Despite willful infringement findings, Judge argues Apple did not prove that it lost its ability to participate

A California federal judge has ordered that while Samsung Electronics Comp., Ltd. (KSC:005930) is guilty of willful infringement of software and design patents held by Apple, Inc. (AAPL), that she would not order a sweeping ban of Samsung smartphones, which Apple had argued for.

I. A Lump of Coal -- Apple Gets no Ban in its Stocking

Apple and Samsung are currently the two most profitable and most prolific smartphone makers in terms of U.S. sales.  Samsung's recent success was kick-started by the Galaxy S, a phone that some felt borrowed a little too much from the iPhone.  

Since then, the tables have turned and it has been Samsung (and its operating system partner Google Inc. (GOOG)) that has been pushing the user interface and form factor envelope.  For example, Samsung's flagship Galaxy Note II and Galaxy S3 feature 5.5-inch and 4.8-inch displays, respectively, prompting Apple to begrudging bump its screen size to 4-inches with the iPhone 5.

Judge Lucy Koh
Federal Judge Lucy Koh

Overall, there are signs that Apple's so-called "patent war" against Google's alliance of Android manufacturers is cooling.  Apple recently agreed to a 10-year licensing agreement with HTC Corp. (TPE:2498).  And it appears to have exhausted its U.S. legal avenues against Motorola Mobility after its case against the Google subsidiary was dismissed with prejudice not once, not twicebut three times.

But the fight between Apple and Samsung remains ongoing and bitter.

In her ruling on Monday, U.S. District Court for the Northern District of California Judge Lucy Koh wrote that the $1.05B USD jury verdict against Samsung was a legitimate reflection that Samsung's violation of six Apple design and utility patents may have caused Apple to lose some customers.

Galaxy S3 v. iPhone 4S
Apple's request to ban Samsung smartphones was denied on Monday.
[Image Source: Android Authority]

However, when it comes to banning products, she comments, "There is no suggestion that Samsung will wipe out Apple's customer base or force Apple out of the business of making smartphones. The present case involves lost sales -- not a lost ability to be a viable market participant."

"In sum, to the limited extent that Apple has been able to show that any of its harms were caused by Samsung’s illegal conduct (in this case, only trade dress dilution)," she concludes, "Apple has not established that the equities support an injunction. Accordingly, Apple’s motion for a permanent injunction is DENIED."
Apple Denied Motion for Permanent Injunction

II. Ban Could Still be Resurrected

The ruling was in some ways unsurprising as Judge Koh had previously denied a similar request for a U.S. sales ban on the Galaxy Tab.

Both denials are likely to be appealed to higher U.S. courts, as stated by Florian Mueller, a paid "consultant"/commentator for anti-Android software firm Oracle Corp. (ORCL).

That means Samsung isn't out of the woods just yet.  It's very possible that the likely appeals court -- Court of Appeals for the Federal Circuit -- might order Judge Koh to reconsider a ban.  Such an order could force the federal judge's hand.

In fact, that is precisely what happened after Judge Koh denied a request for a preliminary injunction earlier in the case.  The Circuit Court ordered [PDF] Judge Koh to reconsider, and she did, issuing the temporary ban.  The Circuit Court made its decision, in part, because sales bans are often used in patent infringement cases in the U.S. to provide so-called "injunctive-relief" to the plaintiff.

Federal Circuit Appeals Court
Apple will likely appeal to the Court of Appeals for the Federal Circuit.

However, there are no guarantees for Apple either.  While sales bans are common, the scope and magnitude of the ban Apple is pushing for are rather unprecedented and would represent a U.S. court removing a major participant from the U.S.'s supposedly "free market".

Thus it should be interesting to see what the higher court says when the inevitable appeal does come.

III. Samsung's Request for Retrial Also Smacked Down

Speaking of appeals, Apple did win one small victory in the ruling.  Judge Koh denied Samsung's request for a retrial.

Samsung had requested the verdict be tossed and a new trial scheduled after it was revealed that Jury Foreman Velvin Hogan did not reveal, despite direct questioning, that a company tied to Samsung had sued him, and thus might be biased against the device-maker.  Mr. Hogan in the 1990s been sued by hard-drive manufacturer Seagate, which today controls Samsung's old hard drive business, after he failed to repay a promissory note after being terminated (reportedly, for misconduct).

The idea was that the Jury Foreman's history could have introduced a bias against Samsung that permeated to other jurors.

It was also known that several jurors had family members who were Apple shareholders, but Judge Koh had previously ruled that was acceptable, in that they would only indirectly profit from Samsung being found guilty, not directly profit.  Samsung did not mention that potential conflict of interest in its failed appeal.

Much like the product ban request, Samsung may opt to take its request for a retrial to the Circuit Court.
Galaxy Note II
The Galaxy Note II will be targeted in the second upcoming patent trial in
Apple and Samsung's legal war.

Both companies are currently gearing up for a second major lawsuit in the Northern California Federal Court.  That case will tackle patent infringement claims by both companies against their latest respective flagship products, including the Apple iPhone 5 and the Samsung Galaxy Note II and S3.

A trial is slotted for early next year.

Source: Scribd via AppleInsider

"It seems as though my state-funded math degree has failed me. Let the lashings commence." -- DailyTech Editor-in-Chief Kristopher Kubicki

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