Apple Sticks to Winning Script in Samsung Damages Retrial

Apple Inc. (AAPL)’s do-over trial on what Samsung Electronics Co. owes for infringing patents is supposed to be “Groundhog Day,” according to the judge overseeing the case. Apple is doing its part to make good on her plan.

Harold McElhinny, who was Apple’s lead attorney when it won a $1.05 billion verdict against its Suwon, South Korea-based rival last year, stood in front of a new jury yesterday in the same San Jose, California, courtroom in a bid to recoup most of the 39 percent chunk of the award the judge cut in March.

Sticking to the script that won Apple its 2012 verdict, the year’s second-largest in the U.S., McElhinny started by showing jurors the video clip played at the original trial of Apple co-founder Steve Jobs introducing the iPhone at a 2007 conference. McElhinny recited the same Samsung internal e-mails that he touted at the first trial. The first witness he called was also a repeat from 2012.

Recycling characters and props was, in part, the judge’s idea. U.S. District Judge Lucy Koh, who found that the original verdict was flawed because jurors miscalculated the period that the infringement occurred for some of the 28 Samsung devices covered by the trial, told lawyers in April that the damages retrial should contain “nothing new” and should feel like the experience of the 1993 Bill Murray film about a weatherman who repeatedly relives the same day.

Global Battle

Groundhog Day in San Jose is the latest chapter in a global battle for dominance of the smartphone market in which the companies have spent hundreds of millions of dollars in legal fees on claims of copying each other’s features. Apple, which initiated the legal fight in 2011, is seeking to limit the Galaxy maker’s increasing share of the U.S. market, where Cupertino, California-based Apple is No. 1 and Samsung No. 2.

Much of today’s testimony came from an accountant called by Apple as an expert witness on damages to replace an accountant who died last year. The day concluded with another witness from the 2012 trial: Philip Schiller, Apple’s senior vice president of worldwide marketing, who Apple is relying on to convince jurors of the risk the company took developing the iPhone, and by extension, how much it deserves to be remunerated for taking chances.

Apple took “huge risks” pursuing a “bet-the-company product” in the iPhone, in part because it had never made a phone before, Schiller said.

Jobs Presentation

Apple again revisited the 2007 Jobs presentation through Schiller, who recounted how the then-chief executive officer phoned him while on stage to demonstrate the new device. In one more echo from the 2012 trial, Schiller described the “huge” press reaction.

“The whole world had been waiting for this announcement,” he said. Media reaction ranged from those who were “blown away” to others who said the iPhone was “a mistake, that we’d fall on our face,” he said. The trial continues tomorrow with Schiller’s testimony.

The judge instructed the jury at the outset to assume that the Samsung infringed five Apple patents. Koh told the the panel of six women and two men its “sole job” in the retrial is to determine the amount of damages Samsung must pay for infringing Apple patents in 13 of its devices.

$3.5 Billion

Koh cut $410.5 million from the original award. McElhinny, of Morrison & Foerster LLP in San Francisco, urged jurors yesterday to reinstate $379.7 million of that amount, saying that’s what Samsung should pay after making $3.5 billion by selling 10.7 million products in the U.S. that infringe Apple patents.

While Samsung is still represented by the same law firm as last time, Quinn Emanuel Urquhart & Sullivan LLP, attorney Bill Price delivered yesterday’s opening statement instead of Charles Verhoeven.

Price asked jurors to award Apple $52 million, which he called “not a trivial sum.” He encouraged jurors to keep an “open mind” because it’s “kind of hard to not start leaning one way or another.”

“This is a case not where we’re disputing that the 13 phones incorporate some elements of Apples’ products,” Price said. “That doesn’t mean that Apple gets to come in here and ask for a windfall, far more than it’s entitled to.”

Another Trial

The retrial over devices that Samsung no longer sells may be a warm-up to a higher-stakes trial between the world’s two top smartphone manufacturers scheduled for March. That case covers technology in newer smartphones, including Apple’s iPhone 5 and Samsung’s Galaxy S III.

Samsung raised the same objection as last time to Apple presenting jurors with images of its iconic late leader, calling it an attempt to turn the trial into a “popularity contest.”

Koh, as she did in 2012, overruled Samsung’s protest. In a pretrial ruling last week, she said the Steve Jobs video clip is “not unduly prejudicial” and is relevant because it shows demand for the iPhone and its patented features, specifically the way an iPad or iPhone screen seems to bounce when a user scrolls to the end of a file.

The case is Apple Inc. v. Samsung Electronics Co. (005930) Ltd., 11-cv-01846, U.S. District Court, Northern District of California (San Jose).

To contact the reporter on this story: Joel Rosenblatt in federal court in San Jose, California, at jrosenblatt@bloomberg.net

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