Saturday, September 3, 2011

German court orders Samsung to remove Galaxy Tab 7.7" from IFA (trade show) booth and German website

[Updated on September 4, 2011] An official Samsung statement quoted by Yonhapnews, South Korea's official news agency, and another statement quoted by Bloomberg confirm that the Düsseldorf Regional Court took another decision in the intellectual property dispute between Apple and Samsung on Friday, September 2, 2011. The court has apparently ordered a new injunction, this time against the Galaxy Tab 7.7 (the previous one related to the Galaxy Tab 10.1).

Friday (September 2, 2011) was the first day a trade show named IFA (Internationale Funkausstellung) in the German capital of Berlin. It's a major international event for the consumer electronics industry, and I have seen on Twitter that a number of U.S. journalists covering mobile devices flew in from overseas. And it's the venue of the latest episode in the world-spanning intellectual property dispute between Apple and Samsung, following an unambiguous sign of weakness on Samsung's part in Australia: On Saturday, Samsung removed all Galaxy Tab samples, especially the new 7.7" version, and all promotional material from its booth on Saturday (the second day of the show). Samsung also removed the Galaxy Tab 7.7" from its German website. produced two videos of the Galaxy Tab 7.7. On that page, the first video shows how Samsung presented the Galaxy Tab 7.7" yesterday. The second one is a hands-on demo of the product, and you can see the "NOT FOR SALE IN GERMANY" sticker on the sample, which is how Samsung apparently hoped to be able to present the product at this international trade show without being affected by a German preliminary injunction.

ThisIsMyNext published some telling "BEFORE" and "AFTER" photos of Samsung's Galaxy exhibits at IFA., the website of a major German computer magazine, claimed that Samsung received a letter from Apple right at its booth today. While I haven't been able to find any corroborating reports by other media, I have been in contact with the author of's article. He says that he was at the Samsung booth, with a colleague of his, right at the time when the Galaxy Tab 7.7 was pulled, and he says that there was talk about a "letter". Based on a subsequent statement by Samsung in Korea, I'm sure was right. contacted Samsung's PR department in the U.S. later on Saturday and received the following statement:

"Samsung respects the court’s decision (The District Court in Dusseldorf) made on September 2 and therefore decided not to display any more the GALAXY Tab 7.7 in IFA."

(the full statement, quoted by TheDroidGuy, continues with a remark on how this limits consumer choice and with Samsung's usual vow to keep on fighting)

So the court became active again -- at Apple's request, as Samsung's statement quoted by Yonhapnews confirms.

Even prior to the official confirmation, there was no reasonable doubt that Samsung didn't show those devices on the first day and the morning of the second day of IFA only to remove them in the middle of the second day. One of the reports says that in addition to removing all Galaxy Tabs, Samsung staff also scraped off the product name shown at the booth right below (or next to) the samples.

After the initial reports, there were two legal possibilities: a new injunction or finding of violation of the existing one

The preliminary injunction Apple obtained in Germany four weeks ago related to the Galaxy Tab 10.1" as the only accused product at the time. After the inital reports came out, there were two possible explanations for why Samsung was now forced to remove the Galaxy Tab 7.7" from its IFA booth:

  1. After the aforementioned Samsung statement quoted by Yonhapnews it appears that Apple has obtained a new preliminary injunction. It was easier for Apple to obtain a new court decision and this would have avoided any argument over whether the existing one applies to the 7.7" version. German courts can move very quickly with these injunctions. Maybe Apple filed for it on Friday morning, received the document in the afternoon or on Saturday morning (for such preliminary injunctions, the courts are also available on weekends) and then sent someone to Berlin to serve the document on Samsung.

  2. There would have been (until the Yonhapnews report) a second possibility: Apple might have asked the Düsseldorf court to impose a fine on Samsung for contempt of the existing preliminary injunction. There could be an argument that the existing preliminary injunction applies to the Galaxy Tab 7.7" as well, given that -- apart from its size -- it looks very similar to the banned Galaxy Tab 10.1", and if one infringes the Community design in question, so will the other.

    Under German law, the court can threaten with and impose fines of up to EUR 250,000 (US$350,000) or, in severe cases of continued contempt, order the imprisonment of Samsung management (at least the CEO of its German subsidiary). The way the courts handle this is that for the first violation they impose a relatively small fine, and with every new violation (or every continuation of an ongoing infringement) they impose increasing fines. If even the maximum fine isn't sufficient, they can theoretically order imprisonment. I actually know of a case in which a lawyer representing a German publisher of computer magazines asked a court to order the imprisonment of the managing director of the German subsidiary of a competitor (Ziff-Davis). In that case, the court denied the motion, and I don't know if anyone was ever imprisoned due to contempt of a preliminary injunction. But theoretically it's possible.

