In patent law, to calculate the damages, companies are asked to recreate a “hypothetical” license negotiation; Samsung Electronics Co. says that Apple Inc. patent-infringement Claims of $2.19 billion are 57 times higher than what the Suwon, South Korea- based company should have to pay, and according to Bloomberg News, Samsung is arguing over the inflated patent damages. Samsung Electronics Co. is the world’s largest information technology company measured by 2012 revenues, and 4th in market value.
A Massachusetts Institute of Technology-trained consultant based in Boston, Christopher Vellturo, said that the $2.19 billion sought by the iPhone maker accounts for two types of damages, the lost profits and also the reasonable royalties the company should have earned on more than 37 million infringing on products that Samsung had sold between August 2011 to December 2013, according to a report by Bloomberg News.
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According to Samsung, Apple’s damages are inflated because the five patented smartphone features at issue are of marginal value. Samsung lawyer’s argument at the outset of the trial was that Apple Inc.’s multibillion-dollar figure is a “gross exaggeration” and an “insult” to the intelligence of the jurors.
An economics and finance professor at the Yale School of Management, Chevalier, was called by Samsung to contest a report produced for Apple by Christopher Vellturo. Samsung became the world’s biggest advertiser in 2012, spending $4.3 billion, compared to Apple’s $1 billion. Samsung’s global brand value of $39.6 billion is less than half that of Apple.
Bloomberg News reported that, Samsung Electronics had 31 percent of industry revenue, compared with 15 percent for Apple Inc. It has been reported that, Apple Inc.’s share of the market has begun to shrink as the touch-screen interface has become commonplace and Samsung, LG Electronics Inc. and Lenovo Group Ltd. have introduced lower-cost alternatives.
A law professor at Santa Clara University, Brian Love, said in an interview that “It is generally in the patentee’s best interest to present as large a figure as possible without appearing unreasonable, just as it is in the accused infringer’s best interest to present a figure as small as possible without appearing unreasonable.” According to Bloomberg News, Brian Love reported that “on average, jury verdicts tend to fall very near the mid-point between the parties’ respective damages estimates.”
According to Mercury News, Samsung will likely resume its case, presenting claims that Apple Inc. has infringed some of Samsung’s patents, such as a mobile video feature used in Apple’s Face Time in iPhones.
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