Apple Shares Rise in Response to Patent Lawsuit Victory

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Apple Shares Rise in Response to Patent Lawsuit Victory

The recently concluded lawsuit in which Apple emerged victorious has had a positive effect on its shares.

The shares witnessed a significant boost in the prices and this seems to be good news for Apple, especially considering that its latest product, the iPhone 5 will be released in the coming weeks. This will mean that Apple shares will see a significant bull run to their fortunes but it is still too early to write off a big company like Samsung. If you are planning to sell of the shares while they can fetch some money, experts suggest that you wait it out as Samsung will most likely bounce back in the coming months.

As expected, Samsung’s share values dropped as they were the losers of the lawsuit. Although this was an unexpected development, Samsung should not be overly affected by this reduction as prices as there are a whole new series of products lined up for release. So you might want to avoid panicking and selling off Samsung shares while they are still hot.

European Stocks Rally

Stocks rallied in Europe as the DAX registered a healthy gain. The value climbed by 1.1% and the final value was 7074. The same trend was also noticed at CAC40 as the share advanced by 0.9% and the final value was at 3463. Although the markets in the United Kingdom were closed because of a holiday, share values did rally around the earlier rates. We might see a reaction in the European markets once the UK market also opens as the UK market plays a very significant role in affecting the fortunes of the whole European stocks trading scene.

Nokia, the Indirect Beneficiary

Another beneficiary of this lawsuit was Nokia and this was completely unexpected. The share values of Nokia increased by almost 5.5% and this was a very surprising reaction by the market that left investors baffled. Many investors looked to take advantage of this bullish trend and there was an increase in the volume of Nokia shares traded. Nokia seems to have established an indirect relationship with Samsung and its shares.

The share values of Nokia seem to vary inversely with the values of Samsung and the trend is likely to continue for the coming months also. If you have been holding off any Nokia shares, now will be a good time to sell them off as experts feel that the future does not look good for the company. This reaction is only temporary until Samsung makes an concentrated effort to shore up its stock prices.

Caltech wins a $1.1-billion patent verdict against Apple and Broadcom

Apple Inc. and Broadcom Inc. must pay $1.1 billion in damages for infringing Caltech patents on Wi-Fi technology, a federal jury in Los Angeles ordered.

Apple was ordered to pay $837.8 million while Broadcom was hit with a $270.2-million verdict, according to lawyers for Caltech. The school sued the technology companies over patents related to wireless data transmissions.

It’s the biggest jury verdict of any kind so far this year and the sixth-largest patent verdict of all time, according to Bloomberg data.

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Apple said it plans to appeal the Caltech verdict. Broadcom said that it also plans to appeal, and that it disagreed with the factual and legal basis for the verdict.

Lawyers for the two companies have denied infringing the patents and said the school wasn’t entitled to significant damages even if they were using the inventions.

Caltech filed the lawsuit in 2020 and named iPhones, iPads, iPods, Apple Watches, Mac computers, HomePod smart speakers and the since-discontinued AirPort wireless routers as devices using the infringing Broadcom components.

Apple and Broadcom previously said in court filings that the accusations against Apple are “based solely on the incorporation of allegedly infringing chips” in Apple products.

The only issues before the jury were whether the Broadcom chips used the university’s patents and, if so, how much in damages was owed. The verdict against Apple marks one of the biggest against the Cupertino, Calif., technology giant in its history.

But if any company knows how to get rid of a billion-dollar patent-infringement verdict, it’s Apple.

In the last decade, the iPhone maker has evaded a $533-million verdict over controlling digital content, a $506-million judgment over microprocessor technology and a $625.5-million verdict over a way to display documents. In cases Apple hasn’t won, the company keeps fighting — it has been embroiled in a decade-long fight to avoid paying as much as $1 billion to VirnetX Holding Corp. over secure communications technology.

