a range of design patent types including those for "any new, useful, and original shape or configuration of any article of manufacture." Act of July 8, 1870, c. 230, § 71, 16 Stat. 209 (emphasis added); see also Act of Aug. 29, 1842, c. 263, § 3, Stat. 543 (providing protection for "any new and original shape or configuration of any article of manufacture") (emphasis added). In 1902, Congress replaced that section with what is essentially the language in effect today. See Act of May 9, 1902, c. 783, § 4929, 32 Stat. 193 ("Any person who has invented any new, original, and ornamental design for an article of manufacture . . .") (emphasis added); Act of July 19, 1952, c. 950, § 171, 66 Stat. 805 ("Whoever invents any new, original and ornamental design for an article of manufacture may obtain a patent therefor . . ."); see also 37 C.F.R. § 1.153 ("The claim shall be in formal terms to the ornamental design for the article (specifying name) as shown, or as shown and described.").

Federal Circuit law confirms that design patents are "limited to ornamentation" and "do not and cannot include claims to the structural or functional aspects of the article." Lee v. Dayton-Hudson, 838 F.2d 1186, 1188 (Fed. Cir. 1988). There, the Court cited to the current statute in rejecting the patentee‘s argument that "the novelty of his design resides in its basic configuration, not the surface details". Id. Relatedly, mere symmetry is also not a protectable ornamental feature. In re Carletti, 328 F.2d 1020, 1022 (Cust. & Pat. App. 1964) ("The creation or origination of an ornamental design does not reside in the mere avoidance of dissymmetry.").

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Apple‘s attempt to assert its patents to monopolize the shape of an article irrespective of the surface details found in either the patent or the accused devices is contrary to law.

V. SAMSUNG’S PATENT INFRINGEMENT CLAIMS AGAINST APPLE

Unlike Apple, which was not a participant in the mobile communications industry until it released the first iPhone in mid-2007, Samsung began developing mobile communications technology in 1991. Samsung has since invested billions of dollars in developing the backbone of the industry and the wireless standards necessary for smartphones. Between 2005 and 2010 alone, Samsung invested $35 billion in research and development relating to telecommunications technology, with over 20,000 engineers worldwide dedicated to telecommunications research and development.

Apple relied heavily on Samsung‘s technology to enter the telecommunications space, and it continues to use Samsung‘s technology to this day in its iPhone and iPad products. For example, Samsung supplies the flash memory, main memory, and application processor for the iPhone. Samsung also manufactures Apple‘s A5X processor and is the sole supplier of the Retina display used in the new iPad. But Apple also uses patented Samsung technology that it has not paid for. This includes standards-essential technology required for Apple‘s products to interact with products from other manufacturers, and several device features that Samsung developed for use in its products.

A. Apple’s Infringement of Samsung’s Standards Patents

Standards organizations are an important part of telecommunications technology, setting requirements that ensure that components from different manufacturers are compatible. The most important telecommunications organization is the European Telecommunications Standards Institute, or ETSI, which produces global standards for information and communications technologies. ETSI creates these standards in "working group" meetings in which companies submit proposals identifying a new standard or an improvement on an existing standard. Samsung has played an active role in these working group meetings, and its contributions have helped build the standards used in the telecommunications industry. Some of these contributions

15

are the subject of the three standards-essential patents at issue in this lawsuit, which Apple uses and benefits from through its compliance with ETSI standards.

The first of these, U.S. Patent No. 7,675,941 ("the '941 patent"), is directed to a "method and apparatus for transmitting/receiving packet data using pre-defined length indicator in a mobile communications system." In general, the '941 patent allows a cell phone‘s processor to quickly determine what kind of data is being sent, allowing for less computing time, faster data speeds and longer battery lives. Specifically, when data is transmitted in a mobile device it is first broken into chunks and these chunk broken into even smaller groups. When the data is received, a computer processor re-assembles the smaller groups back into the original data. The '941 patent recognizes which of these smaller groups of data can be processed most quickly and then unpacks those particular groups and immediately forwards them to the correct component, reducing the time and resources required to process data and resulting in faster data transfer.

This technology, referred to as the "Alternative E-Bit Technology," is required by the 3GPP specification. In order to sell a wireless phone, Apple must comply with the 3GPP specification, which necessitates use of the Alternative E-Bit Technology. Apple‘s products therefore benefit from the Alternative E-Bit Technology and infringe Samsung‘s '941 patent.

