Samsung hit with $1,049,343,540 verdict in Apple lawsuit; maybe Palm could have helped? | webOS Nation
 
 

Samsung hit with $1,049,343,540 verdict in Apple lawsuit; maybe Palm could have helped? 42

by Derek Kessler Fri, 24 Aug 2012 9:02 pm EDT

http://www.webosnation.com/hp-buys-palm

Today was an unexpectedly exciting day in the mobile technology space, though we in the webOS Nation were pretty much bystanders as the epic battle of Apple vs. Samsung (Case no. 11-CV-01846-LHK in the US District Court, Northern District of California) came to a close after three days of jury deliberations. The end result: Samsung's legal case was obliterated by the jury. They found that Samsung had willfully infringed on 5 of the 6 patents Apple sued over, that Apple's design and utility patents were indeed valid, that Samsung's infringement had indeed cost Apple money, and that Samsung had violated antitrust laws regarding monopolization of the UMTS standard. Every single one of Samsung's claims against Apple were declined. Damages owed by Samsung to Apple: $1,049,343,540. That's $1.05 billion - with a b.

The verdict in this case is both a victory and a defeat for the tech world. It's a victory for those who believe in diversified design and protecting intellectual property rights. But it's a defeat that Apple was able to defend and extract damages from a patent on a gird of colorful rounded squares as an app launcher (among others). Don't get us wrong, it's our considered not-legal opinion that Samsung did willingly infringe on Apple's design language, and for that they should be punished. You don't clone your competitor's patented designs. At least if you don't want to pay a billion dollar fine for having done so.

The questions some are asking tonight is "did it have to come to this?" And no, it didn't. Apple and Samsung could have settled out-of-court, but both were too indignant about the whole ordeal to actually come to an agreement of any sort. And, of course, Samsung could have just not willfully infringed upon Apple's designs and none of this would have happened. But was there another way out, a way Samsung could have had a nuclear deterrent to push back against Apple's threat of thermonuclear war?

Turns out that the opportunity presented itself not once, but twice in the past few years. We're talking about Palm and webOS. While Samsung wasn't an active part of the conversation surrounding the sale of Palm back in early 2010 (HP eventually emerged as the sole serious contender), Samsung was mentioned a few times when HP was trying to offload webOS just a 18 months later.

Samsung's CEO shot down the rumors of Samsung purchasing webOS, saying that they would "never" pursue the operating system. With the asking price of $1.2 billion, maybe they should have? The thing is, webOS has oodles of patents of its own that Samsung could have used to fight back against Apple, plus Palm has a long legacy of foundational patents with which Samsung may have been able to extract damages from Apple.

When you add in Samsung's legal fees, which we have no doubt are likely in the tens of millions, plus the negative press they've been receiving and will continue to receive, they may well have come out ahead even if they'd purchased webOS for the $1.2 billion just for the patents. Of course, we would have preferred Samsung have actually done something with webOS if they'd bought it, like putting it on those tens of millions of devices they sell each quarter. So long as they didn't dress it up to look like an iPhone, that is.

42 Comments

Talk about buyers remorse. Probably better off Samsung didn't purchase webOS. They would rename it to Bada 2.0 and put it on feature phones.

Doesn't this open up an opportunity for HP to use those Palm patents to win enough money to fund new hardware?

Not really. If they lose, well, you might as well have taken the money lost from what remains of the webOS budget.
 
The answer to stupid patent litigation isn't to create more stupid patent litigation. All this does is prevent actual innovation from happening in the first place when legal departments end up having to vet every single element of your hardware and software design just to ensure that it doesn't violate some esoteric patent that a competitor was awarded or purchased along the way.
 
Unfortunately, Apple's win today validated exactly that approach. HP getting in the ring to do the same would just cause even more bad faith amongst potential consumers; go ahead and look at all the pissed off Apple users on Twitter right now angry at Apple as a sampling of just how many people disagree with the idea of using patents as a weapon against innovation.
 
It saddens me that people still think this is a valid way to get ahead when all it does it put innovation behind.

The, "if they lose" is the question. If the smart phone patent (the one often cited about including PIM with a phone and all that jazz) is as sound as it seems it should be a slam dunk. At the very least, they should be able to negotiate a fair fee for every smartphone made. Apple tried to get Samsung to give them a crazy amount such as $30 every phone, $40 every tablet. Hell, if HP got $5 for every smartphone it could really compete.

