Apple patent claims stifling innovation; Japan court rules in favour of Samsung

Is Apple stifling innovation?

A US jury decision against Samsung and a Japanese court decision for the Korean conglomerate raise questions over the entire patent issue

WOULD anyone have expected the Apple-Samsung case to be decided in favour of Samsung by a US court in a jury verdict and against Apple, which is by now even more American than apple pie? I certainly didn’t.

But there is an appeal on the cards and it is still anyone’s guess if Apple will be allowed to claim such things as shape and “pinch to zoom out” as its right. But if it is, then that’s a big setback for other smartphones.

Samsung, however, scored a victory in a Tokyo court which ruled yesterday that the Korean electronics giant, and supplier to Apple, did not violate any patents. That victory will no doubt raise questions as to how fair the US jury was in making an award in favour of Apple, including US$1bil in damages.

The US decision means eventually consumers there may have to pay more for Apple’s iPhone, iPod and devices because others may not be able to emulate features that may have made their devices a success. That will have repercussions on prices elsewhere as well.

In the motor industry there have been many trends in shape over the years, moving from angular to rounded designs. If some car company had decided to sue every other car manufacturer for a similar look and feel and succeeded, car shapes may have had great difficulty evolving.

But the best manufacturers of cars did not. In fact some of them deliberately did not register safety patents just so that others could use the innovations to increase passenger safety.

If Samsung is said to have infringed on shape, then there are a number of other manufacturers who are in trouble too. Rectangular faces with rounded edges are a natural evolution in the mobile phone industry. Certainly, other manufacturers are going to hope there will be a reversal on appeal.

Apple did not invent the touch screen. Thus, it seems strange that it has a patent to “pinch to zoom” which is basically one way of many ways to use a screen. That’s like patenting a particular method of driving a car!

Apple has already followed up on its US victory, seeking an injunction to prevent Samsung from selling eight of its smartphones in the United States including some in the best-selling Galaxy range.

However, hearing of the injunction will only be in December and some of Samsung’s models may be phased out by then, which offers some consolation for Samsung.

Some US commentators view the case as a proxy war against another US company Google which makes the Android operating system used in Samsung, HTC and other smartphones.

An article in the San Francisco Chronicle says that the late Apple chief executive Steve Jobs was once a friend of Google’s co-founders but considered Google’s move into mobile a betrayal that demanded revenge.

“I’m going to destroy Android, because it’s a stolen product,” he told his biographer Walter Isaacson. “I’m willing to go thermonuclear war on this.”

But despite the nice rhetoric, revenge from the grave it is not. Apple’s strategy seems quite clear cut. Patent everything. Then tie up competitors in court if there is any semblance of product infringement and keep its competitive advantage intact as long as possible.

Reports put its profit margins on its iPhone at as high as 50%, a huge mark-up in a cutthroat market which it has been able to achieve by parlaying an excellent product with some very deft marketing and public relations.

That made it the biggest company in the world. Many would say that the product, however, is not necessarily the best anymore if ever it was, especially since competitors are fast catching up with their own nifty designs and features. And marketing and PR too – Galaxy is getting a name for itself and no doubt the cases around the world will help.

Thus it makes much economic sense for Apple to prolong this by any legal means it can for as long as possible. Does Apple care that it may be stifling innovation, raising costs and hurting consumers in the process?

Probably not. And why should it? It is a company based on the profit motive. But it needs to remember that all publicity is not good publicity and if it gets a reputation as a bully, its entire image and that of its products could change.

American companies can carry this patent thing too far and they have. Recall a few years ago when some of them tried to patent the production of pesticides from neem trees. For thousands of years, extracts from the leaves of the neem have been used for precisely that.

The American jury system cannot but be expected to favour a US icon such as Apple which is seen as brash, innovative and successful, the very image of the US itself. But that’s not going to be the case in the rest of the world. And even in the US, if learned judges make the decisions instead of a jury, the results may well be different.

