10 Nov 2011

Tablet patent wars down under - Apple wins interlocutory injunction and round one against Samsung

by Mary Still, Nicholas Tyacke, Simon Hardwick

Australian courts move quickly to consider interlocutory injunctions to restrain patent infringement – and usually grant them.

In the first Australian round of Apple's global patent war against Android tablets and smartphones, the Federal Court of Australia in Apple Inc v Samsung Electronics Co Ltd [2011] FCA 1164 granted Apple an interlocutory (preliminary) injunction preventing Samsung from launching its Galaxy Tab 10.1 onto the Australian market. In doing so, the Federal Court continued its trend of granting interlocutory injunctive relief to prevent patent infringement.

This decision more broadly demonstrates the Federal Court's willingness to accommodate the urgent needs of a patentee, so as to be able to hear an interlocutory injunction application and deliver judgment in as little as a matter of weeks after the application is brought. The Federal Court will hear Samsung's application for leave to appeal the round one decision and Samsung's application for injunctive relief with respect to Apple's new iPhone 4S over the next month.

Apple's claim

Samsung had intended to launch in Australia a version of its tablet device, the Galaxy Tab 10.1, which runs the Android operating system. Apple alleges that the Galaxy Tab 10.1 infringes a number of Apple's patents, including those relating to the touch screen technology employed in Apple's iPad 2 tablet and iPhone. It sought an interlocutory injunction to restrain Samsung from releasing the Galaxy Tab 10.1 in Australia pending the final hearing of the matter.

Samsung denies Apple's allegations, and has filed a cross-claim seeking to revoke certain patent claims relied upon by Apple.

Interlocutory injunctions: to grant or not to grant

Before granting an interlocutory injunction, a court must consider two questions:

  • first, has the applicant made out a prima facie case, that is, if the evidence remains as it is, there is a probability that the applicant will be successful at the final hearing of the matter?; and
  • second, the balance of convenience: does the inconvenience or injury that the applicant would be likely to suffer if an injunction were refused outweigh that caused to the respondent if the injunction were granted?

Prima facie case

The Court held that this factor weighed in favour of the grant of an interlocutory injunction, saying:

  • Apple had established a prima facie case of infringement;
  • Apple's patents are prima facie valid by reason of their grant and registration. While Samsung had made out a prima facie case of invalidity of one patent, this was not sufficient to override Apple's prima facie case on infringement.

Balance of convenience

The Court considered a number of factors under this heading.

Factors which were evenly weighted were:

  • the detriment, both to Apple from a refusal, and to Samsung from a grant, of the interlocutory injunction, would be significant;
  • damages would not be an adequate remedy, because tablet devices have a short life cycle (typically 12 months) and an adverse outcome would be equivalent to denying that party some form of final relief which it may be found, at the final hearing, to be entitled.

Favouring Apple, however, were

  • Samsung's unwillingness to be available for a limited early final hearing in November 2011, which contributed to the fact that damages would not be an adequate remedy;
  • the fact that Samsung proceeded with its eyes wide open when it launched the Galaxy Tab 10.1, knowing that it could face these claims by Apple in Australia; and
  • the existence of a prima facie case in respect of two separate registered patents, which strengthens Apple's overall prima facie case for relief.

Accordingly, although the Court stated that "the balance of convenience is almost evenly weighted", it ultimately granted the interlocutory injunction.

Samsung appeals and also seeks interlocutory injunctive relief

The Federal Court has expedited Samsung's appeal against this decision, which will probably be heard in December 2011.

Additionally, since the above decision, Samsung has also brought an application to restrain infringement of a number of its patents by sales of Apple's new iPhone 4S. Again the Court has indicated its willingness to deal with this application urgently.

Implications for patentees

This case is significant for several reasons. Firstly, it continues the trend of Australian courts granting interlocutory injunctions to restrain patent infringement, with such relief being granted in all but two cases in the last six years.

Secondly, the Court did so where its decision could (subject to the decision in the appeal) result in the Samsung Galaxy Tab 10.1, a mass-market consumer good, being kept off the Australian market in the lead up to Christmas, a key sales period.

Thirdly, the case demonstrates the willingness and ability of Australian courts to address applications relating to urgent interlocutory relief to prevent patent infringement as quickly as necessary to protect patentees' rights.

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Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication. Persons listed may not be admitted in all States and Territories.