I'm not a fan of this patent warring either, but if that's the approach that has been validated today (as we agree), you might as well play the same game.

I'm all for innovation, but as we've found with carriers favoring Apple and Google (great article: http://www.theverge.com/2012/7/5/3138711/five-years-after-the-iphone-car...), it's not the patents that are the problem. Or at least they haven't been until now.

I'm still waiting for the innovation that Palm had in 2009 to make it the Apple and Google platforms. They've got a few things, but there's no phone out there that has the good keyboard with inductive charging, multi-tasking, with a user-friendly GUI (Note: I haven't played with Jelly Bean yet, so maybe Google has a decent GUI).

If using patents leads to me getting the option of buying a Pre 4 or a TouchPad 2, I'm all for it. It's better than letting very valuable assets just gather dust in the corner.

I'm clearly in a bargaining stage of grief. I'm open with it.

Apple did offer samsung to let them license their patents for their phones but they declined. its their own fault. Along with that the Galaxy S III infringes on many Palm AND HP patents

If you're going to claim it infringes on HP/Palm patents, you might want to back that up with very specific examples of the patents violated along with exactly how they're infringing upon them before claiming it.
 
Surely you have that information ready to post in this thread because obviously you've done enough due diligence to present an actual legal case of it, right?
 
Or are you just guessing based on uninformed assumption?

Look through the patent articles written about the time the first Pre came out. I think it was Nilay Patel of Engadget who wrote a nice article. One Palm patent I remember was "airplane mode", using programming to turn off a phone's radios instead of a hardware switch. Very innovative back then. Know anyone who might be violating that patent?

Tim Cook did a lot chest thumping when the Pre was announced but there was never any follow through. It was Palm's portfolio that kept him at bay.

Yeah, that was it! It was the mythical Palm patent portfolio that Tim was afraid of.

Let me ask you a simple question. Why would Apple spend millions in lawyer fees going after the Palm Pre when the whole Pre line was a failure in the smart phone market? The Palm Pre was NEVER a competitive threat to the iPhone.

Actually it's the other way around; it was BECAUSE the Pre was never a competition that Apple felt it safe to steal from Palm's portfolio. Y'know, such as the whole "smart phone" patent? Last time I checked, HP/Palm owns THAT patent...

The iPhone came out in 2007. That was two years before the Pre came out in 2009.

If this patent is so valuable, why hasn't HP sued Apple yet? HP just lost almost $10 BILLION this last quarter. But, they are setting on this patent when they could cash in and try to get some of that loss back.

Nortel just sold all their valuable patents to a consortium which included Apple, Microsoft and others for a huge sum of money and companies such as Google had to drop out of the bidding process because the price got too high.

Kodak is now shopping their patent portfolio around to the highest bidder, with Apple and others trying to buy them.

Here, we have HP with Palm patents. They tried to sell webOS and those Palm patents and no one bit. NO ONE is trying to buy them. I guess people on webOS Nation must be intelligent and all these huge tech companies are clueless when it comes to determining the value of the Palm patents.

But, I challenge anyone to explain why if these Palm patents are so valuable, why hasn't any company been knocking down HP's door to buy them.

The Treo came out in 2002, a good five years before the iPhone.

It is unclear why HP hasn't sued Apple for this patent. I presume it is because Palm/HP made use of several Apple patents in the Pre and TouchPad. It would just be two law suits back and forth like the Apple/Samsung one, but more balanced.

Now that HP isn't making hardware, they would have a better chance at suing Apple, but maybe they don't for other business reasons.

We don't know if HP was selling the patents with webOS. It could have been separate. We know that no one was willing to buy webOS, but that isn't shocking. It's not that webOS didn't have value, it's just that there were few people who wanted to take on Google, Apple, and soon Microsoft. Sure you can buy webOS from HP for 1.5 billion, but you have to put another 5-10 billion in marketing it... and then you might just be the fourth place option. That's not an enticing sales pitch.

And what proof do you have that a product that came out 10 years ago or earlier is relevant to products of today?

With the exception of a blogger on Engadget, no one knows if Apple infringed on any Palm patents. Now, if you could point me to a link from someone that knows the real deal about it, I would love to read it. Nor, is there any proof that HP is considering or ever thought about suing Apple. Just idle speculation and assumptions.

But, a bunch of bloggers and people's opinion on a forum is not fact about the value of the Palm patents or if Apple infringed upon them.

