Samsung must post high bond if it loses a U.S. trade ruling
BY TODD SHIELDS & PETER BURROWS Bloomberg News
Tuesday, January 01, 2013
1/01/13 at 6:57 AM
Samsung Electronics Co. should post a bond equal to 88 percent of the value of smartphones found to infringe Apple Inc. patents if it loses a U.S. trade ruling and wants to keep selling the devices, a judge said.
U.S. International Trade Commission Judge Thomas Pender in October found that more than a dozen models of Samsung mobile phones, media players and tablet computers infringed patents on the iPhone and other Apple products.
Pender, in a recommendation posted Dec. 28 on the agency's website, said Samsung should face a ban on imports of the infringing products. Pender also specified bonds Samsung is to post if the full commission accepts his decision to ban imports and the company wants to keep selling the products during a 60-day period when President Barack Obama could overturn the ban.
"That's a high rate," Christopher Marlett, founder of MDB Capital, an intellectual-property consultancy, said in an interview. "With those economics, it will be difficult for Samsung to decide whether to sell the products at all."
The six-member trade commission is to finish its investigation by Feb. 25.
Samsung could try to avoid the bonds by changing product designs to address the dispute, and Apple could ask the commission to decide whether the new equipment still infringes its patents, Rodney Sweetland III, a lawyer with Duane Morris LLP in Washington who specializes in ITC cases, said in an interview.
Even if the commission were to order an import ban, it would probably give Samsung time to work around the patents to ensure there is no disruption to consumers and carriers, Sweetland said.
Samsung is battling Apple worldwide over smartphone and tablet-computer technology. Samsung lost a $1 billion jury verdict in August against Apple, based in Cupertino, Calif.
At stake is a market that Bloomberg Industries said grew 62 percent last year to $219 billion. Samsung has more than a quarter of global mobile-phone sales compared with Apple's 17 percent, though the iPhone has 34 percent of the U.S. market to Samsung's 18 percent, according to market researcher ComScore Inc.
Among tablet computers, Apple had about 70 percent of the market in the second quarter, compared with 9.2 percent for Samsung.
Original Print Headline: Samsung bond high if ruling is for Apple