Apple proposed $30-40 Samsung license fee per device
updated 10:29 pm EDT, Fri August 10, 2012
Six witnesses examined, new documents revealed in trial
Friday's events in the Apple vs. Samsung trial in Judge Lucy Koh's courtroom in San Francisco today included two University of Toronto professors, an MIT marketing professor and two market research experts as Apple begins to wrap up its case against Samsung, clearing the way for Samsung to present its own charges next week. A presentation entered into evidence showed that Apple had warned Samsung it was infringing in 2010, and proposed a license of $30 per phone and $40 per tablet.
The October 2010 patent license meeting proposed Samsung pay a base rate of $30 per touchscreen phone, and $40 per tablet regardless of operating system, with tablet fees decreasing to $30 over two years. A royalty discount would apply depending on the phone features. Phones with Apple patents that Microsoft had already licensed would give 40 percent off, a cross-licensing deal on Samsung's patents would apply another 20 percent, and a QWERTY form-factor design would deduct a further 20 percent.
Apple had given a presentation to Samsung executives in August of 2010 -- the first of two such presentations -- warning Samsung that Android infringed on many Apple patents (with dozens of examples) and that the platform would "lead companies to imitate the iPhone." The slideshow (seen in full below) showed examples both of areas where Android was infringing Apple patents as well as specific instances where Samsung was doing so as well. The second presentation (not yet available) was the one where Apple proposed the licensing of many, but not all, of Apple's iOS-related patents.
In other events, trademark survey expert Hal Poret took the stand first for the completion of Samsung's cross examination begun on Thursday. Poret conducted a survey for Apple demonstrating that a large proportion of customers could identify the iPad and iPhone, even when unique labeling on the home button and icons were masked.
The expert claimed that the general look and feel of the device -- the "trade dress" -- is what allows customers to clearly identify Apple versus its competitors. The same survey showed a large percentage of consumers confusing Samsung devices with Apple-produced phones and tablets. Samsung attempted to prove that the identification of Apple's devices has only recently manifested itself, and Samsung's devices caused no market confusion.
The second expert for the day, market research expert Kent Van Liere, added that consumers were apt to be confused if they observed someone using a device -- an experience he called a "post-sales environment." Van Liere detailed another survey showing consumers clearly-branded and also unbranded Samsung products, asking if they resembled any other company's devices, as well as other surveys where customers were shown videos of Samsung devices from the side and front. His surveys found that about one-third of the people surveyed by video saw Samsung tablets and thought they were iPads, with 24 percent of people confusing the Barnes and Noble Nook with an iPad as well.
The methodology of the surveys was questioned by Samsung lawyers, asking why the device wasn't simply handed to the consumer. Van Liere responded that the survey wasn't designed for an observer to interact with the device, but was modeled to demonstrate how customers respond to the devices when in use by another person.
Computer scientist and University of Toronto computer science professor Ravin Balakrishnan claimed that many Samsung phones violated Apple patents, and played videos demonstrating his points. Balakrishnan discussed Apple's "bounce-back" patent which is utilized when the user over-scrolls content, and the screen snaps back into place, and noted that Samsung internal documents noting that the bounce-back feature "generates fun for the user with a visual element that seems to bounce." On cross examination, Balakrishnan admitted that a bounce effect can be implemented without violating the patent, but emphasized that to not violate, the effect would have to be notably different. On cross-examination, some phones were shown that don't utilize the "bounce-back" feature, but Balakrishnan noted that the ones he examined did.
Doctor Karan Singh, also from the University of Toronto, was called after lunch. She believed that 24 Samsung products violated Apple's pinch-to-resize patent. The jury was shown source code, not displayed to the press or public, notable as being one of the few elements Judge Koh has sealed as proprietary information. Apple lawyers produced another internal Samsung document which recommended to its design engineers should use the iPhone interface as a "design benchmark" for similar features in Samsung phones.
Massachusetts Institute of Technology marketing professor John Hauser testified about a survey he conducted that found that customers would pay extra for Apple's technologies in Samsung phones, perhaps laying the groundwork for damages. He did admit to the results not predicting to the dollar what customers would actually pay in the market. Hauser's survey found that customers said they would pay around $100 more in order to have the specific features Apple is claiming Samsung copied, though Samsung noted that if the same question had been asked about other features, customers might have added up thousands of dollars for all the features of a modern smartphone, which typically sells for $200 or less with a contract.
Finishing the day, Apple patent license strategist Boris Tesker was called to the stand. He recalled being shocked when Samsung introduced smartphones that strongly resembled Apple devices. A brief second-hand recounting of a meeting with Apple executives approaching Samsung two months later with a slideshow that illustrated areas Apple believed Samsung was infringing was revealed. Apple's goal, according to Tesker, was to obtain a "cost effective license to our patent portfolio" was addressed, with restrictions -- Apple would not allow Samsung to adopt "distinctive industrial design, software platforms, or feature sets." Tesker admitted Apple had a group of patents called the "unique user experience intellectual property," which he called the concepts and ideas "which make our brand identity and keep us in the marketplace."
Judge Koh declared an end to the day's trial prior to cross-examination of Tesker. Apple intends on wrapping up its case on Monday. To date, Apple has used 11 hours and 35 minutes of its allowed 25 hours, and Samsung has consumed 12 hours and 16 minutes before before beginning its case on the patents it claims Apple infringed.
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with 24 percent of people confusing the Barnes and Noble Nook with an iPad as well. Oh good God, people really are brain dead. I walked into a car dealership and bought what I thought was a nice Mercedes Benz. Turned out it was a 2011 Hyundai Sonata. They kinda looked the same... Both had four tires, two aerodynamic headlights. It even had this funny stylized "H" for the logo. I thought it stood for "High" performance. Turned out I was wrong. I returned it.