Haunted Empire: Apple After Steve Jobs
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This flurry of requests paled next to the blizzard of motions that roared forth as the two sides fought over the wording of the jury instructions. In a 361-page joint filing, Apple called Samsung’s proposal “long and convoluted,” while Samsung demanded the insertion of the word alleged in claims that Apple had yet to prove. Samsung also separately submitted seven hundred questions spanning forty pages that it wanted the jury to answer in its verdict. Apple, meanwhile, had requested only forty-nine questions.
Each side’s strategy was becoming evident. Apple wanted to simplify the case and focus on the big picture. Samsung wanted to immerse the jury in the nitty-gritty.
In the days leading up to the trial, both sides worked furiously with their first witnesses. Lawyers playing the role of opposing counsel hit them with every question they could think of. What is this? they’d ask, showing a slide or a document. Why are you saying something differently than what you said ten weeks ago in the deposition? Explain the inconsistency. Both sides prepared with an eye toward an appeal.
Judge Koh radiated scrupulous impartiality. The judge was a former intellectual property attorney and a 2010 Obama appointee who had an impressive capacity for details. Equally tough on both sides, Koh backed up each of her rulings with unshakable citations from past cases and procedural rules, seasoned with a bracing dose of her own pragmatism. She denied Samsung’s request that it be allowed to tell the jury about Steve Jobs’s vow to go “thermonuclear.” She forbade Apple from insinuating in front of the jury that Samsung was avoiding taxes in the United States.
From the beginning, Koh empathized with the jury, whose members would be paid just forty dollars a day to show up in court for weeks and sift through an ocean of evidence. Koh later gave them a ten-dollar-per-day raise, but it was still a pittance compared to the hundreds of dollars in hourly rates being paid to the lawyers and expert witnesses.
“I think that’s cruel and unusual punishment to a jury, so I’m not willing to do it,” she told the attorneys as she ordered them to narrow their claims to a more manageable load. She also imposed limits on how long the trial could drag on. Each side could introduce no more than 125 exhibits. They each had a total of twenty-five hours to present their case.
For a trial entangled with global complexities, it was not much time. Samsung’s lawyers, eager to escort the jury deeper into that complexity, were now backed into a corner. Once the judge ruled, they had two choices. They could focus their case more tightly, relying on fewer witnesses and tailoring their evidence to fit the available window. Or they could rush, presenting everything in fast-forward, all the while knowing that such acceleration might overwhelm the jury.
The future of mobile communications was at stake, and the clock was ticking.
On July 30, 2012, a warm summer day, the trial opened at the Robert F. Peckham Federal Building courthouse. Hordes of reporters and lawyers waited in lines that snaked around the drab, bureaucratic five-story building. Everyone, including the seventy-four citizens who had been summoned as potential jurors, was required to enter through a metal detector, where they removed their watches and belts and briefly surrendered their electronic gear, including a slew of iPhones and Galaxies. The room where the trial was going to take place was bigger than Judge Koh’s usual courtroom, but it was still far too small to accommodate the masses lined up outside. The first reporters, who had arrived as early as 7 a.m., snagged the handful of press seats, but everyone else was ushered into an overflow room where monitors were set up.
The morning started with the airing of outstanding issues before the judge. In the tsunami of pretrial motions, Samsung had already protested the use of “gratuitous” images of Steve Jobs that appeared in five slides Apple wanted to show during opening arguments. Judge Koh had overruled the objection, but now Samsung’s lawyers insisted on raising the issue again, asking the judge for clarification on a photo from the Steve Jobs exhibit at the U.S. Patent and Trademark Office. The image of the fallen CEO, honored like a saint at the high temple of patents, was too much for Samsung to endure.
“That’s completely prejudicial, Your Honor,” said Charles Verhoeven, the hard-charging lawyer leading Samsung’s team. “They’ve got a picture of him there. You know he’s going to influence the jury and prejudice the jury into this popularity contest issue.”
