Posted : 2013-12-29 16:50
Updated : 2013-12-29 16:50

'Samsung, Apple resume patent talks'

By Kim Yoo-chul

Shin Jong-kyun
Samsung co-CEO
Tim Cook
Apple CEO
Samsung Electronics has resumed negotiations with Apple to resolve disputes over patent-infringement claims that have continued for more than two years, sources said Sunday.

"As far as I know, the companies recently resumed working-level discussions toward the signing of a potential deal. They are in the process of narrowing differences over royalty payments," said an official at the Fair Trade Commission (FTC).

The official said the FTC has teamed up with anti-trust regulators in Europe and the United States to discuss the matter.

Samsung recently gave up a plan to file patent lawsuits in Europe against its competitors, including Apple.

The companies earlier agreed to submit a settlement proposal before Jan. 8 to U.S. federal judge Lucy H. Koh, who has been presiding over the patents case since April 2011.

Last year, then Samsung Electronics CEO Choi Gee-sung met with Apple CEO Tim Cook in San Francisco and held 17-hour "marathon talks." However, they failed to reach an agreement because Samsung would not accept Apple's demand for royalties.

A Samsung source said its mobile boss, Shin Jong-kyun, may fly to the U.S. for another round of top-level talks with the Apple CEO sometime early next year in hopes of reaching an agreement.

The FTC official said the anti-trust regulator will finish its investigation into Samsung's claims that Apple infringed on Samsung's wireless patents.

He said Samsung and Apple are still poles apart over the patent values that each has.

But the situation is not desperate.

Samsung still prefers to sign a comprehensive "cross-licensing" deal, allowing the world's biggest smartphone manufacturer to access all Apple's design-related, some standard-essential and commercial patents; while Apple is asking Samsung to pay over $30 per device for Samsung's patent violations, which Samsung thinks is "too much," said another Samsung official who is familiar with the issue.

But the officials said the firms may speed up the ongoing settlement talks.

"This is all about money and pride. This is not a political issue," the FTC official said.

"That's why U.S. President Barack Obama vetoed a ruling by the U.S. International Trade Commission that had decided to place a complete ban on certain Apple products in the U.S. If Obama lets the USITC's decision take effect, then concerns will be raised that the U.S. government cares too much about Samsung-owned patents," he added.

Samsung's legal counsel has been persuading Apple to cut its demands for royalty payments before reaching a deal. Apple is also being flexible in the settlement talks, they said, while declining to specific about what the company had softened its position.

Since April 2011, the two companies have been involved in legal tussles over 30 different cases in nine different countries. The total number of cases has decreased by 25 percent since the legal fight began.

Koh nearly halved Samsung's payment to Apple, to $600 million from a $1.05 billion, which was slapped on Samsung in a California verdict. The U.S. court ordered Samsung to pay an additional $290 million, raising Samsung's payment to a total of $890 million.

"Despite the ongoing legal battle, Samsung is trying hard to up its stake in the global smartphone market to offset concerns over margin profitability and to lead over our main competitors," said a Samsung official.

The Samsung-Apple patent infringement case will enter a second round in March with flagship products by each, such as the Galaxy S3 and iPhone5, the subjects of debate.

Samsung supplies chipsets for Apple's iPhone and iPad products. Samsung is developing Apple's A9 processor to be used in next its next iPhones on a contractual basis.

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