Samsung Falls on EU Complaint, Apple Appeal: Seoul Mover
Samsung Electronics Co. (005930), the world’s biggest maker of smartphones and TVs, fell the most in almost four months in Seoul trading after the European Union said it’s preparing an antitrust complaint against the company.
Samsung declined 4.1 percent, the biggest drop since Aug. 27, to 1,442,000 won while South Korea’s benchmark Kospi index fell 1 percent. The EU is probing whether the Suwon, South Korea-based company violated agreements to license key patents to other mobile-phone makers on fair terms and will issue a notice listing antitrust concerns as soon as the end of this year, the bloc’s competition commissioner said yesterday.
The complaint adds to Samsung’s legal challenges as it fights iPhone maker Apple Inc. (AAPL) in lawsuits on four continents over patents for mobile devices. Apple said yesterday it’s appealing a U.S. judge’s decision to turn down its request for a sales ban on 26 Samsung devices after the Cupertino, California- based company won a patent-infringement lawsuit.
“The biggest concern in the market has been that Samsung may face a lot of legal hurdles globally,” Lee Seung Woo, an analyst at IBK Securities, said by phone today. “The EU case is escalating those concerns.”
The EU’s competition commissioner Joaquin Almunia said yesterday Samsung faces a complaint over its use of standard- essential patents in legal disputes with Apple. While regulators were “happy” with Samsung’s announcement this week that it will withdraw injunctions in Europe that seek to block sales of Apple products, Almunia said the EU will continue to investigate whether Samsung’s threats of legal action harmed competition.
Samsung “is fully cooperating with the European Commission proceedings,” the company said in an e-mailed statement.
Samsung has gained 36 percent in Seoul trading this year while Apple has gained 29 percent in New York.
The EU antitrust complaint is “propelling worries and uncertainties surrounding a possible penalty and its size,” David Choi, an analyst at SK Securities Co., said by phone today.
Samsung and Apple, the world’s two biggest smartphone makers, have traded victories in their patent disputes since Apple accused Asia’s biggest electronics maker of “slavishly copying” its devices. The companies, competing for dominance of the global smartphone market estimated by Bloomberg Industries at $219 billion last year, are suing each other even as Apple remains Samsung’s biggest customer.
Samsung said earlier this week it would withdraw injunction requests against Apple in Germany, U.K., France, Italy and the Netherlands involving key patents it holds for wireless communications, citing “the interest of protecting consumer choice.”
The company will continue litigation that seeks damages in intellectual property disputes.
Under phone industry agreements on standards, companies owning the rights to essential technology must usually license it to competitors on fair, reasonable and non-discriminatory terms, known as FRAND.
U.S. District Judge Lucy H. Koh said Dec. 17 that while a jury found Samsung infringed six Apple patents, the infringing elements were such a limited part of Samsung’s device that a sales ban wasn’t warranted. Apple hadn’t shown that consumer demand for Samsung products was driven by technology it stole, Koh said in her ruling.
Nam Ki Yung, a spokesman for Samsung in Seoul, declined to comment on the U.S. case when contacted by phone today.
Separately, Samsung said today it won’t introduce TVs in 2012 using organic light-emitting diode, or OLED, displays, as it had planned. The company said in May it planned to start selling TVs using the displays, which are thinner and produce sharper images than current liquid-crystal-display panels, in the second half of this year.
The decision was based on prices and market conditions, Samsung said in an e-mailed statement.
“We are sorry that we couldn’t keep our promise to launch the product this year,” Samsung said in the statement.
LG Electronics Inc. (066570), the world’s second-largest TV maker, is on schedule to release OLED televisions “in the early part of the new year,” Ken Hong, a spokesman, said by phone today.
Sony Corp. (6758), Japan’s largest TV maker, hasn’t set a date for introducing the technology, Mami Imada, a spokeswoman for the Tokyo-based company, said today by phone. Sony said in June it entered a partnership to jointly develop OLED TVs with Osaka- based Panasonic Corp. (6752), with a goal of establishing mass- production technology next year.
Chieko Gyobu, a spokeswoman for Panasonic, said today the company’s timing for releasing OLED sets hasn’t been decided.
To contact the editor responsible for this story: Anand Krishnamoorthy at firstname.lastname@example.org