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Under Pressure From Taxes, DoJ Suits And Flaggin Sales Apple Files A Patent Suit Against Samsung

by on22 May 2013 1949 times
14621rotten apple

Apple is not having a good run of luck lately. They are sagging behind their rival and manufacturing partner Samsung by almost 2 to 1 in terms of unit sales which is hurting consumer confidence in their phone and tablet products. Apple is also probably going to lose their suit with the Department of Justice over eBook Price fixing which will impact the pile of cash they have an investor confidence. To further add insult to injury they are under investigation for their tax policies in the US an overseas. The Apple mythology is crumbling faster and faster while others jump in to pick up the pieces. Apple may even be delaying the launch of new products which is not doing them helping their situation considering Samsung and others have much faster refresh times than Apple can maintain.

Now many companies in a similar situation (and with the cash reserves that Apple has) might try to push forward the progress of R&D to get new products with compelling features to their customers. Sadly this is not Apple’s way. To combat the investigation into their tax avoidance policies they are going to try and finally make good on their deal to invest $100 Million back into the US. This is a deal that Apple made with the US Government a while ago and did not do anything about it until the investigations started. Now they are looking at needing to pay taxes on an estimated $74 Billion in revenue (from 2009 to 2012) that comes from overseas subsidiaries which Apple pays little to no taxes on. They leave this money overseas instead of bringing it back into the US and paying taxes on it. It is so important for Apple to keep this out of the US that they will even take out loans to pay investors instead of brining this revenue back home.  The $100 Million is a drop in the bucket when you consider what they potentially owe on all of that money (to qualify Apple is not the only one doing this, they are just one of the worst).

The news about the Senate investigation and potential impact to Apple is going to hurt them even if they manage to skate out of this one because they still have the eBook price fixing case looming over their head. Apple might be able to maintain their core investors by giving them dividends on their investment, but that is not going to keep them all happy if things keep sliding. Apple needs to recapture the market somehow and to do this they are going to fall back on what has worked for them in the past; patent suits.

Apple is going after Samsung, again, using five patents that the claim Samsung violates with their new Galaxy S IV smartphone. The fact that Samsung’s S IV is selling like mad is most certainly the inspiration for this new round of suits considering Apple is asking for product bans. The patents in question are listed below including the dates they were filed.

U.S. Patent No. 8,086,604 : "Universal interface for retrieval of information in a computer system" 2004
U.S. Patent No. 6,847,959 : "Universal interface for retrieval of information in a computer system" 2000
U.S. Patent No. 7,761,414 : "Asynchronous data synchronization amongst devices" 2007
U.S. Patent No. 5,666,502 : "Graphical user interface using historical lists with field classes" 1995
U.S. Patent No. 5,946,647 : "System and method for performing an action on a structure in computer-generated data" 1996

Apple is attacking Google Now and other parts of the search feature that comes on every Android Phone, as it applies to Samsung. Why they keep going after the phone makers instead of attacking Google (the owners of the OS) is something that is never quite explained in any of the law suits filed against Android phone makers. This is not the first time that Apple has used these patents and it will probably not be the last (at least until they get invalidated…). Apple likes to file for very vague patents in fact reading their patents they are not so much patenting an invention as they are a concept. They have been very successful at getting these concepts though the US Patent and Trademark office despite the existence of prior art because they keep their patents so vague. Once they are granted they can use them in reverse to go after their competitors, where they were able to avoid having a patent invalidated because of the loose definition they can apply this patent to anything even close (remember Apple claiming a tap was a “zero length swipe”?).

Apple’s new patent war might end up failing quickly this time simply because their target knows their tactics and has found a way to fight back. Although Apple did win the last exchange in court the victory is slowly slipping away. Samsung has already managed to get two key patents that Apple won on invalidated and they still have more up their sleeve. Samsung has also managed to get all of the bans that Apple won overturned so the sales are still flowing in the US. In any new suit Samsung knows what to hit and how to hurt Apple while Apple will end up using the same old tactics they have before (a lot like their iPhone and iPad strategy). We wonder how long Tim Cook can keep the top spot at Apple with everything going on and nothing new to excite the consumer. Investors want revenue and results, not excuses and patent suits.

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Last modified on 22 May 2013
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