Anatomy of Two Patent Cases Mirror Worlds v. Apple (2011) Apple v Anatomy of Two Patent Cases Mirror Worlds v. Apple (2011) Apple v. Samsung (Filed in 2012; Settled 2018) Michael I. Shamos, Ph.D., J.D. Institute for Software Research School of Computer Science Carnegie Mellon University LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Mirror Worlds v. Apple: The Players Leonard Davis, Chief Judge, Eastern District of Texas (Former computer programmer) Mirror Worlds LLC Apple Computer, Inc. David Gelernter, Yale Professor, Inventor Bud Tribble, Apple’s VP of Software Technology

Mirror Worlds LLC v. Apple “Mirror Worlds” is the title of a 1991 book by David Gelernter, a Yale CS professor. The subtitle is “the Day Software Puts the Universe in a Shoebox...How It Will Happen and What It Will Mean.” The book deals with software models of the real world and envisions the ability to review vast quantities of information from one computer screen The book was published before the World Wide Web was invented LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Mirror Worlds LLC v. Apple Gelernter and Eric Freeman, a Yale graduate student, formed a company, Mirror Worlds Technology, to develop software based on this vision. In 1993, Gelernter was injured by a letter bomb sent by the Unabomber. He lost sight in one eye and partial use of his right hand. In 1996, Yale University filed a U.S. patent application that ultimately resulted in three patents, issued in 1999, 2003 and 2004 FREEMAN LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Mirror Worlds LLC v. Apple Yale eventually transferred the patent rights to Mirror Worlds Technology. In 2001, Mirror Worlds Technology released Scopeware, a product based on the patent application The company went out of business in 2004 The patents were transferred to a new entity, Mirror Worlds LLC In January 2007, Apple introduced iPhone. Mirror Worlds LLC believed the iPhone interface infringed its patents LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS U.S. Patent 6,725,427 LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Mirror Worlds’ Scopeware Product LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Apple Was Interested In 2001, Steve Jobs saw an article about Scopeware in the New York Times He wrote a memo to Apple executive Bertrand Serlet: “Please check out this software ASAP. It may be something for our future, and we may want to secure a license ASAP.” Serlet testified “this was the first time I recall having received a specific mail to look at a company or its technology” from Mr. Jobs. LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Apple’s Cover Flow LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Mirror Worlds LLC v. Apple In March 2008, Mirror Worlds sued Apple for patent infringement in the Eastern District of Texas Apple is in Cupertino, California Mirror Worlds is in New Haven, Connecticut Eastern District of Texas LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Why Texas? More patent cases are filed against more defendants in the Eastern District of Texas than anywhere else East Texas jury pool tends to favor patent owners Experienced judges Efficient administrative rules for patent cases U.S. PATENT CASES FILED (2017) 21.3% 19.2% ALL OTHERS 59.5% LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Mirror Worlds LLC v. Apple In October 2010, a jury awarded Mirror Worlds $625.5 million for patent infringement and found the infringement was willful The docket in the case (list of all documents filed with the court) has 515 entries. The first substantive action was for the Court to construe the words of the claims We will focus on claim 16 of U.S. Patent 6,725,427 LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Claim 16 16. A controlling operating system utilizing subsystems from another operating system running a computer, comprising: [a] a document organizing facility associating selected indicators with received or created documents and creating information specifying glance views of the respective documents and information specifying document representations of the respective documents; . . . LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Claim 16 [b] a display facility displaying at least selected ones of said document representations; said display facility further displaying a cursor or pointer and responding to a user sliding without clicking the cursor or pointer over a portion of a displayed document representation to display the glance view of the document whose document representation is touched by the cursor or pointer; and [c] said controlling operating system utilizing subsystems from said another operating system for operations including writing documents to storage media, interrupt handling and input/output. LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Jury Verdict Form

