Apple and Samsung spar over huge damages claim

As Apple rests its case, Samsung's top lawyer goes on the offensive

The federal court building in San Jose, California, on April 11, 2014

The federal court building in San Jose, California, on April 11, 2014

Apple outlined for the first time on Friday how it came up with the US$2.2 billion in damages that it wants a California jury to award it for Samsung's alleged "massive infringement" of five Apple patents.

Around a quarter of it, some $507 million, is to compensate Apple for the profits it lost as a result of Samsung's infringement, said Chris Vellturo, an economist at Quantitative Economic Solutions who is one of Apple's expert witnesses in the case.

A further $560 million would be compensation for the reduced demand for Apple's products, and the largest portion -- $1.12 billion -- is for the royalties Apple says Samsung would have had to pay if it had licensed the patents.

The calculations were disclosed as the trial reached the end of its second week at the federal court in San Jose, California.

Vellturo arrived at the royalty figure by imagining a "hypothetical negotiation" between the two companies. That doesn't sound very scientific, but it's been a common method for estimating patent damages ever since a 1970 lawsuit between Georgia Pacific and U.S. Plywood.

Because no actual negotiation took place, the jury gets to consider what royalties would have been decided if the two sides had actually talked, taking into account factors like the usefulness of the patent and the impact a license would have had on their competitive positions.

Vellturo said his analysis determined a royalty rate of between $1.61 and $15.03 per patent, per device.

There are nine smartphones and one tablet at issue in the case, though not all are accused of infringing all five patents. For those that are, the total royalty bill for each Samsung device sold would be $40.10, according to Vellturo.

Samsung attorney John Quinn quickly went on the attack and questioned many of Vellturo's assertions.

He started with the figures themselves, which were based on data about lost sales and consumer demand supplied by a previous Apple witness, John Hauser, a professor of marketing from the Massachusetts Institute of Technology.

"If Mr. Hauser's survey was not correct, your figures would not be reliable?" asked Quinn in one exchange.

"That's correct," said Vellturo.

Next Quinn went after Vellturo himself. The expert had disclosed earlier that he was being paid $700 per hour by Apple, and that he had earned $2.3 million from the case so far. Quinn accused him of being "a professional witness for Apple."

"If I was, I wouldn't be working for Microsoft, for Amazon," Vellturo said, keeping his cool. "I work with very direct competitors to Apple."

Quinn also questioned how many people who bought Samsung phones would have really considered an Apple phone instead, something that cuts to its lost profits claim. Apple's own market research, revealed earlier in the case, showed that its falling market share was due in part to shifting consumer preference for features such as larger screens.

With Samsung's cross-examination of Vellturo complete, Apple rested its case. Next, Samsung will begin its defense of the charges.

The case is 12-00630, Apple v. Samsung Electronics et al, at the U.S. District Court for the Northern District of California.

Martyn Williams covers mobile telecoms, Silicon Valley and general technology breaking news for The IDG News Service. Follow Martyn on Twitter at @martyn_williams. Martyn's e-mail address is martyn_williams@idg.com

Join the PC World newsletter!

Error: Please check your email address.
Rocket to Success - Your 10 Tips for Smarter ERP System Selection

Tags consumer electronicsintellectual propertysmartphonespatentSamsung ElectronicsCivil lawsuitsiPhonelegalAndroidApple

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Martyn Williams

IDG News Service
Show Comments

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Matthew Stivala

HP OfficeJet 250 Mobile Printer

The HP OfficeJet 250 Mobile Printer is a great device that fits perfectly into my fast paced and mobile lifestyle. My first impression of the printer itself was how incredibly compact and sleek the device was.

Armand Abogado

HP OfficeJet 250 Mobile Printer

Wireless printing from my iPhone was also a handy feature, the whole experience was quick and seamless with no setup requirements - accessed through the default iOS printing menu options.

Azadeh Williams

HP OfficeJet Pro 8730

A smarter way to print for busy small business owners, combining speedy printing with scanning and copying, making it easier to produce high quality documents and images at a touch of a button.

Andrew Grant

HP OfficeJet Pro 8730

I've had a multifunction printer in the office going on 10 years now. It was a neat bit of kit back in the day -- print, copy, scan, fax -- when printing over WiFi felt a bit like magic. It’s seen better days though and an upgrade’s well overdue. This HP OfficeJet Pro 8730 looks like it ticks all the same boxes: print, copy, scan, and fax. (Really? Does anyone fax anything any more? I guess it's good to know the facility’s there, just in case.) Printing over WiFi is more-or- less standard these days.

Ed Dawson

HP OfficeJet Pro 8730

As a freelance writer who is always on the go, I like my technology to be both efficient and effective so I can do my job well. The HP OfficeJet Pro 8730 Inkjet Printer ticks all the boxes in terms of form factor, performance and user interface.

Michael Hargreaves

Windows 10 for Business / Dell XPS 13

I’d happily recommend this touchscreen laptop and Windows 10 as a great way to get serious work done at a desk or on the road.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?