Apple v. Samsung: Little Clarity Given on How to Award Damages Penn State Law Review Online Companion Penn State Law Review

Apple v. Samsung: Little Clarity Given on How to Award Damages

By: Marcus Barry

Published: 4/10/2017

Since the first iPhone was created in 2007, these Apple products have been arguably the most significant advances in technology that people can use every day.  Apple users and opponents are able to spot an iPhone in a crowd with little difficulty due to its iconic look.  Competitors of the iPhone have been trying to catch up and use some of the simplistic styling the iPhone uses and incorporate it into its own design.  Samsung took it a step too far by infringing on the design patent that Apple owns.  Apple sued Samsung for patent infringement and was awarded damages of $400 million.  Samsung appealed to the Supreme Court, with the Court reversing in a unanimous decision.

The Supreme Court did not reverse the ruling that Samsung infringed on the design, but rather reversed on how damages were to be calculated and awarded.  The $400 million figure represented the total profits Samsung earned from the use of the design in its entirety of the phone sales.  However, the Supreme Court ruled that one does not calculate the damages as a whole, but rather calculate the damages on the specific design if the product consists of multiple parts.  The Supreme Court referred to this specific piece as the relevant “article of manufacture.”

The Supreme Court, however, did not give any instruction as to how the damages are to be calculated.  The case was remanded to the Appeals Court for the Federal Circuit.  Apple was hoping to get a full injunction on the sale of the Samsung devices.  This might have been a crippling blow to Apple’s largest competitor in the cell phone market.  Instead, more hearings will be needed to determine the amount owed to Apple for the infringement; a figure that Samsung should be able to absorb easily.  Even though Samsung has to pay for damages, Samsung has to be feeling as if they won.

This was the first design patent case the Supreme Court has heard in more than a century and yet we are no closer to knowing how to calculate damages for design infringement.  Especially since it will be hard to determine what the exact “article of manufacture” is responsible for the phone’s sales.  Since it is rare for patent infringement cases to go to trial, let alone to the Supreme Court, it would have been helpful to give more guidance in how to award damages rather than simply remanding the case.  There have been calls for more technically savvy judges to be appointed to the Federal Circuit and the Supreme Court to help clarify a very difficult area of the law, and this ruling does little to keep those calls at bay.  Hopefully a resolution will be made fairly soon from the Federal Circuit to give clarity where clarity is largely missing.

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