Apple Inc (AAPL.O) had a major setback in its ongoing mobile patents battle with Samsung Electronics (005930.KS) on Friday, as a federal judge slashed a $1.05 billion jury award by more than 40 percent and set a new trial to determine damages.
Apple won the award last year against Samsung in what was the biggest and highest-profile of a number of legal trials around the world, centered on the use and alleged abuse of patents in a highly competitive mobile market.
The iPhone maker convinced the jury that the Korean company, which in 2012 overtook Apple as the global smartphone leader, had infringed on its iPhone and iPad patents.
"We are pleased that the court decided to strike $450,514,650 from the jury's award," the Korean company said in a statement. "Samsung intends to seek further review as to the remaining award."
Apple declined to comment.
Friday's ruling by Judge Lucy Koh of the U.S. District Court Northern District of California in San Jose means the two mobile electronics companies may once again square off in a California court to decide how much of the $450.5 million struck from the damages, associated with 14 Samsung products, should stand.
Koh said the jury had incorrectly calculated part of the damages and that a new trial was needed to determine the actual, final dollar amount. That could end up less than or more than the original $450.5 million set by the jury.
Koh, rejecting Apple's motion for an increase in the jury's damages award, ordered a new trial on damages for the 14 devices, which include the Galaxy SII. The jury's award to Apple for 14 other separate products, totaling almost $599 million, was maintained.
"The court has identified an impermissible legal theory on which the jury based its award and cannot reasonably calculate the amount of excess while effectuating the intent of the jury," Koh said in her ruling.
Apple and Samsung account for one in two mobile phones sold. They also rely on each other for components and business.
Their legal tussle has been viewed as a proxy war between Apple and Google Inc (GOOG.O) as Samsung's flagship Galaxy smartphones and tablets run on Google's Android operating system.
Shares in Apple closed down 2.5 percent at $430.47 on Nasdaq.
(Reporting by Ben Berkowitz; Editing by Gary Hill and Richard Chang)