Apple wins week-long stay on Galaxy Tab 10.1

By James Hutchinson on Dec 2, 2011 3:44 PM
Filed under Strategy

Updated: Scuppers Samsung's plans to launch device today.

The High Court of Australia has delayed the launch of Samsung's Galaxy Tab 10.1 tablet by at least a week, pending an expedited hearing of Apple's application to appeal a Federal Court decision.

The surprise decision comes at the last minute for Samsung, which had planned to launch the delayed tablet as soon as an interlocutory injunction was lifted at 4pm today.

It was a win for Apple, which on Wednesday saw the interlocutory ban on the tablet overturned.

The full bench of the Federal Court unanimously overturned Justice Annabelle Bennett's initial October decision, which had banned the tablet until a final hearing of the case between Apple and Samsung.

Apple will get the chance to appear before a full panel of the High Court next Friday. The move represents a last-ditch effort to ban the Galaxy tablet before the final hearings occur.

Though two panels set aside to hear special leave cases next Friday have both been filled, Justice John Heyond this morning told barristers for both parties that Chief Justice Robert French had "made arrangements" for the case.

Justice Heydon said a further delay on the tablet was "necessary to preserve the subject matter of a special leave application".

"A stay for one week will cost Samsung in effect one week's trade," he said.

However, the delay reduces Samsung's hopes of Christmas trade for the tablet to two - rather than three - weekends before December 25, should Apple lose its High Court bid.

High-speed launch scuppered

In what was characterised as a "high velocity launch", Samsung lead barrister, Katrina Howard SC, revealed during the morning's hearing that the South Korean manufacturer had prepared to launch the Galaxy Tab 10.1 almost immediately after the stay of orders was lifted at 4pm today.

While Samsung was not allowed to import the product into Australia while the orders remain in place, Howard said "plans have been put in place to import the product over the weekend and immediately start promotion and sale" by Monday.

She protested the extended stay, arguing there was "simply no point of public importance here".

"Basically Samsung have been kept out of the market since these proceedings were commenced," she said.

Apple would be required to receive a further stay of orders from the full High Court next Friday in order to successfully ban the Galaxy Tab 10.1 from launch before Christmas.

However, Justice Heydon indicated that, should Apple be granted special leave to appeal the full Federal Court's decision, it would also be likely to receive a further stay on orders, further delaying the Galaxy tablet's local launch.

Granted leave to appeal, Justice Heydon suggested Apple could also win an injunction back.

“One only has to look at statistics to see that once special leave has been granted appeals often succeed," he said. “We would have this rather broken period of injunction up to today, then no injunction for some period of time and possibly a further injunction."

Should that occur, Samsung would likely be unable to launch the tablet until it is deemed commercially unviable.

However, patent expert Mark Summerfield suggested this week that of 63 applications for special leave to the High Court during October, only five were accepted.

High Court appeals

Apple is seeking High Court determinations on specific legal issues involved in the Federal Court judgment.

According to Samsung counsel Howard - reading out Apple's summary of arguments - these include whether a trial judge in an interlocutory hearing would have to consider whether Apple's inconvenience at an injunction being disallowed would outweigh Samsung's injury if the injunction went ahead.

The court would also be asked to consider whether the trial judge would be expected to apply a "verbal formula" on the strength of Apple's case in a final hearing, and whether a party's refusal to proceed with an early final hearing should have relevance on an interlocutory hearing.

In each case, Howard contended the Federal Court's judgment on Wednesday did not raise any matter that would allow Apple's requests to be considered by the High Court.

A Samsung spokeswoman said the company believed "Apple has no basis for its application for leave to appeal and will vigorously oppose this to the High Court".

But in providing reasons for his decision, Justice Heydon said it was "deeply troubling that there was no expedited final hearing" during the initial interlocutory injunction.

He said the case was a matter of "public interest", despite Howard SC's contention that media interest in the ongoing legal battle should not be confused with that of the wider public.

His reasoning appears to side with that of Justice Bennett in the initial hearings, who found Samsung's reluctance to agree to an expedited final hearing was one ground on which to grant the interlocutory injunction.

The full Federal Court overturned that thinking, siding with Samsung that such an agreement would have been unfair to the Galaxy Tab maker.

 
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