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Apple's Claim 19 of '381 Patent Rejected by USPTO in Final Office Action: Impact on Apple v. Samsung Damages Can Be Huge ~pj
Tuesday, April 02 2013 @ 12:13 PM EDT

The claim 19 of the '381 patent that Apple relied upon so heavily against Samsung at trial, the bounce back patent, has now been finally rejected by the USPTO, as it ruled there is prior art that anticipated the '381 patent (Lira, PCT Publication No. WO 03/081458 by Luigi Lira; and Ording, US Patent No. 7,786,975). The jury in Apple v Samsung didn't credit any prior art offered, but it looks like it should have. This impacts the damages award by that jury, as Samsung puts it in a notice [PDF] to the court:
This Final Office Action by the USPTO is relevant because it finally rejects multiple claims of the ‘381 patent as being anticipated under 35 U.S.C. §102 by PCT Publication No. WO 03/081458 to Lira. This final rejection includes claim 19, which is the only claim of the ‘381 patent at issue in this action. The jury found at trial that 21 accused Samsung products infringed claim 19 of the ‘381 patent—specifically, the Captivate, Continuum, Droid Charge, Epic 4G, Exhibit 4G, Fascinate, Galaxy Ace, Galaxy Prevail, Galaxy S, Galaxy S 4G, Galaxy S II (AT&T), Galaxy S II (i9100), Galaxy Tab, Galaxy Tab 10.1 (WiFi), Gem, Indulge, Infuse 4G, Mesmerize, Nexus S 4G, Replenish, and Vibrant. The jury awarded damages as to 18 of these products. Some, but not all, of these damages awards have been vacated for new trial.
Apple's case keeps getting smaller and smaller. This is a final office action, and happily for Samsung, it was ruled on while Apple v. Samsung has not yet been completed. The judge gets the final say on how much this will matter in the immediate, but longterm, this is huge.

Note: Exhibit A [PDF] to the Statement of Recent Decision, below, is the final office action, and it is 112 pages long. Here's the jury's verdict form [PDF], the amended one, after it fixed the first of the many math problems that plagued this jury. Notice that claim 19 is the only part of the '381 patent at issue in this litigation, see page 2. And here's the '381 patent [PDF]. The USPTO preliminarily rejected this patent's claim 19 back in October, if you recall.

And do you remember the juror Manuel Ilaga, interviewed by the respected reporter Greg Sandoval, then at CNET, who related that one of the biggest debates was over the '381 patent, and it was the jury foreman who convinced the others that the prior art didn't invalidate this patent:

"It didn't dawn on us [that we agreed that Samsung had infringed] on the first day," Ilagan said. "We were debating heavily, especially about the patents on bounce-back and pinch-to-zoom. Apple said they owned patents, but we were debating about the prior art [about similar technology that Samsung said existed before the iPhone debuted]. [Velvin] Hogan was jury foreman. He had experience. He owned patents he took us through his experience. After that it was easier. After we debated that first patent -- what was prior art --because we had a hard time believing there was no prior art."

"In fact we skipped that one," Ilagan continued, "so we could go on faster. It was bogging us down."...

"Once you determine that Samsung violated the patents," Ilagan said, "it's easy to just go down those different [Samsung] products, because it was all the same. Like the trade dress -- once you determine Samsung violated the trade dress, the flat screen with the bezel...then you go down the products to see if it had a bezel. But we took our time. We didn't rush. We had a debate before we made a decision. Sometimes it was getting heated."

It was easy, but it was wrong. And so another jury decision by this jury is shown to have been totally wrong. The judge, by the way, could have done something about this mistake, but she did not.

The filing:

04/01/2013 - 2291 - STATEMENT OF RECENT DECISION pursuant to Civil Local Rule 7-3.d re Final Office Action by the USPTO Rejecting U.S. Patent No. 7,469,381 filed bySamsung Electronics Co. Ltd.. (Attachments: # 1 Exhibit A)(Related document(s) 2281 ) (Maroulis, Victoria) (Filed on 4/1/2013) (Entered: 04/01/2013)

04/01/2013 - 2292 -Administrative Motion to File Under Seal re Court's March 17, 2013 Order filed by Samsung Electronics America, Inc.(a New York corporation), Samsung Electronics Co. Ltd., Samsung Telecommunications America, LLC. (Attachments: # 1 Proposed Order Granting Samsung's Renewed Administrative Motion to File Documents Under Seal)(Maroulis, Victoria) (Filed on 4/1/2013) (Entered: 04/01/2013)

Meanwhile, Samsung had to go to the expense and trouble of coming up with a workaround for the bounce back patent, so as to avoid Apple getting an injunction against it. On that same linked page, you'll find an excerpt from Apple's expert testimony by Dr. Balakrishnan, opining for the jury that all Samsung's products infringed claim 19 of the '381 patent, and that there was no prior art. But the inventor of the Apple '381 patent, Bas Ording, also invented the earlier prior art. So somebody knew. It's not just the jury and the judge to blame in this picture.

In Apple's trial brief, filed just before the trial began, it spoke of its '381 patent, and notice all the rulings by the two judges that may have impacted the jury's ultimate, but misguided, decision:

B. Samsung Infringes Apple's User-Interface Software Patents

Apple will prove at trial that Samsung is infringing three patents directed to innovative features of its multi-touch user interface: the '381 "rubberbanding" [redacted] patent, the '163 "tap-to-zoom" patent, and the '915 "scroll vs. gesture" patent. Infringement is clear from using the Samsung products and reviewing the source code, as Apple's experts Ravin Balakrishnan and Karan Singh will explain. Apple will also present evidence that Samsung deliberately copied Apple's features.

