War of giants: how Apple sued Samsung half a billion dollars

After seven years of litigation and five days of trial, in a dispute of major technology companies, come to an end. Why the court ordered Samsung to pay Apple $ 539 million?

The Court in San Jose, California, found Samsung guilty of patent infringement on Apple design and technology of smartphones. Now Samsung will have to pay the American rival $ 539 million, writes Bloomberg. The developments in this case and the losses are usually technology companies in the course of proceedings?

The court found that the Apple was on the screen, plus two of the patent “utility” on the screen, or “invention”. In particular, the case of featured technologies such as the “bounce-back“,” pinch-to-zoom. “Technology” pinch-to-zoom “gives the owner the opportunity to increase a picture, and” bounce-back“is that the picture bounces back to the moment.

War of giants: how Apple sued Samsung half a billion dollars

Initially, in 2011, Apple has about $ 1 billion for patent infringement, the proceeds of the sale of Samsung smartphones that use the patented technology and designs, while Samsung argued that it had to pay only $ 28 million not the entire device, but only a small part of it.

At the end of 2015, the court reduced the claim amount to $ 548 million plus legal costs and additional costs, in March 2016, after appeal to $ 399 million After this the case went to the U.S. Supreme court, but was remanded to the district court for review of the decision. It was made today: the amount of the payment increased by $ 140 million.

Perhaps this is not the end of the story – the Samsung representatives did not rule out that the court’s decision will be appealed. But Apple seems to have a solution for them. “We are deeply convinced of the value of design.” Our team works tirelessly to create innovative products that delight our customers, “commented Apple in the court’s decision. Bloomberg writes that independent lawyers called the verdict “a great victory” for Apple, because of the Supreme Court ruling.

The battle for the patent

This patent dispute between Apple and Samsung was not the only one: for example, in early 2014, a California court ordered Samsung to pay Apple $ 120 million for violating a patent on data synchronization, as well as the patent “slide to unlock” patented by Apple with the release of the first iPhone in.

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Apple has also violated the Samsung patents, for example, associated with the operation of the camera. Though the court determined the amount of the payment only $ 158,000. In 2013, the international trade Commission, the iPhone 3GS and iPad 3G and iPad 2 3G.

At the end of August 2012, another patent lawsuit, but in the court of South Korea. According to the verdict, Apple violated two patents. Apple was ordered to pay a fine of $ 35,400, Samsung $ 22,125. The iPhone 3GS, iPhone 4, iPad 1 and iPad 2 and Samsung gadgets, including Galaxy S, Galaxy SII and Galaxy Tab, on the territory of South Korea. However much damage to producers, this ban did not cause the device is already outdated and was not important for companies.

In total, the two companies sued each other more than 30 lawsuits in various countries around the world. In order to regulate these processes, the United States and the United States. The trial was conducted in parallel in South Korea, Australia, Japan, Germany, the Netherlands, the UK, France and Italy.

A closed power cycle

By and large, Apple and Samsung are enemies and partners at the same time: they have components from the same suppliers, moreover, to 2017, Samsung has supplied Apple chips for mobile devices. That is, increasing the cost of the chip for a few cents, Samsung could recoup its losses through sales before 2017.

The company is in the first place, Apple (215.8 million units sold in 2017) on the first place in the ranking of the world’s smartphone market, IDC in terms of sales: Samsung (317.7 million units sold in 2017) on the second. On the third place is the Chinese company Huawei (in 2017 it sold 154.2 million smartphones). All three companies are in the market for the smartphone market for the first time since 2009. This means that those who are still without a smartphone the world is becoming smaller and companies are starting to seek new profit opportunities.

Despite the fact that the smartphone market is no longer growing, Apple and Samsung are likely to remain competitors in the future, but in new categories such as unmanned vehicles, augmented reality glasses, smart speakers and other IoT devices, as well as in the development of software for artificial intelligence.

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Local conflicts

In addition to war with each other, Apple and Samsung and many technology companies are also patent fight “patent trolls”. Latest not to develop products, and decided to “earn” an alternative way – through the courts.

For example, the company VirnetX in April 2018 was able to win a court case from Apple for $ 502.6 for violation of the patent rights to the technology video calls, used by FaceTime, and iMessage. The case was opened back in 2010. Then, VirnetX holding (formally dealt with telecommunications solutions) Apple filed a lawsuit for $ 900 million in the Fall of 2017, the court ruled that Apple must pay VirnetX $ 439.7 million in the spring to this amount was added another $ 502 million, the Fine was assigned, based on the sale of about 400 million Apple device. It is unlikely Apple will leave the decision without appeal.

In addition to Apple, VirnetX Systems, Microsoft (managed to seize $ 200 million) and Motorola (managed to seize the $ 106 million). VirnetX was one of those companies that produced nothing, but are an organization that received a patent and build a business model solely on lawsuits against other companies.

The company Apple had to fend off Nokia, Motorola, HTC and Kodak. Nokia has accused Apple of illegally using 10 patents. The Americans filed a counterclaim. The trial lasted two years and ended with the signing of the agreement on patent licenses. Motorola filed a lawsuit for the use of seven patents relating to the playback of video and audio files, reminder on the location and number of other functions. Apple was willing to pay $ 1 from each sold device. After Google bought Motorola Mobility for $ 12.5 billion, Apple and Google agreed to drop all current lawsuits that exist directly between the two companies. With HTC American company also exchanged lawsuits over the use of patents. In the end, the company signed an agreement on mutual licensing of patents.

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In January 2012, Kodak filed a patent lawsuit against Apple and HTC, accusing them of violating four patents related to transmitting digital images. Kodak has demanded to stop selling smartphones and tablets of the two companies and to pay damages. For Kodak it was the last chance: for 2011 its shares fell by 91%, and on January 19, Kodak filed for bankruptcy. So it’s litigation involving Apple over, even before it started. However, in December 2012, Kodak agreed to sell its portfolio of 12 patents on a digital image to a consortium for $ 525 million, saying it will use proceeds from the sale to repay the debt in bankruptcy.

Samsung, in turn, pleaded with the Swedish Ericsson for patents: the company had a license agreement, but when its term expired, the Swedes hastened to sue. And Nokia has achieved the smartphone HTC One in the Netherlands, because of the proprietary components of the microphone.

All good

But all this pales before the fact, what force the question of the relationship of the various companies are political decisions. In April 2018, the U.S. Department of Commerce has banned Chinese telecommunications giant ZTE to buy American products for seven years, citing violations of the agreement on sanctions, signed last year. It hit another American company, the chip maker Qualcomm, because the Chinese ZTE had one of her customers. In response to U.S. Qualcomm Danish NXP because many Chinese companies are its customers.

In case of further voltage rise, extreme again can be Apple, many of its devices collect in China because it is cheaper. In addition, if China will ban the sale of Apple products, it will not be able to cover losses from the loss of one of the world’s largest markets. Perhaps these factors were taken into account, or the Chinese compromise, but trump has hinted on Twitter. The world of high technologies is impossible without compromises and treaties, too tied to the participants.


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