Apple, Samsung Business Deals Revealed by Judge

Apple, Samsung Business Deals Revealed by Judge

Apple initially tried to secure a patent licensing deal with Samsung, a court report shows, highlighting a conciliatory approach that shifted to a contentious legal struggle.

U.S. District Judge Lucy Koh, who denied Apple’s attempt to ban Samsung’s Galaxy devices in the U.S., left details in the ruling that she’d intended to black out, according to an exclusive report from Reuters.

Koh’s staff realized the error and sealed the electronic document, posting a revised version fours later, but for a short period, the entire original ruling was available.

The redacted sections offers a glimpse of the early dynamics between Apple and its rivals, before competition escalated beyond the marketplace to the complex tangle of patent litigation that has snared nearly all major phone makers across the globe, with Apple often lining up against Android phone makers.

The court document touches on licensing deals Apple has with other companies over a key patent that covers scrolling documents and images on touch screen devices. Apple has licensed the patent to IBM and Nokia, the tech blog The Verge first revealed over the weekend.

Apple also offered Samsung a royalty license in November 2010, the ruling said, five months before it sued the South Korean company in the U.S., but the companies didn’t appear to have discussed design patents.

Apple is suing makers of Android devices worldwide, and even the late CEO Steve Jobs vowed to battle Android because it “copies” other software. But the licensing deals revealed through the ruling shows the Cupertino, Calif.-based company was actually willing to work with Android phone makers, at least before Android devices became more competitive in the market.

The blacked-out portions of the ruling also indicated Apple’s studies show existing customers aren’t likely to switch to Samsung devices, but an increase in Samsung sales may come at the expense of other Android smartphones, which are also in competition for Apple’s sales.

Last Friday, the U.S. court didn’t uphold Apple’s claims that Samsung’s products copy the design of the iPhone and iPad, so Samsung can keep its Galaxy products on sale in the U.S. until the trial starts next year, including through the lucrative holiday shopping season.

Koh and other judges generally seal documents in patent cases because companies claim the paperwork can contain trade secrets. Koh has kept all of Apple and Samsung’s requests to keep certain documents sealed in the lawsuit, so the sneak peek at Friday’s entire ruling was a rare inside look at the companies’ cases, as well as the inner workings of Apple and Samsung.

According to Reuters, Koh tried to hide about two dozen sentences, but a formatting issue in the first electronic form allowed the redacted material to be viewed by copying text from the PDF and pasting it elsewhere. The version now available has been fixed.

Emery Law professor Timothy Holbrook, who reviewed Koh’s ruling, said the paperwork didn’t appear to have any of either company’s trade secrets included in the blacked out sections.

“Most of it just seems like it was sealed out of an abundance of caution,” Holbrook said.

The California case is just one in the companies’ global legal war, which includes courtroom battles in Europe, Asia and Australia. Apple has sold more than 30 million iPads so far, but the Samsung Galaxy Tab 10.1 is considered its closest competitor. The companies will likely continue their attempts to keep each other’s devices off the market, dampening hopes of a settlement.

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