The simple fact that HP is setting by and letting Apple make billions upon billions in profit every quarter off the iPhone while HP lost $10 billion in one quarter, alone, tells you that HP knows that the patents they hold are not relevant to the iPhone of today.

Watching this debate I am sorry nusome, you are wrong. I posted similar issues on MSN after this.
There is a list of patents owned by Palm/HP that are infringed upon by all cell phones.
Palm was not big enough an could not afford to go after them, needless to say going after Apple.
2001 Kyocera 6035, a phone I once owned and stil do somewhere, introduced by Palm. It was the FIRST smart phone in the United States.
A PDA combined with a phone. Remember them, Palm.
Patent. Integrated handheld computing and telephony system and services. A smart phone.
This of course does not include such things as launching phone calls by typing in contact name, or initials, beaming technology from one to another (Galaxy SIII anyone),
Touch screens, etc. List goes on.
Palm could not afford to challenge. They were living by the skin of their teeth.
If HP was smart they would wait it out, then bam.
And Samsung should wait out the supply contract with Apple and walk away.
Who would buy a sub par device that cost more?

There were other smart phones in 2001,

Wikipedia

The first cellular phone to incorporate PDA features was an IBM prototype developed in 1992 and demonstrated that year at the COMDEX computer industry trade show. A refined version of the product was marketed to consumers on 16 August 1994 by BellSouth under the name Simon Personal Communicator. The Simon was the first device that can be properly referred to as a "smartphone", even though that term was not yet coined. In addition to its ability to make and receive cellular phone calls, Simon was also able to send and receive facsimiles, e-mails and pages through its touch screen display. Simon included many applications including an address book, calendar, appointment scheduler, calculator, world time clock, games, electronic note pad, handwritten annotations and standard and predictive touchscreen keyboards.

OK, I think the problem you and everyone else has is that because apparently Palm was the first to ever bring out a smartphone, no one else can ever do that because they would be infringing upon Palms patents.

Patents don't work that way. Another company can bring out a device that is considered a smart phone, so long as that device doesn't ape that Palm smartphone. When would anyone ever confuse a Palm product with an iPhone?

According to someone else below, Palm wasn't the first to bring out a smart phone, it was done by IBM and released in 1994.

And to add further. Amazon is rumored to possibly be releasing their first smart phone this year.

According to your logic, they can't because they would be infringing on a Palm patent that is over a decade old. But, as long as this Amazon smart phone doesn't get confused or act similar to that Palm smartphone patent, they are within their right to bring out their version of a smart phone.

You are such a troll. Go play with your iphone and let the webOS fans be here. We are fine on our own...

I'm a troll for calling out the myth that the Palm smart phone patent(s) from over 10 years ago are not relevant in today's smart phone market AND no one has been able to provide any rock solid proof that they are being infringed upon.

If that makes me a troll, so be it. Better than being delusional and trying in desperation to make something seem what's not there.

This is good news for Windows I guess.

apple invented everything

No they just got to the Patent office before everyone else did and patented anything that wasn't nailed down.

No they didn't. They didn't invent a portrait slider smart phone in 2009 and declare that the design that people are lusting after.

I really, really, REALLY hate Apple now.

Why? Because they won? You do know it wasn't really because of "rectangles", right? Did you see the internal documents from Samsung that said they needed their icons/software to look and behave like Apples? Apple isn't the only company that does the suing in the tech world.

Nice article Derek. I think your last two paragraphs make several important points. I always wondered why HP had such a tough time selling WebOS in spite of the rumors of several interested buyers. If I had to guess, price was a sticking point. HP was pricing in the value of an OS virtually immune from attack by Apple patent attorneys. Everyone else saw the threat as imaginary.

Well, the threat isn't imaginary any more. Microsoft is probably partying as they see phone and tablet manufacturers running for cover. For WebOS, this is its last big chance. With its attached patent portfolio, WebOS is one of the few safe havens out there for tablet and phone makers if they don't want to have to pay royalties to Apple. Apple won't dare sue the holder of the Palm patents. It would be extremely embarrassing for Apple if a counter suit reveals the "great innovator" to be actually a great copier.

p.s. I found the Apple vs Palm analysis by Patel:
http://www.engadget.com/2009/01/28/apple-vs-palm-the-in-depth-analysis/

All Samsung had to do was use vanilla Android or not have their version look and function like iOS.

If Samsung set up WebOS like they did Android, they would have faced the same problem.

Samsung is already out $1 Billion, how would wasting several more have helped?

