Samsung loses Apple court case over features

Samsung Electronics may be forced to stop using some features in its smartphones and tablets after Apple won a U.S. appeals court ruling on Thursday.

The nation’s top patent court said Apple was entitled to a narrow order that prevents the Korean device maker from using Apple’s slide-to-unlock, autocorrect and quick links features. To rule otherwise would eliminate patent rights of inventors of certain features in multicomponent devices, the U.S. Court of Appeals for the Federal Circuit in Washington said in an opinion posted on its electronic docket.

The decision on the lawsuit filed in 2012 could have far-reaching consequences in how disputes involving complex devices are resolved, and help patent owners limit copying by rivals. The ability to block the use of an invention is a powerful tool that increases the price tag when negotiating settlements.

“It’s an important precedent for Apple and any company that seeks to protect product differentiation,” said Nick Rodelli, who heads CFRA Legal Edge, a New York-based forensic accounting and legal research firm.

“This broadens their moat here in the U.S. and makes it more difficult for new entrants to come into the U.S. market and rip off Apple’s features.”

Samsung said it would ask that the issue be considered by all active judges of the Federal Circuit, since it was a split decision. The court handles all patent appeals.

The decision gives the iPhone maker additional firepower when it comes to resolving this dispute with its biggest rival. A past Apple settlement with HTC included a “no cloning” provision that ensured HTC’s phones didn’t look too similar to the iPhone, and the ruling Thursday helps do the same to other mobile phone makers, such as China’s Xiaomi Corp., that want to enter the U.S. market.

Apple won a $119.6 million jury verdict in May 2014 against Samsung, which was found to have infringed its patents for the slide-to-unlock, autocorrect and quicklinks features. Even so, the trial judge declined to issue an order forcing Samsung to remove those features from its mobile phones, saying monetary damages would be adequate.

Apple argued that if it was not able to control use of its inventions it may lose market share and its reputation as an innovator.

“The right to exclude competitors from using one’s property rights is important,” the Federal Circuit ruled in a 2-1 decision. “And the right to maintain exclusivity - a hallmark and crucial guarantee of patent rights deriving from the Constitution itself - is likewise important.”

Google, HTC, LG Electronics and Rackspace Hosting were among the companies backing Samsung in its arguments. They argued in a filing with the court that a victory for Apple could allow a patent owner “to unfairly leverage its patent for competitive gain.”

“We want to reassure our millions of loyal customers that all of our flagship smartphones, which are wanted and loved by American consumers, will remain for sale and available for customer service support in the U.S.,” said Danielle Meister Cohen, a Samsung spokeswoman.

Samsung is appealing the underlying infringement verdict. Bloomberg