6/10/2011

By Dean Orgill, Partner, Mayo Wynne Baxter LLP

France has become the latest battleground in the patent wars between these two giants, with Samsung having reportedly issued a claim for infringement to follow claims in Germany, the Netherlands, Australia the United States and South Korea.

The recent subjets de la guerre Samsung Galaxy 10.1 tablet; Samsung’s latest entry in the tablet market, and the high-profile counter-suing by Samsung over patent infringements in Apple’s latest 4GS iPhone.

Apple maintains that the model infringes its protected intellectual property and has sought injunctions to prevent sale in various jurisdictions. Unsurprisingly Samsung holds a different view. The multifaceted Korean firm argues Apple has infringed its rights and has brought its own claims.

We all understand the need to protect our business, and if possible our market share, for most companies though litigation on this scale is difficult to imagine, let alone fund.

But, apart from the entertainment of seeing two titans jousting (particularly two who trade substantially between themselves as Apple is reportedly Samsung’s second biggest customer), there may be things to glean from watching the moves unfold.

For a start the case underlines the international nature of intellectual property rights, which can affect traders of every size.

In days of yore anyone who ran a high street shop, or light engineering business on the outskirts of town, could happily co-exist with similar businesses operating under similar names a hundred miles away. Now, transformed by the internet, anyone can trade with the world, and a competitor from Sydney may divert trade from a business in Leeds. This necessitates protection on multiple levels, with the first port of call being registering several versions of the business’ domain name.

The philosophy behind intellectual property laws is to ensure that customers are not confused about the origin of what they’re buying. This complements the concept of brands. Each business builds up one, or several, brand identities as a way of assuring customers that goods or services will be of a quality and character that they associate with the company behind the brand.

Preventing competitors from using your brand is about more than immediate loss of trade. There is also the reputational risk of people receiving something substandard when they thought it came from you.

Yet even back when the chance of a customer confusing two businesses was highly remote this did not stop legislators protecting merchants. The first statute in England was dated 1623 (Statute of Monopolies) and protections in other European countries go back even earlier. Registering a domain name is just the latest manifestation of a step to be taken to protect a brand and its goodwill, but the philosophy behind it would be recognised by 17th century judges.

At its most basic level Apple and Samsung are attempting to assert the intellectual property rights which exist to avoid confusing the consumer. Yet few people would accept this apparently altruistic rationale is the issue either party is fighting for. Whilst both sides have come in for criticism from the tech-tribes each company is doing nothing more than using the tools at its disposal to protect its commercial interests. Given the means most of us would probably do the same.

The case raises a further question about whether intellectual property rights are an appropriate tool with which to handle disputes of this nature. It can be argued quite persuasively that with respect to a tablet there are some practical limitations to be considered. There are limitations on design created by the necessary technology, physical limitations imposed by the need for human use and lastly the expectations of consumers.

Therefore if several designers come up with goods within those parameters, and they happen almost of necessity to be similar, why should they not all be taken to market and let the fittest seller survive?

Because, runs the counter-argument, all of these three features are susceptible to design and if businesses cannot protect the product they have designed, and exploit it commercially, there will be no further design because they will not be able to fund https://www.freshbusinessthinking.com/business_advice.php?AID=9527” rel=”nofollow”>R&D. Consequently there will be less innovation and everyone’s life will be the poorer.

Those who advocate tight intellectual property laws say that innovators can in fact influence the technical limitations of any particular product. For example imagine the evolution of the phone from its inception until today. The requirements of the human user can also be influenced, or at least adapted — think of the move from a candlestick phone to a mobile or Bluetooth device. Finally, the user’s expectations can be influenced greatly. The first product to reach the market can have a huge influence in creating the perceived norm. If the design is good then the item will be viewed as the obvious form from the day it is unveiled.

IP protection is vital for innovators and retailers offering quality products and services. The technical details in this latest case may be beyond the comprehension of those 17th century legislators, but the underlying principles have not changed and they remain relevant to us all.

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