Jury Verdict Form

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Willful Infringement Upon finding for the claimant the court shall award the claimant damages adequate to compensate for the infringement but in no event less than a reasonable royalty for the use made of the invention by the infringer … the court may increase the damages up to three times the amount found or assessed. “If infringement be willful, increased damages 'may' be awarded at the discretion of the district court, and the amount of increase may be set in the exercise of that same discretion.” Kloster Speedsteel AB v. Crucible Inc., 793 F.2d 1565, 1580 (Fed.Cir.1986) $625.5 million x 3 = $1.9 billion! LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS After Trial Problem: Claim 16 requires “displaying a cursor or pointer and responding to a user sliding without clicking the cursor or pointer over a portion of a displayed document representation” The documents remain stationary; the cursor moves. In Cover Flow, the documents move over a stationary point (the center of the screen) Mirror Worlds was obliged to show that the Cover Flow behavior is “equivalent” to that of the claim. LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS After Trial Apple asked the trial judge to vacate the jury’s determination of infringement and willfulness The judge found that “the record lacks sufficient evidence to support the jury’s finding of infringement” and entered judgment in favor of Apple. LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Judgment LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS After Trial Mirror Worlds, as loser, was charged $190,000 in court costs (not attorneys’ fees) On May 2, 2011 Mirror Worlds appealed to the Court of Appeals for the Federal Circuit On September 4, 2012, the Federal Circuit upheld Judge Davis’s decision to vacate On June 24, 2013, the U.S. Supreme Court refused to hear the case. Apple wins. LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Court Costs LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Apple v. Samsung FROM APPLE’S TRIAL BRIEF LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Apple & Samsung Smartphone Units Sold, in Millions, 2010-2015 SAMSUNG TOTAL: 1295 MILLION APPLE TOTAL: 854 MILLION LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Apple v. Samsung Lawsuits Since 2011 NETHERLANDS GERMANY U.K. JAPAN U.S. FRANCE S.KOREA ITALY 20 LAWSUITS IN 9 COUNTRIES 4 CONTINENTS AUSTRALIA LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Apple v. Samsung On April 15, 2011, Apple sued Samsung in the Northern District of California (San Jose Division – Silicon Valley), alleging that the Galaxy SII infringed three Apple patents: 7,469,381 (rubberbanding, Samsung: “bounce”) 7,844,915 (scroll vs. gesture) 7,864,163 (tap to zoom) One claim from each patent was asserted We will examine claim 8 of the ’915 patent Touch one point, scroll; touch two points, resize LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Patent Litigation Very expensive. Average cost to defend one claim of one patent: US $3 million. The jury determines infringement. The jury determines whether the patent is valid. Jury can nullify Patent Office determinations. The jury determines money compensation. The judge determines whether the jury’s decisions have sufficient basis in evidence. All U.S. patent cases are reviewed by a single appeals court – the Court of Appeals for the Federal Circuit. LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

7,844,915 Claim 8 8. A machine readable storage medium storing executable program instructions which when executed cause a data processing system to perform a method comprising: [a] receiving a user input, the user input is one or more input points applied to a touch-sensitive display that is integrated with the data processing system; [b] creating an event object in response to the user input; [c] determining whether the event object invokes a scroll or gesture operation by distinguishing between a single input point applied to the touch-sensitive display that is interpreted as the scroll operation and two or more input points applied to the touch-sensitive display that are interpreted as the gesture operation;

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS 7,844,915 Claim 8 [d] issuing at least one scroll or gesture call based on invoking the scroll or gesture operation; [e] responding to at least one scroll call, if issued, by scrolling a window having a view associated with the event object; and [f] responding to at least one gesture call, if issued, by scaling the view associated with the event object based on receiving the two or more input points in the form of the user input. LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Prior Art: Japanese Patent JP2000163031 PROBLEM TO BE SOLVED: To provide an electronic book and a portable information equipment capable of realizing functions such as rotating, magnifying, reducing and scrolling of a map picture with a human interface having satisfactory operability and to provide an information storage medium to be used for them. SOLUTION: The electronic book includes a display part capable of displaying a map picture. The executing instruction and the manipulated amount of at least one operation of the rotating, the magnifying, the reducing and the scrolling of the map picture can be inputted simultaneously by operation histories of fingers which are brought into contact with the display part. Then, the magnifying instruction and the magnifying amount of the map picture can be inputted by an operation making two fingers more distant. Moreover, the reducing instruction and the reducing amount of the map picture can be inputted by an operation brining the two fingers closer. Furthermore, the rotating instruction and the rotational amount of the map picture can be inputted by an operation making one finger rotate around another → finger.

