Samsung Galaxy Tab 10.1 faces further delays

Updated: Launch pushed back until at least next week.

Samsung has temporarily agreed to further delay the Australian launch of its Galaxy Tab 10.1 device until at least next week, as an interlocutory patent case continues to play out in the Federal Court.

Apple and Samsung presented affidavits and patent arguments one-by-one in the Federal Court in Sydney today.

Justice Annabelle Bennett told the parties at the beginning of the hearing that she would not make a temporary judgment due to the "complex patent construction arguments" involved in the case.

She would instead seek to make an interlocutory judgment - regarding whether or not Samsung would be able to launch the Australian version of its tablet ahead of full hearings expected later this year or early 2012.

The decision conflicted with an undertaking made by Samsung to the court early in September, in which it agreed not to launch the tablet until the scheduled interlocutory hearings this week.

The undertaking was set to expire on Thursday with Samsung looking to launch the tablet on Friday, September 30.

Samsung's lead barrister David Catterns SC agreed to carry on the undertaking into next week, pending the interlocutory judgment.

It was the third in a set of delays that had shifted the launch date for the tablet in Australia from initial plans for an August 11 release this year.

However, further delays were expected as the South Korean manufacturer continued to reduce the functionality of the tablet to avoid further patent infringement cases.

Apple had initially taken action on the alleged infringement of 13 patents based on a prototype of the Australian version of the tablet delivered by Samsung counsel in late August. It had since reduced its claims to five patents.

Of these five, one - use of a slider icon (patent number 2008100011) - had been been cut from the case by Monday's hearing and a second - dubbed "zoom bounce" (2009208103) - had been removed this week after an undertaking from Samsung.

Algorithm changes

Samsung today agreed to remove features that potentially infringed Apple's claim to selective rejection (2008258177) from the Australian version of the tablet.

The agreement required Samsung to remove or alter the algorithm used by the tablet to determine whether a user intended to touch the screen or not.

In video evidence tendered on Monday, Apple demonstrated how the Galaxy Tab 10.1 would reject or accept a user's finger gestures, depending on the user's continued movements.

"We can live without that feature," Catterns said.

The remaining two patents in the case included a heuristics patent (2007286532), which corrected a user's intended finger gestures on the touch screen, and the manufacturing techniques behind the iPad and iPad 2's touch screen (2005246219).

Full hearing schedule

Apple hoped to carry the same two patents to a full hearing in order to speed up proceedings.

But Apple's lead barrister Stephen Burley claimed Samsung was deliberately attempting to delay the full hearing in order to escape a permanent injunction of the current version of the tablet and launch a new version.

"We're saying we're ready to go... our friends won't even tread with us on that," he said.

He argued Samsung had "sliced and diced" the Australian version of the Galaxy Tab 10.1 in order to meet Apple's objections and would continue doing so.

Samsung had so far devoted "550 man hours" over three weeks to make some of the changes to the Australian version of the tablet, Burley said, based on a letter to Apple's counsel this week.

Justice Bennett said there was a chance a full hearing of the patent case could begin in November.

"If I'm looking at one product and three patents, I would see it as reasonable," she said.

However, she warned a full judgment would not look to include permanent injunctions on future Samsung products.

Closed-door negotiations

Burley revealed negotiations between the manufacturers at a global level had been ongoing since July last year, when the South Korean manufacturer first launched the Galaxy-branded smartphone.

In an affidavit tendered from Apple's chief patent lawyer Richard Lutton, discussions had begun as soon as Apple saw products which bore "a striking resemblance to Apple's own iPhone products".

Despite the closed-door talks, Lutton said in the affidavit that Apple had come to the realisation Samsung would not cease its infringement of the iPad maker's patents in March this year, a month before Apple began the first of several global proceedings in California.

In a surprise move, Samsung requested Lutton to the stand during the hearing's afternoon session.

During questioning, Lutton confirmed former Apple chief executive Steve Jobs had initiated the talks with Samsung in July last year.

Jobs was not personally involved in the negotiations, he said.

"Samsung's an important supplier and a company with whom we have deep relationships as a supplier and was one of the reasons we wanted to contact them with our concerns and give them a chance to do the right thing," he said.

The court was later closed to the public briefly as Catterns questioned Lutton on confidential matters regarding the negotiations.

Affidavits were also tendered from Apple Australia marketing director Rob Small. First introduced on Monday, Burley continued to use the documents to underline the argument that Apple would lose significantly more than just a unit sale loss if a user chose to buy the Galaxy Tab 10.1 over an iPad 2.

Other elements of Apple's profits were at risk, he claimed, included the third-party apps bought through the App Store, third-party accessories and other first-party Apple products bought by users through the 'halo effect' of a user that was satisfied with their experience.

"Once the Galaxy Tab goes to a purchaser who invests and purchases apps on the Galaxy Tab, we have lost them forever in relation to apps and interactivity because they will then be Android people," he said.

"It's that vitality that underlies the success of Apple and that can be sapped away because of the Galaxy Tab's infringements."

Arguments continued on Thursday as to the effect the introduction of the Galaxy Tab 10.1 would ultimately have on iPad sales.

Catterns alleged for Samsung that the manufacturer's "principal competitors" were Android tablet makers rather than Apple's iPad product line.

He said Android makers, as a whole, would seek to compete with Apple for what he conceded was the iPad maker's lion share in the current Australian market.

But Apple's counsel Burley countered that Samsung had sought to down play the Galaxy Tab's influence on the market to escape injunctions.

"As I understand it there's a concession from [Apple's] perspective that Samsung will be a formidable player in the market," Justice Bennett said.

"The aim of the Galaxy [Tab 10.1] will be two things - to grow an Android market and largely, in the first instance at least, that will be at the expense of Apple."

Updated at 3.45pm to include information regarding questioning of Lutton and correct mispelling of his name.