Apple blasts Samsung for doing a switcheroo on off-the-market lost profits


Apple, Inc. v. Samsung Electronics Co., Ltd. (Apple II), 2014 U.S. Dist. LEXIS 43907 (March 28, 2014)

 
Before Apple and Samsung played to the jury in their second patent trial, the parties fought in pretrial motions over a lost profits ruling the court had issued in their November 2013 damages retrial. It concerned the calculation of off-the-market lost profits Apple could claim. These are damages for periods when Samsung infringed Apple's patents but should not have been able to sell its products because there were no noninfringing alternatives. The parties wrangled over whether the damages calculation had to consider potential design-arounds from the date of first infringement or from the notice of infringement date. At the retrial, Samsung staunchly advocated for the date of first infringement, and it won. The court's ruling substantially reduced the damages Apple could demand.
 
The second trial initially promised to be a replay of the argument, with Samsung's filing a Daubert motion to contest the off-the-market damages calculation Apple's expert had proposed for four of the five patents in suit.  For the four patents, the date of first infringement was before the notice date. Samsung successfully argued that Apple's expert should have used the first infringement date—because that date reduced its damages exposure. But when Samsung realized that the very ruling it demanded for the four patents could hurt it with regard to the fifth patent, whose notice date actually preceded the first infringement date by a year, it did not miss a beat and claimed the prior decision did not apply to that particular scenario. In other words, Samsung wanted to have its cake and eat it, too: use the first infringement date when it worked in its favor but not when it meant increased exposure. Apple wasted no time pointing out the contradictory behavior, and the court agreed.
 
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