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Samsung to pay $15M for patent infringement

By Robin Y. Richardson
Feb. 13, 2015 at 10 p.m.

Multinational electronics conglomerate Samsung will have to pay patent investment company Rembrandt Wireless Technologies LP $15.7 million for patent infringement, a Harrison County federal jury decided on Friday.

The case began here Monday in the U.S. District Court for the Eastern District of Texas-Marshall Division with U.S. District Judge Rodney Gilstrap presiding.

After a little more than an hour of deliberating Friday, a jury of four men and four women rendered a verdict in favor of Rembrandt, finding defendant Samsung guilty of infringing on two of Rembrandt's patents-in-suit.

The jury ordered Samsung to pay Rembrandt $15,700,000 in damages. Rembrandt was seeking a reasonable royalty of $31.9 million in the case.

In closing arguments, Attorney Jesse Jenner, co-counsel for Samsung, asked if liability was found, that the jury only award $500,000 to Rembrandt in the case.

"Even though we think Samsung owes nothing, I have to address damages because Rembrandt wants $30 million," Jenner said.

"(Approximately) 24,000 companies believe Bluetooth technology should be shared for free. Obviously, Rembrandt is not a part of that, and they're taking advantage of that."

The two patents-in-suit relate to a "system and method of communication using at least two modulation methods." Rembrandt contended that Samsung infringed the patents by making, using, selling or offering for sale Bluetooth EDR (enhanced data rate) devices, which attorneys for the plaintiff argue is "the heart" of the patented technology in suit.

Samsung denied the infringement and contended that Rembrandt's patents are invalid, referring to a couple of prior art references.

The jury determined on Friday that the defendant did not prove its case of invalidity.

"It's not easy to file a patent case against the biggest electronics company in the world," Attorney Demetrios Anaipakos, co-counsel for Rembrandt, said during closing arguments.

Anaipakos said the last 18 months of litigation, Samsung has tried to confuse and conceal the trust.

Anaipakos said EDR is the heart of the patented technology and exists in every Bluetooth device that Samsung sells.

"You cannot buy a Bluetooth chip without it," he said.

He said unlike Samsung's argument that EDR is not important, it is.

He noted that Rembrandt's expert on Bluetooth, Dr. Bob Morrow, offered more to the case than Samsung's.

"I tell you if there is a smarter, direct, more likeable expert than Dr. Morrow, I haven't met him yet," Anaipakos said.

Anaipakos further argued that the EDR section in the Bluetooth manual uses the word "indicates" just like the claim language described in the patents.

"Dr. Morrow wrote the book on Bluetooth," he said. "He walked you through it. He went two hours going over claim element by claim element, showing you how we satisfy that."

Anaipakos said the defense's expert, Dr. Steven Hall, who spent four years of his life writing EDR standards, admitted that Samsung satisfies the "indicate" claim.

"He said the payload modulation scheme is 'indicated,'" Anaipakos said. "That's our infringement case - straight from the horse's mouth."

Anaipakos said Rembrandt's other expert witness, Dr. Chris Jones, told jurors how there was a striking similarity between the claims in the patent and Broadcom's source code that Jones was asked to look at since Broadcom is Samsung's Bluetooth supplier.

"Without EDR, there's no backwards compatibility," he said, noting backwards compatibility is one of the perks of EDR.

He said the advantages of EDR are important. Besides backwards compatibility other advantages include battery life improvement, ability to move more data and better performance, Anaipakos said.

"I told you in opening statement, the invention in this case is at the heart of EDR and EDR would not work without multiple modulation systems," Anaipakos said.

During his closing arguments, Attorney Jeffrey Sherwood, representing Samsung, said the company does not infringe because the Bluetooth device does not meet the requirement of a change in modulation.

"Everyone of thee claims require a heading in the packet to notify a change in the modulation packet," he said.

"The structure of the Bluetooth header does not change," Sherwood said.

"They have to meet every element of the claim. They failed to. That means there is no infringement and there's no liability," Sherwood said.

Sherwood further argued that if Rembrandt's case on validity was so good then their expert Dr. Robert Akl, who was present for trial, would've actually testified on the validity of the patents.

"If his opinion were so good why didn't they have him march up here and tell you about them?" Sherwood asked.

In his closing arguments, Anaipakos said Rembrandt had clearly proved their validity case and therefore no longer needed Akl to testify.

Sherwood further argued that the inventor of Rembrandt's patents, Gordon Bremer, even testified that he didn't know about Bluetooth until 2007 - three years after Bluetooth EDR was out in the market.

"There's no product for any of his inventions," Sherwood said, adding Bremer tried to sell his patents before Rembrandt bought them, but no one wanted them.

"Mr. Bremer told you he didn't know if battery life was mentioned in the patents," Sherwood said.

Sherwood said not even Samsung's expert witness Steven Hall, technical director at Broadcom and "the father of EDR", was familiar with Bremer.

"Steven Hall… when it comes to EDR, he is the man," Sherwood said. "He never heard of Mr. Bremer.

"Mr. Bremer told you he never contributed to anything in EDR," he said.

Sherwood further argued that Rembrandt's source code expert, Dr. Jones, gave no opinion at all on infringement.

Jenner, co-counsel for Samsung, said Samsung doesn't dispute that there's some value to EDR, but it's like any other feature.

"There's value in features, but they're just not worth thirty million dollars," he said, describing Rembrandt's damage award request as "far-reaching".

"That's not fair," he said of Rembrandt's $30 million request. "EDR didn't solve customers' complaints to battery life. It wasn't the solve all. These patents are not worth $30 million."

Anaipakos, for Rembrandt, argued that the patents' inventor, Bremer, has important inventions.

"Yes, he wasn't a member of the SIG (Bluetooth Special Interest Group), but he has 100 patents," Anaipakos said. "No, he's not going to win popularity, but he's a smart guy.

"It's time for all the smoke to vanish and for justice to be done," Anaipakos said.



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