The Supreme Court unanimously ruled on the 6th December that Samsung might not have to pay $399 million of its profits, in the Apple Patent case, for imitating parts distinctively resembling the iPhone.
According to federal laws, if a company is found to be infringing the design patent on a manufactured article, it is liable for the total profits made out of the article. The case with the Supreme Court is between Samsung Electronics and Apple Inc.
According to the Justice, Sonia Sotomayor, the article manufactured could be the complete product that was sold to customers, which in this case would mean the Samsung Phones. It could also be the parts that were seen to be infringing the patent design of another company.
The patent of Apple Inc. covered certain specific elements of the iPhone design, such as the black and a rectangular face on the front with round corners, the colorful grid containing 16 icons. In 2012, one jury had stated that Samsung Electronics had infringed these patents and would have to pay an amount of $399, which was the total profit that Samsung had made from selling the infringed smartphones.
Design Patent Cases
Design patents address the looks of the product, whereas a utility patent is more common and describes the working of the product. It has been more than hundred years since a design patents case has been heard in the Supreme Court. According to the US Court of Appeals, Federal Circuit, the federal law authorizes awarding of total profits from articles manufactured on a patented design. According to the appeals courts, awarding the entire profits of the defendant for infringement of design patents was not practical in these days, but these were policy decisions that the Congress had to make. The appellate court stated that the statute was binding on it, regardless of policy argument against it.
Supreme Court Opinion
The opinion of the court has not decisively resolved the case, but has stated that the liability for a design patent case may not necessarily be an all or nothing proposition. Apple and Samsung, the two giants in the smartphone world, will have to get back to the court and argue about the correct damages that Samsung has to pay for this design patent infringement. The decision of Justice Sotomayor has depended a great deal on the meanings of words. It implies that a patent covers only one part of a device.
Victory for Samsung
Danielle Meister Cohen, a spokeswoman for Samsung, claimed that it was a victory in case of Samsung and also for people promoting creativity and innovation to offer fair competitions in the market. Samsung had earlier argued that a design patent that addresses the looks of the product is not suited for complex devices that come with several features, as they can be the cause of a disproportionate penalty. The rule of total profits to be given up did not make sense in a digital era of today and would result in the rewarding of far more than the value of such a design.