BREAKINGVIEWS- Apple-Samsung patent clash more standoff than war

Wed Jul 3, 2013 12:28am IST

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(The author is a Reuters Breakingviews columnist. The opinions expressed are his own.)

By Reynolds Holding

NEW YORK, July 2 (Reuters Breakingviews) - Apple's (AAPL.O) patent clash with Samsung (005930.KS) is looking more like a standoff than a war. As the iPhone maker waits for its Korean rival to pay last year's $600 million verdict, the tech giants are inching toward another trial next year, and maybe even a third. Such judicial delay pushes patent holders to sue overseas or sell their rights to so-called trolls.

In an industry that measures product lifespans in months, the nearly four-year tiff between Apple and Samsung over tablets and smartphones seems almost ancient history. Apple hasn't seen a dime from the jury award last August, and a second trial over similar Samsung patents has been delayed until May 2014. A judge's decision last week to limit the claims in that trial – to avoid a "tax on the court's resources" – almost guarantees a third courtroom meeting at an even later date.

The companies can be faulted for not settling, but last year's verdict suggests Apple's case is strong. And as shown by other disputes like Microsoft's (MSFT.O) continuing three-year patent feud with Motorola Mobility, now owned by Google (GOOG.O), slow-footed judges are part of the problem.

The delays are costly. Patents permit inventors to benefit from their creations by temporarily blocking competition. Rivals can easily defeat that purpose, however, by exploiting endless court proceedings while they design around the intellectual property in question. Patents can become little more than devices for sapping a competitor's resources.

That's why many companies sue in Germany and other foreign jurisdictions known for swift decisions, tech know-how and a pro-patent approach. It's also a reason patent holders turn to trolls, firms that buy intellectual property rights just to enforce them in court. Trolls can offer inventors liquidity, but too often file frivolous or over-broad claims designed to extract settlements. More than 60 percent of patent litigation is brought by companies that don't produce anything, according to IP licensing firm RXP.

A judicial system that caters more effectively to trolls than to companies protecting products they actually make requires reform. President Barack Obama's proposals to tighten what patent claims are allowed, force disclosure of who really owns rights and the like will help. But only when judges better employ the court's resources with swift and informed adjudication will justice be served better.

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CONTEXT NEWS

- A U.S. magistrate judge on June 26 ruled that Apple could not include Samsung's new Galaxy S4 smartphone in a patent infringement lawsuit against the Korean technology giant scheduled for trial in March 2014. Judge Paul Grewal said adding the device to the case would be a "tax on the court's resources."

- The ruling makes a third trial involving the Galaxy S4 and other products more likely in the two tech rivals' long-running legal battle over smartphone patents. The first trial ended last year with a $600 million jury verdict in favor of Apple.

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(Editing by Richard Beales and Martin Langfield)

((reynolds.holding@thomsonreuters.com)(Reuters messaging reynolds.holding.thomsonreuters.com@reuters.net)) Keywords: BREAKINGVIEWS APPLE/SAMSUNG

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