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Scope Set for Apple-Samsung Damages Retrial
Apple wants to proceed quickly. So it goes without saying, Samsung wants to move slow.
The two tech companies have been feuding over the timing and scope of a new damages trial mandated by U.S. District Judge Lucy Koh in her order slashing the jury's $1.05 billion jury award based on legal errors.
At a hearing Monday Koh made her position clear: A new trial will proceed promptly, limited to the same evidence and same legal theories on damages as the first trial.
"This is going to be Groundhog's Day," Koh said, referring to last year's jury trial. "You're going to be reliving July of 2012."
Koh set a trial date of Nov. 12, rejecting Samsung's proposal to delay a new damages trial and certify a partial final judgment as to 14 Samsung products for which damages were upheld. A separate 12-day trial on additional patent infringement claims between Apple Inc. and Samsung Electronics Co. is set for trial March 31, 2014.
Koh's exasperation over the scorched earth strategies of both companies in patent litigation over their popular smartphones and tablets was clear, as she repeatedly threatened to put off the damages trial indefinitely unless the companies would commit to a narrow retrial.
"No one is going to get a do-over in this case." Koh said. "I just want to do a very limited retrial on damages on all of the old information and then have this go up to the Federal Circuit."
In a March 1 order, Koh struck $450.5 million from the jury's award and ordered a new trial to calculate proper damages against Samsung for 14 products. Koh's ruling let stand the jury's verdict of $599 million with respect to 14 other Samsung products. On Monday she reversed her order as to one Samsung phone, handing $40.5 million back to Apple.
Koh had encouraged the companies to seek appellate review before a new damages trial but the adversaries agreed an appeal of the order wasn't legally possible.
It was a rare point of accord; the companies differed as to what issues should be decided in a new jury trial and to the impact of ongoing reviews by the U.S. Patent and Trademark Office.
To make the post-trial proceedings even more complicated, Apple needs to find a new witness to replace its damages expert, Terry Musika, who died of cancer in December.
The two companies bickered at Monday's hearing over how much latitude Apple's lawyers at Morrison & Foerster and Wilmer Cutler Pickering Hale and Dorr should have in finding a substitute for Musika.
Koh insisted the new expert be an accountant like Musika and adopt Musika's findings as closely as possible. Apple must identify its expert by May 13.
Apple secured a prompt trial on damages over objections from Samsung's lawyers at Quinn Emanuel Urquhart & Sullivan, who urged Koh to enter a partial final judgment as to those products for which damages were upheld and stay further proceedings. That approach would allow for guidance from the U.S. Court of Appeals for the Federal Circuit, Quinn partner Kathleen Sullivan argued, and promote judicial economy.
"If we win in the circuit or lose in the circuit we're bound by whatever the circuit says on those issues," Sullivan said. "That would instantly simplify the second trial."
Arguing for Apple, MoFo partner Michael Jacobs said certifying a partial final judgment under Rule 54(b) was improper and would delay resolution.
"We want to get a final appealable verdict on all the issues to be decided and we want it as promptly as we can," Jacobs said. "Anything that is done to delay that is prejudicial to Apple."
Koh agreed the matter would not be ripe for appeal until all of Apple's claims against Samsung are decided as to validity, liability and remedy.
"Entering judgment now may just lead to further delay," she said.
The scrap between Apple and Samsung involved more than timing.
Koh rejected a claim from Samsung's lawyers that the new damages trial should also address liability for the products at issue to pass constitutional muster. The Federal Circuit routinely remands cases for new trials on damages alone, she remarked, and scolded Samsung for not directly raising the issue in post-trial motions.
"You only requested a new trial on damages in your JMOL motion. You never said a new trial on liability," she said. "It seems awfully sneaky."
Koh put off for later consideration the specifics of how the next jury will be informed of the first jury's findings.
"We do have to figure out some way to tell the jury without retrying the first case," said William Price, a Quinn Emanuel partner based in Los Angeles.
Also put off for a later date is whether ongoing proceedings before the PTO should affect the damages trial. The agency is re-examining Apple patents that relate to the "bounce-back" and "pinch-to-zoom" features of its iPhones and iPads. Koh denied a motion to stay the case as to those patents but suggested a final determination that either patent is invalidated might change her mind.
As for the death of Apple's expert, Samsung was on alert for any sign of unfair advantage.
"Apple is getting a brand new expert. Apple's methodology and report will necessarily change," said Quinn partner Victoria Maroulis. "We simply cannot be put in a straitjacket."
That's when Koh extracted promises from Apple's counsel to hew as closely as possible to their first expert report. The judge said she could foresee a "horrible scenario" with Apple seeking advantage and Samsung filing aggressive motions to strike the new expert reports.
"If that is going to happen, then I will postpone this trial," Koh said, adding her objective was speedy resolution.
"It's going to be limited to the same evidence that was before the jury of 2012," Koh said. "Once this is resolved you can take all of it up to the Federal Circuit."
This article originally appeared in The Recorder.