The Court's claim construction rulings leave Samsung with only a few scattered non-infringement arguments that plainly lack merit. Samsung's own expert conceded that Samsung infringes the '163 patent. Samsung's original non-infringement defense to the '915 patent cannot survive the Court's construction of "invokes" in rejecting Samsung' motion for summary judgment. (Dkt. No. 1158 at 18-20.) Samsung has an alternative argument that a few of its products do not infringe the '915 patent because they can be made to perform what Samsung's expert calls "two-finger scrolling" (i.e., a combination of translating and minimal or imperceptible zooming). But Samsung's argument fails because it adds a new limitation that is not part of the claim, namely that scrolling and scaling are mutually exclusive.

As to the '381 patent, this Court has already found likely infringement, rejecting the claim constructions that were the basis for Samsung's non-infringement defenses. (Dkt. No. 452 at 52-56; Dkt. No. 1266.) Samsung apparently continues to argue that it does not infringe because "first direction" requires the human finger to move with single-pixel precision, even though the Court has rejected that argument. (See Dkt. No. 452 at 55 ("because the term 'first direction' does not require linear movement, Samsung's devices do infringe").) Samsung may also assert that some of its products do not infringe the '381 patent because they can be manipulated to avoid rubberbanding, by making slow and minimal finger movements. But the Accused Products do "rubberband" in normal operation and thus necessarily include the instructions for performing the claimed method, which is all that asserted claim 19 requires.


Lacking any plausible non-infringement argument, Samsung has no choice but to argue invalidity. Samsung cannot overcome the presumption of validity with clear and convincing evidence. Samsung's prior art references fail to disclose key limitations of Apple's inventions, as Apple's experts will explain. Samsung's deliberate copying and the iPhone's and iPad's commercial success reinforce the conclusion that Apple's inventions were far from obvious. Moreover, Judge Grewal struck prior art references to the '915 patent cited by Samsung's expert Stephen Gray, as well as references cited by Andries Van Dam (except as technical background to the '381 patent). (Dkt. No. 1144 at 3, 5.) Samsung cannot rely on these references as prior art.

Finally, Judge Grewal's rulings preclude Samsung from presenting evidence of any efforts to design around Apple's software patents. On May 4, 2012, Judge Grewal ruled that as a sanction for Samsung's unjustified failure to produce "design-around" source code for Samsung's products until long after the Court-ordered deadline, Samsung "shall be precluded from offering any evidence of its design-around efforts for the '381 . . . and '163 patents. . . ." (Dkt. No. 898 at 9.) In response to Samsung's motion for "clarification," Judge Grewal confirmed that his order meant what it said: during the jury trial, Samsung could not offer "any evidence of its design-arounds," meaning "no source code evidence, no non-source code evidence, no evidence of any kind, whether for liability or any other purpose." (Dkt. No. 1106 at 3-4.) Samsung did not file a timely objection to Judge Grewal's June 19 Order. (Dkt. 1274-2, at 3.)

See what I mean? Samsung intends to appeal the way it was treated at trial, and can anyone now say that it has no basis to complain? It almost had to pay megabucks on a bogus patent claim, as each decision left it less and less room to make its case. And perhaps the jury picked up on that mood from the judges. Who knows? Patent law favors the patent holder, but when it's not a valid patent, how unfair it all becomes.

Software patents are the real problem, and Samsung's tale of woe dealing with this one, now finally overturned regarding this patent's claim 19, is just one small corner of this sad and toxic upside-down and anti-competitive patent game.

And don't forget that this impacts more than just Samsung. The Japanese equivalent to the '381 US patent is the heart of the dispute there, as well. And Samsung told the court earlier that Apple was calling around, warning other companies about the '381 patent. Apple told the appeals court in its pending appeal of Judge Lucy Koh's refusal to order an injunction against Samsung just how important the '381 patent is in Apple's estimation:

Because they protect key designs and functionalities that have fueled the iPhone's and iPad's overwhelming success, the D'677, D'087, D'305, '381, '915, and '163 patents as well as Apple's iPhone trade dress are crown jewels of Apple's "unique user experience" IP portfolio.
Well, one of the crown jewels turns out to be costume jewelry, and it surely caused a lot of unnecessary trouble before it was revealed as bogus. Patent trolls are decidedly not the only problem with US patent law. Patent invalidity needs to be addressed before a defendant has to spend millions to get its rights established. This claim in this patent should never have issued in the first place. And the problem is, once a patent issues, the courts treat it like it came down on stone tablets from above. That is what Samsung faced. Apple called it a copycat, but all its aspersions now boomerang, at least with respects to this claim. You know, when all the geeks at Groklaw tell you a patent is stupid, you should take it seriously.

Claim 19 is the one that matters for the Apple v. Samsung litigation, but more than just claim 19 were found invalid as anticipated or obvious. From the final office action document:

The following rejections are utilized by the Examiner below, referencing the proposed prior art listed on pages 23-85 of the Request:
Rejection A: Claims 1-6, 8-12, 16, and 20 as being anticipated by Lira

Rejection B: Claims 7, 13, and, 15 as being obvious over Lira

Rejection D: Claims 1-5, 7-13, and 15-20 as being anticipated by Ording '975 (since removed over the 1.131 declaration)

So claims 14, 17, and 18 survived, see pages 21-23, after Apple provided more info in response to the earlier preliminary rejection, which you can read about in more detail beginning on page 23. But none of those claims matter to Samsung in Apple v. Samsung, although they could matter elsewhere.

But look at what Samsung has been put through. Imagine you are Samsung. Or worse, imagine you are a startup or an app developer and Apple or some other deep-pocket company comes after you with a patent like this. You don't have millions to defend yourself with. See the problem? Surely we can devise a better system than this.

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