Samsung‘s second standards patent, U.S. Patent No. 7,447,516 ("the '516 patent"), is directed to a "method and apparatus for data transmission in a mobile telecommunication system supporting enhanced uplink service." The '516 patent keeps the power used by radio antennae on mobile devices below the limit imposed by the Federal Government, while simultaneously ensuring that all necessary information is still sent. The '516 patent thus helps reduce interference in crowded networks and helps calls intended for one person from being overhead by others. Apple‘s infringement of the '516 patent is confirmed by its compliance with the 3GPP standard as well as third-party testing documents.

B. Apple’s FRAND Defenses Are Meritless

Long before Apple even announced any of its 3G products that use Samsung‘s standards-essential technology, Samsung had offered licenses for these patents(along with other patents) to virtually every major player in the mobile phone industry, successfully striking cross-licensing

16

deals with all of them. After Apple released products that use the technology patented in the '941 and '516 patents, Samsung similarly offered a cross-licensing deal to Apple, asking for a fair and reasonable royalty in return for Apple‘s use of Samsung‘s technology. Unlike all the major players in the mobile phone industry, however, Apple refused to enter a cross-licensing deal with Samsung.

Instead, despite the fact that virtually every other major industry participant was willing to take a license from Samsung for use of the standards-essential patents in this suit, Apple claimed that Samsung‘s patents are unenforceable because, according to Apple, Samsung should have disclosed these patents to ETSI during the working group discussions concerning the technology. But the '941 and '516 patents did not even exist at that point. What Apple is really arguing is that Samsung should have disclosed confidential Korean patent applications during the working group discussions — but this is contrary to ETSI‘s own rules, which expressly exclude confidential information from ETSI‘s disclosure requirements for intellectual property rights, or so-called IPRs. In fact, ETSI‘s Guide on IPRs instructs ETSI members that technical meetings are not an appropriate place for discussion of IPRs. And Apple‘s own expert on this issue, a former Chairman of the Board of ETSI, has stated that he cannot recall a participant ever disclosing IPRs in the working group meetings.

Apple argues in the alternative that Samsung‘s proposed royalty is not fair and reasonable, but Samsung‘s opening offer to Apple is consistent with the royalty rates other companies charge for use of their standards-essential patents. Moreover, Apple never even made a counteroffer. Instead, it simply rejected Samsung‘s opening offer, refused to negotiate further and to this day has not paid Samsung a dime for Apple‘s use of Samsung‘s standards-essential technology.

C. Apple’s Infringement of Samsung’s ‘460, ‘711 and ‘893 Patents

In addition to infringing Samsung‘s standards patents, Apple‘s products use features invented and patented by Samsung, and infringe the three remaining patents Samsung has asserted in this lawsuit. The first of these patents, U.S. Patent No. 7,577,460 ("the '460 patent"), is directed to the integration of a cell phone, digital camera and email technologies in a single device. Samsung is asserting Claim 1 of the '460 patent at trial, which describes Samsung‘s innovation

17

as a five-step method performed on a camera phone. Together, these five steps describe three core functions performed on a camera phone – sending text-only emails, sending emails displaying both text and an image, and sequentially displaying images stored on the device. Apple‘s products perform the five steps and three core functions described in the '460 patent.

The technology patented by the second of Samsung‘s feature patents, U.S. Patent No. 7,456,893 ("the '893 patent"), is also used by Apple‘s iPhones and iPads. The '893 patent allows users to bookmark an image in an image gallery so that, after taking new pictures with the camera, the user returns to that same image instead of the new images. At the time of this invention, galleries on digital cameras displayed the most recently captured image, which resulted in users losing their place in the image gallery if they paused to take new photos. Samsung‘s bookmarking invention is described in claim 10 of the '893 patent, which is infringed by Apple‘s iPhones and iPads. Importantly, Apple did not incorporate this patented feature into any of its devices until seven months after the '893 Patent issued.

The third of Samsung‘s asserted feature patents, U.S. Patent No. 7,698,711 ("the '711 patent"), addresses the longstanding problem earlier mobile devices had with allowing users to multi-task while listening to music in the background. The patented technology solved this problem by providing users with the ability to play music in the background while simultaneously accessing other programs and menus. Apple‘s products use this feature and infringe Samsung‘s '711 patent.

VI. DAMAGES

A. Unlike Samsung’s Reasonable Royalty Claims, Apple’s Claims For Lost
Profits and Disgorgement of Samsung’s Profits Lack Credibility

Apple‘s overreaching claim for damages is a natural extension of its attempt to monopolize the marketplace. It demands the entirety of Samsung‘s revenues on the accused phones and tablets for the alleged infringement of a design patent that shows little more than a blank rectangle with rounded corners. It seeks to collect "lost profits" despite the fact that no one buys phones because they have "bounce back" feature or other manifestations of Apple‘s alleged inventions

18

asserted in this case. Damages are meant to compensate, not confer an absurd windfall at the expense of competitions and consumers worldwide."