Verhoeven, known to colleagues as Charlie, was one of Quinn Emanuel Urquhart & Sullivan’s best patent attorneys, having successfully defended Google and Cisco. In 2010, he and his team were named “IP Litigation Department of the Year” by American Lawyer magazine, beating out both of Apple’s law firms. In law school, Verhoeven had considered dropping out because he didn’t want to be a hired hand. But he had changed his mind when he was introduced to litigation.
“Where else, outside of professional sports,” he said in an interview, “can you have a battle with an adversary and judge or jury?”
Verhoeven was exhausted after a grueling year in which he had tried seven cases. He was also suffering from sciatica and in a great deal of pain. He had to sit on a stool and take regular cortisone shots, but he refused to allow these factors to slow him down. Most of the people in the room had no idea that there was anything wrong with him.
On the other side of the aisle, with his large frame and neatly combed silver hair, Apple’s lead counsel, Harold McElhinny, projected a folksy, disarming air, neither too brainy nor too slick. In his spare time, he liked to travel along the Silk Road in far-flung places like Uzbekistan. His terrifyingly dry sense of humor and demanding style were legendary at his firm Morrison Foerster. According to one story that circulated about his early career, when a junior attorney, trying to make conversation with him in an elevator on a Friday afternoon, asked about his plans for the weekend, McElhinny had supposedly replied, “That’s none of your fucking business!”
It was said in such a way that the poor attorney wasn’t quite sure if he was kidding or not.
McElhinny had a sharp technical mind and vast experience in litigation, but in court he came across as exceedingly personable. Like the television detective Columbo, McElhinny projected a perplexed air as he made the case that it was just a photo of the patent office and that Apple had no influence over what it displayed.
“We didn’t put the picture of Steve Jobs on there.”
The judge promptly overruled Samsung’s objection.
Once the judge had dealt with the influence of Jobs’s ghost, the court was ready to pick a jury. The pool of prospective jurors was a quintessential cross section of Silicon Valley. Several of them had ties to Apple or Google and many had read Isaacson’s biography of Jobs. When the lawyers asked the pool what phones and tablets they owned, one potential juror—a Google employee—named multiple Apple and Samsung phones and tablets as well as the Amazon Kindle and Barnes & Noble Nook readers.
“You’re good for the economy,” Judge Koh told him, eliciting laughter from the observers.
In response to the attorneys’ questions, five potential jurors revealed they had patents issued to them. One man, an engineer who was ultimately dismissed, was named in 125 patents related to physics, robotics, and semiconductor manufacturing. When the judge asked if the pool had read anything about the lawsuit, most raised their hands. What was also striking was the international nature of the jury pool. At least eight of them were born outside of the United States. Several had advanced degrees and technical backgrounds. One was a retired San Jose resident who had worked in the hard-drive industry for more than thirty-five years.
By mid-afternoon, the two sides had picked their jury—an eclectic group of seven men and three women, including a social worker, an engineer, a bicycle store manager, and a young video game enthusiast. The hard-drive veteran was chosen to be the foreman. One of the women dropped out right away after discovering that her employer wouldn’t pay her while she was away, so the trial proceeded with nine jurors. Two were originally from the Philippines and one was Indian American. Only three owned smartp
hones. Most owned just a basic phone by LG or Samsung. Only one had an iPhone. The video game fan didn’t own a phone at all.
At the end of the day, after the jurors had been sworn in and sent home, Samsung attorney John Quinn asked the judge for one more change.
“Your Honor, there is a sign outside the elevator and downstairs that says ‘Apple versus Samsung,’ ” said Quinn. “It also should say ‘Samsung versus Apple.’ ”
To a layperson, the request would have sounded ridiculous. But to the Samsung team, it was a crucial distinction in how the case would be framed.
The judge acquiesced. The sign was quickly amended. For the rest of the trial, the case would be billed as “Apple v. Samsung, Samsung v. Apple.”
