Monday, September 26, 2011

Apple-Samsung court hearings in South Korea, Australia and the Netherlands

With 20 (or more) lawsuits going on between Apple and Samsung around the globe, it happens that hearings in two such cases take place on the same day. Today, there was a hearing in Australia, and as I write this, one is going on in the Netherlands. On Friday, there was a hearing in South Korea.

In between those two hearing days, on Saturday, I spotted a letter filed by Verizon, the largest U.S. wireless carrier, in support of Samsung with a U.S. district court. Earlier today, wrote the following in its pre-market commentary:

"In stock-specific news, Apple shares are down about 1.5 percent after [FOSS] Patents reported that Verizon was backing Samsung against Apple in the U.S. patent fight between the two companies."

I'm not sure that movement is attributable to my reporting. The Euro crisis is taking its toll, and there could be other Apple-related reasons. Should it be true, I just reported on material in the public record and any resulting stock movement is unintended. I haven't held or traded any tech stocks or derivatives thereof since spring 2010 just to avoid conflicts of interest.

Now I'll comment on those hearings country by country, in chronological order.

South Korea (Friday, September 23, 2011)

I'm not aware of any media report on that hearing. I received information from an independent observer of the proceedings.

Samsung was first to sue Apple in Korea, but Apple countersued later. The focus of the Friday hearing was on two patents asserted in Apple's countersuit. The related Korean patent numbers end with '120 and '459:

  • The '120 patent is the Korean equivalent of what I called "Apple's favorite make-Android-awkward patent": a list-scrolling patent. That patent is also the only intellectual property right Verizon's intervention formally relates to.

    I've been told that Samsung argues against the validity of that patent with different pieces of prior art, particularly including (but not necessarily limited to) an email program named LaunchTile, an AOL patent, and a Japanese electronic dictionary. Apple argued that there are fundamental differences between those technologies and Apple's list-scrolling technique. In connection with LaunchTile, Apple also appears to dispute that it's admissible prior art since it resulted, allegedly, from a study sponsored by Microsoft and wasn't made public prior to Apple's patent application.

  • The '459 patent is the Korean equivalent of the slide-to-unlock patent a Dutch judge previously deemed (preliminarily) invalid because he considered it to be trivial in light of prior art, in particular, a Swedish device named Neonode N1m.

    Since Samsung was (on a preliminary basis) successful with its invalidity contentions in the Netherlands, I would be surprised if they couldn't also prevail with those in their home court.

I learned that the Korean court will have another hearing on November 25 to discuss different patents. I don't know yet whether those other patents are Apple or Samsung patents.

Overscroll workaround

With respect to the list-scrolling patent, it seems that Samsung already has a workaround in place. One of my readers (a different source than the one for the Seoul court hearing) sent me this screenshot taken from an Android version 2.3.5 update to Samsung's firmware that is currently being tested prior to its official rollout:

In that screenshot (which you can enlarge by clicking on it) you can see that the topmost menu item, "Wireless and network", appears in a lighter shade of blue than the other items. That's the "overscroll glow" effect: instead of moving the list along with the user's finger and bouncing it back so the list aligns with the edge of the screen, the edge where the user hits the end of the list gets a temporary glow.

The glow should steer clear of infringing Apple's list scrolling patent, but it's suboptimal as I explained before (with two YouTube videos). As a Samsung Galaxy S II user, I'm very, very unhappy that at some point in the near future I'm going to get an update that replaces the intuitive overscroll with a counterintuitive glow. Updates should usually enhance -- not degrade -- the user experience. If Apple succeeds with several more patents of this kind, I'll have to choose another platform than Android. Seriously.

Australia (Monday, September 26, 2011)

A month ago I reported that Samsung apparently felt forced to delay the launch of its Galaxy Tab 10.1 in Australia by another month, and that the Sydney-based Federal Court of Australia had scheduled hearings for September 26 (today) and 29 (Thursday).

For information on today's hearing in Australia I can recommend three articles:

The Netherlands (Monday, September 26, 2011)

A month ago, the Rechtbank 's-Gravenhage (an old name for the Dutch city of The Hague) ordered a formally EU-wide preliminary injunction against a few Samsung smartphones. That injunction will take effect in a couple of weeks, and since the technical scope of the injunction was rather narrow, I believe Samsung will be able to work around that one. I heard from someone that Samsung has already modified the photo gallery page-flipping functionality in its firmware. Also, the related patent was registered in only a few European countries.

Meanwhile, Samsung brought four countersuits against Apple, asserting different patents declared essential to the 3G (UMTS) wireless communications standard. Apple raised a FRAND defense just like in the United States, and the court in The Hague held a hearing today to discuss those FRAND standards issues first. If the court agrees with Apple, Samsung cannot seek an injunction against the iPhone and iPad based on those patents. Prior to today's hearing, I applauded the court (in an interview) for addressing those FRAND issues ahead of all other aspects of Samsung's claims.

Today's court hearing didn't lead to a decision, which will be announced on October 14 at 2 PM Central European Time with respect to those FRAND issues (which are outcome-determinative for the case at large), but it revealed some interesting information. Webwereld's Andreas Udo de Haes tweeted live from the courtroom. For a detailed account of all that was said, I refer you to his Twitter page (if you click on that link on one of the following days, look for his tweets dated September 26, 2011). I'm sure he will write a report on today's hearing and I will link to that one when it is published.

9to5Mac picked up an interesting piece of information that was supposed to be strictly confidential but disclosed by Apple's counsel during one of the public parts of today's hearing: for each of its 3G-related patents (I believe there are four that Samsung is asserting in the Netherlands), Samsung wants 2.4% of the price of the related chip as a royalty. Considering that there are at least several hundred patents that are declared essential to a standard like 3G, such a per-patent royalty demand appears to be completely out of line.

Samsung's lawyers apparently tried to claim that Apple can't make a distinction between its "crown jewels" (its multitouch-related patents) and Samsung's standards patents, but the fact of the matter is that it's a lot easier to acquire monopoly power by cooperating with other major industry players in a standard-setting process than to do so singlehandedly the way Apple did with the iPhone and iPad.

It's also a fact that FRAND licensing commitments must be honored, and Apple's lawyers didn't exaggerate the importance of this when they told the court that Samsung's approach to those patents calls into question the way standard-setting organizations like ETSI operate.

Apple's lawyers compared Samsung to Rambus, a company whose demands in connection with patents gave rise to an EU antitrust proceeding. Since ETSI is a European organization (operating under French law), I wouldn't be surprised if Apple filed an antitrust complaint with the European Commission at some stage. At least there were a couple of statements by Apple's lawyers today that clearly accused Samsung of violating European competition law with its behavior. But antitrust proceedings are slow and Apple wants a quick resolution of this. My prediction for October 14 is that the judge will probably conclude that Samsung is not entitled to an injunction against Apple and that Samsung is in breach of its FRAND licensing obligations.

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