Really, no one is going to benefit and there may well be detriment, if we allow patents to get the better of us and stifle innovation and hinder the development of new products and services at lower costs.
It would be a travesty of sorts and ironic indeed if Apple is now seen as a technology inhibitor instead. Beware!

A QUESTION OF BUSINESS By P. GUNASEGARAM starbiz@thestar.com.my

P Gunasegaram is an iPhone user but only because the service provider gave such a good deal.

 Japanese court rules for Samsung over Apple

In this Aug. 25, 2011 file photo a lawyer holds an Apple iPad and a Samsung Tablet-PC at a court in Duesseldorf, Germany. The Duesseldorf state court ruled Tuesday, Jan. 31, 2012, that neither the South Korean company‘s Galaxy Tab 10.1 nor the Galaxy Tab 8.9 could be sold in Germany because they were in violation of unfair competition laws. A German appeals court has upheld a decision prohibiting Samsung Electronics Co. from selling two of its tablet computers in Germany, agreeing with Apple Inc. that they too closely resemble the iPad2. (AP)

Samsung wins one battle in the multinational conflict over patent and innovation

By Jeong Nam-ku, Tokyo correspondent

A Japanese court has ruled in favor of Samsung over Apple in a patent lawsuit. In the August 31 verdict, Tamotsu Shoji, the Tokyo District judge, declined Apple’s claim that “8 models of Samsung Galaxy series infringed on Apple’s patents.”

Apple had sued Samsung for infringing on its synchronization of music and other data with remote servers. It asserted that “Samsung’s products use Apple’s technologies of synchronization, which constitutes patent infringement,” and demanded both compensation of 100 million Japanese Yen (around US$1.27 million) and a block on eight Samsung products.

According to Jiji Press, judge Tamotsu stated, “Samsung’s products are technologically distinct from Apple and can’t be considered infringements.”

As a first trial, this does not hold much importance beyond being an indication of what the final verdict might end up being. However, because the verdict ordered a ‘dismissal’ on Apple’s injunction, there is only a slight possibility for an overturn in the final verdict.

Apple has also sued Samsung for infringing on its ‘bounce back (technology that springs back when the document has reached the end)’ patent, a claim that is still ongoing.

This verdict is the first ruling out of the 9 lawsuits Apple and Samsung Electronics have against each other. Samsung also filed lawsuits against Apple in April and October of 2011, arguing that Apple also infringed on 6 of Samsung’s patents.

Samsung and Apple have ongoing lawsuits in different 10 countries. In the US, a judge ruled that Samsung had infringed Apple patents, ordering the Korean electronics giant to pay $1.05 billion in damages.  

Translated by Yoo Hey-rim, Hankyoreh English intern

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Apple's rot starts with its Samsung lawsuit win

Just like Microsoft, Apple's evolution from smart tech company to global uber-brand contains the seeds of its own destruction

The risk for Apple is that it focuses more and more on intellectual property rights – filing patents and litigating – than it does on product innovation. Photograph: Ahn Young-Joon/AP

Apple came close to destroying its business in the late 1980s by pursuing a suit against Microsoft claiming that Windows infringed the look and feel of the Mac desktop metaphor. Apple focused its hopes and business future on this lawsuit, while its market share dwindled. Rather than competing, it litigated. And lost.

Last week, it litigated against Samsung over its iPhone design and won.

The first justifiable conclusion might be that big companies get their way. The second might reasonably be that Apple doesn't change much: its business model remains aggressive self-righteousness. The third is what everybody knows: patent rules and philosophy are all screwed up.

As for the first point, Apple is not just a big company, but the biggest. And it is not just the biggest American company, but the most American company. It has entered a rarefied brand status in which it is now almost synonymous with American virtue: American as Apple. Its good design sense has become a major point of American pride, if not nationalism.

