Apple Inc. has spent at least $32 million in one patent-infringement dispute with Google Inc.’s Motorola Mobility unit — one among many legal fights on four continents.
Add them up, and it’s clear Apple is paying hundreds of millions of dollars in its quest to prove that Samsung Electronics Co., Motorola Mobility and HTC Corp. ripped off the iPhone.
The lawsuits are a boon for patent lawyers, who bill companies as much as $1,200 an hour each for their ability to help jurors and judges understand technology and arcane rules of law. Apple has spent more than $2 million on expert witnesses alone for a trial in its case against Samsung in federal court in San Jose, Calif., based on a compilation of what witnesses said they were being paid.
“When you have the smart phone wars and there’s a lot at stake, no one is telling you to do a hard cost-and-benefit analysis,” said Max Grant, a lawyer with Latham & Watkins in Washington. “People aren’t making those judgments. They’re just saying, ‘Do everything you can to get what you need.’ ”
Legal fees, like advertising, are investments in the companies’ efforts to seize and defend share in a global smart phone market that grew 62 percent to $219 billion last year. South Korea-based Samsung is the world’s biggest smart phone maker, while Apple dominates in the U.S.
Apple’s $32 million expense in the one Motorola Mobility dispute equals less than six hours of iPhone sales.
More than money, the complaints seek to use the power of patent law to force competitors to remove popular features or disrupt distribution plans. HTC was delayed in selling its newest phones in May after one Apple victory.
Apple contends devices using Google’s Android operating system copy features that make the iPhone and iPad tablet computer unique, and is fighting counterclaims it uses other companies’ inventions.
Apple co-founder Steve Jobs told his biographer he’d spend $40 billion if necessary on a “thermonuclear war” to prove that Android phones copy the iPhone.
The various sides met several times with no resolution, including an Aug. 20 court-ordered talk between Jobs’ successor, Apple Chief Executive Officer Tim Cook, and Samsung’s former CEO Choi Gee Sung. HTC has said it’s willing to settle. Motorola Mobility says Apple won’t negotiate; Apple says Motorola Mobility is making unreasonable demands.
Consumers choose between Apple and Android makers for their mobile phones, then stick with that operating system for other devices, features and accessories that can build brand loyalty, Apple lawyer Mark Perry of Gibson Dunn told a U.S. appeals court Aug. 20.
“It means more than these patents, such as leveraging cross-license deals,” said David Long, a patent lawyer with Dow Lohnes in Washington. “This is scratching the surface.”
Apple has become the world’s most valuable company, with a sevenfold stock surge since the iPhone debuted in January 2007. The iPhone generated $47 billion in sales in fiscal 2011, and the iPad tablet brought in another $20 billion.
A typical patent case costs each side $10 million to $15 million. That can rise to $25 million or more when a case involves a large number of patents.