Apple is “certainly one of the most targeted entities out there, so it makes sense for them to aggressively defend themselves when they don’t see a path to settlement,” said Jonathan Stroud, chief intellectual property counsel for Unified Patents, which challenges patents used in litigation against its members, including Apple. “Otherwise they’ll be seen as an ATM and continue to be targeted regardless.”

Led by Chief Litigation Counsel Noreen Krall, Apple’s strategy has been geared toward maintaining the company’s high profit margin. That means waging a years-long battle with Samsung Electronics Co. when Apple thought the Korean electronics maker had copied iPhone designs and a no-holds-barred fight with chipmaker Qualcomm Inc. to lower royalties it pays on crucial telecommunications technology.

The cases don’t always end in complete victories. Apple kept losing market share to Samsung, and its battle with Qualcomm ended in a settlement in which it paid the chipmaker billions of dollars and agreed to start using Qualcomm’s chips again.

“This is just the starting point,” Bridget Smith, a lawyer with Lowenstein & Weatherwax in Los Angeles, said of Wednesday’s verdict. “They’re still going to have to win on appeal.”

Apple also has been accused of being a bully when it comes to using other companies’ inventions. Medical device maker Masimo Corp. says Apple stole health-monitoring technology, and a Florida company that makes “virtual iPhones” to test for flaws has accused Apple of trying to control security research.

The big-dollar verdicts against Apple are in part because of its size. The $838 million won by Caltech is less than two days worth of sales for Apple and equal to less than 2% of the company’s $55.3-billion net income in fiscal 2020.

Broadcom’s share of the verdict could mean a bigger rap to that company’s bottom line. The San Jose chipmaker reported $22.6 billion in sales in the fiscal year that ended Nov. 3, and net income of $2.7 billion. Broadcom shares slipped $2.31, or 0.7%, to $315.20 on Thursday.

Caltech said it is “committed to protecting its intellectual property in furtherance of its mission to expand human knowledge and benefit society through research integrated with education.”

District Judge George Wu, who presided over the trial, has ordered a telephone conference Feb. 6 to determine the next steps in the case.

No $1-billion-plus verdict has ever stood in a U.S. patent-infringement case: They are tossed on appeal or settled for a lower amount.

“Less than a hundred million, there’s not a lot of attention,” said Bernard Chao, a professor at the University of Denver Sturm College of Law. “But when you get in excess of nine figures, I think you start raising eyebrows and drawing attention.”

The biggest decision won by a university was a $1.17-billion verdict in favor of Carnegie Mellon University against Marvell Technology Group Ltd. in 2020. An appeals court later ordered that damages be recalculated, and the case was settled for $750 million.

“When you have a number that big, the courts scrutinize the verdict and say, ‘Is this legit?’” said Patrick McElhinny of K&L Gates in Pittsburgh, who represented Carnegie Mellon. “They typically are. As long as they are grounded in the record, they are perfectly appropriate.”

For years, Apple and other Silicon Valley companies have been trying to lower how much patent owners can collect in damages. They have argued that too often juries are awarding big awards when the invention is for a tiny component in a complex device.

The concern, said Timothy Holbrook, a professor at Emory Law in Atlanta, is “giving too much weight to the value of this technology as it relates to a broader product.”

Working to limit damages is at the heart of a Supreme Court petition Apple has filed seeking to overturn a $439-million judgment won by VirnetX. In a second case involving the same patents but newer products, a federal appeals court ordered a recalculation of a $503-million verdict.

Even as tech companies want to avoid paying high royalties, universities are trying to collect more money from their research, with recent lawsuits filed by the University of California against Abbott Laboratories over an infant formula and against lighting companies and retailers over LED bulbs, along with a cross-country battle among research institutes over who will get royalties on ground-breaking gene-editing technology.

Universities are seen as the incubators for new ideas and have to rely on a sometimes fickle federal government for funding, said Peter Corless, a patent lawyer with Mintz Levin in Boston who often represents universities.