The brand is a national asset. Apple is AT&T in its pre-break-up from; it's GM, in its what's-good-for-General-Motors-is-good-for-the-country stage; it's United Fruit when it made US foreign policy; it's Microsoft when desktop computing was transforming the world.

 Commercial omnipotence

This is about as close to commercial omnipotence as it gets. Its unassailability, its right to be preternaturally aggressive, is built into its share price. We believe in Apple. So let us briefly consider the chance for a Korean company defending itself against (or, perish the thought, challenging) the greatest American company of the age in the eyes of an American jury.

And then, there's the self-righteousness. Apple is one of the most aggressive intellectual property litigators of all time. Its major moves have not been about protecting precise technical innovations, but about claiming the much softer zone of look and feel.

It sues for brand rather than engineering. It has pioneered a new modern sensibility: taste is what's most valuable; identity is king. It's sued about the lower case "i"; it's sued about the word "pod"; it's sued New York City over the "big Apple"; it's sued over using the words "app store".

This fierce defensiveness might be rightly understood in a psychological sense: Apple itself is based on stolen iconography. There was first the Beatle's Apple and there was Xerox PARC's desktop design.

Apple's self-righteousness masks its guilt. (It may be sheepish, too, about being more of a marketing organization than a technology company.) What's more, it knows better than anybody that if you relax your vigilance, somebody can easily walk off with what you've done – and improve it.

And then, in the algebra of Samsung's loss and Apple's victory, there's patent hell. Or absurdity.

 System of litigation

Patents are, arguably, no longer a system of protection; they are a system of litigation. Great numbers of patents are now filed, in an over-burdened system, to protect not innovations but the right to litigate over innovations. Indeed, any patent of value will ultimately be litigated.

What's more, as the system has become ever more over-taxed, as technology itself has become more complex, the ill-equipped and under-trained bureaucracy has increasingly taken to giving patents to wide-ranging abstractions.

Design concepts, behavior adjustments, and new approaches to problem solving are all patentable innovations. The system itself assumes that litigation is the check on the system. Which means, fundamentally, that the litigant with the most resources and greatest status wins.

But let us not argue the case that all this quite obviously impedes innovation and is part of a new unreal property land grab – not about technology at all, but about intellectual property: an effort to privatize much of what was once understood to be shared and public (indeed, not ownable, like the shape of the iPhone). But rather, for a moment, let's look at this as a form of hubris that has inevitable consequences.

The Apple that has won against Samsung is the same Apple that lost against Microsoft. In other words, it is the kind of company that, through sheer willfulness, discipline, and perfectionism, can achieve brand hegemony of a singular type. But it is, too, the kind of company – the exact sort of company – that becomes, perhaps inevitably becomes, the bete noire of consumerists, regulators and, of course, most of all, its competitors.

This is the story between the lines of its great victory and its further share price surge. On the one hand, there is this seemingly golden company. On the other hand, there is anybody with any sense of history knowing this is going to end badly.
  
American capitalism

Companies that acquire the nation's imprimatur often, if not invariably, over-reach. It is a characteristic of American capitalism: the price of getting really big and overbearing is that you incur an inverse reaction. In the early 1990s, an ambitious department of justice (a Republican administration DOJ at that) commenced its assault on Microsoft.

For better or worse, by the time the feds were finished, the company, with its rotten operating system, besieged and beleaguered, had become just one of many not-very-adept players in the space – an unimaginable outcome if you remember the once God-like power and scorched-earth wrath of Microsoft.

Apple, and its rotten phone, have a ways to go. But karma should not be underestimated as a factor in this game.

• • By Michael Wolff
  • guardian.co.uk

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Apple wins $1bn in US while Samsung wins in Korea; it may reshape the free Google Android system

Apple won more than $1 billion in a massive victory Friday over South Korean giant Samsung, in one of the biggest patent cases in decades—a verdict that could have huge market repercussions.

