By Brent Kendall 

WASHINGTON -- The Supreme Court on Tuesday ruled a lower court should reconsider how much money Samsung Electronics Co. owes rival Apple Inc. for infringing patents on the iPhone's design.

Samsung has been challenging a $399 million award to Apple after jurors in 2012 found that 11 smartphone models from the South Korean electronics giant infringed Apple's design patents.

The high court agreed to hear the case to clarify how courts should compute monetary damages for design-patent infringement. Apple argued it was entitled to the total profit on Samsung's infringing products. Samsung countered that it shouldn't have to hand over all of its profit on the phones because the design was only one component of those complex devices.

The Supreme Court said an appeals court used the wrong analysis when it ruled for Apple.

Justice Sonia Sotomayor, writing for a unanimous court, said the holder of a design patent isn't always entitled to the total profit on an infringing product sold to consumers. In multicomponent products, sometimes a patent holder will only be entitled to the infringer's total profit on the specific component that infringed the patent, she said.

The decision, however, didn't resolve the dispute between the smartphone makers. The court declined to apply its legal rules to the specifics of the case, so it didn't determine whether Samsung must pay its total profit on the 11 phones or just its profit attributable to the screen and case design of those products. The justices said a lower court should sort out that issue.

A Samsung spokesperson called the ruling a landmark decision that "is a victory for Samsung and for all those who promote creativity, innovation and fair competition in the marketplace."

An Apple spokesman said, "Our case has always been about Samsung's blatant copying of our ideas, and that was never in dispute." He said Apple remained "optimistic that the lower courts will again send a powerful signal that stealing isn't right."

The case had been closely watched in tech circles. An array of companies including Dell Inc., Facebook Inc., and Google Inc. had filed a court brief in support of Samsung.

They argued it would be absurd to require companies to fork over their total profit on complex modern technological products when one component among thousands in a device infringed another company's design.

A group of design professionals and companies including Crocs Inc., Tiffany & Co. and Adidas AG supported Apple, saying a total-profits remedy was important for protecting valuable and innovative designs that drive consumer demand and are the lifeblood of many businesses.

The smartphone makers have been locked in a variety of patent battles. The case before the high court involved the highest profile litigation, which dates back to 2011.

The $399 million was part of a $930 million award Samsung was ordered to pay by a trial court. The rest of the money stemmed from other Apple claims not before the Supreme Court. Part of the overall damages award already was scheduled to be revisited in the lower courts.

For all the money involved, the case isn't expected to have much impact on smartphone consumers. Despite losing past rulings to Apple, Samsung has been able to continue selling phones and has moved on to newer models.

Write to Brent Kendall at brent.kendall@wsj.com

 

(END) Dow Jones Newswires

December 07, 2016 02:48 ET (07:48 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.
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