Winer Report

Case5:11-cv-01846-LHK Document1367 Filed07/26/12 Page1 of 129
Exhibit 1 (Submitted Under Seal)
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EXPERT REPORT OF RUSSELL S. WINER Case No. 11 cv-01846-LHK sf-3122763
UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA
APPLE INC., Plaintiff, v. SAMSUNG ELECTRONICS CO., LTD., A Korean business entity; SAMSUNG ELECTRONICS AMERICA, INC., a New York corporation; SAMSUNG TELECOMMUNICATIONS AMERICA, LLC, a Delaware limited liability company, Defendants.
Case No.
11-cv-01846-LHK
EXPERT REPORT OF RUSSELL S. WINER
**CONFIDENTIAL CONTAINS MATERIAL DESIGNATED AS HIGHLY CONFIDENTIAL ATTORNEYS EYES ONLY PURSUANT TO A PROTECTIVE ORDER**
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TABLE OF CONTENTS Page I. II. III. IV. QUALIFICATIONS............................................................................................................ 1 ASSIGNMENT AND COMPENSATION ......................................................................... 2 APPLES ASSERTED TRADE DRESS ............................................................................ 3 BRANDS ARE AMONG A FIRMS MOST VALUABLE ASSETS ............................... 7 A. B. C. D. V. A. B. C. D. E. VII. What is a Brand? ..................................................................................................... 7 Brand Identity.......................................................................................................... 8 Brand Image .......................................................................................................... 10 Benefits of Strong Brands and Brand Equity ........................................................ 11 Apples Compelling Brand Identity ...................................................................... 12 Apples Advertising Strategy ................................................................................ 14 Apples Investments in Advertising ...................................................................... 20 Third-Party Promotion of Apples Products ......................................................... 21 Impact of Advertising on Consumers.................................................................... 28
APPLES BRAND IS COMPELLING AND VERY STRONG ...................................... 12
APPLES BRAND EQUITY IS AMONG THE HIGHEST IN THE WORLD ............... 29 IMPORTANCE OF THE LOOK AND FEEL OF APPLE PRODUCTS AT ISSUE FOR CONSUMERS.......................................................................................................... 32 APPLES TRADE DRESS IS DISTINCTIVE AND FAMOUS...................................... 33 SAMSUNGS INFRINGEMENT OF APPLES TRADE DRESS .................................. 37 A. B. Analysis of Sleekcraft FactorsiPhone Trade Dress ........................................... 39 Analysis of Sleekcraft FactorsiPad Trade Dress ............................................... 55
IX.
SAMSUNGS MISAPPROPRIATION OF APPLES TRADE DRESS DILUTES AND HARMS APPLES BRAND ................................................................................... 68 A. Samsungs Misappropriation of Apples iPhone Trade Dress and iPhone 3G Trade Dress Dilutes the Distinctiveness of Apples iPhone Trade Dress and iPhone 3G Trade Dress................................................................................... 68 Samsungs Misappropriation of Apples iPad Trade Dress Dilutes Distinctiveness of Apples iPad Trade Dress ........................................................ 72 Diluting the Distinctiveness of Apples iPhone Trade Dress, iPhone 3G Trade Dress, and iPad Trade Dress Harms Apples Brand ................................... 75
C. XI. XII.
SUPPLEMENTATION..................................................................................................... 78 EXHIBITS TO BE USED ................................................................................................. 78
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I.
QUALIFICATIONS 1. I am the William Joyce Professor of Marketing and the Chair of the Marketing
Department at the Stern School of Business, New York University (NYU). I have been on the faculty of the Stern School of Business since 2003. 2. Prior to joining NYU, I was on the faculties of the University of California at
Berkeley, Vanderbilt University, and Columbia University. I have also been a visiting faculty member at M.I.T., Stanford University, the Helsinki School of Economics, the University of Tokyo, cole Nationale des Ponts et Chauses, Cranfield School of Management (U.K.), and Henley Management College (U.K.). 3. Since 2009, I have been the Dean of the Department of Business Administration at
the University of the People, a tuition-free, non-profit, online academic institution with a mission to provide universal access to higher education. 4. I received a B.A. in Economics from Union College and an M.S. and Ph.D. in
Industrial Administration from Carnegie Mellon University. 5. My research, teaching, and consulting work has mainly been focused on consumer
choice, marketing research methodology, marketing planning, advertising, and pricing. I have authored over 60 papers and published in top marketing and management journals such as Journal of Marketing Research, Marketing Science, Management Science, and Journal of Consumer Research. 6. I have won several awards for teaching and research over the course of my career.
In addition, I am an Inaugural Fellow of the INFORMS Society for Marketing Science (ISMS). Because of my lifetime contributions to the practice and research of marketing, I received the 2011 American Marketing Association/Irwin/McGraw-Hill Distinguished Marketing Educator Award for Lifetime Achievement in Marketing. From 2007 to 2009, I also served as the Executive Director of the Marketing Science Institute, a nonprofit organization dedicated to bridging the gap between marketing science theory and business practice. 7. I have written three books, Marketing Management, Analysis for Marketing
Planning, and Product Management, and a research monograph, Pricing. I have served two
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terms as the editor of Journal of Marketing Research. I am the past co-editor of Journal of Interactive Marketing. I am also an Associate Editor of International Journal of Research in Marketing, and the co-editor of the Review of Marketing Science. I serve on the editorial boards of Journal of Marketing, the Journal of Marketing Research, and Marketing Science. A copy of my curriculum vitae is attached as Exhibit 1. 8. I have also participated in executive education programs around the world and
served as advisor to a number of startup companies. 9. I have studied and consulted on brands and branding over the course of my 35-
year career in marketing. My textbook Marketing Management, which is in its fourth edition and is used by leading business schools around the world, includes a chapter focusing on products and branding. I have also taught executive education programs on branding, most recently in Mumbai in January 2012. 10. I have provided testimony as an expert witness in the area of marketing, including
issues related to brands and branding. A list of my testimony in the past four years is attached as Exhibit 2. II. ASSIGNMENT AND COMPENSATION 11. I have been asked by counsel for Apple Inc. (Apple) to opine on (i) the value of
brands generally, (ii) the strength of Apples brand specifically, (iii) the importance of designor the look and feel of productsto the strength of Apples brand, and (iv) the harm to Apples brand resulting from Samsungs misappropriation of Apples distinctive designs. 12. In arriving at my conclusions, I have relied on certain opinions contained in the
expert reports of Hal Poret and Kent Van Liere.1 In addition, I, or Cornerstone Research staff at my supervision and direction, have reviewed other materials identified in Exhibit 3 to this report. 13. Documents and other information cited in my report (including exhibits) are
illustrative of information I have relied upon in conducting my analysis. According to the
Expert Report of Hal Poret in Apple Inc. v. Samsung Electronics Co., March 22, 2012 (Poret Report); Expert Report of Kent D. Van Liere, Ph. D., in the Apple Inc. v. Samsung Electronics Co., March 22, 2012 (Van Liere Report).
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schedule set by the Court and/or agreed upon by the parties, I am to provide an expert report on March 22, 2012, which I do herein. My analysis of information provided to date is ongoing and, if allowed by the Court, I may update and supplement my findings and my report to incorporate additional information that I may receive. 14. For my work in this matter, I am being compensated at my normal hourly rate of
$625 per hour. Staff at Cornerstone Research have assisted me in preparation of this report. Their billing rates range from $230 to $510. 15. In the future, I may receive compensation from Cornerstone Research that reflects
the work that has been done by Cornerstone Research on this matter. The amount of that compensation cannot be quantified at this time. None of my compensation is contingent upon the conclusions I reach or on the outcome of this matter. III. APPLES ASSERTED TRADE DRESS 16. I understand that the trade dress at issue involves the distinctive shape and
appearance of certain Apple products. In particular, the original iPhone trade dress (the Original iPhone Trade Dress) includes: a rectangular product with four evenly rounded corners; a flat clear surface covering the front of the product; the appearance of a metallic bezel around the flat clear surface; a display screen under the clear surface; under the clear surface, substantial black borders above and below the display screen and narrower black borders on either side of the screen; when the device is on, a matrix of colorful square icons with evenly rounded corners within the display screen; and when the device is on, a bottom dock of colorful square icons with evenly rounded corners set off from the other icons on the display, which does not change as other pages of the user interface are viewed.2 Apple Inc., v. Samsung Electronics Co., Amended Complaint, U.S. District Court, Northern District of California, Case No: 11-cv-01846-LHK (Amended Complaint) 57.
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17.
The iPhone 3G trade dress includes all of the elements of the Original iPhone
Trade Dress, plus when the device is on, a row of small dots on the display screen (the iPhone 3G Trade Dress).3 The iPhone 4 trade dress includes all of the elements of the Original iPhone Trade Dress and the iPhone 3G Trade Dress except that it does not have a metallic bezel, but does have a thin metallic band around the outside edge of the iPhone 4, which creates a thin rim adjacent to the face of the phone (the iPhone 4 Trade Dress).4 The iPhone 4s profile is also flatter than the previous versions of the iPhone. 18. The iPhone trade dress (the iPhone Trade Dress) includes the elements that are
common to all versions of the iPhone, namely: a rectangular product with four evenly rounded corners; a flat clear surface covering the front of the product; a display screen under the clear surface; under the clear surface, substantial neutral (black and white) borders above and below the display screen and narrower neutral borders on either side of the screen; when the device is on, a matrix of colorful square icons with evenly rounded corners within the display screen; and when the device is on, a bottom dock of colorful square icons with evenly rounded corners set off from the other icons on the display, which does not change as other pages of the user interface are viewed.5 19. Another Apple product at issue in this case, the iPod touch, builds upon the
original iPhones appearance and configuration and includes all of the elements of the iPhone Trade Dress.6
Amended Complaint 35, 59-60. The iPhone 3G Trade Dress also applies to the iPhone 3GS. See Amended Complaint 35. 4 Amended Complaint 37, 61-62. 5 Amended Complaint 63-64. 6 Amended Complaint 41.
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20.