A jury in San Jose, California rejected Samsung's counterclaims against Apple, according to media reports—a big win for the Silicon Valley giant, which had claimed its iconic iPhone and iPad had been illegally copied.

Samsung Electronics' Galaxy S III, right, and Apple's iPhone 4S are displayed at a mobile phone shop in Seoul, South Korea. (Ahn Young-joon/Associated Press)

The jury, which had examined infringement claims and counter-claims by Apple and Samsung, ruled the South Korean electronics giant had infringed on a number of patents, the tech websites Cnet and The Verge said in live courtroom blogs.

The verdict affects patents on a range of Samsung products including some of its popular Galaxy smartphones and its Galaxy 10 tablet—devices alleged to have been copied from the iPhone and iPad.

"This is a huge, crushing win for Apple," said Brian Love, a professor of patent law at Santa Clara University.

"All of its patents were held valid, and all but one were held to be infringed by most or all accused Samsung products. Even better for the company, five of the seven patents were held to be willfully infringed by Samsung."

Love said this means that Judge Lucy Koh "now has the discretion to triple Apple's damages award, which is already a monstrous and unprecedented $1.051 billion."

Technology analyst Jeff Kagan said of the verdict: "This is a great day for Apple. And it will turn into a very expensive day for Samsung."

Kagan said it was not immediately clear if Samsung would be able to continue to use the technology and pay Apple for the right to do so, or if they must pull their devices and redesign them.

In any case, the verdict in the case—one of several pending in global courts—is likely to have massive repercussions in the hottest part of the technology sector, smartphones and tablets.

Even a delay in sales could endanger Samsung's position in the US market, where it is currently the top seller of smartphones.

A survey by research firm IDC showed Samsung shipped 50.2 million smartphones globally in the April-June period, while Apple sold 26 million iPhones. IDC said Samsung held 32.6 percent of the market to 16.9 percent for Apple.

The jury reached its verdict after deliberating for less than three days, examining claims of infringement by both sides. The trial heard evidence during 10 days over a three-week period.

Samsung had steadfastly denied the charges by Apple, claiming it developed its devices independently, and countersued in the case, seeking more than $400 million for infringement on its wireless patents.

The verdict came the same day a South Korean court ruled Apple and Samsung infringed on each other's patents on mobile devices, awarding damages to both technology giants and imposing a partial ban on product sales in South Korea.

The court banned sales in South Korea of Apple's iPhone 4 and iPad 2, as well as Samsung's Galaxy S and Galaxy SII among other products. (c) 2012 AFP

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Apple wins U.S. patent battle against Samsung

 

 Apple headquarters in Cupertino, Calif. A U.S. jury has ruled for Apple in its huge smartphone patent infringement case involving Samsung. (Paul Sakuma/Associated Press)

After a year of scorched-earth litigation, a jury decided Friday that Samsung ripped off the innovative technology used by Apple to create its revolutionary iPhone and iPad.

The jury ordered Samsung to pay Apple $1.05 billion. An appeal is expected.

Apple Inc. filed its patent infringement lawsuit in April 2011 and engaged legions of the country's highest-paid patent lawyers to demand $2.5 billion from its top smartphone competitor. Samsung Electronics Co. fired back with its own lawsuit seeking $399 million.

The verdict, however, belonged to Apple, as the jury rejected all Samsung's claims against Apple. Jurors also decided against some of Apple's claims involving the two dozen Samsung devices at issue, declining to award the full $2.5 billion Apple demanded.

However, the jury found that several Samsung products illegally used such Apple creations as the "bounce-back" feature when a user scrolls to an end image, and the ability to zoom text with a tap of a finger.

As part of its lawsuit, Apple also demanded that Samsung pull its most popular cellphones and computer tablets from the U.S. market. A judge was expected to make that ruling at a later time.

