Apple suffers first loss against Samsung in US patent case

Apple's first loss against Samsung in a US patent case could mean a ban on imports of some older devices including the iPhone 4 while lessening prospects of the largest smartphone makers ending their legal battles.

The US International Trade Commission's decision, posted in a notice on its website on Tuesday, covers the iPhone 4 and iPad 2 3G sold for use on networks operated by AT&T, T-Mobile US and two regional carriers, General Communication in Alaska and CT Cube in Texas.

With dozens of lawsuits spread across four continents in their battle for a greater share of the US$293.9 billion market for smartphones, each side can now claim a victory in the US. With plenty of litigation remaining, Samsung's victory probably will not bring the two sides closer to settling, said Will Stofega, a programme director at Framingham, Massachusetts-based researcher IDC.

"There's too much skin in the game now," he said. "It's almost so ugly I don't think they'll come to any agreement. Both companies have a lot of cash and are generating a lot of money. It's not like they have to worry about paying the legal bills."

The ITC's import-ban order is subject to review by president Barack Obama. The president can overturn it on public-policy grounds, though that rarely happens. Apple can keep selling the devices during the 60-day review period.

"Historically, the president does not interfere in these sorts of things," said Lyle Vander Schaaf, a patent lawyer with Brinks Hofer in Washington. "It shows the commission is a very bold agency that they are willing to take these steps despite the popularity of the Apple products."

Apple won a $1bn verdict last year in California that has since been cut to about $600 million. It was based on a jury finding that Samsung devices copied the look and unique features of the iPhone and iPad. The commission is scheduled to release a final decision in Apple's trade case against Samsung in August.

A new trial on some of the damages in the California case must be held and a second lawsuit, involving newer models by both companies, is scheduled for next year. An appeals court could hear arguments later this year on Apple's request to halt sales of Samsung products found by the jury to infringe its patents.

Apple pledged to appeal the ITC decision. The underlying findings will be reviewed by a US appeals court specialising in patent cases.

"We are disappointed that the commission has overturned an earlier ruling and we plan to appeal," said Kristin Huguet, an Apple spokeswoman. "Today's decision has no impact on the availability of Apple products in the United States."

* Bloomberg News