The first Supreme Court case of the current term that involved intellectual property concerned the appropriate measure of damages in a design patent case. In Samsung Electronics Co., Ltd. v. Apple, Inc., ___ U.S. ___ (Dec. 6, 2016), the Supreme Court considered whether Apple was entitled to Samsung’s profits for infringing design patents relating to smartphones. The potential damages were enormous – $399 million.
Apple owned design patents that covered the design of an iPhone face and certain icons. The $399 million in damages represented Samsung’s profits from the sale of smartphones that included those features. In the U.S., design patent owners are entitled to additional statutory remedies when they prove infringement. The relevant statute, 35 U.S.C. § 289, states:
[w]hoever during the term of a patent for a design, without license of the owner, (1) applies the patented design, or any colorable imitation thereof, to any article of manufacture for the purpose of sale, or (2) sells or exposes for sale any article of manufacture to which such design or colorable imitation has been applied shall be liable to the owner to the extent of his total profit, but not less than $250, recoverable in any United States district court having jurisdiction of the parties.
Nothing in this section shall prevent, lessen, or impeach any other remedy which an owner of an infringed patent has under the provisions of this title, but he shall not twice recover the profit made from the infringement.
Id. (emphasis added).
The Supreme Court had to decide whether the relevant “article of manufacture” was a smartphone or the items specifically identified in Apple’s design patents (i.e., a rectangular front face with rounded edges and a grid of colorful icons on a black screen). The Court concluded that it was the latter, rather than the former. This finding is consistent with the current trend in patent law to award patentees with “proportional” damages.
As a result, the damage award was reversed, and the case was remanded to the lower courts to determine a new measurement of damages.
Thomas Joseph is a patent attorney in Pittsburgh, Pa. You can contact him at www.joseph-iplaw.com.