Apple vs. Samsung: Three possible outcomes
NEW YORK (CNNMoney) — An epic patent battle involving the world’s two largest technology companies and some of the most popular gadgets on the market now rests with nine jurors in California.
A verdict could come any time, but given the case’s complexity, few expect a decision before the middle of next week. No matter how the jury decides, the fight won’t be over. The companies are virtually guaranteed to appeal the rulings they lost.
Still, it’s possible to suss out a few of the most likely outcomes and their consequences. Here are three ways it could go down.
Apple wins outright
Apple says Samsung infringed on four of its design patents and three software patents. There’s no doubt that many of the Samsung gadgets in question look very similar to Apple’s iGizmos. Even U.S. District Judge Lucy Koh admitted that Samsung’s Galaxy tablet appeared “virtually indistinguishable” from the iPad.
A number of experts tracking the courtroom action think Apple made a strong case.
“I have been surprised that Samsung seems to have been on the defensive so much,” said Mark McKenna, a law professor and intellectual property specialist at the University of Notre Dame.
Any edge Apple gains could turn into a decisive victory.
In nearly three-quarters of patent cases, the jury decides in favor of the same party on all the issues, according to Alex Poltorak, CEO of the General Patent Corp., an industry consulting firm. He thinks it’s unlikely that the jury will go into the fine details point by point.
“The dynamics of jury deliberation generally are about finding who is the good guy and who is the bad guy,” Poltorak said. “More likely than not, Samsung will be found to have ripped off Apple’s design, and therefore the jury will rule on all issues in favor of Apple.”
Losing could be very expensive for Samsung: Apple is seeking as much as $2.5 billion in damages. Samsung has enough cash, though, to withstand the blow. It earned $12 billion last year and has $14 billion cash in the bank.
If Apple sweeps the board, legal and technology experts widely agree that the smartphone landscape will be shaken up, particularly for Google’s Android ecosystem. Samsung is the largest manufacturer of Android devices.
“Other manufacturers could be sued for similar software infringements, which means Google (GOOG, Fortune 500) has to make sure its Android interface doesn’t infringe,” said Jefferson Wang, mobile consultant at services firm IBB. “That means wireless carriers would have to start worrying about whether Android is a viable ecosystem.”
A design-patent infringement ruling could also force smartphone and tablet makers to retool their designs.
“If Apple wins, competitors will have to stay away from how close Samsung got to Apple’s products,” said Chris Carani, a design patent attorney at McAndrews, Held & Malloy. “They will have to create products that are distinct from Apple.”
Apple could also request an injunction against the Samsung devices that were found to have infringed Apple’s patents. That means those gadgets could be forced to stay off the market until they are tweaked.
Samsung wins outright
Samsung is counter-suing Apple, saying the tech giant violated five of its own software patents. If Samsung wins, the stakes are much lower.
The patents that Samsung is disputing are considered “non-essential.” Forcing major changes or even having an injunction granted against the iPhone or iPad is extremely unlikely, according to Poltorak. What’s more probable is that Apple would be forced to license those patents from Samsung for a small amount of money per iPhone sold.
The most striking blow Samsung could deal is if the jury rules that Apple’s patents are invalid, Carani said.
Apple will likely continue its legal crusade against Android — it has lost some high-profile patent cases before, and it hasn’t been deterred. But if its patents are invalidated, some of the wind would be taken out of its sails.
Experts doubt Samsung will win all of its battles, though. What’s much more likely is a split decision.
A mixed verdict
The jury’s task is extremely complicated. Judge Koh issued 109 pages of instructions, complete with 84 separate directives on how to fill out a 20-page verdict form that includes 36 multi-part questions. It’s like the most nightmarish multiple-choice test imaginable.
Among the many issues the jurors need to sort out is which — if any — patents were violated by each of Samsung’s 26 smartphones and two tablets, as well as three of Apple’s iPhones, the iPad 2 and the iPod Touch.
If the jury finds in favor of Apple on some patents and in favor of Samsung on others, all bets are off. No one can really predict what a mixed ruling means, though some think it would jump-start the industry’s creativity.
“If a split decision happens, most sides are going to have to be more careful with innovation,” said Wang, the IBB consultant. “The industry will accelerate new designs that are different from the rectangular slabs out there today.”