After the verdicts were read, the judge sent the jury back to deliberate further on two inconsistencies involving about $2.5 million in damages awarded to Apple based on products jurors found didn't infringe Apple's patents. Those deliberations were continuing.

'Crisis of design'

During closing arguments at the trial, Apple attorney Harold McElhinny claimed Samsung was having a "crisis of design" after the 2007 launch of the iPhone, and executives with the South Korean company were determined to illegally cash in on the success of the revolutionary device.

Samsung's lawyers countered that it was simply and legally giving consumers what they want: Smart phones with big screens. They said Samsung didn't violate any of Apple's patents and further alleged innovations claimed by Apple were actually created by other companies.

'Today's verdict should not be viewed as a win for Apple, but as a loss for the American consumer. It will lead to fewer choices, less innovation, and potentially higher prices.'—Samsung statement

Samsung responded to the verdict in a statement issued from its Seoul headquarters, saying it was "unfortunate that patent law can be manipulated to give one company a monopoly."

"Today's verdict should not be viewed as a win for Apple, but as a loss for the American consumer. It will lead to fewer choices, less innovation, and potentially higher prices," Samsung said.

Samsung has emerged as one of Apple's biggest rivals and has overtaken Apple as the leading smartphone maker. Samsung's Galaxy line of phones run on Android, a mobile operating system that Google Inc. has given out for free to Samsung and other phone makers.

Samsung conceded that Apple makes great products but said it doesn't have a monopoly on the design of rectangle phones with rounded corners that it claimed it created.

'Thermonuclear war' on Android

Google entered the smartphone market while its then-CEO Eric Schmidt was on Apple's board, infuriating Apple co-founder Steve Jobs, who considered Android to be a blatant rip off of the iPhone's innovations.

After shoving Schmidt off Apple's board, Jobs vowed that Apple would resort to "thermonuclear war" to destroy Android and its allies.

The trial came after each side filed a blizzard of legal motions and refused advisories by U.S. District Judge Lucy Koh to settle the dispute out of court. Deliberations by the jury of seven men and two women began Wednesday.

Apple and Samsung combined account for more than half of global smartphone sales. Samsung has sold 22.7 million smartphones and tablets that Apple claimed uses its technology. McElhinny said those devices accounted for $8.16 billion in sales since June 2010.

Identical look and feel

From the beginning, legal experts and Wall Street analysts viewed Samsung as the underdog in the case. Apple's headquarters is a mere 16 kilometres from the San Jose courthouse, and jurors were picked from the heart of Silicon Valley where Jobs is a revered technological pioneer.

Samsung Electronics' Galaxy S III, right, and Apple's iPhone 4S are displayed at a mobile phone shop in Seoul, South Korea. (Ahn Young-joon/Associated Press)

While the legal and technological issues were complex, patent expert Alexander I. Poltorak previously said the case would likely boil down to whether jurors believed Samsung's products look and feel almost identical to Apple's iPhone and iPad.

To overcome that challenge at trial, Samsung's lawyers argued that many of Apple's claims of innovation were either obvious concepts or ideas stolen from Sony Corp. and others. Experts called that line of argument a high-risk strategy because of Apple's reputation as an innovator.

Apple's lawyers argued there is almost no difference between Samsung products and those of Apple, and presented internal Samsung documents they said showed it copied Apple designs. Samsung lawyers insisted that several other companies and inventors had previously developed much of the Apple technology at issue.

Global patent war

The U.S. trial is just the latest skirmish between the two tech giants over product designs. Apple and Samsung have filed similar lawsuits in eight other countries, including South Korea, Germany, Japan, Italy, the Netherlands, Britain, France and Australia.

• Samsung wins Korean battle in Apple patent war

Samsung won a home court ruling earlier Friday in the global patent battle against Apple. Judges in Seoul said Samsung didn't copy the look and feel of the iPhone and ruled that Apple infringed on Samsung's wireless technology.