“Everyone is so under pressure to come up with funds to be more competitive and put together better packages for incoming professors,” Corless said. The universities nonetheless have been asking themselves, “If we start asserting some of our patents against blue-chip corporate America, is that appropriate for us and who we are?”

Many legal experts predict the damages award will be cut if Apple doesn’t get an outright victory, but Corless said Caltech won’t give up without a fight.

“It’s a big deal,” he said. “It would change an institution if they get the money.”

Decker, Lopez and Bultman write for Bloomberg.

Apple hits new record after big US court victory

Apple shares have soared to a new all-time high after the US tech giant’s big win in a patent lawsuit against South Korea’s Samsung, which saw its own stock tumble.

The California tech giant also asked the California court to ban eight Samsung mobile phones to begin enforcement of Friday’s landmark court decision.

Meanwhile Google shares slipped amid concerns that its Android operating system used on mobile devices made by Samsung and others would come under greater scrutiny.

Apple jumped 1.88 percent to close at $675.68, giving the maker of the iconic iPhone and iPad a record market value of $633 billion (506 billion euros), reinforcing its place as the world’s most valuable corporation.

Apple filed a court request Monday seeking to ban eight Samsung mobile phones in the US market following its major victory.

Apple asked to ban some of the newer 4G phones from Samsung’s Galaxy line as well as the Droid Charge sold through Verizon.

The case does not include Samsung’s newest Galaxy S III, which was released subsequent to the suit but which is facing separate litigation.

But patent law consultant Florian Mueller said Apple “will push for an injunction that will have an open-ended wording and include any product, even products that haven’t been released yet, that infringes the same intellectual property.”

Analysts said Friday’s court verdict ordering Samsung to pay Apple more than $1 billion for patent infringement bodes well for the Silicon Valley firm.

“We believe this verdict strengthens Apple’s already strong competitive position in the smartphone and tablet markets ahead of upcoming key product launches such as the iPhone 5,” said Michael Walkley at Canaccord Genuity.

Apple, which is widely expected to announce a new version of its iPhone in September and possibly a smaller version of its market-leading iPad, has been riding strong momentum.

Katy Huberty at Morgan Stanley said that “the bigger win for Apple is the competitive ramifications if other smartphone vendors experience lengthened product cycles and are forced to alter their software and hardware to ensure unique designs relative to Apple products.”

Samsung shares slumped 7.5 percent in Seoul, the biggest single-day percentage drop the electronics giant has seen in nearly four years.

Google shares dropped 1.39 percent to $669.22.

Google, which was not a party in the case but is affected because of its Android system used in Samsung devices, said in a statement that the patent claims will be reviewed on appeal and that “most of these don’t relate to the core Android operating system.”

“We work with our partners to give consumers innovative and affordable products, and we don’t want anything to limit that,” Google said.

Anthony DiClemente, an analyst at Barclays, said he sees a “mild setback” for Google and its Android system.

“While we do not expect this verdict alone will significantly impact Android’s momentum, we believe that risk to Android exists if Samsung receives injunctions against the sale of its infringing products,” the analyst said.

US District Judge Lucy Koh has set a hearing for September 20 to consider injunctions against Samsung devices. She will also hear Samsung motions to reduce or dismiss charges and Apple’s request for “punitive” damages, which could triple the award.

In one bit of irony, there were reports that US consumers were snapping up Samsung devices in anticipation of a possible ban.

This was pronounced for the Samsung Galaxy S III, which was unveiled this year as a rival to the iPhone, but was not part of the case decided on Friday.

“Customers rushed to buy Samsung Galaxy S III this weekend, with some stores reporting stock outs,” said Trip Chowdhry at Global Equities Research.

Other firms which might benefit from Android woes also rose.

Microsoft, readying a push for new Windows-powered devices, added 0.43 percent to $30.69 and beleaguered BlackBerry maker Research in Motion advanced 1.7 percent to $7.06.

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