Breakingviews- Apple appeal may bring smartphone patent ceasefire

Fri Aug 9, 2013 10:34pm IST

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

By Reynolds Holding

NEW YORK, Aug 9 (Reuters Breakingviews) - Apple's (AAPL.O) appeals court showdown with Samsung (005930.KS) may bring a ceasefire in the smartphone wars. Following the Obama administration's veto of a U.S. trade agency ruling, courts look like patent warriors' last chance to stifle rival products. Even that option may vanish if Apple loses its bid to block its Korean rival from selling infringing devices.

The two companies, along with Microsoft (MSFT.O) and Google's (GOOG.O) Motorola Mobility, have for years been waging global combat over the rights to technology behind touch-screen gizmos. Their most powerful weapons have been orders banning rivals' equipment from the market, especially in the United States.

A 2006 Supreme Court ruling made such orders tougher to get in court, and combatants started flocking to the more lenient International Trade Commission (ITC). Last week, however, the White House reversed a June ITC ban on importing older iPhones and iPads that infringed Samsung patents. It was a message to the U.S. agency to toughen its own standards.

The reversal also reflects a growing legal consensus that devices shouldn't be blocked from a market when they infringe so-called standards essential patents (SEPs), as those Apple products did. SEPs are so essential to an industry that their holders agree to share them at a reasonable price. Samsung can sue to get paid, the thinking goes, but stopping Apple from selling gadgets that use SEPs-protected technology unduly harms consumers.

Courts are beginning to apply that thinking to ordinary patents as well. The federal judge overseeing Apple's California lawsuit against Samsung refused last year to block the Korean company's devices, even though a jury found they violated Apple's patents. The Cupertino-based firm hadn't proven that patented technology drove consumer demand for its products, the judge ruled, so money damages – nearly $1 billion in this case – were adequate compensation.

Apple wants that ruling overturned in an appeal starting on Friday, and understandably so. Obtaining court bans will be almost impossible if companies must prove that consumers buy smartphones because of a few patented features out of perhaps thousands.

That, of course, is largely the point. Tech giants would lose leverage over rivals, but the public would probably gain better access to the latest technology. Peace in the smartphone wars – and real competition – would finally get a chance.

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CONTEXT NEWS

- Apple will ask a U.S appeals court on Aug. 9 to stop Samsung from selling smartphones and tablets that a California jury determined last year infringed certain of the Cupertino-based technology giant's patents. A federal judge in 2012 allowed Samsung to continue selling its infringing devices, ruling that because Apple had not proven that the patented features persuaded consumers to buy the products, money damages were adequate compensation. Apple is seeking reversal of that ruling.

- The Obama administration on Aug. 3 overturned a decision by the U.S. International Trade Commission to block imports of older Apple products that infringed Samsung's smartphone and tablet patents.

- Samsung brief: link.reuters.com/vur32v

- Apple brief: link.reuters.com/sur32v

- Reuters: Obama administration overturns ban on some iPad, iPhones [ID:nL1N0G40EJ]

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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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