Apple also owns federal trade dress registrations for its iPhone products. The
trade dress registered in U.S. Registration No. 3,470,983 consists of the image shown in the registration, where it is described as follows: The color(s) black, blue, brown, brown-gray, gray-green, green, orange, red, silver, tan, white and yellow is/are claimed as a feature of the mark. The mark consists of the configuration of a rectangular handheld mobile digital electronic device with rounded silver edges, a black face, and an array of 16 square icons with rounded edges. The top 12 icons appear on a black background, and the bottom 4 appear on a silver background. The first icon depicts the letters SMS in green inside a white speech bubble on a green background; the second icon is white with a thin red stripe at the top; the third icon depicts a sunflower with yellow petals, a brown center, and a green stem in front of a blue sky; the fourth icon depicts a camera lens with a black barrel and blue glass on a silver background; the fifth icon depicts a tan television console with brown knobs and a gray-green screen; the sixth icon depicts a white graph line on a blue background; the seventh icon depicts a map with yellow and orange roads, a pin with a red head, and a red-and- blue road sign with the numeral 280 in white; the eighth icon depicts an orange sun on a blue background, with the temperature in white; the ninth icon depicts a white clock with black and red hands and numerals on a black background; the tenth icon depicts three brown-gray circles and one orange circle on a black background with a white border, with the mathematical symbols for addition, subtraction, multiplication, and the equal sign displayed in white on the circles; the eleventh icon depicts a portion of a yellow notepad with blue and red ruling, with brown binding at the top; the twelfth icon depicts three silver gears over a thatched black-and-silver background; the thirteenth icon depicts a white telephone receiver against a green background; the fourteenth icon depicts a white envelope over a blue sky with white clouds; the fifteenth icon depicts a white compass with a white- and-red needle over a blue map; the sixteenth icon depicts the distinctive configuration of applicants media player device in white over an orange background.7 21. The trade dress registered in U.S. Registration No. 3,457,218 consists of the image
shown in the registration, which is described as follows: The mark consists of the configuration of a rectangular handheld mobile digital electronic device with rounded corners. The matter shown in broken lines is not part of the mark.8 22. The trade dress registered in U.S. Registration No. 3,475,327 consists of the image
shown in the registration, which is described as follows:

7 8
Amended Complaint 49, 125, Exhibit 16; APLNDC-Y0000182302-182304. Amended Complaint 50, 126, Exhibit 17; APLNDC-Y0000182305-182306. 5
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The color(s) gray, silver and black is/are claimed as a feature of the mark. The mark consists of the configuration of a handheld mobile digital electronic device. The material shown in dotted lines, namely, the buttons and openings on the device show the position of the mark in relation to the device and are not considered a part of the mark. The color gray appears as a rectangle at the front, center of the device. The color black appears on the front of the device above and below the gray rectangle and on the curved corners of the device. The color silver appears as the outer border and sides of the device. The color white is shown solely to identify placement of the mark and is not claimed as a part of the mark.9 23. In addition to the trade dress associated with the various generations of the iPhone
and iPod touch, the trade dress associated with Apples tablet computers, namely the iPad and the iPad 2, are also at issue. The iPad trade dress (the iPad Trade Dress) includes: a rectangular product with four evenly rounded corners; a flat clear surface covering the front of the product; the appearance of a metallic rim around the flat clear surface; a display screen under the clear surface; under the clear surface, substantial neutral (black or white) borders on all sides of the display screen; and when the device is on, a matrix of colorful square icons with evenly rounded corners within the display screen.10 24. The iPad 2 trade dress (the iPad 2 Trade Dress) at issue includes all of the
elements of the iPad Trade Dress.11 The overall appearance of the iPad and iPad 2 provides an extremely thin side profile, making the products appear to be relatively flat when placed on the table.
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Amended Complaint 51, 127, Exhibit 18; APLNDC-Y0000182307-182308. Amended Complaint 65-66. 11 Amended Complaint 65-68.
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IV.
BRANDS ARE AMONG A FIRMS MOST VALUABLE ASSETS A. 25. What is a Brand? In its essence, a brand is a persons gut feeling about a product, service, or
company.12 Brands have three primary functions vis--vis the consumer.13 Brands provide: Navigation: Brands help consumers choose from a plethora of choices and can simplify the purchase decision.14 Reassurance: Brands communicate the intrinsic attributes of the product or service and reassure consumers that they have made the right choice. Therefore, brands serve an important function by shaping consumers expectations of a certain level of quality based on their experiences and knowledge about the brand.15 Navigation and reassurance are not unrelated, of course. Expectations about quality, benefits, and value associated with brands help consumers in their purchase decisions, particularly when there is ambiguity or uncertainty in the purchase.16 Engagement: Brands use distinctive imagery, language, and associations to encourage consumers to identify with the brand. Therefore, brands engage consumers on the level of senses and emotions. Brands provide prestige and satisfy consumers emotional needs.17 Brands can also be aspirational and help consumers project their self-image.18
Marty Neumeier, The Brand Gap: How to Bridge the Distance Between Business Strategy and Design 2 (Revised ed., Berkeley, CA: Peachpit Press, 2006). 13 D. Haigh & J. Knowles (2004), Brand Valuation: What It Means and Why It Matters, Intellectual Asset Management, Supplement No. 1, 18-21. David Haigh is CEO of Brand Finance Plc, one of the worlds leading brand valuation consultancies. See http://www.brandfinance.com/ and http://www.brandfinance.com/about/board_members/david-haigh; Alina Wheeler, Designing Brand Identity 2 (3d Ed., Hoboken, NJ: John Wiley & Sons, Inc., 2009). 14 Russell S. Winer & Ravi Dhar (2011), Marketing Management 179 (4th ed., Upper Saddle River, NJ: Pearson Education 2011) (Winer & Dhar (2011)). 15 Winer & Dhar (2011) 179; Tlin Erdem & Joffre Swait, Brand Equity as a Signaling Phenomenon, 7 JOURNAL OF CONSUMER PSYCHOLOGY 131-157 (1998). 16 Winer & Dhar (2011) 179; A. V. Muthukrishnan, Decision Ambiguity and Incumbent Brand Advantage, 22 JOURNAL OF CONSUMER RESEARCH, 98-109 (1995). 17 Winer & Dhar (2011) 179; A. V. Muthukrishnan, Decision Ambiguity and Incumbent Brand Advantage, 22 JOURNAL OF CONSUMER RESEARCH 98-109 (1995). 18 Kevin Lane Keller, Strategic Brand Management 8 (3d ed., Upper Saddle River, NJ: Pearson Education, 2008) (Keller (2008)).
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26.
Therefore, a brand is much more than a product. A strong brand differentiates
itself from other brands and stands out in the marketplace. This differentiation may stem from tangible aspects of the underlying product (e.g., differences related to product performance) or intangible, emotional, and symbolic aspects of the brand (e.g., differences related to what the brand represents).19 Companies that have successful brands create strong brand identity. B. 27. Brand Identity Brand identity is the embodiment of how the company wants its brand to be
perceived by the consumer. Companies invest in brand identity because a compelling brand identity makes it easier for consumers to buy the companys products. Brand identity also makes it easier for a company to sell its products and build brand equity through increased recognition, awareness, and customer loyalty. 28. Brand identity can be composed of numerous brand elements. For example, a
tagline such as Think Different (Apple) is a brand element that is distinctive and memorable to consumers. Distinctive look and feel components are examples of brand elements. 29. A compelling brand identity is one that clarifies and focuses the companys value
proposition by building a high level of brand awareness and recognition. An important trigger of brand awareness and recognition is visual identityidentity that is easy to remember and immediately recognizable. The Nike swoosh and the Apple logo are examples. Therefore, brand identity strategists manage brand perception by integrating meaning with distinctive visual form. Marketing literature has studied how individuals recognize and interpret sensory stimuli from the clutter of brands to which they are exposed.20 Keller (2008) 5. P. H. Bloch, Seeking the Ideal Form: Product Design and Consumer Response, 59 JOURNAL OF MARKETING 16-29 (1995); M. E. H. Creusen & J. P. L. Schoormans , The Different Roles of Product Appearance in Consumer Choice, 22 JOURNAL OF PRODUCT INNOVATION MANAGEMENT 63-81 (2005); J. Josko Brakus, Bernd Schmitt & Lia Zarantonello, Brand Experience: What Is It? How Is It Measured? Does It Affect Loyalty?, 73 JOURNAL OF MARKETING 52-68 (2009); Philip Kotler & G. Alexander Rath, Design A Powerful but Neglected Strategic Tool, 5 JOURNAL OF BUSINESS STRATEGY 16-21 (1984); Robert W. Veryzer, Jr., Aesthetic Response and the Influence of Design Principles on Product Preferences, 20 ADVANCES IN CONSUMER RESEARCH 224-228 (1993); Robert W. Veryzer, Jr., A Nonconscious Processing Explanation of Consumer Response to Product Design, 16
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30.
Visual identity is, of course, related not only to logos like the Apple logo but also
to the product itself and its packaging. Appearance or aesthetics of the productthe physical product form (e.g., shape, symmetry, texture, etc.)influence consumers purchase decisions as well as their evaluation of a particular brand.21 For example, when given a choice between two products that were equal in price and function, target consumers purchase the one that they deem to be more attractive.22 Aesthetically pleasing products provide sensory pleasure and stimulation.23 Finally, product appearance communicates symbolic value (e.g., cool, trendy, cheerful, friendly, valuable, and so on).24 31. Therefore, companies spend a lot of time and resources in developing brand
identity that has a distinctive look and feel. Look and feel is what makes elements of brands proprietary and immediately recognizable. The strongest brands have a look and feel that resonates in the mind of the consumer and sets the brand apart from the clutter of the visual environment. Pentagram, one of the worlds leading design consultancies,25 defines look and feel in the following way: Look is defined by color, scale, proportion, typography, and motion. Feel is experiential and emotional.26 Therefore, look and feel is a very important aspect of brand PSYCHOLOGY & MARKETING 497-522 (1999); Robert W. Veryzer, Jr. & J. W. Hutchinson, The Influence of Unity and Prototypicality on Aesthetic Responses to New Product Designs, 24 JOURNAL OF CONSUMER RESEARCH 374-394 (1998); Mel Yamamoto & David R. Lambert (1994), The Impact of Product Aesthetics on the Evaluation of Industrial Products, 11 JOURNAL OF PRODUCT INNOVATION MANAGEMENT 309-324 (1994). 21 P. H. Bloch, Seeking the Ideal Form: Product Design and Consumer Response, 59 JOURNAL OF MARKETING 16-29 (1995). Yamamoto and Lambert show that even for industrial products, appearance has an influence on product preference. See Mel Yamamoto & David R. Lambert, The Impact of Product Aesthetics on the Evaluation of Industrial Products, 11 JOURNAL OF PRODUCT INNOVATION MANAGEMENT 309-324 (1994). 22 M. E. H. Creusen & J. P. L. Schoormans, The Different Roles of Product Appearance in Consumer Choice, 22 JOURNAL OF PRODUCT INNOVATION MANAGEMENT 63-81 (2005). 23 P. H. Bloch, Seeking the Ideal Form: Product Design and Consumer Response, 59 JOURNAL OF MARKETING 16-29 (1995); M. E. H. Creusen & J. P. L. Schoormans , The Different Roles of Product Appearance in Consumer Choice, 22 JOURNAL OF PRODUCT INNOVATION MANAGEMENT 63-81 (2005). 24 M. E. H. Creusen & J. P. L. Schoormans, The Different Roles of Product Appearance in Consumer Choice, 22 JOURNAL OF PRODUCT INNOVATION MANAGEMENT 63-81 (2005). 25 http://www.pentagram.com/work/#/all/all/newest/. 26 Alina Wheeler, Designing Brand Identity 66 (3d ed. Hoboken, NJ: John Wiley & Sons, Inc. 2009).
