The Court has thrown out a US$399 million (about $535 million) award won by Apple over infringement of key design elements of the iPhone. The US Court of Appeals for the Federal Circuit in Washington will now have to recalculate how much Samsung owes Apple.
The Supreme Court has not considered design patents since cases involving spoon handles in the 1870s and carpets in the 1890s, notes Bloomberg Law
Justice Sonia Sotomayor, delivering the opinion
for a unanimous Court, said that the Court of Appeals’ reading of “article of manufacture” in Section 289 of US’ Patent Act of 1952 to mean only the end product sold to consumers gives too narrow a meaning to the phrase.
The Court sided with Samsung’s and Quinn Emanuel’s argument that damages should have been paid from profits derived from the infringing “article of manufacture,” such as the screen or case of the smartphone, rather than the entire infringing product.
Apple through WilmerHale argued that limiting the damages award to certain infringing parts was not required because the “innards of Samsung’s smartphones were not sold separately from their shells as distinct articles of manufacture to ordinary purchasers.”
However, the Court is of the opinion that “article of manufacture” can also be the parts of a multicomponent product.
“An article of manufacture, then, is simply a thing made by hand or machine,” Justice Sotomayor wrote.
“So understood, the term ‘article of manufacture’ is broad enough to encompass both a product sold to a consumer as well as a component of that product. A component of a product, no less than the product itself, is a thing made by hand or machine.
“That a component may be integrated into a larger product, in other words, does not put it outside the category of articles of manufacture,” she adds.
This interpretation of the phrase is consistent with Section 171 of Part 2, Chapter 16, Title 35 of the US Code concerned with patents for designs which has been interpreted by the Patent Office to allow for granting design patents extending to only a component of a multicomponent product, the opinion reads.
Thus, Samsung would not have to pay a portion of its entire profit from the sale of its infringing smartphones but rather a portion of the profit derived from the certain infringing components of the smartphones.
The case is Samsung Electronics Co, Ltd v. Apple Inc, Supreme Court of the United States, 15-777.
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Quinn Emanuel Urquhart & Sullivan has scored over Wilmer Cutler Pickering Hale and Dorr as Samsung beat Apple in the Supreme Court of the United States’ first consideration of design patents since the late 1800s.