Opening arguments began the following morning. Judge Koh issued stern instructions. “You can only say what the exhibits will show, what witnesses will testify to. There should be no argument, no inferences, no arguing the law, and if you do that, I’m going to stop you in the middle of your opening and ask you to please stop arguing the case,” she warned. “Please don’t cross the line.”
McElhinny spoke first about the risks that Apple had taken in developing the iPhone and how Samsung had shamelessly copied it.
“The evidence will show that Samsung had two choices: It could accept the challenge of the iPhone, it could create its own products, it could innovate, it could come up with its own designs, it could beat Apple fairly in the marketplace. Or it could copy Apple,” he said. “As we all know, it’s easier to copy than to innovate.” McElhinny promised to show confidential documents to prove his case.
When he was finished, WilmerHale’s Bill Lee took over to present Apple’s defense against Samsung’s countersuit. Like McElhinny, Lee had an easygoing, obliging demeanor that disguised a keen intelligence and tenacity. As one of the nation’s most admired intellectual property attorneys, he had a long list of wins in his nearly four-decade career. His cross-examination of witnesses in cases like the Broadcom-Qualcomm dispute was legendary. A former college athlete, he still ran 125 miles a month. Even during this trial, he stayed in Palo Alto so he could go jogging in the early mornings.
Lee stressed that Samsung’s patents concerned older technologies that played only a very small part in Apple’s devices. Some of these patents were standard essential, the category of patents that had to be made available to everyone at fair, reasonable, and nondiscriminatory terms. Samsung, Lee argued, was violating that requirement.
Verhoeven’s defense of Samsung was straightforward—Apple’s patents weren’t valid, he said, because there were plenty of examples of similar designs and features before the iPhone and iPad appeared on the scene.
“What the evidence will show is there’s an evolution in technology, in smartphone technology, and the evidence will show that as the guts of these phones got more sophisticated and more sophisticated, you could do more things. It’s not just Samsung,” he said. “The entire industry moved this way.”
Verhoeven agreed that the iPhone was an inspiring product. “But being inspired by a good product and seeking to make even better products . . . is called competition. It’s not copying. It’s not infringement. Everybody does it in the commercial marketplace,” he said, adding that Samsung had invested $35 billion in research and development to help build its smartphones. “Samsung is not some copyist, some Johnny-come-lately who’s doing knockoffs.”
In a move designed to capture the jurors’ interest, Apple opened its case by calling to the stand three of Apple’s high-ranking officials. Tim Cook was not among the witnesses, but few dwelled on his absence. Samsung’s Chairman Lee wasn’t planning on testifying, either. Neither executive had played a direct role in the case. Either way, the throngs of spectators were mesmerized by the realization that Apple was about to break its sacrosanct vows of secrecy and reveal its inner workings in open court.
The first witness was Christopher Stringer, a veteran industrial designer who had worked at the company for nearly as long as Jonathan Ive. He was testifying instead of his boss. Ive was in London, attending a Royal Academy of Arts creative industries event with the Duchess of Cambridge, the prime minister, and other notables.
Stringer looked like no one else at court. Dressed in a light suit with long rock-star-like hair and a neatly trimmed salt-and-pepper beard, he fulfilled every expectation of how a hip designer should look. Some people compared him to Viggo Mortensen’s character Aragorn in The Lord of the Rings movies. If Apple’s intent was to dazzle, it had succeeded. Even before Stringer spoke a word, his physical presence was already testifying to the company’s legendary, subversive cool. In effect, the designer was the first exhibit, another Apple product, poured from a mold that had been polished to a sleek and seemingly effortless elegance.
The journalists in attendance, normally blasé about courtroom theatrics, could not help swooning. Was his suit ivory or beige? Cotton or linen? And how about that beard?
As Stringer glided into the courtroom and settled into the witness chair, his studied perfection instantly affirmed the heart of Apple’s case: Of course Samsung was desperate to copy us.
