Yeah, it's a little bit more complicated than that. Samsung's case collapsed once emails and documents came to light that demonstrated they'd wilfully copied trademarked design elements and stolen IP from Apple. As it turns out, there was even more damning evidence, but Samsung destroyed it Still, what was submitted proved damaging enough: documents that dissected the Apple UI, analysed why their own functionality was inferior, and then showed how to use these elements in an Android skin that emulated the iPhone. There was an email from Google warning them against skinning an Android UI that copied the iPhone. Samsung ignored it. Apple offered them the opportunity to license the IP. Samsung showed them the middle digit.
And so the two companies went to court, where Samsung demonstrated the kind of hubris that comes from being above the law in your own country.
In order to score a quick win, Samsung brought a countersuit, claiming that Apple owed them millions for 3G FRAND licenses. The company generously offered to take a small sum for the licenses if Apple agreed to drop the suit and allowed them free access to the contested IP. Apple refused, stating that the licenses had been paid for when they bought the 3G chips from Intel; Samsung was effectively trying to double-dip. Samsung didn't have a leg to stand on, and when the surviving emails and documents were submitted as evidence, Samsung's case pretty much imploded straight away. Their legal team decided it was time to start throwing $hit at the walls to see what would stick.
First they claimed that they had come up with the idea first: a phone similar to the iPhone was already in development before the iPhone was released. Here it is:
Similar? Not so sure, myself.
Anyway, it was too late to submit that little conjuring trick as evidence, so the judge refused. Samsung released it to the press anyway, claiming that the public had a right to see it. They then followed up with criticisms of the legal process, the judge, the method of jury selection, the presentation of evidence...
Now, many Apple fans accused the judge of bias because she didn't charge Samsung with contempt. I think what they failed to realise was that Samsung already knew they'd lost the case, and were, most probably, trying to force a mistrial. Judge Koh was determined not to give them any excuse for doing so.
And of course, Apple wasn't much better, a late submission near the end of the trial prompted Koh to ask if the Apple legal team was smoking crack!
Samsung tried the prior art route, submitting an example of a tablet similar to the iPad that had been conceived years before:
Yes, there were tablets in the movie 2001: A Space Odyssey. They weren't touch screens though.
And they didn't really exist.
Still, since this case was about design elements as well as IP, then I think they should have been considered. However, the jury didn't agree with Apple that the Samsung tablet was too similar to the iPad, so it made little difference.
Samsung enlisted the help of Google, who proposed a change to the way patents are seen: if IP demonstrated that it was so obviously the right way to do something, then that intellectual property should be made available freely to everyone. Apple had clearly demonstrated the right way to build a phone, so everyone should be allowed to build a phone in the same way, even if it infringed on Apple's patents.
The problem with that argument is that if it was so 'obviously' the right way to build a phone, then why had no one done it before?
Meanwhile, the Samsung case continued to unravel: Apple's witnesses were well-rehearsed, succinct, and ran rings around the Samsung legal team. Samsung made a subtle strategic shift: yes, we did it, but we should be allowed to do it! Apple is trying to keep vital technology locked up behind their polished glass walls! They're attempting to stifle competition!
Apple said this was not the case. They were happy to license their IP as long as their licensees didn't use it to build copies of Apple's products.
"Hah! Prove it!" screamed Samsung.
"Okay," said Apple, and produced a jaw-dropper: a license agreement between themselves and Microsoft that allows MS to use Apple's intellectual property in the Surface tablet.
I'm not sure what this IP is, but it is interesting to note that Apple holds the patent on the keyboard/case that Microsoft is selling alongside the Surface. Anyway, it proved that Apple wasn't adverse to giving the competition a leg-up as long as they did not use the IP to copy Apple's products.
So now, pretty much beaten, Samsung employed the strategy they should have used from day one: damage limitation.
Yeah, we did it, but $2.75 billion is a bit excessive don'tcha think?
And here, the jury agreed. Apple accounts for about 70% of the profits in the mobile space. That, and the fact that they couldn't meet existing demand at the time, led the jury to decide that $1billion-ish should be enough.
Let's face it, even $2.75 billion is a drop in the profit ocean for both companies. The damage to Samsung's reputation, and the possibility that other companies will come after them for IP theft, could prove far more expensive. And in the longer term, Samsung will lose their biggest customer: Apple. Cupertino is already looking at alternative suppliers for screens, memory and processors.
Apple has sent a clear message to the rest of the industry: We have a long memory and bottomless pit of cash. Steal from us and we will crucify you. Even if they'd lost the case, they'd already achieved their main objective: Samsung has moved away from Apple designs and started using their own skins and design elements. As one pundit put it, the S3 is the first phone designed by lawyers.
And the real irony is that many think it looks better than the iPhone ...