Ina Fried

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Apple: Offer to License Patents to Samsung Didn’t Include iPhone’s Interface

An Apple patent licensing executive said Monday that the company’s offer to license its patents to Samsung included only certain patents and not “untouchable” ones related to the iPhone’s unique user interface.

A document entered into evidence on Friday showed Apple was willing to license certain patents for $30 per phone and $40 per tablet.

Apple’s Boris Teksler said Monday that the company wasn’t willing to license many of its user interface patents but was willing to license some of its patents.

“We were trying very hard to come up with an amicable resolution with Samsung,” Teksler said. “We wanted them to respect and protect our unique user experience.”

In general, Teksler said, Apple doesn’t license its design patents to any other company.

Teksler noted that Apple and Microsoft have a cross-license agreement that does cover the design patents at issue in this case, but said that there are also special “anti-cloning” provisions in the agreement between those two companies.

“We couldn’t copy each other’s products,” Teksler said.

Once both sides finished their examination of Teksler, who began testifying on Friday, Apple played videotaped depositions from JunWon Lee, a Samsung patent licensing official; Dong Hoon Chang, head of Samsung’s mobile design group; and Timothy Benner, an analytics executive for Samsung Telecommunications America.

The next live witness, Terry Musika, is an accountant who offered his estimate of what Samsung would owe Apple if the jury finds Apple’s patents are both valid and infringed.

Musika testified that, again if found to be infringing, Samsung would owe between $2.5 billion and $2.7 billion in damages. Musika acknowledged that’s a very large damage figure, but noted that Samsung has sold 22.7 million allegedly infringing smartphones and tablets, generating $8.16 billion in revenue.

As part of his analysis, Musika noted that Samsung’s smartphone market share increased dramatically once it introduced the phones accused of infringing on Apple’s patents, citing IDC figures.

Update, 10:43 a.m.:There’s lots of accounting talk now. Most of it at the moment is focused on the billion dollar difference between what Musika estimates as Samsung’s profit vs. what Samsung calculates as its profits on the devices accused of infringing.

Musika calculated damages in three different ways. For the bulk he used his estimate of Samsung’s profits, while for some phones he used a reasonable royalty rate and for still others he used a calculation of Apple’s lost profits on sales they would have gotten were it not for the alleged infringement.

11:20 a.m.: After a long and rather tortured explanation of how he reached his conclusions, Apple has wrapped up its questioning of Musika and now Samsung attorney Bill Price is getting his turn.

1:43 p.m.: With Musika done, Apple has rested its case. Samsung now making its motion that Apple has failed to prove infringement and that, as a matter of law, judge should rule in its favor.

Judge Koh opts not to review written briefs on this issue, so Samsung’s lawyers now reciting all of the ways in which they feel Apple has failed to meet its burden. Koh has said Samsung has five minutes to make its case.

2:30 p.m.: Samsung is getting a pretty full hearing on this. Judge Koh let Samsung have more than five minutes to state all its reasoning and required Apple lawyers to respond.

Much of the current debate is over whether three models in question — the Ace and a global version of Galaxy S and Galaxy S II were sold in the United States. Samsung points out Samsung never sold to carriers or U.S. customers.

2:45 p.m.: Judge Koh gives Samsung a very limited victory, dismissing Apple’s case with respect to Samsung’s US subsidiaries as it relates to three phones not broadly sold in the U.S.– the Galaxy Ace and two global variants of the Galaxy S and Galaxy S II.

However, she denied Samsung’s broader request to find in its favor.

“I think there is a legally sufficient evidentiary basis,” Koh said.

Apple versus Samsung Full Coverage


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I think the NSA has a job to do and we need the NSA. But as (physicist) Robert Oppenheimer said, “When you see something that is technically sweet, you go ahead and do it and argue about what to do about it only after you’ve had your technical success. That is the way it was with the atomic bomb.”

— Phil Zimmerman, PGP inventor and Silent Circle co-founder, in an interview with Om Malik