Intervention
Seoul hits at Obama’s Apple veto in patent dispute
President Barack Obama’s intervention on behalf of Apple in a patent dispute with Samsung Electronics drew a sharp official rebuke from South Korea on Monday, as the Seoul-based company prepared for what could be its second major legal setback in the US in less than a week.
South Korea’s trade ministry on Monday criticised the US president’s weekend veto of a patent infringement ruling against Apple, expressing "concern over the possible negative impacts that this kind of decision could have on Samsung Electronics’ patent rights".
Mr Obama vetoed a June ruling by the US International Trade Commission banning a range of Apple devices – which the court ruled had infringed a Samsung patent – from being imported into the US.
Trade experts warned that the highly unusual move, which marked the first time a president has overruled the ITC since 1987, risked drawing complaints of protectionism and would make it harder for the US to argue for stronger global protections of intellectual property rights.
A separate patent case involving Samsung and Apple is set to come to a head on Friday, when the ITC isexpected to decide whether to ban imports of some Samsung smartphones and tablets into the US.
An administrative law judge has already made a ruling against Samsung, and the ITC’s commissioners usually uphold such preliminary judgments.
The South Korean ministry said it would closely monitor the ruling expected on Friday and the US government’s subsequent response to it.
"We expect the decision to be fair and reasonable," the ministry said.
However, if Samsung loses the latest case, President Obama is thought unlikely to exercise a second veto, this time on behalf of the South Korean company.
His intervention over the weekend on behalf of Apple in the first case was made because the Samsung patent involved technology that is key to technology standards, potentially giving the South Korean company "undue leverage" in licensing negotiations, according to the reasoning for the veto.
The same considerations do not apply in the second case, in which Apple alleges that Samsung infringed on a design patent that covered rounded corners and other elements of smartphone design, as well as a number of technology patents.
Meanwhile, Samsung said it had been granted a hearing next year in a US appeals court in the case, reviving the prospects that it could eventually draw penalties against Apple for alleged patent infringement. The appeal, filed on July 18, was made on the grounds that ITC ruled that Apple had infringed only one patent, rather than all four patents, Samsung said.
Adnaan Ahmad, an analyst at Berenberg Bank, said investors were increasingly ignoring the long-running patent wars between technology companies including Apple and Samsung. "The fact that margins are being questioned, growth is being questioned in the mid to long term – these are much bigger issues for the companies," he said.
(Published by Financial Times - August 5, 2013)