10 August 2011

‘Tab Wars’ Update – Apple Claims a Win in Europe

Bloomberg is reporting today that a district court in Dusseldorf, Germany, has granted an injunction preventing Samsung from distributing the Galaxy Tab 10.1 throughout the European Union (EU), except for the Netherlands.

The information appears to have come originally from the Deutsche Presse-Agentur news service, which cited – according to Bloomberg – ‘unidentified people involved in the court negotiations’.  Other outlets are also reporting the story, citing the same original source.

However, Bloomberg also claims that an Apple spokeswoman, Kristin Huguet, confirmed the report ‘in a phone interview’.   It is not clear with whom this interview was conducted, or whether it has been reported in greater detail elsewhere.

We are presently a little sceptical of the Bloomberg report, in part because it is unclear to us that a German court necessarily has the power to issue – or to enforce – an injunction covering the entire EU, although this may depend upon the basis for the injunction.  Despite the existence of a largely pan-European patent application and grant process, maintenance and enforcement of European patents operates on a country-by-country basis.  Thus an EU-wide injunction based on patent rights is not likely.  However, there are trade-based laws relating to unfair competition and/or misleading or deceptive conduct, that do operate across national borders within the EU.

According to a CBS report, ‘[b]ecause Germany is part of the EU, the ruling carries beyond its national borders,’ although the mere fact that Germany is part of the EU is not sufficient, and it will depend upon exactly which laws are being invoked.  For example, the CBS report also refers to ‘patent wars’, although as noted above this is not generally a basis for any EU-wide order.

In fact, according to FOSS Patents blogger Florian Mueller, Apple’s German action is based on a Community Design Registration (which protects the physical shape of a product, but not its function) and unfair competition grounds, on the basis that Galaxy Tab is an iPad imitation.  As we noted in an earlier comment, this type of ‘misleading conduct’ would be very difficult to establish under Australian law, because the overall distribution, marketing and sales activities of Apple and Samsung mean that it is highly unlikely that someone wishing to buy an iPad2 would end up inadvertently acquiring a Galaxy Tab 10.1.  This is not a case of Samsung ‘passing itself off’ as Apple – it wishes and intends to be recognised as a competing brand.

In the absence of relevant intellectual property rights, such as the Community Design relied upon by Apple in Europe, it is not ‘unfair competition’ merely to market a product that has a similar function and appearance to that of a competitor, on the basis that this is what consumers want.  For conduct to become unfair, misleading or deceptive, something more is required, such as creating a false impression that there is some formal connection between the ‘original’ product or its supplier, and the competitor’s product.

In its article, Bloomberg also states that ‘[i]n Australia, Samsung has agreed not to introduce a version of its Galaxy tablet computer until an Apple lawsuit there is resolved’ which, as we have reported previously, is not an accurate characterisation of the current agreement forged between Apple and Samsung outside the Federal Court in Sydney.

Under the pressure of the ‘24-hour news cycle’ there is a trade-off between speed and accuracy of reporting.  We will keep an eye on how this develops.


Dylan Xavier said...

You might want to note that the injunction was issued without any notice to Samsung. Didn't realise that it was possible to secure an injunction without giving notice to the other company in question



Patentology (Mark Summerfield) said...

There is a reason why much European IP-related litigation tends to commence in Germany...  the German system, more than any other, advantages the rights-holder.  As I understand it, courts that hear patent infringement cases are not competent to assess validity.  So, unlike most other countries, it is not possible for an accused infringer to raise invalidity as an affirmative defense, or in a cross-claim for revocation of a patent.

Even so, obtaining an injunction without even being required to notify the other party was new to me.  Florian Mueller has a discussion of this on his FOSS Patents blog: http://fosspatents.blogspot.com/2011/08/why-samsung-was-not-put-on-notice.html.  His reporting on the Australian case was not great, in my view, but I would give more credence to his knowledge of German law.

I am still sitting back waiting for the smoke to clear.  I freely admit that I do not know enough about the relevant European laws to form an independent view of how this will pan out.  But I do know that at least 95% of what was written about the Australian case was ill-informed and inaccurate, and I have no reason to suppose that the reporting (professional and otherwise) of the German injunction is any more reliable.

Dylan Xavier said...

Florian Mueller from FOSS Patents blog is bodering on being an apple troll. everything he has written on the Samsung vs apple case all he tries to do is prove how he is right that Samsung is in a week spot.He will use ne thing and every thing to prove it.His reporting on the Australian hearing  was pretty ordinary. He likes to twist the truth.
The is what Florian Mueller says."While it's true that they weren't put on notice and that there wasn't any hearing, Samsung wasn't forthright enough to admit that it had filed a protective pleading. Samsung wasn't blindsided -- Samsung knew it had this coming, and the court's decision was based on both Apple's motion and Samsung's pre-emptive opposition pleading. This kind of communication strategy on Samsung's part is old-school spin doctoring and only serves to strengthen my impression that Samsung is in a legally weak position against Apple." Based on what he is saying, He implies that because Samsung filed a protective pleading they knew that apple had seeked an injunction. That in itself is the most misleading statement ever. He goes on to state that samsung communication stratergy is part is old-school spin doctoring. I think that Florian Mueller communication is part is old-school spin doctoring.Just because you apply for a protective pleading doesnt mean you know that the other party will apply for an injunction. Your just being safe.Also Samsung stated that"request for injunction was filed with no notice to Samsung, and the order was issued without any hearing or presentation of evidence from Samsung"Which is true. Samsung didnt have a chance to present any evidence at the injunction hearing.
Whats your take on it?

Dylan Xavier said...

Well what the past couple of weeks has thought me is really take what you read with  a cup of salt. I do tend to read a fair bit on multiple topics and have always been pretty skeptical in believing everything as the truth. But the amount the media has drifted from the actual facts and put their own spin on things was amazing. More interesting was how most of those media articles linked back to Florian Mueller. For the media to base an entire report on just one source's beliefs is shocking. If i were to write a paper in science, such kind of referencing would instantly be rejected.
I have to admit that he has done well from the publicity, but siding with Apple has helped him gain that attention. I would be pretty interested to see when Samsung actually releases those tablet. Especially now that its been close to 2 weeks since that court hearing. Am i correct in saying that Samsung dont have to wait till the 29 August to release or proceed with releasing the tablet?

Patentology (Mark Summerfield) said...

Samsung's agreement with Apple is to wait at least seven days after they have provided samples of the product.  Of course, we do not know whether that has happened yet, nor whether Samsung will choose to wait longer.  The court will determine the timetable for proceedings, separately from what is happening commercially.  However, it is possible that Apple may apply again for an injunction, so Samsung's strategy is likely to be designed to further minimise Apple's already very slim chance of success in this respect.  Unlike Florian Mueller, I am not really willing to speculate any further than this.  We do not know, for example, whether there are continuing discussions going on between Apple and Samsung regarding a possible settlement. 

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