Fri, Jun 29, 2018 - Page 10 News List

Apple, Samsung settle seven-year patent lawsuit


Apple Inc and Samsung Electronic Co have ended a years-long patent battle over copied iPhone design with an undisclosed settlement, a US court filing on said on Wednesday.

The world’s two biggest smartphone makers reached a truce in their seven-year-old court battle one month after a federal court jury ordered Samsung to pay Apple about US$539 million for copying patented iPhone features.

That award was seen as a victory for Apple, which argued in court that design was essential to the iPhone.

Financial terms of the settlement were not revealed and neither company elaborated on the brief court order, which dismissed the litigation dating back to 2011.

“Whereas the court has been advised by the parties that the above-entitled action has been settled, all remaining claims and counterclaims in this case are hereby dismissed with prejudice,” US District Court Judge Lucy Koh wrote.

When contacted for comment, Apple referred to a statement released last month after the jury announced the damages award.

“This case has always been about more than money,” the statement read. “It is important that we continue to protect the hard work and innovation of so many people at Apple.”

South Korea-based Samsung declined to comment.

Apple’s lawsuit claimed that Samsung, now the world’s biggest handset maker, copied the design and other features of the iPhone as the smartphone market was exploding.

The three design patents in the case apply to the shape of the iPhone’s black screen with rounded edges and a bezel, and the rows of colorful icons displayed.

Two utility patents also involved apply to “bounce-back” and “tap-to-zoom” functions.

Separately, Apple is close to getting its first batch of organic light-emitting diode (OLED) screens from South Korea’s LG Display Co, people familiar with the matter said — a key step in the US company’s push to reduce the iPhone’s costs and its dependence on Samsung.

The initial volume is likely to be between 2 million and 4 million units — small relative to Apple’s sales, as LG continues to work on ramping up capacity, said one of the people, who asked not to be identified, as the matter is private.

However, that would help Apple gain leverage in price negotiations with Samsung, the sole supplier of OLED displays for the iPhone X and Apple’s primary rival in smartphones.

The expense of that component is a key reason that the iPhone X’s pricing in the US starts at US$1,000 and sales have not met initial expectations.

A successful supply deal would help Apple, as well as LG. The Cupertino, California-based company would be able to buy significant volumes from LG for next year’s iPhone model as it tries to fight off a slump in smartphone sales. LG needs a fresh source of revenue as it battles a slide in the price of liquid crystal displays.

“Securing a second supplier for OLED screens is crucial for Apple, as it will allow the company to reduce its reliance on Samsung, which is currently the sole supplier,” IHS Markit senior principal analyst Jerry Kang said.

“At the same time, it will help accelerate a broad adoption of OLED screens. More suppliers means more volume, and in turn, lower pricing,” he said.

Apple and LG Display declined to comment.

Additional reporting by Bloomberg

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