However, the judges also said Samsung violated Apple's technology behind the feature that causes a screen to bounce back when a user scrolls to an end image. Both sides were ordered to pay limited damages.

The Seoul ruling was a rare victory for Samsung in its arguments that Apple has infringed on its wireless technology patents. Samsung's claims have previously been shot down by courts in Europe, where judges have ruled that Samsung patents were part of industry standards that must be licensed under fair terms to competitors.

The U.S. case is one of some 50 lawsuits among myriad telecommunications companies jockeying for position in the burgeoning $219 billion market for computer tablets and smartphones. - The Associated Press

Apple patent win may reshape sector

WASHINGTON — Apple's decisive victory in a landmark US patent case against Samsung could reshape the hot sector for mobile devices and slow the momentum of Google and its Android system, analysts say.

Apple won more than $1 billion in the case Friday, after a California jury found the South Korean electronics giant infringed on dozens of patents held by the iPhone and iPad maker.

Although Google was not a party in the case, it makes the Android operating system which was central to the case -- a system which Apple's late co-founder Steve Jobs called a "stolen" product.

Apple has been battling as Samsung and other manufacturers of the free Android system eat away at its market share in the sizzling market for smartphones and tablet computers.

"I think this will force a reset on Android products as they are reengineered to get around Apple's patents," said Rob Enderle, a technology analyst and consultant with the Enderle Group.

But Enderle said other companies may benefit from the decision, including Microsoft, which has been lagging in the mobile sector, and Blackberry maker Research in Motion, which has been hit hardest by the rise of Android devices.

The court ruling, said Enderle, "should provide a stronger opportunity for both of Microsoft's new platforms -- Windows 8 and Windows Phone 8 -- because they come with indemnification against Apple, suddenly making them far safer and possibly a faster way to get product to market."

The decision also "will make RIM far more attractive as an acquisition because RIM's patents are thought to be strong enough to hold off Apple," Enderle said.

"Both Samsung and Google may make a play for the company, and both Microsoft and Apple may move to block them."

In recent months, Android devices have grabbed more than 50 percent of the US smartphone market to around 30 percent for Apple, while RIM's shares have slid to around 12 percent.

The patents at play include software such as the "bounceback" feature for smartphone users when scrolling and pinch-zooming, which are featured on Android devices.

Florian Mueller, a consultant who follows patent and copyright issues, said Friday's court ruling was "a huge breakthrough."

"The jury essentially concluded that Samsung is a reckless copycat and, since some of the infringement is Google's responsibility, basically agreed with Steve Jobs's claim that Android is a stolen product," he wrote on his blog.

Still, a lot hinges on what happens next in court, with the case likely to be tied up in appeal for some time.

Judge Lucy Koh set a September 20 hearing where she will consider whether to overturn or modify the jury verdict, whether to impose "punitive" damages which would triple the award and whether to issue injunctions against Samsung.

A critical factor will be whether Apple will be able to obtain a permanent injunction, or halt in sales on infringing Samsung devices, and whether this would be enforced during the appeal.

Dennis Crouch, a University of Missouri patent law specialist, said the judge will have broad discretion.

"Some courts have issued broad injunctions that essentially say 'stop infringing the patent,' others issue much more narrow orders directed only toward the particular products that are adjudged to infringe," Crouch said on his blog.

"The reality is that Samsung has been planning for the likelihood of injunctive relief and is surely ready to stop selling any of the infringing products and replace those products with ones that at least have not yet been adjudged as infringing."

This could lead to more legal battles, since Apple has another lawsuit pending on Samsung's newer handheld devices.

Samsung has pledged to keep fighting the case, and said that if it stands "it will lead to fewer choices, less innovation, and potentially higher prices."

Samsung called it "unfortunate that patent law can be manipulated to give one company a monopoly over rectangles with rounded corners, or technology that is being improved every day by Samsung and other companies."

Analysts say that aside from Samsung, Google could be the big loser, especially if Apple pursues its litigation against other manufacturers.

