Samsung’s Alleged Patent Infringing Devices Not Very Profitable

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Apple Samsung Profitsvia Shutterstock

Samsung rested its case Thursday in its bitter patent dispute with Apple in U.S. Federal Court, The Wall Street Journal reported. The two sides will now discuss damages before presenting closing arguments.

Apple says Samsung owes it over US$2.5 billion in damages for improperly using Apple patents on multiple Samsung devices. Samsung countered that any damages awarded should be reduced because Apple’s number, which it claims was based on Samsung’s profits from the infringing products, does not consider the costs to produce and market the phones.

Actual profit from the devices, the Korean company argued, is much less than the number Apple used to derive its damages figure. As detailed by Reuters, in determining its damages, Apple assumed a 35.5 percent profit margin for Samsung’s products on $8.16 billion in U.S. revenue.

However, Samsung expert witness Michael Wagner estimated that Samsung’s margins were only about 12 percent, earning the company $519 million in profits from the disputed phones since Apple first sued Samsung in 2011.

Mr. Wagner also claimed that Apple has “overstated” the value of profits the Cupertino company claims it would have made in the absence of allegedly infringing Samsung products. Factors such as constraints in Apple’s supply chain contributed far more to Apple’s inability to sell more devices than did supposed customer confusion between Apple and Samsung products, he told the court.

Despite continued encouragement by the presiding judge to reach a settlement, it appears that both Apple and Samsung are determined to see the case to the end, which is rapidly approaching. Closing arguments are scheduled for Tuesday.

Comments

RonMacGuy

Give me a break.  It is SO easy for Samsung to fudge product profitability.  More allocations here.  More R&D there.  Burden it up over there.  See?  Lots of extra cost, if you assume that all of the advanced development work for all future “non-infringing” products is charged to the infringing products.  Total B.S.

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