Apple argues that its products are only worth 20% of their value
Europe is still the main battle field in the global patent war. Samsung tried to get the iPhones off the market but failed to do so. However Apple argued that others offered similar phones at 20% of their price so that royalties for 3G/UMTS should be based on this lower amount.
The war on patents is a global one so there are many courts looking at the cases between the main players in the industry. The Netherlands is an important battle field as the location as an import harbor for Europe makes it strategic and Samsung and Apple decided last year to present the full package of cases against each other in that country.
If it confuses you, don´t worry, everyone except some experts lost track of the multiple court cases. Germany has been dominating the news last year, but that´s mainly because you can get a quick, temporary decision there. It was there that Samsung was forced to remove its Galaxy 10.1 tab from the market. A strike which was quickly countered by a new Samsung model, which had some very small design changes. Apple encountered a large setback in that same Germany as it had to withdraw all its cloud services from the German market. No push email, no iCloud the moment your Apple device enters German soil, not even when you´re just visiting.
Yesterday the real court case, the bottom procedure, between Samsung and Apple started in Amsterdam, the Netherlands. It involves the ´standards essential´ patents Samsung holds on 3G/UMTS technology. The quintessence is that holders of these patents always need to offer fair and reasonable pricing to all parties who want a license.
Apple argues that it already has a license because they are using 3G/UMTS in their products. The court found it a funny reasoning and didn´t agree. That you violate a patent by using it doesn´t give you an implicit agreement. A verdict every reader will agree with but Apple lawyers have nevertheless pushed hard to get this argument accepted.
If that was not accepted, Apple argued, then they should pay the license fee (undisclosed in the public court verdict) over the ´real value´ of the products. Why would they pay x % to be able to use the essential standards without which no phone can operate over their high prices while competitors just pay the same x% and offer similar phones at 20% of Apple´s prices. I kid you not, these were Apple´s arguments, not some Android fan arguing Apple uses ridiculously high prices.
Apple went on stating that this 20% was also reflected in the price of their non-3G products. The court has accepted this statement as ´not completely unreasonable so worth further considerations´. It made us wonder where we can find a iPad without 3G at 20% of the price?
The first round was concluded by the verdict that Apple seems to be willing to negotiate making an immediate sales stop overkill and that anyway the whole issue only deals with the pre-4s models as the new Broadcom chip in use by Apple has a Samsung license.
To be continued when the court deals with the real merits of the case. For the moment they turned down Samsung´s request to stop all sales of iPhones and iPads with the Samsung technology. That doesn´t mean Apple can´t be ordered in a next phase to start paying Samsung for the violation of these patents.
Are you bored by all the patent news or are ordering new popcorn and watch the global fight with amusement?
Further reading:
Dutch court verdict original (in Dutch): http://zoeken.rechtspraak.nl/detailpage.aspx?ljn=BV8871&u_ljn=BV8871
Author: Max Huijgen
