US government puts Apple ahead of Samsung - Duh!

Posted by Emory Kale
Samsung had waged a successful patent battle with Apple that resulted in the US International Trade Commission banning certain Apple products in June of this year.
 
However, now, the US government has been able to overturn that ban. The process has been very clearly outlined in the Wall Street Journal:
 
Thanks to the constitutional separation of powers, the executive branch can’t veto rulings issued by federal courts.  The ITC, however, is a different animal because it’s not part of the judiciary.  Once the ITC issues a product ban, the president gets 60 days to review the decision and has the option to veto it on policy grounds.  Presidents rarely do this, which is why even advocates for Saturday’s veto weren’t sure the administration would actually pull the trigger.
 
Complicating matters further, President Barack Obama didn’t make the call on the veto—that decision rested with U.S. Trade Representative Michael Froman.  The current mechanics for the presidential-review process date back to 2005, when the Bush White House delegated presidential authority to the Trade Representative on these matters.
 
An official with the Office of the U.S. Trade Representative said the veto decision “was made solely by” Mr. Froman after a rigorous review process.  The official said nearly two dozen government agencies were afforded the opportunity to present their views.  Among those agencies was the Justice Department, which has argued that ITC product bans aren’t usually appropriate in cases involving patents that are essential for industrywide technology standards.
 
 
Well, the result of the intervention of the US government is a $1 billion loss for Samsung shares on the stock market, and the opportunity for Apple to capitalize in settlement talks with Samsung on its pending patent disputes.
 
 
At the heart of the matter is Samsung desire to wrest greater revenues from licensing fees to Apple. However, the US has chosen to look at the fact that the patents at issues are more in line with being industry standard than unique product features. In other words, the more general the patent, the less onerous the demands that are expected of it, in this case.
 
There is an official letter from U.S. Trade Representative Michael Froman to Irving A. Williamson, chairman of the United States International Trade Commission, on the decision:
 
On June 4, 2013, the United States International Trade Commission (“Commission”) determined that Apple Inc. (“Apple”) had violated Section 337 of the Tariff Act of 1930, as amended, in the importation of certain devices, e.g., certain smartphones and tablet computers that infringe a U.S. patent owned by Samsung Electronics Co., Ltd. and Samsung Telecommunications America Inc. (“Samsung”). Following this determination, the Commission issued an exclusion order prohibiting the unlicensed importation of infringing devices, manufactured for or on behalf of Apple. The Commission also issued a cease and desist order that prevents Apple from engaging in certain activities, such as sale of these products in the United States.
 
Under section 337, the President is required to engage in a policy evaluation of the Commission’s determinations to issue exclusion and cease and desist orders. The President may disapprove an order on policy grounds, approve an order, or take no action and allow the order to come into force upon the expiration of the 60-day review period. This authority has been assigned to the United States Trade Representative. The legislative history of section 337 lists the following considerations relevant to the policy review of the impact of the Commission’s determination to issue an exclusion order: “(1) public health and welfare; (2) competitive conditions in the U.S. economy; (3) production of competitive articles in the United States; (4) U.S. consumers; and (5) U.S. foreign relations, economic and political.”
 
Ultimately, this is a win for Apple. It raises questions about Samsung's ability to leverage its patent portfolio. Was it outside of the remit of the US government? No. The ITC is  a quasi-judicial body so, it's not like the legal system was usurped which begs the question, why go through the charade in the first place?