Samsung, on the other hand, has simply demanded a reasonable royalty for its patents. Samsung invested billions of dollars in researching and developing wireless technology, including contributions Samsung has made to the UMTS standard. The UMTS standard is important to the performance of smartphones and, like other smartphone manufacturers, Apple charges consumers a premium for devices that use UMTS standards because they perform better. Unlike Samsung, however, Apple did not contribute to the development of the UMTS standard. Nor has Apple paid for its use of the UMTS technology Samsung developed. Apple should not be allowed to free-ride on Samsung‘s investments without paying for the use of Samsung‘s technology.

Samsung‘s royalty rate for its standards patents is a reasonable percentage of the selling price of the device using the UMTS standard, which is consistent with other industry license rates for smartphones using standards patents. While Samsung‘s standards patents enable a mobile device to actually work, Samsung‘s feature patents make mobile devices more convenient for people to use. Consequently, the royalty for those patents is less.

A. Under Section 289, Apple May Only Recover Profits From The Allegedly
Infringing Cases Of Samsung’s Products, Not Their Functional Contents And
Components.

Apple seeks to recover windfall profits that bear no proportion to any claimed harm to Apple or alleged wrongful gains by Samsung. According to Apple, the cases of Samsung‘s phones and tablets are infringing because those cases infringe Apple‘s patented designs. Yet Apple seeks all of Samsung‘s profits from sales of the accused phones and tablets on the grounds that 35 U.S.C. § 289 purportedly grants such a windfall – even if the non-infringing contents of Samsung‘s devices are in fact what creates Samsung‘s profits. Apple‘s request for a non-compensatory windfall overlooks Section 289‘s requirement that profits disgorgement be limited to the "article of manufacture" to which a patented design is applied, and is contrary to law. The Court has not previously addressed the identity of Section 289‘s "article of manufacture" as

19

applied to the D‘889, D‘087 and D‘677 design patents; it will need to do so should liability be found.

The Federal Circuit explained in Nike Inc. v. Wal-Mart Stores, 138 F.3d 1437, 1442 (Fed. Cir. 1998), that the legislature removed "the need to apportion the infringer‘s profits between the patented design and the article bearing the design" in the Act of 1887, which led to the current Section 289. It remains necessary under Section 289, however, to determine the amount of profits earned from the "article of manufacture to which [the patented] design or colorable imitation has been applied". 35 U.S.C. § 289. A Second Circuit case explains how to make that determination where, as here, the product that is sold consists of an ornamental case that surrounds a functional core. See Bush & Lane Piano Co. v. Becker Bros., 222 F. 902, 903-904 (2d Cir. 1915) ("Bush & Lane Piano"); see also Bush & Lane Piano Co. v. Becker Bros., 234 F. 79 (2d Cir. 1916) (opinion after remand) ("Bush & Lane Piano II").

In Bush & Lane Piano, the plaintiff proved infringement of its patented design for a piano case – i.e., "the structure which incloses and holds in position the piano proper, viz., the part which produces the music. The former appeals to the eye, the latter to the ear." 222 F. at 903. Applying the Act of 1887, the predecessor to Section 289, the Court reversed an award of "the entire profits of the sales of the piano and case," holding instead that only "the profits upon the sale of the case" could be disgorged. Id. The Court explained:

To attribute the sale of 958 Imperial pianos solely to the design of the case which inclosed them seems unwarranted. Such a supposition is unsupported by the proof and involves too violent a presumption to be accepted. What Lane invented was a piano case, not a piano. He received a patent for a 'piano case‘ and not for a piano, but he has recovered the profits on 958 pianos.
Id. at 904. A dissent urged that all profits from piano sales properly were awarded under the Act of 1887 because "the article which the complainant manufactures and sells is a piano and the article to which the design is applied is a piano," and the "complainant neither manufactures the case nor sells it separately." Id. at 905-06 (Ward, J., dissenting). But for the majority, "[w]hen the patent owner is awarded the profits due to his design he receives all he is entitled to. If the rule be established that a design for a case enables the owner to collect damages for the case not only, but for the contents of the case as well, it will lead to results which shock the conscience.

20

A design for a watch case will include the watch itself. A design for a gun case will include the gun, a design for a hat case will include the hat and so on." Id. at 905.

