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Apple and Samsung’s Post-Trial Slugfest in San Jose

Apple and Samsung are returning Thursday to the site of their epic patent battle to argue a variety of post-trial motions.

For its part, Apple wants injunctions on various Samsung products as well as to see the jury’s billion-dollar verdict raised by a few hundred million dollars. Samsung wants the damage award reduced and is also seeking a new trial because of, among other things, what it alleges was juror misconduct.

We’ll have live coverage from the hearing, which is due to start around 1:30 pm PT.

In the meantime, here’s our preview of what to watch for as well as a look at the Apple-HTC settlement agreement, a redacted version of which was made public on Thursday as part of Samsung’s case.

1:08 pm: We’re in and seated. It’s pretty packed here in the main courtroom and plenty more people are being routed to the overflow room.

All of the key trial attorneys for both sides appear to be here. Twenty minutes to showtime. Get your popcorn. We are, of course, not allowed such treats in here.

1:25 pm: HTC has filed documents with the court trying to justify the heavy redactions to its contract with Apple.

Judge Lucy Koh had said such exclusions should be limited to very specific financial terms such as royalty rates.

“Samsung only contends that this agreement is proof that Apple was willing and in fact has entered into license agreements concerning at least some of the patents at issue in this case,” HTC said in the filing. “Hence the terms and details HTC has redacted are irrelevant to this case.”

We’ll see if anyone objects and whether HTC’s arguments fly with Koh, who has been a stickler on such matters.

1:36 pm: Court is now six minutes late in getting started. That’s what, like $10,000 per side in legal fees right there?

1:37 pm: Judge Koh enters the courtroom and the case is called.

1:38 pm: Koh: I have quite a number of questions because there are so many issues and they are so complex.

Originally she had wanted to issue one omnibus order on everything. Now she’s planning to issue orders piecemeal.

1:39 pm: Not all the orders will come this month, Koh says, since she is in the midst of another patent trial.

1:39 pm: Okay. On to Judge Koh’s questions.

First issue is whether one of the Apple patents Samsung was found to have infringed is, in fact, indefinite.

Koh said she is leaning toward siding with Samsung that this specific patent is “indefinite.” The patent in question refers to when one taps to zoom and gets a zoomed-in result that is “substantially centered.”

1:50 pm: Discussion centering at the moment on what would happen if this particular patent were to be found indefinite.

The Samsung products found to infringe this product were found to infringe one or two other patents, so Apple is arguing damages should still stand. Samsung argues a new trial on damages for those products would be needed.

1:56 pm: I believe Samsung just cited a case of a deer versus a bushhog, but I may have misheard.

Ahh. That’s John Deere vs. Bush Hog. Also, that case apparently has nothing to do with Boss Hogg.

As you can tell, things are moving slowly here.

2:00 pm: Next issue is on the damage award for a particular product (didn’t catch which one) where Samsung argues that the jury awarded an unreasonably high damage amount. Koh seems persuaded at least for this case.

The discussion in question is about the Galaxy Prevail. It’s a complicated point related to how damages were calculated — complicated because Apple asked for three different standards to be applied in calculating damages.

Samsung’s lawyer argues that things are muddied because while the jury specified the damage per product, it didn’t say which method of damage assessment it used.

The issue here is that the jury appears to have awarded Apple using the same percentage basis it did on products that were also found to infringe on design patents, which the Prevail was not found to have done.

“They made a mistake on the Prevail,” Samsung’s lawyer said.

2:20 pm: More discussion from Samsung on why the jury’s damage calculations, broadly speaking, were legally incorrect.

2:25 pm: We’re hearing a lot today from a new voice in the trial — Samsung lawyer Kathleen Sullivan, the head of the appellate practice at Quinn Emmanuel. She’s a former dean of the Stanford law school.

Apple, meanwhile, is still mainly being represented by key voices from trial. Most arguments are coming from its lead lawyer, Harold McElhinny of Morrison Foerster.

For more on the players in the case, here’s our definitive insider’s guide from earlier this year.

2:36 pm: On to the next issue, what’s known as “the notice date” — another key question in figuring damages.

Basically, damages are a rate times the number of units shipped over a period of time. The notice date has to do with the length of the period for which Samsung owes damages. One key factor is when Samsung was “on notice” that Apple believed its patents were being infringed.

2:39 pm: Apple is arguing the court doesn’t even need to consider what notice date the jury used and that it can’t be determined from their verdict. Plus, it says it did give notice.

