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The Great Smartphone War: Apple vs. Samsung

Posted on May 6th, 2014 at 8:34 by John Sinteur in category: Apple -- Write a comment

[Quote]:

According to various court records and people who have worked with Samsung, ignoring competitors’ patents is not uncommon for the Korean company. And once it’s caught it launches into the same sort of tactics used in the Apple case: countersue, delay, lose, delay, appeal, and then, when defeat is approaching, settle. “They never met a patent they didn’t think they might like to use, no matter who it belongs to,” says Sam Baxter, a patent lawyer who once handled a case for Samsung. “I represented [the Swedish telecommunications company] Ericsson, and they couldn’t lie if their lives depended on it, and I represented Samsung and they couldn’t tell the truth if their lives depended on it.”

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It was the same old pattern: when caught red-handed, countersue, claiming Samsung actually owned the patent or another one that the plaintiff company had used. Then, as the litigation dragged on, snap up a greater share of the market and settle when Samsung imports were about to be barred. Sharp had filed its lawsuit in 2007; as the lawsuit played out, Samsung built up its flat-screen business until, by the end of 2009, it held 23.6 percent of the global market in TV sets, while Sharp had only 5.4 percent. All in all, not a bad outcome for Samsung.

The same thing happened with Pioneer, a Japanese multi-national that specializes in digital entertainment products, which holds patents related to plasma televisions. Samsung once again decided to use the technology without bothering to pay for it. In 2006, Pioneer sued in federal court in the Eastern District of Texas, so Samsung countersued. The Samsung claim was thrown out before trial, but one document revealed in the course of the litigation was particularly damaging—a memo from a Samsung engineer stating explicitly that the company was violating the Pioneer patent. A jury awarded Pioneer $59 million in 2008. But with appeals and continued battles looming, the financially troubled Pioneer agreed to settle with Samsung for an undisclosed amount in 2009. By then, it was too late. In 2010, Pioneer shut down its television operations, tossing 10,000 people out of work.

Even when other companies have honored competitors’ patents, Samsung has used the same technology for years without paying royalties. For example, a small Pennsylvania company named InterDigital developed and patented technology and was paid for its use under licensing agreements with such giant corporations as Apple and LG Electronics. But for years Samsung refused to cough up any cash, forcing InterDigital to go to court to enforce its patents. In 2008, shortly before the International Trade Commission was set to make a decision that could have banned the importation of some of Samsung’s most popular phones into the United States, Samsung settled, agreeing to pay $400 million to the tiny American company.

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