updated 11:32 pm EST, Thu November 14, 2013
SVP of Marketing describes iPhone as a 'bet-the-company' product
With a jury seated, the retrial concerning damages related to Samsung's infringing of Apple patents got underway in earnest on Thursday, largely taken up with procedural matters but also featuring brief testimony from Apple's Senior Vice President of Worldwide Marketing, Phil Schiller. In his few minutes of testimony, he told the jury about the original development of the iPhone, describing it as a "bet-the-company" high-risk product that might not have succeeded, with "almost everyone" at Apple involved at some point.
The retrial does not re-examine Samsung's infringement of Apple utility and design patents; Samsung's original conviction on those points stand, and the company has since admitted in the retrial to its actions (though it is still expected to appeal the original verdict). The purpose of the new jury trial is to re-calculate a portion (about 45 percent) of the $1.03 billion in damages awarded Apple in the first trial. Judge Lucy Koh, who has presided over both trials, set aside some $450 million on the premise that the original jury miscalculated or was not specific enough about some of its damage awards.
In the new trial, Apple is arguing for $380 million in awards, less than the set-aside award. Samsung is acknowledging its infringement, but argues that the actual damages should be closer to $52 million. While Apple has asked for less money than was set aside, the jury is free to decide on any amount it feels justified. Punative damages against Samsung are not being figured in this proceeding: those will be determined at some future date.
Schiller told the court that there were "huge risks" associated with the development of the iPhone, according to CNet. The existing cell phone industry, with the exception of AT&T, had expressed hostility to the concept of "computer guys" moving in on the mobile phone market; the iPhone was advanced and thus expensive in a way that might not find favor with the public; and resources that could be used to further develop the iPod (at the time, Apple's most popular product) were being pulled to work on the iPhone.
Apple, as with Samsung, are largely limited to re-arguing the same points that they did in the original trial, with the judge barring any new theories or formulations that could sway the jury differently than the arguments made in the previous case. Apple seeks to show that the iPhone was its own original effort, and that Samsung's subsequent copying undermined the product later on, costing Apple money and customers due to unfair competition. Samsung can only dicker about how much Apple really lost, as the iPhone was and continues to be a hugely popular product - thus, in Samsung's arguments, minimizing the "harm" or "dilution" aspect of its infringing.
Schiller will continue his testimony tomorrow, and the case is expected to conclude sometime next week.