Sue Different

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Update: August 24: Apple has won. A federal jury declared today that Samsung violated many of the patents in question and must pay Apple over one billion dollars. Apple, meanwhile, did not violate any of Samsung's patents. The verdict isn't a surprise: Apple is a beloved company arguing a strong case on its home turf. Samsung was clearly inspired by Apple and it does seem to have engaged in "copytition." Still, a big verdict, particularly involving broad design questions like the making of phones with rectangles with rounded corners, isn't good for the industry. Mobile phone companies, as I argue in the post below, are mired in a stew of lawsuits, protecting patents that are often either inscrutable or mundane. Just today, in fact, a South Korean court ruled largely in favor of Samsung in a different dispute between the two companies. This verdict seems likely to inspire more lawsuits, and, ultimately, innovation will come most when there's legal detente and cross-licensing. This is the argument I made in the Daily Comment, from this past Tuesday, about the case.

Here are some of Apple’s innovations: making computers that aren’t scary, creating MP3 players that work, re-inventing phones and inventing tablets, making retail stores that people camp out to get into, and using patent litigation the way that Bruce Lee used his feet. Right now, Apple is aggressively suing nearly every major phone manufacturer, all of whom have retaliated and countersued. Apple likes to batter HTC and Motorola, but its main enemy is Samsung. The two companies have filed around fifty lawsuits against each other, in ten different countries. The most prominent case has been argued in San Jose this summer and should be settled soon.

When Steve Jobs introduced the iPhone, in 2007, he strode across the stage in his black turtleneck, praising the device’s interface and announcing, poignantly, “boy, have we patented it.” In the Samsung case, Apple asserts that its Korean competitor blatantly copied the iPhone—and Apple is probably right. The highlight of the recent trial was the release of a hundred-and-thirty-two page document, from 2010, in which Samsung employees laid out, in great detail, Apple’s superiority. The document is like a primer on phone-interface design. (See, for example, the discussion of why Apple’s system for entering long telephone numbers is clearer than Samsung’s). Gradually some of Samsung’s phones began to look like cousins of an iPhone; then they began to look like brothers. The Galaxy S could now pass as the iPhone’s unshaven twin.

Arguments have concluded, and now the jury has to decide whether the copying was illegal. Apple says it was: they had valid patents and Samsung infringed. Samsung argues that it wasn’t: some of the technology had been invented long before Apple; some of what they copied was obvious. There aren’t many ways, after all, that you can build a rectangular object you hold in your hand and bring up to your ear.

Conventional wisdom holds that Apple will win. But as Tim Wu, a law professor at Columbia, told me, one way to think about the result is to go back to Apple’s first big lawsuit: when, in the late nineteen-eighties, the company asserted that the “look and feel” of its products had been ripped off by Microsoft Windows. Bill Gates had stolen the pleasing, intuitive design of Apple’s machines. The courts narrowed down the lawsuit and eventually threw it out. The result was good for the public. Apple’s interface was better than Windows’, and Microsoft got better by learning from its rival.

In general, we should want good ideas to be copied. If you’ve got a Samsung phone, be grateful that the engineers at Apple helped design the dialer. Yes, inventors need incentives to invent. They need to know that their ideas can make them money and that building something brilliant can make them rich. And in some industries—particularly ones, like pharma, with huge research costs—you do need strong patent protection. But technology doesn’t work like drug development. The industry evolves quickly, and you need to try to be first, whether you get patent protection or not. Enforcing patents can help you lock in profits; but patents won’t change your approach to research.The prime example of this phenomenon is, of course, Apple. It invented the iPhone and the iPad, and locked in huge profits and brand loyalty before anyone could catch up. Apple, on Monday, became the most valuable company in the history of mankind—and its most valuable product is the iPhone. The company is worth six hundred and twenty-five billion dollars, roughly four times as much as Samsung.

Furthermore, software patents (and even some hardware patents) are notoriously confusing. Last summer, “This American Life” ran an extraordinary segment on the muck of software patents, which included one engineer admitting that he didn’t understand even the patents he himself had filed. They were just “mungo mumbo jumbo.” It’s hard for the patent office to evaluate code; it’s even harder for juries. Given the complexity and confusion, a good general principle would be to first do no harm. This summer, Judge Richard Posner dismissed a case between Motorola and Apple, and then proclaimed in an interview that the fighting between technology companies shouldn’t be surprising. “As in any jungle, the animals will use all the means at their disposal, all their teeth and claws that are permitted by the ecosystem.” He then added, “It’s not clear that we really need patents in most industries.”

And Apple’s litigation strategy appears to not only come out of the jungle, but it seems to be turning the industry into more of one. For years, Google took pride in always being the defendant in patent cases and never the plaintiff. But now that’s changing. Last spring, Larry Page, the C.E.O. of Google, told Businessweek that his company owned lots of patents, which it was proud of not having used. > We have somehow been successful without suing other people over intellectual property. So for us, the general trend of the industry toward being a lot more litigious somehow has just been—it has been a sad thing. There is a lot of money going to lawyers and things, instead of building great products for users.

On Monday, however, Google’s subsidiary Motorola Mobility sued Apple over nine patents. Page now sounds a bit like a politician who says that he’ll run a clean campaign—but who then puts out an ad saying that his opponent’s plan would put your grandma in a bread line.

So what should we want from the Samsung/Apple case? If our goal is a technology industry that innovates, then we want the whole thing thrown out. Forget Apple’s claims against Samsung; forget Samsung’s counterclaims against Apple. Let every company that’s mired in this mess just agree to a détente and to cross-license their patents.

The worst outcome would be if Apple wins a large judgment. That will increase the value of patents and will just inspire more suits. Other tech companies will do what they’ve always done: copy Apple’s innovations and just start suing everyone.

Disclosure: I helped found The Atavist, a technology startup whose investors include people connected to Facebook, Google, Hewlett-Packard, and other technology companies.

Photograph by Vicki Behringer/Reuters.