This morning two Apple witnesses attacked Samsung for not living up to its responsibilities with its standards-essential patents — and violating the spirit of FRAND as well. At issue are two Samsung standards-essential patents that apply to UMTS technology. In 2005, Samsung lobbied for several changes that were made to the 3GPP Standard. Per the company's agreement with the standards body, it needed to disclose any associated intellectual property rights it held before the changes were adopted. According to Apple expert witness Michael Walker, the company didn't live up to its end of the bargain.
Walker noted several examples of Korean patents, which the US patents in question were derived from, that Samsung held long before the 3GPP changes were made. Samsung, however, didn't disclose the intellectual property until 11 months later in one case — and more than two years in another.
Samsung hasn't been investigated for disclosure issues
Samsung attorney Charles Verhoeven, however, pointed out that Samsung had never been investigated for any delays or lack of disclosure with regard to its patents. It had also announced in 1998 that it would offer up any patents related to the standard for licensing as expected. Verhoeven then pointed out that "intellectual property" as defined by the appropriate bodies doesn't cover confidential information. If Samsung's Korean patents were confidential in nature, wouldn't that mean it wasn't obligated to disclose them, he asked? "No," Walker replied, "you can't use it then" for 3GPP standards.
Apple continued its attack on Samsung, inferring that the company didn't comply with the spirit of FRAND when it had engaged in licensing negotiations with Apple. Expert witness Richard Donaldson explained that Samsung needed to offer licenses for any standards-essential patents at fair, reasonable, and non-discriminatory (FRAND) rates. Donaldson was asked if Samsung's 2011 offer letter to Apple — which requested a 2.4 precent royalty rate for every device sold — fit FRAND guidelines. "No," Donaldson said. "I believe that it is discriminatory," pointing out that the requested amount would cost more than the baseband chips that allegedly infringe in the first place.
Apple went through several more witness — both it and Samsung will finish presenting all evidence today — including deposition testimony from Seung-Ho Ahn, one of Samsung's senior licensing executives. Ahn was asked about the company's adherence to FRAND, and if he had any evidence backing up the 2.4 percent figure Samsung asked for. "Personally, I do not," he said.
Matt Macari contributed to this report.