The Düsseldorf regional court will hand a post-hearing decision on the Galaxy Tab 10.1" injunction on Friday, September 9, 2011. The judge presiding over that case appears to be on Apple's side anyway, but it wouldn't be wise for Samsung to bring up that court against it even more by acting in contempt of a preliminary injunction.

Original Samsung statement didn't admit a new court decision

Prior to the Samsung statement quoted further above, published a video of an interview of AndroidPit's Fabien Roehlinger with Annika Karstadt, the press spokeswoman of Samsung's German subsidiary. This is my translation of the interview:

AndroidPit: People saw that you removed all Galaxy Tabs 7.7 and covered [parts of the tables] with a sheet. What's the matter with this?

Samsung: We have decided -- on a current occasion -- to replace the product with our other IFA highlight product, the Galaxy Note, since, as the press reported, we weren't going to offer the product for sale in Germany anyway, so we want to show our customers the other product -- the [Galaxy] Note -- more closely.

AndroidPit: Does this have to do with Apple by any chance?

Samsung: On this one I have to ask you for your understanding that I'm not allowed to comment on an ongoing [legal] proceeding.

AndroidPit: So this apparently means you want to focus more on the Galaxy Note and you have therefore taken a decision on short notice to rearrange your exhibits?

Samsung: The Note was going to be our highlight product anyway and since the other product wasn't going to be sold in Germany at any rate, I believe it's also better for the consumers here [at the show] and simpler and in the interest of trade show visitors that we really show only those products that are really going to be released in Germany.

I think the Samsung spokeswoman handled this delicate situation fairly well. Between the lines it was easy to figure out that there was pressure from Apple, and that's also what AndroidPit's article (written after the interview) described as the most plausible explanation. But she wasn't allowed to say so. The only problem for Samsung Germany is that Samsung's U.S. subsidiary and especially its Korean HQ confirmed the issuance of a new injunction, but even hours later it appears that Samsung Germany was not allowed to do so. Their intercontinental coordination has room for improvement unless they want to jeopardize the credibility of their German subsidiary, which wouldn't be a good idea given that Germany is now the first country in which Apple has already obtained two injunctions against Samsung.

The words "on a current occasion" don't explain why they would change their focus on the second day of a trade show. If this was just about market focus, they could have done so before the show, and other reports say that Samsung does actually exhibit products at IFA that aren't going to be sold in Germany.

I noticed that she avoided mentioning the Galaxy Tab 7.7 by name, referring to it only as "the product" or "the other product". While this could be attributable to a desire to downplay the relevance of that product, the much more likely reason is that she was instructed by lawyers not to mention its name -- only to make generic references to it in order to answer questions asked by the interviewer -- because this could otherwise be seen as an act of promoting a banned (or potentially banned, if there's uncertainty about whether the Galaxy Tab 7.7 falls within the scope of the existing injunction) product. She obviously wouldn't want to make mistakes that result in fines or -- in a hypothetical worst-case scenario -- the imprisonment of her boss.

In such global organizations, local subsidiaries are sometimes not authorized to speak out on legal issues before they get directions from their headquarters. It's possible that Samsung U.S. is the only subsidiary that has some more discretionary power on these issues, and even Samsung U.S. wasn't as clear as the Korean statement quoted by Yonhapnews.

Samsung had previously said it wouldn't sell the Galaxy Tab 7.7" in the United States market

When Samsung presented the Galaxy Tab 7.7", it said that it didn't intend to sell the device in the United States. Given the size of that market, that statement (which may reflect Samsung's long-term intention or may just be a tactical move) is most likely also attributable to Apple's legal pressure. There's a process underway in California that could lead to a preliminary injunction. A hearing is scheduled for October 13. I guess Samsung will firstly see whether there's going to be a U.S. injunction. If not, Samsung could say that it changed mind and simply release the Galaxy Tab 7.7" in the U.S. as well. Apple's motion for a preliminary injunction in the U.S. relates to three smartphones and the Galaxy Tab 10.1. If Samsung announced its intent now to launch the Galaxy Tab 7.7 in the U.S., Apple would immediately take measures to try to obtain a preliminary injunction with respect to that product as well.

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