WASHINGTON — The U.S. Supreme Court Tuesday unanimously sided with Samsung in the South Korea company’s acrimonious, five-year patent infringement battle with Apple, tossing out a ruling that Samsung must pay Apple nearly $400 million.
The high court sent the case back to the U.S. Court of Appeals for the Federal Circuit for review.
The federal circuit court had ruled Samsung must pay Apple $399 million in damages for infringing on design patents for iPhone’s rounded corners, surface and grid of colorful app icons. The lower court based the decisions on a federal law stipulating that any company that infringes a patent design to “any article of manufacture” is liable “to the extent of his total profit.”
Samsung, which does not dispute it infringed on the patents, argued it should have to pay only the portion of profits derived from the iPhone features it copied in its 11 not smartphones, including the Galaxy, helping cattapult Samsung to the world’s top smartphone maker.
The federal circuit court, upholding two lower court rulings in favor of Apple, erred in ruling the entire smartphone was the “article of manufacture,” requiring Samsung to pay damages based on total profits from the 11 smartphones, Justice Sonia Sotomayor wrote in the 8-0 opinion.
“The term ‘article of manufacture’ is broad enough to embrace both a product sold to a consumer and a component of that product, whether sold separately or not,” Sotomayor wrote. “Thus, reading ‘article of manufacture’ … to cover only an end product sold to a consumer gives too narrow a meaning to the phrase.”
Samsung attorney Kathleen Sullivan had told the court in October that Apple deserves only the portion of profits attributable to the features.
“A smartphone is smart because it contains hundreds of thousands of the technologies that make it work,” she said.
Apple spokesman Josh Rosenstock said in a statement, “We remain optimistic that the lower courts will again send a powerful signal that stealing isn’t right.”
Samsung in 2011 did not immediately comment.
Tech giants including Google, Dell and Facebook have lined up in support of Samsung, arguing in a brief an Apple victory would have a “devastating impact” on investment in tech products.
But designers like Calvin Klein, Adidas and Tiffany & Co. counter that design patents protect against piracy, and industrial design experts warned design rip-offs often mislead consumers into thinking copycat products are the same as the originals.
Cupertino, Calif.-based Apple sued Samsung in 2011, and Samsung initially had faced nearly $1 billion in penalties, before the amount was reduced.
This marks the first patent design case before the court in more than 120 years.