On Thursday evening local California time, Samsung filed a notice of appeal to the Federal Circuit of the final judgment that had been handed down less than 20 hours before. By proceeding so quickly, Samsung demonstrates a strong belief that something is fundamentally wrong with the outcome of that California case. And presumably it won't take long before Apple will also appeal the unfavorable parts of that ruling, possibly including Thursday's denial of its renewed motion for a permanent injunction (in that post I also mentioned that Judge Koh certified the ruling).
The August 2012 billion-dollar jury verdict can be appealed only now because a limited damages retrial (concerning 13 of the 28 accused devices) had to be held last November (resulting in a final total damages figure of $929 million), and after a partly (but, as we know now, not sufficiently) successful appeal by Apple of the December 2012 denial of an injunction, Judge Lucy Koh had to take another look at this equitable remedy.
Samsung was unhappy about the verdict for several reasons. None of its offensive counterclaims against Apple succeeded, while Apple prevailed on almost all liability issues. And the jury, as one or more of its members later told the press, didn't really care to evaluate Samsung's invalidity contentions -- after the first few prior art references it got tired of the process and decided to simply rule in Apple's favor.
A few days after the verdict I identified the fact that not a single patent-in-suit was found invalid as the biggest issue with the verdict. While Apple's rubber-banding patent survived (most of its claims didn't, but the claim asserted in this case was affirmed in June 2013), the Central Reexamination Division of the United States Patent and Trademark Office rejected all claims of the '915 pinch-to-zoom API patent, Apple's most valuable multi-touch software patent in this case, last year and Apple had to file an appeal to the USPTO's Patent Trial and Appeals Board (a fact I discussed in this late-December post on Apple's renewed motion for a permanent injunction).
It's a safe guess that the validity of the '915 patent will be a key issue on appeal. Should the Federal Circuit share the USPTO's current perspective that the patent should never have been granted in the first place, then there will have to be another retrial.
Yes. Another retrial. It would be the third trial in this case. And it would involve more than 20 products. That's because the court had adopted Apple's proposal to keep the verdict form simple (over Samsung's objections) and have the jury determined damages only on a per-product basis, but not in the form of a product/patent matrix. As a result, it's now impossible to tell precisely what portion of the damages award (but certainly not an insignificant one) the jury awarded for infringement of the '915 patent. If the patent is found invalid (which is now reasonably likely to happen), the jury verdict is worthless with respect to more than 20 products. And the only way to set a new damages figure would be another jury trial. That's the way it works.
For the rubber-banding patent, invalidation is unlikely, but Samsung claims that Apple narrowed its scope through representations it made in reexamination (something Samsung also says about the '915 patent, but if that one was invalidated, any narrowing statements wouldn't matter anyway). So the infringement of that one could also be a key issue on appeal.
Besides infringement and validity issues and possibly (though not necessarily) some damages-related argument, we may also see some argument over jury instructions. The jury instructions were a very contentious issue in this case. Parties always disagree on them to some extent, but in this case there were some very fundamental issues. Modification of the jury instructions would also require a large-scale retrial...
Almost three years after Apple filed this first California lawsuit, the fact of the matter is that it does not have any remedies in its hands. Neither has Samsung paid even a cent of the damages award (since it isn't truly final, and quite frankly, it's unlikely that the final outcome will be identical to the current $929 million figure) nor is an injunction in force, after two failed attempts to obtain one. This appeal is going to be adjudicated sometime next year; then there may very well be another trial (I think this is fairly likely to happen); and then there could even be another appeal. That's the reality of patent litigation.
The fact that Apple still cannot enforce any remedy of any kind against Samsung in the United States -- again, after almost three years of litigation -- is a huge success for the law firm of Quinn Emanuel, which has so far delivered precisely what benefits its client the most: QE has shielded Samsung from any actual business impact of this first California lawsuit. Meanwhile, Samsung's market share has grown, and it's now the global market leader. The fact that QE persuaded Judge Koh to once again deny a permanent injunction, even though the partly-successful appeal made it a rather likely outcome, can hardly be overestimated.
But this is just one of numerous Apple-Samsung lawsuits pending worldwide, and not even the only one in the Northern District of California. The next Apple v. Samsung trial, over different patents and mostly different products, will start on the 31st. When Apple prepared its remedies-related evidence in that case, it didn't have the benefit of certain guidance from the Federal Circuit and from Judge Koh regarding the "causal nexus" requirement for injunctive relief. This is speculative, but it could be that the evidence in that second California litigation is not strong enough to prove a causal nexus between any infringements the jury may identify and the alleged irreparable harm. The requirements are exacting. There's no such thing anymore as a presumption that a patentee is entitled to an injunction (despite the fact that intellectual property was envisioned by the Founding Fathers to be an exclusionary right). Not even in a case in which the number one and the number two in the market are suing each other.
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