Samsung recently appealed to CAFC for ITC’s
ruling of non-infringement regarding its HSUPA standard essential patent (SEP)
– US7486644. US7486644 and US7706348 are the two SEPs that Samsung alleged that
Apple’s products infringed them. Even if ITC finally determined that Apple’s
products (iPhone 4 (AT&T models); iPhone 3GS; (AT&T models);
iPhone 3 (AT&T models); iPad 3G (AT&T models); and iPad 2 3G
(AT&T models)) infringe the asserted claims (claims 75-76 and 82-84) of
the US7706348 (’348) patent “Apparatus and Method for Encoding/Decoding
Transport Format indicator in CDMA Mobile Communication System,” the USTR (U.S.
Trade Representative) vetoed against the ITC’s ruling. Notwithstanding the
recent administrative and judicial blocking against exploiting SEPs for
injunction, Samsung decided to appeal for its SEPs. Why? Because recently
several courts ruled that SEPs are still eligible for monetary relief for
infringement.
For example, in In re INNOV A TIO IP
VENTURES, LLC, No. 1:11-cv-09308 (N.D. Ill. 2013), Dkt. No. 975, the court
calculated FRAND royalty of WiFi SEPs: (average profit margin to the
contribution of patentee’s SEPs) x (net profit of relating products) x (pro
rata share of patentee’s SEPs to the total number of WiFi SEPs providing
similar contribution to the profit). Similar calculation can also lead to the
FRAND royalty cap for 3G UMTS SEPs. Considering the huge net profit from
Apple’s 3G UMTS products sale in the US market and the pro rata share of
Samsung’s SEPs to the total number of 3G UMTS SEPs, the amount of licensing
royalty generated by Samsung’s share of 3G UMTs SEPs will be significant in
amount. Thus, Samsung’s SEPs can play an important role in the potential
settlement negotiation with Apple.
For more information, please contact Alex Lee
at alexglee@techipm.com .
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