Apple seeking $2.2B from Samsung for patent infringement

Apple bases its claim on a survey that said consumers were ready to pay between $23 and $102 for features involved in the infringement case.
By Ananth Baliga  |  April 9, 2014 at 8:00 AM
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CUPERTINO, Calif., April 9 (UPI) -- Apple has detailed its claims to $2.2 billion for alleged patent infringement by Samsung, making its case in front of an eight-person jury in California.

Apple's cases hinges on five of its patents and their use in 10 Samsung devices -- nine smartphones and one tablet. Apple is claiming royalties and loss of sales it suffered as a result of Samsung's sale of 37 million smartphones and tablets between August 2011 and the end of 2013.

The damages were calculated by Christopher Vellturo, a Massachusetts Institute of Technology graduate who's spent the past 12 years running consultancy Quantitative Economic Solutions. Vellturo has testified on Apple's behalf in 15 other cases and said that the infringements were particularly damaging to Apple because the patents covered the ease of use of the phone, something that has made the iPhone a popular device.

“The competition for first-time buyers is particularly important, because once they buy, they are very likely to make their next purchase from the same manufacturer, and maybe other products and services too,” he said.

Vellturo used two surveys conducted by John Hauser, a marketing professor at the MIT Sloan School of Management. Hauser polled 507 consumers about smartphones and another 459 customers about tablets. Hauser said that based on his survey consumers were ready to pay $32 to $102 each for the features allegedly infringed upon.

According to Hauser's survey, using a base hypothetical $149 phone, consumers were willing to pay an additional $102 for automatic word correction and $69 for contextual links. Tablet users were ready to shell out an extra $32 for the slide-to-unlock feature and $33 for universal search, on a hypothetical $299 tablet.

Samsung attorney Bill Price spent almost two hours trying to chip away at Hauser's testimony. He questioned certain parts of the survey and the underlying allegiance consumers had to Samsung or Android devices.

“One of the major questions is whether Apple has lost anything to Samsung,” Price said. “Buying a different version of a phone is very different from buying a different phone.”

Samsung is expected to argue that they don't owe Apple any more than $6 million in lost sales and royalties.

[PC World] [The Verge]

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