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image or how consumers perceive the brand and its connotations. Companies spend enormous sums of money developing a brand image that they hope will have strong, positive, and unique brand associations in the minds of consumers.27 C. 32. Brand Image As noted above, brand image is the perception of the brand and all its connotations
in consumers minds. Brand image is formed by associations that consumers have with the brand; associations are the means by which consumers feel brands satisfy their needs and are often the key sources of brand value.28 Inherent in brand associations are the perceived meaning of the brand in the minds of consumers. The stronger and more unique the brand identity, the stronger are the brand associations and the brand image.29 Brand associations form the building blocks of consumers attitudes or overall evaluations of a brand as well as a brands image. 33. Consumers attitudes towards the brand, in turn, lead to brand loyalty and brand
activity. Brand activity involves the extent to which the customers use the brand, talk to others about it (i.e., generate word of mouth), and seek out brand information.30 Brand value is created when consumers have a high level of awareness; strong, favorable, and unique brand associations; positive brand attitudes; intense brand attachment and loyalty; and high degree of brand activity.31 34. Therefore, brand valueor brand equity as it is known in the marketing
disciplineis intrinsically tied to brand identity and brand association.32 The power and value of a brand lies in what customers have learned, felt, seen, and heard about the brand as a result of their experiences over time.33 Kevin Lane Keller, (1993), Conceptualizing, Measuring, and Managing CustomerBased Brand Equity, 57 JOURNAL OF MARKETING 1-22 (1993) (Keller (1993)). 28 Kevin Lane Keller & Donald R. Lehmann, How Do Brands Create Value, 12 MARKETING MANAGEMENT 26-31 (2003) (Keller & Lehmann (2003)). 29 Keller (1993). 30 Keller & Lehmann (2003). 31 Keller & Lehmann (2003). 32 Marketers use the term brand equity to refer to the value of a brand (http://www.marketingpower.com/_layouts/Dictionary.aspx?dLetter=B). 33 Keller (2008) 48.
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35.
Unauthorized use of brand identity by a competitor reduces brand equity because it
dilutes the distinctiveness of the brand identity (from a companys perspective) and blurs the uniqueness of association (from a consumers perspective). Imitation of look and feel, for example, attenuates brand association and reduces brand equity. D. 36. Benefits of Strong Brands and Brand Equity The value of a brand is measured by its brand equity. Brand equity depends on
how well a company develops its brand identity and concomitantly how strong the brand associations are in consumers minds. Therefore, brand loyalty, brand awareness, brand associations, and a companys proprietary assets determine brand equity.34 Of course, the brands proprietary assets inform each of the other three factors. A valuable brand (a brand whose brand equity is high) confers enormous benefits to the owner of the brand. These benefits include higher brand awareness in the market, increased marketing communication effectiveness, and positive word-of-mouth created by loyal customers.35 Strong brands also engender prestige and emotional attachment.36 Therefore, strong brands have a significant effect on the bottom-line of a firm. 37. The profits generated by strong brands provide the firm with resources to make
investments in new products and increases their probability of success in the market.37 In particular, the firm can leverage a strong brand across products (i.e., product line and product category extensions) and markets (i.e., new channels and geographic markets).38
David A. Aaker, Managing Brand Equity 15-21 (New York, NY: The Free Press, 1991) (Aaker (1991)). 35 Winer & Dhar (2011) 179-180; Keller & Lehmann (2003); Steve Hoeffler & Kevin Lane Keller, The Marketing Advantages of Strong Brands, 10 BRAND MANAGEMENT 421-445 (2003). 36 See, e.g., Aaker (1991) 109-113; Keller (1993); Keller & Lehmann (2003). 37 Aaker (1991) 208-209. 38 Kevin Lane Keller & David R. Lehmann, Brands and Branding: Research Findings and Future Priorities, 25 MARKETING SCIENCE 740-759 (2006).
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V.
APPLES BRAND IS COMPELLING AND VERY STRONG A. 38. Apples Compelling Brand Identity The Apple brand is one of the strongest in the world. This is because Apple has a
compelling brand identity. A significant contributor to Apples compelling brand identity is the look and feel of Apples products: Apple manages to celebrate creativity and self-expression while, [sic] anticipating consumers needs and wants and meeting those needs with solutions that are noteworthy for their ease of use and elegance of design.39 39. Apple imbues its products with a look and feel that is an integral element of
Apples brand identity and sets it apart from the rest of its competitors. Numerous articles, technology websites, and marketing and branding consultancies have extolled Apples look and feel.40 For example: Apples look is always simple and clean and the packaging for the iPad is true to the brand. The art on the cover of the box is a lifesize photo of the product inside. No words, no sell copy. Since this is exactly what the customer cant wait to get their hands on, its the perfect marketing message, building anticipation and making the product the star. The only other art on the package is the Apple logo and the product name on the sides of the box. The product specs (16GB, 3G, etc.) and copyright are hidden on the back at the bottom. Nothing gets in the way of the brand.41
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BrandZ Top 100: Most Valuable Global Brands 2010, Millward Brown Optimor, at
127. See, e.g., Apple iPhone CNET Editors Rating, CNET, June 30, 2007 (http://reviews.cnet.com/smartphones/apple-iphone-16gb-at/4505-6452_732851722.html?tag=mncol;lst;1); Apples iPhone 4 Lives Up to All Expectations, PC World, September 9, 2010; Apple iPod Touch Flash-Based MP3 Player, PC World, March 21, 2008 (http://www.pcworld.com/article/143681/apple_ipod_touch_flashbased_mp3_player.html); Miller: Apples iPad Pleases, But Is It Essential? PC Magazine, April 5, 2010; iPad 2 Review, Engadget, March 9, 2011 (www.engadget.com/2011/03/09/ipad-2-review/); Best Global Brands 2010, Interbrand, at 9; BrandZ Top 100: Most Valuable Global Brands 2010, Millward Brown Optimor,at 127. 41 Branding in the Package: Lessons from Apples Master Marketers, Gianfagna Strategic Marketing, May 21, 2010 (http://www.gianfagnamarketing.com/blog/2010/05/21/branding-in-the-package-lessonsfrom-apples-master-marketers/).
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40.
When the iPhone was introduced to the market, it was described as unique,
cool, and sexy by various industry insiders.42 For example, PC Magazine commented on its first impressions of the iPhone as follows: The first thing you notice when holding the iPhone is how slim it is and how cool it feels in comparison to other smartphones, which are boxy and often thick. . . . [T]he iPhone will become the gold standard in smartphones, and likely give Apple at least a two-year edge over the competition.43 41. Another article in PC Magazine explained that the two reasons the iPhone was
hot were the successful publicity conducted by Apple, and, more importantly, the uniqueness of the iPhone itself: Clearly, the iPhone is hot, but why? Two reasons, said Jen OConnell, author of The Cell Phone Decoder Ring, a book that helps readers pick a cell phone. First, OConnell recognizes the power of the publicity machine at Apple, famous these days for its Mac notebook computers and iPod music players. They give just enough information for people to freak out over it, said OConnell, who credits the company as having enough reach to touch her grandmother in Montana. . . . But OConnell also believes the hype around the iPhone is because of its uniqueness. This is nothing like anyone else has manufactured before, she said. It looks cool and the way you interact with it is cool. Im drooling at the mouth to get one.44 42. PC Magazine also said that [t]he iPhone 3G represents the birth of a new
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computing platform. Its also one very cool phone.45 43. CNET News.com commented that the iPad is, more than any other product the
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company has made, the quintessential Apple device.46
iPhone Hype Has Gadget Geeks Camping and Drooling, PC Magazine, June 11, 2007; Editors Letter: Bloggers, Welcome Aboard, InfoWorld Daily News, June 25, 2007; I Tried an iPhone; A Chance Meeting Turns into a Rare Opportunity to Touch and Try This One-of-a-Kind Apple Creation, PC Magazine, June 28, 2007. 43 First Impressions of the Apple iPhone; Steve Jobs Made Some Heady Claims About the iPhone Back in January. Does the Actual Device Live Up to What He Told Us to Expect? PC Magazine, July 2, 2007. 44 iPhone Hype Has Gadget Geeks Camping and Drooling, PC Magazine, June 11, 2007. 45 Apple iPhone 3G, PC Magazine, July 11, 2008. 46 iPad Unites Apples Media and Mobile Ambitions, CNET News.com, January 28, 2010.
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44.
Industry observers have also commented on the link between Apple and the look
and feel of its various products. For instance, as the author of an article published in eWEEK, described: My first impression of the iPad when I took it out of the (beautifully packaged) box and plugged it into my MacBook Pro was that it looked and felt like a really big iPod touch.47 45. Therefore, there is widespread recognition of the fact that the unique look and feel
of the iPhone, the iPad, and the iPod touch makes these products distinctive. This distinctiveness goes to the heart of Apples brand identity. 46. At the core of brand association is the Apple product itself: how it works and how
it looks. According to Interbrand, a leading branding consultancy: Apple is a brand that customers immediately understand. They know what they get out of adopting and associating with it. Its products are seen as innovative and creative. In contrast to Dell, which creates products that lack any consistent visual cues, Apples design is consistent and distinctive from the clean, silver [sic] or smooth white of its laptops to the pocketsize rectangle of its iPod or iPhone.48 Central to the associations consumers form vis--vis Apple is its painstaking attention to detail in developing the look and feel of Apple products.49 B. 47. Apples Advertising Strategy Apple carefully promotes a single vision for the brand through its advertising and
follows a specific strategy. For instance, the primary focus in all Apple advertising is the product itself. Sissie Twiggs (Ms. Twiggs), Apples Director of Worldwide Advertising, describes this as [t]he product is hero, front and center.50 While the advertising can highlight specific features of the product, nothing upstages the product itself. According to Greg Joswiak (Mr. Joswiak), Apples Vice President, iPhone, iPod and iOS Product Marketing, when Apple promotes its
47
INSIDE MOBILE Becoming Part of the Apple iPad Generation, eWEEK, April 7,
2010. Best Global Brands 2010, Interbrand, at 9. Design Thinking and Innovation at Apple, Harvard Business School Case Study No: 9-609-066, revised March 4, 2010, APLNDC-Y0000134928-134940 at APLNDCY0000134931. 50 Deposition of Sissie Twiggs on July 27, 2011 (Twiggs Dep.) 19:8-11, 97:1-25; see also Deposition of Tamara Whiteside on February 28, 2012 (Whiteside Dep.) 33:24-35:4; Deposition of Stanley Ng on February 21, 2012 (Ng Dep.), 64:3-18, 65:11-16.