Prior Art: Paper by Jefferson Han, SIGGRAPH 2005 LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Apple v. Samsung I On June 26, 2012, the Court issued a preliminary injunction against Samsung On August 24, 2012, after a three-week trial, a jury found that Samsung infringed all three patents The case docket had 3838 entries (as of November 4, 2018) The verdict form was 20 pages long (many issues other than infringement had to be decided) Here is a short version, pertaining just to the Apple patents. LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Apple v. Samsung I Total damages: $1,049,343,540.00 The jury found willful infringement, which means the judge could have raised it to $3 billion. BUT, Samsung appealed successfully and won a new trial on the issue of money damages LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Apple v. Samsung I Later, on a re-trial of damages, the jury found in favor of Apple for $290 million, upheld by the Federal Circuit on May 18, 2015. On appeal, the Federal Circuit vacated certain jury findings, necessitating a third trial, resulting in a verdict of $399 million for design patent infringement, Samsung’s ENTIRE PROFIT from the infringing phone. Samsung sought review by the Supreme Court. On March 21, 2016, the Supreme Court agreed to hear the case. THE FIRST SUPREME COURT DESIGN PATENT CASE SINCE 1894. 2017 Reversed. Apple not entitled to entire profit. LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Apple v. Samsung Apple and Samsung were battling in Australia, France, Germany, Italy, Japan, Netherlands, South Korea and the U.K. The California judge called the case “one action in a worldwide constellation of litigation between the two companies” Apple and Samsung settled all their cases outside the U.S., but continued fighting in the U.S. The U.S. cases were settled in June 2018, with Samsung paying Apple an undisclosed amount LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS The Judge: Hon. Lucy Koh LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Judge Koh’s Career Judge Koh is the only female U.S. federal judge of Korean descent. Obama appointment in 2011. Confirmed 90-0. She presided over all the U.S. Apple v. Samsung trials Her Apple v. Samsung decisions were all reversed by the Federal Circuit. On February 25, 2016, President Obama nominated Judge Koh for seat on the 9th Circuit Court of Appeals On February 26, 2016, her decisions in Apple v. Samsung II were reversed by the Federal Circuit. Her nomination expired in January 2017 when the 114th Congress terminated. She has a lifetime appointment. LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Major Ideas Patents are having a major effect on computer system development and online business Decisions on technology questions made by judges and juries can determine the outcome of a lawsuit An adverse patent infringement verdict can involve huge amounts of money Judges can overrule the jury when there is no substantial evidence to support the jury’s verdict LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Q A & LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Proposed Claim Constructions Term Mirror Worlds Apple controlling operating system operating system that utilizes subsystems from another operating system operating system that controls another operating system document organizing facility software that organizes documents portion of a stream-based operating system whose purpose is to organize documents glance view abbreviated presentation of a document different graphical representation of a document that appears when a document representation is touched by the cursor or pointer and provides additional information about the document

Adopted Claim Constructions Term Mirror Worlds Apple controlling operating system operating system that utilizes subsystems from another operating system operating system that controls another operating system document organizing facility software that organizes documents portion of a stream-based operating system whose purpose is to organize documents glance view abbreviated presentation of a document different graphical representation of a document that appears when a document representation is touched by the cursor or pointer and provides additional information about the document

Additional Constructions Term Court’s Construction document representation graphical depiction of a document, or data unit operating system software that handles basic computer operations (e.g. managing input/output, memory, applications, etc.) and presents an interface to the user selected indicators data structures that contain information relating to respective documents LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS