Why Judge Koh nixed Apple bid to bar Samsung phones and tablets
The standard for U.S. judges to grant a preliminary injunction is notoriously high. Plaintiffs have to show that they’re likely to succeed on the merits; that they’ll suffer irreparable harm if the injunction isn’t granted; that the injunction is in the public interest; and that the balance of fairness supports awarding the bar. In patent cases, the analysis of likely success on the merits offers two outs for defendants: they can show that the plaintiffs’ patent probably isn’t valid or that they didn’t infringe it. In other words, there’s a long list of reasons for a judge to refuse to grant a preliminary injunction (which is one reason why so many patent holders also seek injunctions overseas).
In the most consequential injunction case of the moment — Apple’s attempt to bar sales of three Samsung smartphones and Samsung’s new Galaxy tablet — U.S. District Judge Lucy Koh of San Jose federal court picked reasons from all over the no-injunction menu as she refused late Friday to grant the injunction. (Here’s the Reuters story from Dan Levine.) There’s no real theme running through Koh’s decision, which analyzes each asserted patent and each allegedly infringing product. That’s frustrating for anyone hoping to find a broader meaning for smartphone litigation in her ruling, but it gives Apple and Samsung a pretty clear indication of how they’re likely to fare as the merits case moves forward.
Apple asserted that two Samsung phones — the Galaxy 4G and Infuse 4G — infringe two Apple design patents. Based on the precedent established by the U.S. Court of Appeals for the Federal Circuit in a case called Egyptian Goddess v. Swisa, Koh applied an “ordinary observer” test to evaluate infringement. She concluded that although it is “a close question,” an ordinary observer would likely find Samsung’s Galaxy and Infuse phones infringe Apple’s patent on a flat, black, rectangular smartphone with a translucent face. She found that under the Durling v. Spectrum Furniture test for obviousness, Samsung was likely to succeed in challenging one of Apple’s smartphone design patents as invalid — but she found Samsung had not raised substantial questions about the validity of the other patent.
That was a significant finding for Apple, but Apple’s case for an injunction foundered when Koh considered the question of whether it would suffer irreparable harm if Samsung continued selling the allegedly infringing phones. Apple said it would suffer a loss of goodwill and brand erosion from Samsung’s sale of phones that, in Apple’s view, are knockoff iPhones. Koh said Apple hadn’t offered evidence to back its somewhat novel theories. “Given the ambiguity of the evidence regarding the importance of design to smartphone purchasers, and the lack of evidence establishing actual consumer confusion, or some other direct or circumstantial evidence that Samsung’s design choices have impacted Apple’s market share or led Apple to lose customers, it is difficult to say that Apple is likely to suffer irreparable harm as a result of Samsung’s infringing conduct,” she wrote.
Apple made a stronger showing of irreparable harm from Samsung’s continued sale of Galaxy tablets, according to Koh. She also found that “in light of the substantial similarities” between the Samsung and Apple tablets, Apple would likely be able to show that Samsung infringed its iPad design patent. (You may recall the Reuters report from the injunction hearing where, when Koh held up the two rival tablets, Samsung counsel Kathleen Sullivan of Quinn Emanuel Urquhart & Sullivan, standing 10 feet away, couldn’t pick out her client’s product.)
But Koh said that Apple’s design patent appeared to have been anticipated by previous tablets, such as a 1994 Fidler/Knight Ridder device and an HP device. “The court therefore finds that Samsung has raised a substantial question regarding the validity of the [Apple tablet design] patent on obviousness grounds,” Koh wrote. “Accordingly, given the strength of the prior art presented by Samsung, the court does not find that Apple’s secondary considerations of evidence of non-obviousness overcomes the substantial questions of invalidity.” (Koh did not cite Samsung’s much-discussed assertion that the iPad was anticipated by a handheld device in Stanley Kubrick’s movie “2001: A Space Odyssey”.)
Apple claimed four Samsung devices — the Galaxy phone and tablet, the Infuse phone, and the Droid Charge phone — infringed an Apple patent on touch-screen scrolling. Koh agreed that Apple is likely to be able to show that the Samsung products infringe the patent and that Samsung hasn’t raised a substantial question of the patent’s validity, despite Samsung’s claim that Apple engaged in inequitable conduct to obtain the patent. But the judge said Apple hadn’t shown it would be irreparably harmed by Samsung’s continued sale of devices that infringe a patent for a function that’s only one of many the devices perform. “That [the patent] does not appear to be either necessary for the product to function, or a core technology of the product, weighs against a finding of irreparable harm,” she wrote. “Ultimately, the court finds that Apple has failed to meet its burden to establish that money damages will not be sufficient to compensate Apple for the Samsung products that likely infringe the patent.”
Interestingly, Koh gave no weight to amicus briefs by AT&T and T-Mobile arguing that Apple’s proposed injunction is not in the public’s interest. Although the judge permitted the briefs to be submitted, she concluded they were essentially self-serving.
A preliminary injunction ruling isn’t, of course, a ruling on the merits. But given the furious, albeit mostly sealed briefing in this case, the record before Koh is well-developed. If I were Samsung’s lawyers at Quinn, I’d be worrying about the cellphone design and touch-screen scrolling patents the judge found likely to be valid and infringed; they squeaked by an injunction because Apple couldn’t show irreparable harm, but money damages are another matter. Apple’s lawyers at Morrison & Foerster, meanwhile, appear to have their work cut out for them if they want to uphold the validity of the tablet design patent; Samsung’s tablet may look the same, but that’s not enough to make a case unless Apple was the first to devise the look.
For more of my posts, please go to Thomson Reuters News & Insight