49 48
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products, the emphasis is on what the product looks like, its beauty, and its materials.51 Apples iPhone, iPad, and iPod touch marketing communications specifically identify the product is hero approach as part of their guiding principles.52 48. Apple is also selective about the choice of medium in which it advertises its
products. For example, the iPhone media guidelines specifically advise: that across all media, ensure quality of placement over cost or quantity.53 Apples new products are shown publicly for the first time at its own product launch presentations. All of this is typically supported by various television and print advertising campaigns,54 outdoor advertising, 55 and online advertising. 56 Following the product is hero approach, these advertisements prominently feature the product and emphasize the appearance of the product. In addition, Apple pursues product placement opportunities in feature films, talk shows, prime-time network television, and parody news shows.57 Apples marketing programs are well integrated and carefully crafted and implemented to resonate in the strongest possible way with consumers.
Deposition of Greg Joswiak on February 23, 2012 (Joswiak Dep.) 285:20-287:2. Philip Schiller, Apples Senior Vice President of Worldwide Product Marketing, states that [f]or example, when we create our website, one of the first things youll see when you go look at the iPhone is a beautiful photo of it because how it looks is really tantamount. I think its one of the most important things, that its beautiful and the design is something unique and distinctive, and we will show that. See Deposition of Philip Schiller on February 17, 2012, 121:16-22; Apple Inc. Schedule 14A filed January 9, 2012, at 16. 52 See, e.g., APLNDC0002155318-2155322, at APLNDC0002155320; APLNDC0002155335-2155338, at APLNDC0002155336; APLNDC0002008363-2008405, at APLNDC0002008368-69, APLNDC0002008380; APLNDC0001327374-1327415, at APLNDC0001327376; APLNDC0001335264-1335280, at APLNDC0001335266; APLNDC0002203457-2203482, APLNDC0002203459,APLNDC0002203464; APLNDCY0000236364-236370 at APLNDC-Y0000236368; APLNDC0001964084-1964099, at APLNDC0001964087; APLNDC0002027210-2027226, at APLNDC0002027225. 53 APLNDC-Y0000236364-236370 at APLNDC-Y0000236366. 54 APLNDC0002190486-2190487; Joswiak Dep. 278:16-24, 279:10-13; Twiggs Dep. 25:3-26:13, 35:24-36:7, 38:5-8, 42:9-19. 55 APLNDC0002190486-2190487 at APLNDC0002190487; APLNDC00013228751323050; Joswiak Dep. 279:10-13; Twiggs Dep. 38:16-39:24, 40:12-23. 56 Twiggs Dep. 44:10-13, 49:18-21. 57 Deposition of Suzanne Lindbergh on February 28, 2012 (Lindbergh Dep.) 15:317:5. There are several other forms of marketing activity that Apple engages in such as direct marketing sales, public relations, retail marketing, and marketing on Apple.com. See Whiteside Dep. 27:11-18; Twiggs Dep. 50:7-51:1, 203:15, 204:2-7.
51
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49.
Apples product launch presentations, where Apples new products are unveiled
publicly for the first time, are major worldwide media events.58 These events feature the products prominently and generate a tremendous amount of buzz and excitement. For example, BMWs Chief Executive Officer, Norbert Reithofer, described the palpable public anticipation for the iPad as follows: [T]he whole world held its breath before the iPad was announced. Thats brand management at its very best.59 50. The launch presentation is accompanied by a webpage prominently featuring the
product on Apples website and various in-store promotions and demonstrations at Apple retail stores.60 Apple then engages in a press tour, during which the company shares the product with selected press members and allows these individuals to test and review the products themselves.61 51. As noted above, Apple advertises its products on various television programs.62
The company targets specific television shows as opposed to targeting specific television networks.63 The iPhone media guidelines specify that, with respect to television programming, the focus should be on quality programming and environment over ratings.64 For example, ads for the iPhone have aired during television programs such as Late Show with David Letterman, How I Met Your Mother, The Tonight Show with Jay Leno, Gossip Girl, NCIS, Modern Family, So You Think You Can Dance?, Parks & Recreation, 30 Rock, Vampire Diaries, Bones, Saturday Night Live, and The Simpsons.65 The iPad marketing guidelines similarly state that across all A Harvard Business School case study describes these product launch events as follows: Products are not rolled out; they are presented to the public by Apples management team in periodic extravaganzas . . . . See Design Thinking and Innovation at Apple, Harvard Business School Case Study No: 9-609-066, revised March 4, 2010, APLNDC-Y0000134928-134940 at APLNDC-Y0000134937. See also Joswiak Dep. 277:23278:8. 59 Worlds Most Admired Companies 2010, Fortune Magazine, available at http://money.cnn.com/magazines/fortune/mostadmired/2010/snapshots/670.html. 60 Joswiak Dep. 279:7-279:22. 61 Joswiak Dep. 278:9-15. 62 See supra discussion 48. 63 Joswiak Dep. 295:14-16; Schiller Dep. 94:15-95:3; Twiggs Dep. 42:9-44:7; Whiteside Dep. 137:1-138:6. 64 APLNDC-Y0000236364- 236370 at APLNDC-Y0000236366; see also APLNDC0002155335-2155338 at APLNDC0002155336. 65 See, e.g., APLNDC0001380378; APLNDC0001380392.
58
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media, the focus should be on quality of the environment/placement over cost/quantity (e.g., focus on quality programming over ratings, position in break/title/page/etc.).66 Ads for the iPad have aired during programming such as Late Night with Jimmy Fallon, Glee, Modern Family, Greys Anatomy, The Daily Show with Jon Stewart, Friday Night Lights, Two and a Half Men, Hawaii Five-0, CSI, and the NBA Playoffs,67 and ads for the iPod touch have aired during programming such as Gossip Girl, Monday Night Football on ESPN, Vampire Diaries, Scrubs, Smallville, Saturday Night Live, college football games on ABC, and college basketball games on CBS.68 Furthermore, Apples ad campaign titled Theres an App for That won an Effie Award in 2010 for effectiveness in marketing consumer electronics.69 52. In its print advertising, Apple similarly follows a careful strategy.70 The iPhone,
iPad, and iPod touch marketing guidelines specify that, with respect to print advertising, only high-quality magazines within genres that are contextually relevant to the product and audience should be targeted.71 For instance, an internal Apple marketing document for the iPhone demonstrates Apples desire for the appropriate quality and context for its ads, explaining how a creative titled Apps in the city feels out of place in Newsweek but fits in The New Yorker, despite the quality of each publications reputation.72 For example, iPhone ads have run in publications such as The New York Times, USA Today, The Wall Street Journal, Newsweek, The New Yorker, Time, The Economist, Sports Illustrated, The Week, Rolling Stone, and Food &
APLNDC0002145596-APLNDC0002145612, at APLNDC0002145600, APLNDC0002145602. 67 See, e.g., APLNDC0001380370; APLNDC0001380389; APLNDC-X0000021159. 68 See, e.g., APLNDC-X0000014538-14543; APLND-X0000014544-14549. 69 2010 Effie Awards: Awarding Ideas that Work The Winners, 2010, (http://www.effie.org/downloads/2010_Winners_List_with_trophy.pdf). 70 APLNDC0001335342-1335355. 71 See APLNDC-Y0000236364-236370 at APLNDC-Y0000236367; APLNDC0002145596-APLNDC0002145612, at APLNDC0002145604; APLNDC0001327374-APLNDC0001327415, at APLNDC0001327412; see also APLNDC0002194282-2194294 at APLNDC0002194286; APLNDC0002155335-2155338 at APLNDC0002155337; Twiggs Dep. 25:2-26:13, 31:1-24; APLNDC0002190486-2190487 at APLNDC0002190487; APLNDC0001335342-1335355 at APLNDC0001335347. 72 APLNDC0001335342-1335355 at APLNDC0001335353.
66
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Wine,73 and iPad ads have run in publications such as The New York Times, The Wall Street Journal, Business Week, Fortune, Rolling Stone, Real Simple, Wired, Time, The Week, Entertainment Weekly, The New Yorker, and Paper.74 In addition, Apple strategically places its magazine advertisements only on back covers or inside the front cover (in the form of a spread), which is consistent with its goal of putting the focus on the product.75 Exhibits 4, 5, and 6 are examples of print advertisement copies for different generations of the iPhone, the iPad, and the iPod touch. As is evident in these exhibits, the trade dress elements at issue are often clearly visible in Apples advertisements for these products.76 53. Apple also engages in outdoor advertising. This includes transit stops (such as bus
shelters or subway stops) and billboards.77 Apples strategy is to focus on high-traffic, highvisibility spots for all of its outdoor advertising.78 The iPhone and iPad marketing guidelines specify to target top markets with a mix of large-format/mega-site and street-level units.79 The guidelines also recommend to hand-pick locations as much as possible for clear line-of-site [sic] and traffic considerations.80
See, e.g., APLNDC-X0000019536; APLNDC-X0000015992; APLNDCX0000019858; APLNDC-X0000015016. 74 See, e.g., APLNDC-X0000030612; APLNDC-X0000026718-26736; APLNDCX0000030646. 75 Twiggs Dep. 89:22-25; Whiteside Dep. 52:12-15, 86:20-22, 87:2-5; APLNDCY0000236364- 236370 at APLNDC-Y0000236367; APLNDC0001327374-1327415 at APLNDC0001327412; APLNDC0002194282-2194294 at APLNDC0002194286. 76 Ms. Twiggs states in her deposition that, Apple as a company comes from the design of our products. Its the key to what makes our products distinctive, and thats something that we live with every day, fortunately. . . . As I mention all the time, showing our product as hero, with the design elements in the center of our advertising, is absolutely critical. And probably like anyone with their own product, they like to show their product as it appears in the best light possible. And were fortunate with Apple products in that there are so many gorgeous design elements to them, theres a lot to show off. See Twiggs Dep. 164:17-165:4. 77 See APLNDC0001322875-1323050 for Apples permanent billboard locations across the country as of 2012; see also Twiggs Dep. 38:16-39:12. 78 Twiggs Dep. 39:13-40:23. 79 See APLNDC-Y0000236364- 236370 at APLNDC-Y0000236367; APLNDC0002145596-APLNDC0002145612, at APLNDC0002145605; see also APLNDC0002155335-2155338 at APLNDC0002155337. 80 See APLNDC-Y0000236364- 236370 at APLNDC-Y0000236367; see also APLNDC0002155335-2155338 at APLNDC0002155337; Twiggs Dep. 39:13-40:23.