This holding is fully consistent with Section 289, and the Act of 1887 on which it is based. As the Federal Circuit explained in Nike, the Act of 1887 was a response to a "series of cases involving carpet designs," where infringing defendants were found "liable for no more than 'nominal damages‘ of six cents because the patentees could not show what portion of their losses or the infringers‘ profits was due to the patented design and what portion was due to the unpatented carpet." Nike, 138 F.3d at 1441. The legislature removed "the need to apportion the infringer‘s profits between the patented design and the article bearing the design" in response. Id. But this removal of the need to apportion did not remove the need to limit an award of profits to "the article bearing the design" itself, and to determine what the article bearing the design actually is. Id. In Bush & Lane Piano, the article bearing the design was the infringing piano case; without engaging in apportionment proscribed by the Act of 1887, profits therefore were properly "confined to the subject of the patent - a piano case." 222 F. at 904. This presents an unresolved issue that will require the Court‘s attention; while the Court has previously addressed apportionment under Section 289, see June 29, 2012 Order at 9, it has not resolved what the relevant "article of manufacture" is as applied to Apple‘s design patents.

In some cases the article bearing the infringing design is inseparable from the entire article as sold, and therefore all profits from sales of the article are recoverable under Section 289. An infringing carpet design, see Dobson v. Dornan, 118 U.S. 10 (1886), or a design for a spoon handle, see Gorham v. White, 81 U.S. 511 (1871), "is inseparable from the article to which it is attached, or of which it is a part," and all profits from sales of such infringing products are recoverable. Bush & Lane Piano, 222 F. at 904. By contrast, a "patent for a 'book binding‘ cannot, either justly or logically, be so identified with the entire book as to give all the profits on a work of literary genius to the patentee of a binding, although the binding was manufactured with and for that one book, and has no separate commercial existence. The binding and the printed record of thought respond to different concepts; they are different articles." Bush & Lane Piano II, 234 F. at 81-82. So too as to the outer case of a functional product. Even though the piano

21

“case and works were merely component parts of an integral whole, and [] there was no instance of a sale of a piano without a case, or a case without works,” only profits attributable to the case itself could be awarded because the case, and not the piano works, was “the article to which the design was applied”. Id. at 79, 83 (affirming award of profits based on proportionate cost of case versus works).

Any ruling that grants “the owner of a design patent for a receptacle intended to hold an expensive article of manufacture the profits made on the sale of the receptacle and its contents, must certainly lead to inequitable results and cannot be sustained.” Bush & Lane Piano, 222 F. at 904-905. Apple seeks precisely such a ruling from the Court. Following the Second Circuit’s guidance, the Court should reject Apple’s request for windfall profits that are not attributable to the allegedly infringing phone and tablet cases sold by Samsung.

DATED: July 23, 2012

QUINN EMANUEL URQUHART &
SULLIVAN, LLP

By /s/ Victoria F. Maroulis
Victoria F. Maroulis
Attorneys for SAMSUNG ELECTRONICS CO.,
LTD., SAMSUNG ELECTRONICS AMERICA,
INC., and SAMSUNG
TELECOMMUNICATIONS AMERICA, LLC

______________
1 All citations to "Ex." refer to exhibits attached to the Declaration of Joby Martin, filed concurrently herewith.

2 By discussing specific prior art references, Samsung in no way waives its right to present evidence of other prior art references cited in Samsung‘s Invalidity Contentions, interrogatory responses, and Notice of Prior Art Pursuant to 35 U.S.C. § 282.

3 The Court construed "event object invokes" a scroll or gesture operation to mean the "event object causes" a scroll or gesture operation. (Dkt. 1159 at 18-20.)

4 This and other formulations of the test appear verbatim in Samsung‘s instruction, yet Apple erroneously suggests that Samsung is rewording the standard. Dkt No. 1232 at 164. Apple also quarrels with the phrase "deceptively similar" used in Samsung instructions as shorthand for the infringement test. This is surprising because the phrase is pulled straight out of Federal Circuit precedent. Just two years ago in Richardson v. Stanley Works, for example, the Federal Circuit stated that "infringement cannot be found unless the accused product creates an appearance deceptively similar to the claimed design." 597 F.3d at 1296 (citing Egyptian Goddess). In Arminak v. Saint-Gobain, the Federal Circuit commended the trial court for applying the design patent infringement test "in the proper manner" because it "determine[d] whether an ordinary observer would find the accused design deceptively similar" to the patented design. 501 F.3d 1314, 1327 (Fed. Cir. 2007). And Egyptian Goddess itself said that where an accused design copies a novel feature of the asserted design, it is ―"more likely to be regarded as deceptively similar to the claimed design, and thus infringing." 543 F.3d at 677 (emphasis added).

Apple‘s related objection to Samsung‘s design patent infringement instruction that the phrase "deceptively similar" is used instead of the phrase "substantially the same" in what is otherwise a direct quote from Arminak is wrong. Dkt No. 1232 at 165. As shown, the phrase "deceptively similar" was the choice of the Arminak Court itself. It is not the creation of Samsung.

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