US judge slashes $1b damages award to Apple in Samsung rights case

By InvestSMART · 4 Mar 2013

By InvestSMART ·
4 Mar 2013

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A US judge slashed nearly half of the $US1 billion damage award a jury ordered Samsung to pay Apple over the rights to the design and technology running market-leading smartphones and tablet computers.

District Court Judge Lucy Koh lowered the damages awarded to Apple by $US450.5 million for 14 Samsung products including some in its hot-selling Galaxy line-up, saying jurors had not properly followed her instructions in calculating some of the damages.

She also concluded mistakes had been made in determining when Apple had first notified Samsung about the alleged violations of patents for the iPhone and iPad.

Judge Koh ordered a new trial to recalculate damages for those products. "We are pleased that the court decided to strike $US450,514,650 from the jury's award," Samsung spokeswoman Lauren Restuccia said. "Samsung intends to seek further review as to the remaining award."

Apple declined to comment.

The ruling reduced Samsung Electronics' bill to just under $US599 million. The judge said the tab will increase after the appeals of both companies are resolved.

Apple is seeking more damages and Samsung a complete dismissal of the case in the US Court of Appeals for the Federal Circuit, the Washington, DC-based court that handles all patent appeals.

However, the new trial to recalculate the damages could also increase the award.

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Frequently Asked Questions about this Article…

What did the US judge rule in the Apple v Samsung damages case?

District Court Judge Lucy Koh slashed about US$450.5 million from a jury’s roughly US$1 billion damages award, ordered a new trial to recalculate damages for certain products, and reduced Samsung’s current bill to just under US$599 million.

Why were the damages cut by Judge Lucy Koh in the patent lawsuit?

Judge Koh found jurors had not properly followed her instructions when calculating some damages and that mistakes were made in determining when Apple first notified Samsung about alleged patent violations, so she struck part of the award and ordered a new trial on those items.

Which Samsung products were affected by the reduction in damages?

The judge reduced damages tied to 14 Samsung products, including some devices in Samsung’s hot-selling Galaxy line-up, according to the ruling described in the article.

Does Samsung still have to pay nearly US$1 billion to Apple?

No. After the judge’s reduction the outstanding damage award was trimmed to just under US$599 million, but the judge said the total could change as appeals and the new damages trial are resolved.

What did Samsung and Apple say after the ruling?

A Samsung spokeswoman, Lauren Restuccia, said the company was pleased the court struck US$450,514,650 from the jury award and that Samsung intends to seek further review of the remaining award. Apple declined to comment, according to the article.

Where will appeals in the Apple v Samsung patent case be heard?

Both companies are pursuing appeals in the US Court of Appeals for the Federal Circuit, the Washington, DC-based court that handles patent appeals, as stated in the article.

Could the damages be increased again after the new trial or appeals?

Yes. The judge ordered a new trial to recalculate damages for certain products, and the article notes that the new trial or the outcome of appeals could increase the award.

What should everyday investors take away from this Apple v Samsung ruling?

From the article: the immediate jury award was materially reduced, lowering Samsung’s current liability to just under US$599 million, but the final financial outcome remains uncertain because of the new damages trial and appeals at the Federal Circuit. Investors should be aware that further legal developments could change the amount either company owes or recovers.