73
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54.
In addition, Apple runs online advertisements for its iPhone, iPad, and iPod touch
products. Specifically, Apple uses two types of online advertising: search engine marketing (SEM) and display advertising.81 The former category involves keyword advertising,82 and the latter can take the form of advertisements on websites, but Apple does not do a whole lot of display advertising.83 The iPhone and iPad marketing guidelines specify that [a]ll sites [for online display. . . must be of high quality.84 55. Lastly, Apple engages in product placement. Product placement involves
placement of a firms products in different forms of mediasuch as television, movies, and videogameswhere the actors or characters are shown using brand-name products and services.85 Suzanne Lindbergh (Ms. Lindbergh), Director of Buzz Marketing at Apple, states that Apple places its products in talk shows, primetime network television, parody news shows, and feature films.86 Unlike most companies, Apple has a policy of not paying for product placement.87 In addition, Apple selectively gives away its products for free to key individuals such as Stephen Colbert.88 Twiggs Dep. 44:10-13, 49:18-21. Twiggs Dep. 44:15-20. 83 Twiggs Dep. 47:1-3; see, e.g., APLNDC-X000007734; APLNDC-X0000007686. 84 APLNDC0002145596-APLNDC0002145612, at APLNDC0002145606. 85 Winer & Dhar (2011) 30. 86 Lindbergh Dep. 9:20-24, 15:3-17:5. 87 Many major marketers pay fees of $50,000 to $100,000 and even higher so that their products can make cameo appearances in movies and television, with the exact fee depending on the amount and nature of brand exposure. See Keller (2008) 253. In contrast, Apple will loan the product to the movie or TV program, but will not make a payment. See Lindbergh Dep. 47:25-48:11; Joswiak Dep. 284:15-285:3; Whiteside Dep. 30:1-9. 88 Lindbergh Dep. 48:12-51:7; The Colbert Report: Tribute to Steve Jobs, Comedy Central, October 6, 2011 (http://www.colbertnation.com/the-colbert-reportvideos/399182/october-06-2011/tribute-to-steve-jobs). Ms. Lindbergh uses the term influencers to characterize these individuals. In marketing terminology, influencers are those individuals who have an influence over potential buyers. Celebrities such as famous athletes, actors, and television personalities are typically included in this category. See American Marketing Association Dictionary, available at http://www.marketingpower.com/_layouts/Dictionary.aspx?dLetter=B; J. Foxton Live Buzz Marketing, CONNECTED MARKETING: THE VIRAL, BUZZ AND WORD OF MOUTH REVOLUTION 24-46 (Justin Kirby and Paul Marsden, eds. Oxford, UK: Elsevier, 2006); S. Curran, Changing the Game, CONNECTED MARKETING: THE VIRAL, BUZZ AND WORD OF MOUTH REVOLUTION 129-147 (Justin Kirby and Paul Marsden, eds. Oxford, UK: Elsevier, 2006); S.
82 81
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C. 56.
Apples Investments in Advertising Apple invests enormous amounts of time, money, and effort to develop, promote,
and improve its brand identity. In 2003, Apple spent $193 million on advertising alone.89 By the time Apple introduced the iPhone in 2007, its advertising expenditures increased to $467 million.90 Apples advertising expenses were almost a billion dollars in 2011 ($933 million),91 and Apple is one of the 100 largest advertisers in the U.S.92 Much of this advertising involves the products at issue. In its 2008 fiscal year, Apple spent almost $98 million in the U.S. on iPhone advertisements.93 Apples advertising in the mobile phone market leads all other phone manufacturers.94 Apples U.S. advertising expenses for the iPhone increased to approximately $227 million in fiscal year 2011.95 Since the iPhones introduction and through the first quarter of its fiscal year 2012, Apple spent a total of $747 million in the U.S. on iPhone advertisements.96 Similarly, Apples U.S. advertising expenses for the iPad were approximately $150 million and $308 million in fiscal years 2010 and 2011, respectively.97 Since the iPads introduction and through the first quarter of its fiscal year 2012, Apple spent a total of $536 million in the U.S. on Brown, Buzz Marketing: the Next Chapter, CONNECTED MARKETING: THE VIRAL, BUZZ AND WORD OF MOUTH REVOLUTION 208-231 (Justin Kirby and Paul Marsden, eds., Oxford, UK: Elsevier, 2006). The general idea is that when the influencers use these products in their personal lives, their followers might notice the products. This can generate buzz, or strong word-of-mouth, among potential users and lead to increased brand awareness and potentially sales. See Winer & Dhar (2011) 30; S. Brown, Buzz Marketing: the Next Chapter, CONNECTED MARKETING: THE VIRAL, BUZZ AND WORD OF MOUTH REVOLUTION 208-231 (Justin Kirby & Paul Marsden, eds. Oxford, UK: Elsevier, 2006). 89 Apple Computer, Inc. Form 10-K filed December 19, 2003, at 66. 90 Apple Inc. Form 10-K filed November 15, 2007, at 64, APLNDC-Y0000135409135576 at APLNDC-Y0000135476. 91 Apple Inc. Form 10-K filed October 26, 2011, at 50, APLNDC-Y0000135683135789 at APLNDC-Y0000135734. 92 How Steve Jobs Apple Married Mass Marketing with Unabashed Creativity, Advertising Age, August 29, 2011 (http://adage.com/article/news/steve-jobs-married-massmarketing-unabashed-creativity/229487/), APLNDC-Y0000134910-134911 at APLNDCY0000134910. 93 APLNDC-Y0000051623. 94 See, e.g., OMD0000039 (phones); OMD0000076 (phones); OMD0000004 (tablets); OMD00000011 (tablets). 95 APLNDC-Y0000051623. 96 APLNDC-Y0000051623. 97 APLNDC-Y0000051623.
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iPad advertisements.98 Apples heavy investments to develop, promote, and improve its brand identity have a concomitant effect on Apples brand image and brand awareness in consumers minds. D. 57. Third-Party Promotion of Apples Products Consumers form associations with the Apple brand not only through Apples own
advertising but also through independent channels. For instance, following their introductions, Apples iPhone and iPad products received widespread media coverage in the form of product reviews in major newspapers and technology publications and websites. The products were also featured on the covers of popular magazines and in popular media. 58. The iPhone was first announced publicly on January 9, 2007.99 But as early as
August 2002, The New York Times had reported on rumors of an Apple mobile phone.100 These rumors continued up until the launch of the iPhone101 and Apples actual announcement received widespread media coverage. Major newspapers ran stories about the iPhone, many of which featured images of the device.102 Television news programs such as The Today Show similarly featured stories about the iPhone, prominently displaying images of the device.103
APLNDC-Y0000051623. Apple Reinvents the Phone with iPhone, Apple Inc. Press Release, January 9, 2007 (http://www.apple.com/pr/library/2007/01/09Apple-Reinvents-the-Phone-with-iPhone.html). 100 Apples Chief in the Risky Land of the Handhelds, N.Y. Times, August 19, 2002 (http://www.nytimes.com/2002/08/19/business/apple-s-chief-in-the-risky-land-of-thehandhelds.html?pagewanted=all&src=pm). 101 Apples Remarkable Comeback Story, CNNMoney.com, March 29, 2006 (http://money.cnn.com/2006/03/29/technology/apple_anniversary/index.htm); Cool 2 Use: The Gear Hunter: Intelligent Design: Since That First Call, Cell Phones Have Evolved, Newsday, April 4, 2006; Apple Stock Hits New High on Analyst Optimism Over iPod, Possible iPhone, Associated Press Newswires, November 21, 2006; Expert View: We Want the iPhone! PC Magazine, November 29, 2006 (http://www.pcmag.com/article2/0,2817,2066661,00.asp). 102 Apple Unveils All-in-One iPhone, S.F. Chronicle, January 9, 2007; Apple, Hoping for Another iPod, Introduces Innovative Cellphone, N.Y. Times, January 10, 2007 (http://query.nytimes.com/gst/fullpage.html?res=9C06E1DC1230F933A25752C0A9619C8B 63&pagewanted=all); Apple Unveils All-in-One iPhone, USA Today, January 10, 2007; Apple Storms Cellphone Field, Wall St. Journal, January 10, 2007; Apples iPhone: Is It Worth It? Wall St. Journal, January 10, 2007. 103 The Today Show, NBC, No Date, APLNDC-X0000358382.
99
98
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59.
The iPhone continued to be the subject of press in the five-month period between
its announcement and release. Nielsen BuzzMetrics reported that the iPhone was riding an unprecedented wave of pre-launch conversation, as there were more than 1.79 million unique visitors to the iPhone website in January 2007 coupled with 870,000 searches for the keyword iPhone.104 Survey results released by M: Metrics on June 15, 2007 found that consumer awareness of the iPhone was high, as 64% of American mobile phone users were aware of the product.105 In addition, an April 2007 survey by ChangeWave Research showed that 26% of those likely to buy an advanced mobile phone in the next three months were planning to purchase the iPhone.106 Many news articles discussing the iPhones upcoming release included photographs of the phone, often turned on to display the devices homescreen.107 60. Much hype surrounded the launch of the iPhone itself. According to news reports,
people lined up outside the Apple store on Fifth Avenue in New York at least two days before the product went on sale.108 In the days leading up to and immediately following its release, the iPhone was the subject of product reviews in major publications.109 Unprecedented Pre-Launch Buzz Sets High Expectations for iPhone Sales and Satisfaction, Nielsen BuzzMetrics Reports, Nielsen BuzzMetrics Press Release, June 25, 2007 (http://www.marketwire.com/press-release/unprecedented-pre-launch-buzz-sets-highexpectations-iphone-sales-satisfaction-nielsen-745783.htm). 105 M:Metrics: High Awareness, Strong Demand for iPhone Among British and American Mobile Phone Users, M:Metrics Press Release via Marketwire News Releases, June 15, 2007 (http://finance.boston.com/boston/news/read/2343970/m). 106 Apple iPhone is Top Choice Among Smart-Phone Buyers (Update 1), Bloomberg.com, June 22, 2007 (http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aVXpexoVPuIg&refer=canad a). 107 Apple Buffs Marketing Savvy to a High Shine, USA Today, March 9, 2007 (http://www.usatoday.com/tech/techinvestor/industry/2007-03-08-apple-marketing_N.htm); Cellphone Users Set Their Sights on Apples iPhone, USA Today, March 16, 2007 (http://www.usatoday.com/tech/products/2007-03-14-cellphone-contracts-iphone_N.htm); Apple Earnings Only Expected to Grow, USA Today, April 27, 2007 (http://www.usatoday.com/tech/techinvestor/corporatenews/2007-04-26-appleprofits_N.htm); The Informed Reader, Wall St. Journal, May 28, 2007; Fever Builds for iPhone (Anxiety Too), N.Y. Times, June 4, 2007 (http://www.nytimes.com/2007/06/04/technology/04iphone.html); iPhone Set for June 29 Debut, USA Today, June 5, 2007. 108 See, e.g., Waiting for the Latest in Wizardry, N.Y. Times, June 27, 2007 (http://www.nytimes.com/2007/06/27/technology/27apple.html); iPhone Notebook: People Starting to Fall in Line, S.F. Chronicle, June 28, 2007 (http://www.sfgate.com/cgiEXPERT REPORT OF RUSSELL S. WINER Case No. 11 cv-01846-LHK sf-3122763
104
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61.