"Google cannot stop Apple. It is now on the run and will have to scramble to make software changes to Android," Mueller said.

"In a few years, the San Jose jury verdict may -- I repeat, MAY -- be remembered as the tipping point that sent Android on a downward spiral."

By Rob Lever (AFP)

Samsung wins Korean battle in Apple patent war

South Korean electronics giant Samsung has earned a rare victory in its global court battle with rival Apple. (Bruce Bennett/Getty Images )

 

 Samsung wins 1st round2:51

South Korea's Samsung won a home court ruling in its global smartphone battle against Apple on Friday when Seoul judges said the company didn't copy the look and feel of the U.S. company's iPhone, and that Apple infringed on Samsung's wireless technology.

However, in a split decision on patents, the panel also said Samsung violated Apple technology behind the bounce-back feature when scrolling on touch screens, and ordered both sides to pay limited damages.

The Seoul Central District Court ruling called for a partial ban on sales of products including iPads and smartphones from both companies, though the verdict did not affect the latest-generation phones — Apple's iPhone 4S or Samsung's Galaxy S3.

The ruling affects only the South Korean market, and is part of a larger, epic struggle over patents and innovation unfolding in nine countries. The biggest stakes are in the U.S., where Apple is suing Samsung for $2.5 billion over allegations it has created illegal knockoffs of iPhones and iPads.

Wide-ranging dispute

The Seoul ruling was a rare victory for Samsung in its arguments that Apple has infringed on its wireless technology patents, which previously have been shot down by courts in Europe where judges have ruled that they are part of industry standards that must be licensed under fair terms to competitors.

"This is basically Samsung's victory on its home territory," said patent attorney Jeong Woo-sung. "Out of nine countries, Samsung got the ruling that it wanted for the first time in South Korea."

The ruling ordered Apple to remove the iPhone 3GS, iPhone 4, iPad 1 and iPad 2 from store shelves in South Korea, ruling that the products infringed on two of Samsung's five disputed patents, including those for telecommunications technology.

The court also denied Apple's claim that Samsung had illegally copied its design, ruling that similar rectangular screens with rounded corners had existed in products before the iPhone and iPad.

"Based on the similarity in these features, it is not possible to assert that the two designs are similar," the court said in a ruling issued in Korean that was translated into English by The Associated Press. It also said individual icons do not appear similar to the icons Apple used in the iPhone.

But the court ruled that Suwon, South Korea-based Samsung had infringed on one of Apple's patents on the feature that causes a screen to bounce back when a user scrolls to an end image. The court banned sales of Samsung products using the technology, including the Galaxy S2, in South Korea.

Products removed

Court spokesman Kim Mun-sung said the court's ruling was to take effect immediately, although companies often request that sanctions be suspended while they evaluate their legal options.

Nam Ki-yung, a spokesman for Samsung, said the company welcomed the ruling. "Today's ruling also affirmed our position that one single company cannot monopolize generic design features," he said.

Apple did not respond to multiple calls seeking comment.

The court also ordered each company to pay monetary compensation to its competitor. Samsung must pay Apple 25 million won ($22,000) while Apple must pay its rival 40 million won.

South Korea is not a big market for Apple, and the ruling is not likely to have a big impact on jury deliberations in the U.S.

However, some industry watchers expressed concern over the South Korean ruling to protect industry standard patents. They say the decision could invite a trade war by giving Samsung and fellow South Korean company LG — both industry standard patent holders — more room to block rivals' entrance into South Korea if they don't agree to licensing terms.

"It would mean that foreign companies would either have to bow to Samsung's and LG's demands ... or stop selling in Korea," said Florian Mueller, a patent expert in Munich, Germany who has been closely following the case.

