Quarter of Samsung U.S. sales result from copying: Apple Inc

Apple Inc is claiming that more than a quarter of Samsung Electronics'  $30.4 billion in U.S. smartphone and tablet sales result from copying of the iPhone and iPad or infringe on other patents, a damages expert for the U.S. company said on Monday. The Silicon Valley company is demanding up to $2.75 billion of damages from its Korean rival, which includes lost profits.


The Korean company sold more than 87 million mobile devices from mid-2010 to March 2012, according to documents displayed before the jury.

The ongoing battle between Samsung and Apple ...

Samsung handsets sold in the US are copied from the iPhone


Accountant Terry Musika, citing Samsung records and testifying as an Apple expert witness, estimated that $8.16 billion in revenue, or 22.7 million of those total unit sales over that two-year period, came from products that infringed Apple patents, such as the first Galaxy S smartphone in July 2010.


Samsung earned roughly 35.5 percent gross profit margin on that revenue, between June 2010 through March 2012, Musika said.

"It's not me sitting at a desk with a calculator," Musika, a former KPMG and PriceWaterhouseCoopers accounting partner, told the court.

"There are literally hundreds of millions of calculations," he said, adding that it took more than $1.75 million to employ a team of 20 programmers, accountants, statisticians and economists to work out damages over a plethora of gadgets.


Samsung is expected to cross examine Musika later today.


Apple's legal battle with its fiercest business rival, which has transfixed the global mobile industry, moved into a technical damages-estimate phase this week. The trial, which began in late July, has seen a procession of executives, designers and patents experts testifying on behalf of the U.S. company. Closing arguments should begin next week.


The world's most valuable technology company is accusing Samsung, now the leader in smartphones, of copying its iPhone and iPad. The Korean company denies that and says Apple infringes several of its wireless technology patents.


Musika also cited Samsung documents that identified the iPhone back in 2007, when the first of the revolutionary smartphones emerged, as one of four major factors defining mobile trends in the ensuing five years.



The trial continues to offer glimpses behind Apple's secretive operations, from its industrial design process to its product marketing machine.


On Monday, an Apple executive testified that the company had licensed prized design patents to Microsoft Corp but with an "anti-cloning agreement" to prevent copying of its iPhone and iPad.


Apple had reached out to Samsung in 2010, hoping to strike an agreement with its rival on patent licensing before their dispute hit the courts, patent licensing director Boris Teksler said.


Teksler testified that Apple offered a clutch of patents for licensing but, crucially, viewed patents related to what he called the "unique user experience" as a highly protected category.


Those included design patents at issue in the lawsuit, covering the look and feel of the iPhone and iPad. Teksler told jurors last week he could count "on one hand" the instances Apple has licensed those patents.


Negotiations between Apple and Samsung did not produce a licensing agreement, and Apple filed a lawsuit in federal court in San Jose, California, in April 2011.


Apple's decision to license its design patents to Microsoft was consistent with its corporate strategy, Teksler said, because the agreement prohibited Microsoft from manufacturing copies.


"There was no right with respect to these design patents to build clones of any type," Teksler said.


The case in U.S. District Court, Northern District of California, is Apple Inc v. Samsung Electronics Co Ltd et al, No. 11-1846.