This media coverage often highlighted the distinctive look and feel of the iPhone.
Just a few days after the product was announced, David Pogue of The New York Times published a preview of the product, stating: As youd expect of Apple, the iPhone is gorgeous. Its face is shiny black, rimmed by mirror-finish stainless steel. The back is textured aluminum . . . .110 Similarly, Time magazine described the iPhone as a typical piece of Ive111 design . . . .112 The New York Times observed that [t]he iPhone races straight ahead of the pack on aesthetics by looking and feeling gorgeous,113 and stated that Apple is hoping that the distinctive design of the iPhone will disrupt and even re-invent the concept of the mobile handset in the United States and worldwide.114 62. To top off this enormous amount of publicity for the original iPhone, Time
magazine named the iPhone the Invention of the Year for 2007, displaying color images of the phone on the cover of the magazine as well as with the accompanying story, which identified
bin/article.cgi?f=/c/a/2007/06/28/BUG80QN2E01.DTL&ao=all); Even Apples Co-Founder Is Standing in Line for an iPhone, S.F. Chronicle, June 29, 2007 (http://www.sfgate.com/cgibin/article.cgi?f=/c/a/2007/06/29/BAGJNQOEBO4.DTL); Gave Up Sleep and Maybe a First-Born, but at Least I Have an iPhone, N.Y. Times, June 30, 2007 (http://www.nytimes.com/2007/06/30/technology/30phone.html); Wait Worth It, But Unnecessary, S.F. Chronicle, June 30, 2007 (http://www.sfgate.com/cgibin/article.cgi?f=/c/a/2007/06/30/MNGSCQOVMT1.DTL). 109 Testing Out the iPhone, Wall St. Journal, June 27, 2007 (http://online.wsj.com/article/SB118289311361649057.html); The iPhone Matches Most of Its Hype, N.Y. Times, June 27, 2007 (http://www.nytimes.com/2007/06/27/technology/circuits/27pogue.html?_r=1); Apples iPhone Isnt Perfect, but Its Worthy of the Hype, USA Today, June 27, 2007 (http://www.usatoday.com/tech/columnist/edwardbaig/2007-06-26-iphonereview_N.htm?loc=interstitialskip). 110 Apple Waves its Wand at the Phone, N.Y. Times, January 11, 2007 (http://www.nytimes.com/2007/01/11/technology/11pogue.html?pagewanted=all). 111 Jonathan Ive is the Senior Vice President of Apples Industrial Design group (http://www.apple.com/pr/bios/jonathan-ive.html). 112 Apples New Calling: The iPhone, Time, January 10, 2007 (http://www.time.com/time/business/article/0,8599,1575743,00.html). 113 Does the iPhone Have It? Early Signs Are Good, N.Y. Times, June 24, 2007 (http://www.nytimes.com/2007/06/22/style/22iht-design25.1.6284070.html). 114 Science/Technology: iPhone Launch, N.Y. Times, June 28, 2007.
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The iPhone is pretty as the number one reason that the device is still the best thing invented this year.115 63. The release of subsequent generations of the iPhone similarly received extensive
media coverage. Crowds lined up outside the Moscone Center in San Francisco in anticipation of the rumored unveiling of the iPhone 3G at the Apple Worldwide Developer Conference.116 Major news sources aired or printed high-profile reviews of the iPhone 3G,117 and people again lined up outside Apple stores a day in advance to purchase the device.118 Similar media coverage accompanied the announcement and release of the iPhone 3GS119 and the iPhone 4.120 The announcement that the iPhone 4 would be available on Verizon also received significant press.121
115
Invention of the Year: the iPhone, Time, November 1, 2007 (http://www.time.com/time/specials/2007/article/0,28804,1677329_1678542_1677891,00.htm l). Time magazine featured the iPhone on its cover again in its June 15, 2009 issue on Twitter. See Time, June 15, 2009. 116 KGO SF News at 11AM, ABC 7, June 9, 2008, APLNDC-X0000358416; Jobs Expected to Ring in Apples New iPhone, S.F. Chronicle, June 9, 2008. 117 Squawk on the Street, CNBC, No Date, APLNDC-X0000358459; All Things Digital, Fox Business, No Date, APLNDC-X0000358463; Apples New iPhone 3G: Still Not Perfect, but Really Close, USA Today, July 10, 2008; For iPhone, the New Is Relative, N.Y. Times, July 9, 2008; Newer, Faster, Cheaper iPhone 3G, Wall St. Journal, July 9, 2008. 118 WBZ News at 6, CBS, No Date, APLNDC-X0000358467; News 4 Midday, NBC 4, No Date, APLNDC-X0000358475; First @ Four, NBC 5, No Date, APLNDCX0000358478; NBC 4 New York, No Date, APLNDC-X0000358480; KMBC-TV 9 News, ABC, No Date, APLNDC-X0000358484; SF 7 Morning News, ABC, July 11, 2008, APLNDC-X0000358486; CNN, No Date, APLNDC-X0000358505; Entertainment Tonight, KRON, July 11, 2008, APLNDC-X0000358507. 119 See, e.g., iPhone Stars in Apple Show, Supported by Software, N.Y. Times, June 8, 2009; Apple Unveils Faster iPhone with New Features, S.F. Chronicle, June 9, 2009; iPhone 3G S [sic] Cements Apples Place at the Top, S.F. Chronicle, June 20, 2009; Evening News with Katie Couric, CBS, June 8, 2009, APLNDC-X0000358800; The Kudlow Report, CNBC, June 8, 2009, APLNDC-X0000358801; HLN News, CNNH, June 8, 2009, APLNDC-X0000358805; FOX 25 News at 5, Fox Boston, June 8, 2009, APLNDCX0000358809; KTVU Channel 2 News at 5, Fox San Francisco, June 8, 2009, APLNDCX0000358811; ABC 7 Morning News, ABC San Francisco, June 9, 2009, APLNDCX0000358815; The Early Show, CBS, June 9, 2009, APLNDC-X0000358816; ABC Tech Bytes, ABC, June 18, 2009, APLNDC-X0000358838; Worldwide Exchange, CNBC, June 19, 2009, APLNDC-X0000358864; Fox Business, Fox Business Network, June 19, 2009, APLNDC-X0000358868; Nightly Business News, PBS, June 19, 2009, APLNDCX0000358869; CBS4 News at 5PM, Miami CBS, June 19, 2009, APLNDC-X0000358876; WGN Morning News, Chicago CW, June 19, 2009, APLNDC-X0000358877; American Morning, CNN, June 19, 2009, APLNDC-X0000358880.
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64.
The different generations of the iPhone have also appeared in various forms of
popular media. For instance, late-night comedy shows such as Saturday Night Live122 and Late Night with Conan OBrien123 ran parody skits about the original iPhone; episodes of The Tonight Show with Jay Leno124 and The Colbert Report125 referenced the release of the iPhone 3G; Jimmy Fallon joked about the announcement of the iPhone 3GS on Late Night with Jimmy Fallon126 and interviewed the editor of Engadget about that device;127 and David Letterman referenced the iPhone 4 on an episode of Late Night with David Letterman.128 Various television programs have also included segments that do not explicitly focus on the iPhone yet nonetheless feature the product.129 65. In part because of its distinctive look and feel, which includes the trade dress at
issue, Apples iPhone has been among the most commercially successful products in the world. After the first iPhone shipped in June 2007, Apple sold one million units in 74 days.130 Additionally, within three days of launching the iPhone 3G and iPhone 3GS respectively, Apple sold more than one million units of each.131 Apple sold more than 1.7 million iPhone 4 units in
120
Apples iPhone 4 Makes its Official Premiere, San Francisco Chronicle, June 8, 2010; Apple iPhone 4 Review: No, You Cant Touch It, Time, June 28, 2010; ABC News, No Date, APLNDC-X0000359801; ABC7, No Date, APLNDC-X0000359813; ABC7, No Date, APLNDC-X0000359816; APLNDC-X0000359879; What the Tech?, NBC 10, No Date, APLNDC-X0000359832; CNN, No Date, APLNDC-X0000359930; Fox 5, No Date, APLNDC-X0000359935; Huge Lines to Pick Up New iPhone, San Francisco Chronicle, June 25, 2010. 121 See, e.g., Everything You Need to Know About the Verizon iPhone 4, Time, January 11, 2011. 122 Saturday Night Live, NBC, No Date, APLNDC-X0000358383. 123 APLNDC-X0000358381. 124 APLNDC-X0000358444. 125 APLNDC-X0000358450. 126 APLNDC-X0000358806. 127 APLNDC-X0000358835. 128 APLNDC-X0000359840. 129 APLNDC-X0000358408; APLNDC-X0000358621. 130 Apple Sells One Millionth iPhone, Apple Inc. Press Release, September 10, 2007 (http://www.apple.com/pr/library/2007/09/10Apple-Sells-One-Millionth-iPhone.html). 131 Apple Sells One Million iPhone 3Gs in First Weekend, Apple Inc. Press Release, July 14, 2008 (http://www.apple.com/pr/library/2008/07/14Apple-Sells-One-Million-iPhone3Gs-in-First-Weekend.html); Apple Sells Over One Million iPhone 3GS Models, Apple Inc.