Apple said it told Samsung broadly that it believed the company was copying its patents and designs. Here, it’s making the case it didn’t have to enumerate each patent it believed was being infringed in order to have provided notice.

2:42 pm: Koh says she is not persuaded the law doesn’t require notice of specific patent infringement.

“I don’t want to be avant garde” on this, Koh said.

McElhinny argues that the damage verdict can be sustained even if judge finds Apple should have given notice. (Only certain claims require notice.)

Apple did notify Samsung earlier of the ’381 patent specifically, but some of the other patents on which it charged infringement weren’t specifically enumerated in its early discussions with Samsung.

The time period in question for a lot of this is from when Apple first met with Samsung about August 2010 and when the lawsuit was first filed.

Koh says that clearly Samsung was on notice after the lawsuit was filed.

Things are getting bogged down with the specter raised of needing more paperwork from both sides on potential impact of her decisions.

“I was hoping to send you on your merry way to the Federal Circuit,” Koh said.

2:50 pm: Samsung argues that for 11 phones found to infringe on one or more design patents, $600 million in damages should be reduced to about $17 million due to changing calculation of damages and time period.

For five patents found to infringe one or more design patents and dilute trade dress, Samsung argues $381 million in damages should be reduced to about $4.5 million.

2:55 pm: Discussion shifting to ’915 utility patent. Both sides agree, Koh said, that there was some inconsistency in jury’s verdict. There’s evidence to go either way on these products, Koh said.

3:00 pm: Samsung attorney Charles Verhoeven is arguing that Apple performed a necessary element-by-element analysis for only one phone on each utility patent accused of infringement. To manage the clock, Verhoeven said, Apple just went point by point with one accused product and then asked its expert if the other phones also similarly infringed.

“That doesn’t present us an (adequate) opportunity to challenge him,” Verhoeven said. Nor, he argues, did the jury have enough information. Hence, he argues, the inconsistency in the verdict.

3:02 pm: McElhinny is now citing one of his favorite cases, the “LA Nuthouse” case. The question at issue is not whether it is inconsistent, but irreconcilably inconsistent.

Apparently that’s Tex-Goober vs. Los Angeles Nut House. (Loving these case citations.)

3:06 pm: Okay, on to some of Apple’s motions, including a request for additional damages. This one apparently relates to the Junker case. Aaron Sorkin couldn’t come up with better case names.

Here’s more on that case.

Samsung says Apple’s request of $131 million in post-verdict supplemental damages is unprecedented and such a precedent shouldn’t be set here.

Apple is arguing why it deserves supplemental damages. Several products found to infringe are still being sold. Apple says the only other remedy would be to file another lawsuit, something its lawyer says he knows Koh does not want.

“I don’t even want the ones that I have,” Koh quipped.

3:22 pm: We still haven’t gotten to a key issue yet to be argued today — whether there should be an injunction on any Samsung products.

Now up, ahead of a 3:30 break, are some of Samsung’s post-trial motions. This could be where Samsung’s juror misconduct claim will come up. First, though, we’re discussing which of the verdict’s damage findings can even be raised due to willful infringement.

3:25 pm: By the way, the first line in that LA Nuthouse case cited earlier is priceless.

“This is an appeal by a nut house in a lawsuit over peanuts,” the court wrote in its findings.

3:27 pm: Meanwhile, back in live court, Samsung argues that only $101 million of the jury’s verdict could possibly be a baseline for willful infringement and subject to enhancement, and really, Sullivan said, it should just be $10 million that could be enhanced.

Apple is seeking several hundred million dollars in enhanced damages.

Sullivan also argues that Samsung shouldn’t be found willful in any case, saying that the company had a reasonable belief that it was not infringing.

3:45 pm: Mercifully, we just got a 15-minute break. Should be back any minute.

3:53 pm: Back from break, Apple getting its couple minutes to make its case on the “willfulness” of Samsung’s infringement.

McElhinny is citing cases, but they don’t have funny names.

McElhinny on Samsung’s willfulness: “There has never been a case in which the evidence was so strong.”

Naturally, Apple also thinks that way more of the damages can be enhanced than Samsung’s $101 million figure.

4:00 pm: Now the talk is turning to the issue of potential juror misconduct for the foreman not mentioning his past lawsuit with Seagate.

“I think that issue is fully briefed,” Koh said, not hearing the full argument.

4:01 pm: On to injunctions — Koh asks regarding the trade dress that Apple is no longer using, how would Apple be harmed if Samsung uses it?