Courts in Europe, including Netherlands, France, Italy and Germany have rejected similar claims by Samsung that Apple violated its wireless patents, with judges arguing that the patents have become part of industry standards. Standard-essential patents are a crucial technology for new players to make products compatible with the rest of the market and must be licensed under fair and reasonable terms.

Case continues elsewhere

Europe's anti-trust regulator launched an investigation earlier this year into whether Samsung was failing to license those patents under fair and reasonable terms.

In Friday's ruling, the South Korean court said Samsung did not abuse its market power as an industry standard patent holder.

Apple filed suit against Samsung in San Diego, California, in April 2011, alleging that some of the South Korean company's smartphones and computer tablets are illegal knockoffs of Apple's iPhone and iPad. Samsung denies the allegations and argues that all companies in the cutthroat phone industry mimic each other's successes without crossing the legal line.

Cupertino, California-based Apple is suing Samsung for $2.5 billion and demanding that the court pull its most popular smartphones and computer tablets from the U.S. market, making the case one of the biggest technology disputes in history.

Jury deliberations in San Diego began Wednesday after three weeks of testimony. The case went to the jury after last-minute talks between the companies' chief executives failed to resolve the dispute.

Shortly after Apple filed its suit in the U.S., Samsung filed a complaint in South Korea against Apple for allegedly breaching its telecommunications patents.

The battle is all the more complex as Apple and Samsung are not only competitors in the fast-growing global market for smartphones and tablet computers, but also have a close business relationship.

Samsung, the world's biggest manufacturer of memory chips and liquid crystal displays, supplies some of the key components that go into Apple products, including mobile chips that work as a brain of the iPhone and the iPad.

The South Korean firm overtook Apple in less than three years in smartphone markets. In the second quarter of this year, Samsung sold 50.2 million units of smartphones, nearly twice as much as Apple's 26 million units, according to IDC. - The Associated Press

Chinese Tech Billionaire To Launch Next Xiaomi Smartphone

All will be revealed (Photo credit: Wikipedia)

Chinese smartphone startup Xiaomi has confirmed that it will unveil its new model in Beijing on Aug. 16, a year after the launch of its debut MI-1. The Android-based phone has sold over 3 million units and put Xiaomi and its billionaire cofounder Lei Jun on the global smartphone map. A Xiaomi spokesman refused to discuss the phone’s features, telling FORBES that all would be revealed on Aug. 16. A report on Sohu.com last week claimed that the new phone would use a Qualcomm quad-core 1.5GHz chip with a 4.3″ display touchscreen. Interestingly, Xiaomi may be raising its price to RMB2,499 ($392), compared to RMB1,999 for the first-generation phone. Lei initially told reporters that he didn’t expect to make a profit from handset sales, but surging shipments upended that calculation and boosted Xiaomi’s valuation to $4 billion in a recent funding round. You can read my profile of Lei here.

In a research note, Brian White of Topeka Capital Markets notes that Xiaomi recorded $995 million in sales for 1H 2012 and that China’s smartphone market continues to post rapid growth.

During our travels to China, we have noticed a surge in the popularity of Xiaomi smartphones and already the Company is a top-five vendor at a leading service provider in the country. The Company’s smartphones seem to be especially popular with the younger crowd due to their cutting edge design with high- energy color patterns.

Photos of Xiaomi’s new phone’s eco-packaging, though not what’s inside the box, have been posted to Lei’s microblog. Lei is famous for Steve Jobs-style product presentations that play to his geek fans in China (and infuriate his detractors). He will be out to prove that Xiaomi hasn’t sat still over the last year but is building a better phone with an integrated software experience for users. However, a jump to RMB2,499 would be a bold step, as smartphone prices in China are heading the other way, i.e. cheaper and cheaper. Apple and Samsung occupy the top rungs of smartphone chic, where a high sticker price doesn’t deter avid buyers. Xiaomi wants to carve out a mid-tier position where its brand carries weight. Its new phone will be a crucial part of that strategy.

By Simon Montlake, Forbes Staff

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