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the three days following its launch.132 In fiscal year 2011 alone, Apple recorded more than $47 billion in net sales revenue for the iPhone and related products and services.133 66. An RBC Capital Markets analyst report commented that: Apples iPhone in
June 2007 disruptively raised the standard for a new kind of smartphone design and user experience, breaking sales launch records, sparking competitive responses, and defying accepted conventions.134 67. Similarly, the announcement that Apple was going to introduce a tablet
computer135 and the formal launch of the iPad was extensively covered in the press.136 Major newspapers and magazinesincluding The New York Times, The Wall Street Journal, Chicago Tribune, The Washington Post, USA Today, Mercury News, and Timeran reviews of the iPad, many of which included photographs of the product.137 Press Release, June 22, 2009 (http://www.apple.com/pr/library/2009/06/22Apple-Sells-OverOne-Million-iPhone-3GS-Models.html). 132 iPhone 4 Sales Top 1.7 Million, Apple Inc. Press Release, June 28, 2010 (http://www.apple.com/pr/library/2010/06/28iPhone-4-Sales-Top-1-7-Million.html). 133 Apple Inc. Form 10-K filed October 26, 2011, at 30, APLNDC-Y0000135683135789 at APLNDC-Y0000135714. 134 Wireless Industry Sizing the Global Smartphone Market, RBC Capital Markets, November 12, 2008, APL-ITC796-0000458644-458703 at APL-ITC796-0000458649. 135 With Its Tablet, Apple Blurs Line Between Devices, N.Y. Times, January 27, 2010 (http://www.nytimes.com/2010/01/28/technology/companies/28apple.html); Apple Takes Big Gamble on New iPad, Wall St. Journal, January 25, 2010 (http://online.wsj.com/article/SB10001424052748704094304575029230041284668.html); WBZ, No Date, APLNDC-X0000359282; Big Apple, WSVN, No Date, APLNDCX0000359423; Top Stories, CNN, No Date, APLNDC-X0000359585. 136 See, e.g., The iPads Big Day, N.Y. Times blog entry, April 3, 2010 (http://bits.blogs.nytimes.com/2010/04/03/live-blogging-the-ipads-big-day/); Buzz Powers iPad Launch, but Will It Be Enough?, Wall St. Journal, April 3, 2010; Fans Snap Up iPads After Waiting Overnight, S.F. Chronicle, April 4, 2010; For iPad, Lines but No Shortage, Wall St. Journal, April 5, 2010; The iPad Is Here: First Look at New Technology, ABC Good Morning America, No Date, APLNDC-X0000359615. 137 Looking at the iPad From Two Angles, N.Y. Times, March 31, 2010 (http://www.nytimes.com/2010/04/01/technology/personaltech/01pogue.html); Laptop Killer? Pretty Close, Wall St. Journal, April 1, 2010 (http://online.wsj.com/article/SB10001424052702304252704575155982711410678.html); iPad Envy . . . and Hope, Chicago Tribune, April 2, 2010 (http://articles.chicagotribune.com/2010-04-02/news/ct-edit-ipad-20100402_1_ipad-applechief-steve-jobs-tablet); Apples iPad: First Impressions, Wash. Post, April 3, 2010 (http://voices.washingtonpost.com/fasterforward/2010/04/apples_ipad_first_impressions.html ); Verdict Is in on Apple iPad: Its a Winner, USA Today, April 2, 2010
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68.
Major magazines also featured the iPad prominently on their cover pages. For
instance, The Economist featured an image of Steve Jobs holding the iPad prominently on the cover of the January 28, 2010 issue.138 And Newsweeks April 5, 2010 issue entitled What Is So Great About the iPad? Everything. also featured the iPad prominently.139 69. Furthermore, countless celebrities have been photographed with an iPad, such that
it has become Hollywoods most buzzed about piece of arm candy.140 And ABCs hit television comedy Modern Family had an episode in which one of the primary stories was a main characters attempts to obtain an iPad the day it was released.141 Oprah Winfrey also named the iPad one of her Ultimate Favorite Things.142 70. The iPad has also been enormously successful. On the first day of iPad sales
alone, Apple sold over 300,000 units.143 Within a month, Apple had sold one million devices,144
(http://www.usatoday.com/tech/columnist/edwardbaig/2010-03-31-apple-ipadreview_N.htm); Curious Customers in Marin Snap Up iPads, Mercury News, April 3, 2010 (http://www.mercurynews.com/ci_14817081); Do We Need the iPad? Time, April 1, 2010 (http://www.time.com/time/magazine/article/0,9171,1977106,00.html). 138 The Book of Jobs: Hope, Hype and Apples iPad, The Economist, January 30February 5, 2010. 139 Newsweek, April 5, 2010 issue titled What Is So Great About the iPad? Everything. 140 Celebrities Who Love the iPad, Forbes.com, June 22, 2010 (http://www.forbes.com/2010/06/22/ipad-cyrus-bieber-technology-celebrities.html). 141 iPad Gets Star Turn in Television Comedy, Wall St. Journal, April 2, 2010. 142 Oprahs Ultimate Favorite Things 2010, The Oprah Winfrey Show, November 19, 2010 (http://www.oprah.com/oprahshow/Oprahs-Ultimate-Favorite-Things-2010/2). 143 Apple Sells Over 300,000 iPads First Day, Apple Inc. Press Release, April 5, 2010 (http://www.apple.com/pr/library/2010/04/05Apple-Sells-Over-300-000-iPads-FirstDay.html). 144 Apple Sells One Million iPads, Apple Inc. Press Release, May 3, 2010 (http://www.apple.com/pr/library/2010/05/03Apple-Sells-One-Million-iPads.html).
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and it hit the two million and three million marks within 60 days145 and in 80 days,146 respectively. During the first quarter of fiscal year 2012, Apple sold 15.43 million iPads.147 E. 71. Impact of Advertising on Consumers Apples products have been widely advertised through Apples own advertising as
well as through independent channels. Such advertising has a substantial impact on consumers purchase decisions, as demonstrated by several market research studies by Apple. For instance, a 2010 iPad Buyer Survey study concludes that [a]ds triggered the desire to own an iPad, while the product features such as being portable/lightweight, Wi-Fi capable, and easy to use were the hooks. 148 In particular, when the surveyed buyers in the U.S. were asked what triggered their decision to acquire an iPad, 44% indicated that they saw the ads and wanted to try the product.149 Similarly, other iPad Tracking Studies conducted in 2010 show that iPad ads were important in triggering the purchase decisions of U.S. buyers.150 72. To summarize: In my opinion, what is noteworthy about Apples brand identity is
that the core strategy focuses on the product itself and its aesthetic presentation to consumers. Apples brand image is closely tied to the look and feel of the products at issue. This look and feel is distinctive and there is an enormous amount of external validity that it is unique and famous. Therefore, not only have consumers developed brand associations toward the look and
145
Apple Sells Two Million iPads in Less Than 60 Days, Apple Inc. Press Release, May 31, 2010 (http://www.apple.com/pr/library/2010/05/31Apple-Sells-Two-Million-iPadsin-Less-Than-60-Days.html). 146 Apple Sells Three Million iPads in 80 Days, Apple Inc. Press Release, June 22, 2010 (http://www.apple.com/pr/library/2010/06/22Apple-Sells-Three-Million-iPads-in-80Days.html). 147 Apple Reports First Quarter Results, Apple Inc. Press Release, January 24, 2012 (http://www.apple.com/pr/library/2012/01/24Apple-Reports-First-Quarter-Results.html). 148 See APLNDC-Y0000023361-23427 at APLNDC-Y0000023362-23363, APLNDCY0000023384. 149 See APLNDC-Y0000023361-23427 at APLNDC-Y0000023363, APLNDCY0000023385. 150 See APLNDC-Y0000023428-23578, at APLNDC-Y0000023485 (indicating 22% of U.S. buyers were influenced by ads); APLNDC-Y0000023579-23729 at APLNDCY0000023636 (indicating 23% of U.S. buyers were influenced by ads); APLNDCY0000023730-23907, at APLNDC-Y0000023806 (indicating 24% of U.S. buyers were influenced by the ads).
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feel of Apple products by experiencing them personally but also by experiencing them via media. In my view, the importance of external validity cannot be overstated; they provide additional, accretive cues with respect to what makes Apples look and feel distinctive. VI. APPLES BRAND EQUITY IS AMONG THE HIGHEST IN THE WORLD 73. According to Fortune: What makes Apple so admired? Product, product, product. This is the company that changed the way we do everything from buy music to design products to engage with the world around us. Its track record for innovation and fierce consumer loyalty translates into tremendous respect across business highest ranks.151 74. At the heart of Apples products is look and feel. Marc Gob, president of
Emotional Branding, LLC and former CEO of Brandimage (one of the top branding firms in the world), had this to say about Apple: Good design is courageous. But apart from its aesthetic value, lets not forget that it represents a long-term investment that can increase a companys value tenfold and over. Can anyone dispute thatApples turnaround is design driven?152 75. Apples brand rankings and brand value increased significantly since the
introduction of the iPhone in 2007, and Apple is now among the top most valuable brands in the world. The increase in Apples brand value has been attributed, in particular, to the successes of the iPhone and the iPad. 76. According to Millward Brown Optimors BrandZ rankings, Apple was the worlds
most valuable brand in 2011. Since the introduction of the iPhone in 2007, Apples ranking has increased from number 16 to number 1, while its brand value has increased from $24.7 billion to $153.3 billion.153 BrandZ has attributed the increase in brand value and ranking to, in part, the iPhone and the iPad: Worlds Most Admired Companies 2010, Fortune, available at http://money.cnn.com/magazines/fortune/mostadmired/2010/snapshots/670.html. 152 M. Gob, Emotional Branding: The New Paradigm for Connecting Brands to People 119 (New York, NY: Allworth Press, 2009). 153 BrandZ Top 100: Most Valuable Global Brands 2007, Millward Brown Optimor, at 10; BrandZ Top 100: Most Valuable Global Brands 2011, Millward Brown Optimor, at 13.
151
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154
[Apple] earned an 84 percent increase in brand value with successful iterations of existing products like the iPhone, creation of the tablet category with iPad, and anticipation of a broadened strategy making the brand a trifecta of cloud computing, software, and innovative, well-designed devices. At the start of last year, few people fretted that their lives felt bereft of a digital gadget smaller than their laptop but larger than their mobile phone. By the end of 2010, however, around 18 million of us owned iPads or other tablets. Apple understood that its customers wanted access to data and images anywhere, anytime, in easy-to-view definition with an easy-to-use touch interface. In a span of a few months, the brand met these needs with the iPad and iPhone 4. Apple trusted that its customers would discover uses for these products that would help organize, simplify or complicate, but mostly improve their lives. This cocreation approach resulted in roughly 350,000 Apple apps, and it added value to the product and the brand. Apple continued quietly developing a cloud and loudly discovered an empty space in the computing category that it filled with a new device the iPad.154 77. Similarly in 2010, Millward Brown Optimor increased its assessment of Apples
brand value by 32 percent from the previous year, while stating that [T]his increase is a tribute to the companys ability to transform itself from an electronics manufacturer into a brand that is central to peoples lives. Apple manages to celebrate creativity and selfexpression while, [sic] anticipating consumers needs and wants and meeting those needs with solutions that are noteworthy for their ease of use and elegance of design. Apple benefited specifically from the popularity of the iPhone, its 100,000 apps, and anticipation for the iPad.155 78. From 2007 to 2011, Interbrand increased the ranking of Apples brand from
number 33 to number 8. During the same time period, the value of Apples brand as calculated by Interbrand increased from $11.037 billion to $33.492 billion.156 Like BrandZ, Interbrand linked the success of the iPhone and iPad products to the increase in Apples brand value and rankings. In 2008, the Interbrand report stated: Can anything slow the ascent of Apple? Its ability to identify new customer needs and deliver products of beautiful simplicity and BrandZ Top 100: Most Valuable Global Brands 2011, Millward Brown Optimor, at 16, 48, 83. 155 BrandZ Top 100: Most Valuable Global Brands 2010, Millward Brown Optimor, at 127. 156 Best Global Brands 2007, Interbrand, (http://www.interbrand.com/en/best-globalbrands/best-global-brands-2008/best-global-brands-2007.aspx); Best Global Brands 2011, Interbrand, at 20.