Apple’s lawyer argues that if Chevy came out with a car like the ’67 Mustang, Ford would it be harmed even if it was no longer making that car. In legal terms, he calls it “residual goodwill.”

In this case, the trade dress in question is related to the iPhone 3G or 3GS. Apple says that its products are recognizably Apple products and that could be harmed if Samsung is allowed to sell infringing devices.

Apple is arguing there is an “onslaught” of infringing Samsung devices.

“They got that leg in the market through the Galaxy line,” Apple’s lawyer said.

Asked why the court should issue an injunction on products no longer being sold, Apple says it would prevent the sale not only of those products but also new ones that employ similar infringing features.

She turns to Samsung, but also shows signs of fatigue with the pace of discussion. “I’d like to finish before 2013,” Koh said.

4:09 pm: Sullivan says the injunctions will create a hardship for Samsung as it would create fear among retailers.

“That’s where we could locate our harm,” Sullivan said, noting that Apple can’t suffer harm from products that aren’t shipping or from trade dress it no longer uses.

4:10 pm: Samsung says there are about 77,000 Galaxy S II devices in the hands of retailers. The S II is the highest-volume product still shipping in the case.

4:14 pm: Last issue is a technical one regarding some of the Samsung patents that Apple was accused of infringing.

The jury found Apple didn’t infringe, but Apple also wants the judge to declare that the patents in question should be declared unenforceable going forward.

Koh seemed to feel the question was moot, but didn’t issue a ruling and did ask some factual questions of both sides related to the issue in case she does decide she has to consider Apple’s request.

4:24 pm: Continued disagreement on the number of angels that can dance on the head of a pin.

4:25 pm: Apple outside lawyer Bill Lee labels as “fiddling and diddling” what Samsung did before various standard-setting bodies.

4:27 pm: Koh indicates that since even Apple agrees she has discretion not to decide the matter, she probably won’t since the jury found Apple didn’t infringe Samsung patents.

(Jingle of an Apple text message heard in courtroom — first digital sound today.)

Lots of talk over the last 15 minutes about equitable estoppel. I think it would be equitable if all this talk estoppel-ed soon.

4:36 pm: Koh asks lawyers: When is this case going to resolve? In all seriousness.

McElhinny says the timetable is the same as what he said when he first met Koh in 2010 — it won’t be resolved until the law is resolved and enforced.

The area of remedies has yet to be settled, he said.

“They make the (decision) every day how close they are going to get to the line,” McElhinny said. They have placed a bet — successfully so far — on infringing, he said, and the role of the court is to set a line on enforcement.

Even the billion-dollar verdict isn’t enough of a deterrent, he said. “It is the going-forward conduct.”

Samsung’s Verhoeven: I’m not going to go on and on and give a big speech. That said, he says Apple is engaging in a thermonuclear war, seeking to battle in the courthouse rather than the marketplace.

As for settlement talks: “We are willing,” Verhoeven said. “The ball is in their court.”

Samsung has seemed to indicate otherwise.

“I’ve said this all along,” Koh said. “I think it is time for global peace.”

Koh said she will issue orders on the questions and set things up for the appeal, but indicated a settlement would be better.

“It would be good for consumers, it would be good for the industry and I think it would be good for the parties.”

4:44 pm: John Quinn speaks for the first time today, asking to be heard about Velvin Hogan, the jury foreman. Koh had said she was fully briefed on the matter, but agrees to give Quinn a few moments. (I originally mistyped as Tom Quinn.)

The always energetic Quinn is passionately making the case that Hogan “failed to give key information.”

“He was dishonest,” Quinn said. “He was deliberately dishonest.”

Quinn said Seagate and Samsung have key financial ties, and Hogan had a past lawsuit with Seagate.

“He did not disclose that,” Quinn said.

Quinn is saying a juror who is dishonest in order to get on the case is by definition not indifferent and therefore not a suitable juror.

4:54 pm: Quinn wants a hearing to have Hogan quizzed as well as the other jurors brought in to see what impact Hogan had.

Bill Lee rises for Apple to respond.

“Very briefly,” Koh said, before he even speaks.

Lee says that Samsung has not proved that Hogan was dishonest or lied.

Quinn’s rebuttal: This is a juror that had an agenda. It’s unfortunate he got on a jury.

Now McElhinny rises to defend Hogan. He’s waxing poetic about the jurors asking Koh not only to rule against Samsung but to vindicate Hogan and declare it as an “unprofessional motion.”

Koh thanks everyone for their patience today. “I will try to get these orders out as quickly as I can.” And we are adjourned.


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