What he said was equally engaging as he talked about how Apple’s products were conceived around a kitchen table that Ive had set up in the industrial design studio. “It’s where we’re comfortable. It’s where we are most familial,” he said, providing a glimpse into the heart of Apple. “It’s a brutally honest circle of debate.” Stringer, who was born in Australia and partly educated in Britain, spoke with a subtle accent that could have been Australian or British or something in between. That too added to his suaveness.
Stringer’s testimony focused on how the team had designed the iPhone. The point was to emphasize the bold risk Apple had taken in creating such a unique device that was unlike any other in the market. But even as he acknowledged Steve Jobs’s early doubts about the iPhone, Stringer couldn’t help but wax poetic about how their labors had resulted in such a wondrous machine.
“It’s very simple. It was the most beautiful of our designs,” he said, sounding exactly like Ive. “We sometimes don’t recognize it instantly. It may take some energy and adding detail. But when we realized what we had, we knew it.”
When asked about Samsung’s Galaxy devices, Stringer didn’t mince words.
“We’ve been ripped off, it’s plain to see. . . . It’s offensive.”
Apple’s next witness was marketing chief Phil Schiller, who offered further evidence of how the iPhone’s and iPad’s status was revolutionary. Though he was a regular presenter at Apple’s product launch events, Schiller looked less comfortable on the witness stand in an ill-fitting dark suit. None of Apple’s executives wore such formal wear to work.
If he lacked the charisma of Stringer, Schiller made up for it with enthusiasm. The jury paid close attention to his testimony as he revealed more secrets about how Apple was looking for another category it could reinvent after the success of the iPod.
“People started asking, well, if you can have a big hit with the iPod, what else can you do? Make a camera, make a car. Crazy stuff,” Schiller recalled. “With the iPod, we realized that if anything were ever to challenge the idea that you have all your entertainment in your pocket—your movies, your photos, your music—it might be the cell phone.”
Schiller talked about how Apple had invested more than $1.1 billion in advertising to help turn the iPhone and iPad into a success and how shocked he was when he saw Samsung take advantage of its innovation with nearly identical imitations.
“When you copy or steal the idea of one company’s product,” he said, “now you’re trading off of all that investment in marketing, all that good will we’ve created with customers.”
Apple concluded its executive testimony with mobile software chief Scott Forstall, who looked relaxed as he spoke about how his engineers secretly developed the iPhone operating system. In homage to the project’s code name, Project Purple, their building was dubbed the Purple Dorm.
Apple fans had long heard of how new products were developed under lockdown, but to hear Forstall confirm the legend in such detail was thrilling.
“People were there all the time. They were there at night. They were there on weekends. You know, it smelled something like pizza,” he said. “In fact, on the front door of the Purple Dorm, we put up a sign that said ‘Fight Club’ because the first rule of Fight Club in the movie is you don’t talk about Fight Club, and the first rule about the Purple Project is you do not talk about that outside of those doors.”
Forstall smiled often and spoke confidently as he looked directly into the eyes of the jury. He had testified in several depositions, so he was comfortable on the stand. He came across as a little too practiced to some of the reporters, but they lapped up the information.
During cross-examination, Samsung tried to poke holes in Apple’s assertions of the purity of its innovations, introducing emails between Apple’s executives that referenced rivals’ products in designing the iPhone and iPad. But none was enough to overcome Apple’s most damning evidence: an internal email from Samsung’s head of mobile communications, J. K. Shin, to his designers in February 2010, right before the Korean company unveiled the Galaxy S.
“All this time we’ve been paying all our attention to Nokia, and concentrated our efforts on things like Folder, Bar, Slide,” Shin wrote, referring to the phone’s user interface. “Yet when our UX is compared to the unexpected competitor Apple’s iPhone, the difference is truly that of Heaven and Earth. It’s a crisis of design.”
When Apple’s attorney Bill Lee asked Samsung Telecommunications America’s mobile strategy chief Justin Denison about the memo, the executive downplayed it, insisting that such exaggerated statements were part of the company’s self-critical corporate culture. Samsung didn’t want to rest on its laurels and become complacent, he said. “You hear a lot of hyperbolic statements.”