Having the patents for a proper counter lawsuit could have helped.

As soon as the verdict come out, I know that we'd start hearing about palm's mystical patents - powerful enough to ward off any attacker but oddly not attractive enough for anyone to buy.

Tis a mystery!

Do we know that such patents were ever for sale after HP bought them?

Don't count Samsung out yet. Most patent litigations don't get resolved until way up (sometimes the supreme court).

As far as innovation, I disagree with the comment that litigation stiffles it. As a former patent agent, I have always seen it encourage it instead. Rather than doing what Samsung did, the threat of litigation makes most people think of ways on how to get around patents. That thinking outside the box has given us innovative solutions, such as:

-Tesla's light bulb sockets. Though we don't utilize his design, it was much simplier and easier to produce than Edison's design.
-Format wars. To get around patents, many companies have waged format wars rather than paying each other license fees or royalties. This has resulted in us, the consumer, to decide what's best (Blu-Ray vs HD-DVD & Betamax vs. VHS).

Moreover, without these patents, what motivation would a company have to try something different? With no threat of infringement, everyone would just copy what was the great seller to a tee. If the TouchPad took cues from the iPad, it would have taken more if not for threat of infringement.

Samsung's problem is it didn't differentiate itself enough from the patents. Design patents are also tricky, given there is no way to make their interpretation objective. As such, their icon set and UI elements are strikingly similar to Apple's patents. However, also keep in mind that Apple is also suffering, as they now lost an OE supplier. My bet though is this won't be finished until it hits the DC court of appeals.

Derek, I don't think so.

They'd have bought Palm for just one reason. Patents. The rest would have been thrown straight to the bin. Instead of open webOS we would have exactly nothing.

Palm, like pretty much every other Company in the World, missed the chance of patenting loads of stuff that doesn't seem to be patent-worthy at the first look. I don't know what happened to the Touchstone Clone Patent apple threw in a few weeks ago but I'm pretty sure that they never thought about it if another Company would hold the Patent.

Some great comments and points are made by a lot of people on here...bunch of smarties you webOS fans! Nickfifteen, kwarner and metaphor make some of the best points.

To add to those, we have to keep in mind where HP was at in all of this. They were barely getting their hands around Palm when all this stuff really started to go down. I'm not even sure that they new what they had. Factor in all of the senior management turmoil and there not being a unified vision of where HP wanted to go (and still no unified vision?) in the mobile space, would it make any sense to go suing Apple for patent infringment? Bear in mind that the cost of the suite alone would cost tens of millions of dollars and that they just spent 1.2B(?) on it (Palm). The short and easy answer is "no"...or should I say, hell no! I think that we can all agree that HP has done some down right bone-headed things within the past 18-24 months, but in light of the above, not suing Apple was the right move. Frankly I wish that wasn't the case, but it is. You just can't worry about the fire behind you when all you see in front of you is flames.

Once the judge ruled against Samsung for trying to introduce evidence against apple the handwriting was on the wall. I would appeal based on the judge appeared to be biased.

people that aren't patent attorneys discussing patent law with other people that are not patent attorneys is like two 9 year olds debating the merits of string theory.

You're right. Maybe that says something about the convoluted, corrupt, ridiculous mess that we call a patent "system."

This the chance for HP to dive back in! Be an innovator and bring back webOS in a big way with tablets and new phone hardware. Take advantage of the Palm patents.

Not sure I like the premise of the article. According to internal emails, Samsung clearly and willfully copied Apple design language. The solution isn't to buy some other patents in the hope of trying to extract offsetting monies from Apple.

The solution is to NOT INFRINGE. Worse yet, Derek is basically arguing for webOS to be reduced to some patent threat they keep on a shelf somewhere and do nothing with. Blech.

Let's not start again with webOS "needing" to be picked up by companies to avoid licensing fees and patent litigation. The $1 billion Samsung got hit with today is a drop in the bucket compared to the billionS any company would have to invest to get webOS into modern fighting shape. Same goes for $5-$15/device licensing fees paid to Microsoft. A pittance compared to the money they'd lose per device making webOS phones and pricing them at a loss to make an inroads.

Trust me, guys...these companies have run the numbers.

I just want a webos to not ever die :-(

its the most awsome os ever!

Samsung and Apple both are biggest pillar in the mobile industry, and we all know as Apple design patent case registered against to the Samsung, It was really hitting to the Samsung. At last Apple won the case as per Patent guidelines by the USA.

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