USPTO decision could cut Apple’s (AAPL) claims vs. Samsung by $18 million – or more

The United States Patent & Trademark Office (USPTO) may have cut the legs out from under Apple Inc.’s (NASDAQ:AAPL) muted victory in the recent patent infringement lawsuit decided in California earlier this year against Korean competitor Samsung. Apple’s attempts to win $2.2 billion were already mostly quashed by a decision to award just $119 million in damages instead. However, Tuesday’s USPTO decision on the ‘172 patent could cut this amount by a further $18 million or more.

The patent involved is one on “predictive text input,” or more simply, the autocomplete function that both Apple (AAPL) iPhones and Samsung Galaxies, among many others, feature. The USPTO ruled on Tuesday that the patent was not violated due to prior art, and that the patent in question is in fact invalid.

In other words, since autocomplete features existed long before Apple’s ‘172 patent did, there is no basis for assessing penalties against Samsung for using a feature over which the Cupertino company has no valid claim. The patent in question is United States Patent #8,074,172, and was originally granted on December 6th, 2011.

According to the original award document, now available on Scribd, jurors assessed $17,943,750 in damages based on Samsung’s alleged violation of the ‘172 patent. This amounts to $18 million, and if this sum is eliminated from the judgment – as seems quite likely in view of the USPTO ruling – then damages would be immediately slashed to just $101.6 million.

Matters get worse for Apple’s (AAPL) claims, however. Yesterday, on Thursday, August 6th, 2014, Samsung filed a statement with trial judge Lucy Koh describing the USPTO’s decision regarding Apple’s ‘172 patent. This 12-page document, however, also includes the notation that “Claims 1-6, 8-15, and 17-38 are invalid.” Since all of the claims accepted by the jurors fall within these ranges, it is clear that there is a possibility that all damages awarded will be erased by the USPTO’s decision, and not just those related to the ‘172 patent.

Though the outcome is still doubtful, and Lucy Koh’s decision as well as that of any other courts appealed to will weigh heavily in the balance regardless of the USPTO’s assertions, Samsung appears to have fairly solid grounds to move that at least $18 million be slashed from Apple’s winnings in the contentious litigation, and possibly to nullify the Cupertino company’s rather measly victory entirely.