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157 158
desirability continue to put it in a league of its own. The latest iPods, iPhone and MacBook Air strike the perfect balance between coolness and mass appeal . . . .157 79. Interbrands 2011 report further underlined the importance of the iPhone and iPad
products to the Apple brand: Setting the bar high in its category and beyond, Apple is the icon for great branding meeting great technology to deliver a unique overall experience, making its giant leap from #17 to #8 in the rankings less than surprising. Consumers continue to follow its product launches with anticipation and are quick to integrate its sleek products into their lifestyles. Continuing its wave of first-tomarket products, Apple launched the iPad in 2010 creating the new tablet category in the process. Since its launch, young and old alike have embraced it as a tool, with organizations from education to health to sales coming on board as well. Apple has even implemented the iPad in its innovative retail spaces as a service tool for customers as they wait in line.158 80. Apple makes the most of the success of the iPhone and iPad to increase its brand
value by using what the company calls logo lockup. All of Apples advertisements for the iPhone and iPad feature the Apple icon next to the name of the product in the ad.159 According to Ms. Twiggs, this technique allows advertisers to [lock] two things together, a logo plus something else [such as a company name or product name].160 In this instance, the use of the logo locks the iPhone and the iPad to the Apple brand. Ms. Twiggs testified that this technique informs consumers as to the company that makes the featured product and is one of the branding elements and in general an important element of advertising.161 Apple also places its logo on the back of the iPhone further encouraging those who view it to associate the iPhone and its distinct look and feel with the Apple brand. 162 81. To summarize: Apples trade dress at issue is an integral part of the look and feel
that is so important to Apples brand identity. As I have discussed above, Apple has been
Best Global Brands 2008, Interbrand, at 30. Best Global Brands 2011, Interbrand, at 20. 159 Twiggs Dep. 100:2-101:14. 160 Twiggs Dep. 100:13-19. 161 Twiggs Dep. 101:7-14. 162 Deposition of Eric Jue on February 24, 2012 (Jue Dep.), 132:20-133:8.
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extraordinarily successful by making its products look and feel the fulcrum of its branding strategy. In my opinion, a combination of a high degree of innovation and cutting-edge technology and a unique and distinctive look and feel has been instrumental in the branding and concomitant success of the iPhone, iPad, and iPod Touch products. VII. IMPORTANCE OF THE LOOK AND FEEL OF APPLE PRODUCTS AT ISSUE FOR CONSUMERS 82. Market research studies conducted or commissioned by Apple provide insights
into how the look and feel of Apples iPhone, iPad, and iPod touch products impact consumers attitudes toward the Apple brand and their purchase decisions. 83. For example, according to a pre-iPhone launch market study conducted by Apple
in May 2007 about the most important reasons to purchase an iPhone, appearance and design was the top-ranked reason for those surveyed who were very/somewhat likely to purchase an iPhone.163 84. In an iPhone Owner study conducted by Apple in the U.S. in March-April 2011,
when iPhone 3GS and iPhone 4 owners who had considered Android were asked what convinced them to get an iPhone after considering Android, 32% indicated they liked the physical appearance and design.164 According to the same study, of the iPhone 3GS and iPhone 4 owners who bought their phones, 46% of those surveyed in the U.S. indicated physical appearance and design as one of the very important features in their decision to purchase their iPhones.165 85. Similarly, in iPhone Buyer Surveys conducted by Apple during the fourth quarter
of Apples 2010 fiscal year, and the first, second, and third quarters of Apples 2011 fiscal year, when iPhone 3GS and iPhone 4 buyers were asked to rank the importance of a given list of attributes in their purchase decision, 46% to 50% of those surveyed in the U.S. ranked attractive appearance and design as very important (or top box), while 32% to 35% of those surveyed in
APLNDC-Y0000028751-28849 at APLNDC-Y0000028771. APLNDC-Y0000025024-25147 at APLNDC-Y0000025027, APLNDCY0000025060. 165 APLNDC-Y0000025024-25147 at APLNDC-Y0000025064.

164
163
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the U.S. ranked attractive appearance and design as somewhat important (or second box).166 In sum, 81% to 82% of those surveyed in the U.S. in these studies ranked attractive appearance and design in top-2 boxes.167 The top-2 boxes represent a conventional measure used by companies and in the market research industry. 86. Market research conducted by Apple about the iPod touch also provides support
for the importance of the look and feel of the product for consumers. For instance, according to an iPod Buyer Survey conducted by Apple during the second quarter of its 2009 fiscal year, when iPod touch buyers were asked to rank the importance of a given list of attributes in their purchase decision, 42% of those surveyed in the U.S. ranked attractive appearance as very important.168 Another iPod Buyer Survey, conducted by Apple during the fourth quarter of its 2009 fiscal year, similarly shows that when iPod touch buyers were asked to rank the importance of a given list of attributes in their purchase decision, 37 % of those surveyed in the U.S. ranked attractive appearance as very important.169 VIII. APPLES TRADE DRESS IS DISTINCTIVE AND FAMOUS 87. I have been asked to consider whether Apples iPhone Trade Dress, iPhone 3G
Trade Dress, and iPad Trade Dress have acquired distinctiveness among consumers and potential consumers of smartphones and tablets, which I understand to mean that consumers associate these trade dresses with a particular source. In evaluating whether these trade dresses have acquired distinctiveness, I have been instructed to consider the following factors: the extent and manner of APLNDC-Y0000027256-27340 at APLNDC-Y0000027258, APLNDCY0000027277; APLNDC-Y0000027341-27422 at APLNDC-Y0000027343, APLNDCY0000027362; APLNDC-Y0000027423-27505 at APLNDC-Y0000027425, APLNDCY0000027450; APLNDC-Y0000027506-27599 at APLNDC-Y0000027508, APLNDCY0000027572. 167 APLNDC-Y0000027256-27340 at APLNDC-Y0000027277; APLNDCY0000027341-27422 at APLNDC-Y0000027362; APLNDC-Y0000027423-27505 at APLNDC-Y0000027450; APLNDC-Y0000027506-27599 at APLNDC-Y0000027572. 168 APLNDC-Y0000027807-27941 at APLNDC-Y0000027809, APLNDCY0000027866. Also, 79% of those surveyed in the U.S. ranked attractive appearance as very important or somewhat important. See APLNDC-Y0000027865. 169 APLNDC-Y0000027942-28097 at APLNDC-Y0000027944, APLNDCY0000028014. Also, 75% of those surveyed in the U.S. ranked attractive appearance as very important or somewhat important. See APLNDC-Y0000028013.
166
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Apples advertising for the iPhone, iPad, and iPod touch; the length and manner of Apples use of the trade dresses; actual recognition of the trade dresses; whether Samsung copied Apples trade dresses; and whether Apples use of these trade dresses has been exclusive. 88. I have also been asked to consider whether Apples iPhone Trade Dress, iPhone
3G Trade Dress, and iPad Trade Dress are famous among the general consuming public. In assessing whether these trade dresses are famous, I have been instructed to consider the following factors: the duration, extent, and geographic reach of advertising and publicity of the trade dress, whether advertised or publicized by the owner or third parties; the amount, volume, and geographic extent of sales of goods or services offered under the trade dress; and the extent of actual recognition of the trade dress. I am not rendering a legal opinion on distinctiveness. However, the factors I have been asked to consider are consistent with the type of information I would consider in assessing whether a branded product (or a group of branded products) is likely to be viewed as having a distinctive look and feel. Similarly, I am not rendering a legal opinion with respect to fame. Factors such as advertising, sales, market recognition, competitor reactions, and exclusivity are consistent with the types of information that would be informative in determining whether the look and feel of a branded product (or a group of branded products) has become famous in the marketplace. 89. Advertising. As discussed above, Apple has invested significant resources in
advertising the iPhone and iPad products.170 These advertisements generally focus on the products themselves, displaying the elements of the asserted iPhone Trade Dress, iPhone 3G Trade Dress, and iPad Trade Dress.171 Moreover, the iPhone and iPad products have been the subject of extensive press coverage, include numerous product reviews, and have appeared in popular media, such as television shows and movies.172
See supra Section V.B-C; 106, 142. See id.; see, e.g., APLNDC-X0000363655, APLNDC-X0000007455, APLNDCX0000007699, APLNDC-X0000364248; APLNDC-X0000363682, APLNDC-X0000363702, APLNDC-X0000364115, APLNDC-X0000364307, APLNDC-X0000363862; APLNDCX0000363709. 172 See supra Section V.D.
171
170
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90.
Sales. Both the iPhone and iPad have experienced significant success in the
marketplace.173 Between late June 2007 and summer 2010, Apple sold 24.9 million original iPhone, iPhone 3G, and iPhone 3GS devices,174 and between April 2010 and before fall 2010, it sold 4.3 million iPad tablets in the U.S..175 Between April 2010 and June 2011, Apple sold 14.1 million iPad tablets in the U.S.176 and spent more than $300 million on advertising the iPad.
177
91.
Actual Recognition. The surveys from the Poret Report show that 61.0% of
respondents associate the iPhone Trade Dress with Apple, 68.0% of respondents associate the iPhone 3G Trade Dress with Apple, and between 57.3% and 75.2% of respondents associate the iPad Trade Dress with Apple.178 As part of his survey methodology, Mr. Poret also tested control devices to determine what percentage of people associated those devices with Apple. A much smaller percentage of respondents associated the control devices with Apple, namely 3.7% of respondents associated the control phone with Apple and between 10.8% and 17% of respondents associated the control tablet computer with Apple.179 92. Copying. As discussed below, Samsungs internal documents support the
conclusion that Samsung held up Apples iPhone and iPad products as the aspirational models in designing its own smartphone and tablet products, and even made changes to its graphical user interface specifically to make the icons look more like Apple icons, thus demonstrating Samsungs marketing tactics to create products that looked like Apple products.180
See supra 65-66, 70; see infra 107, 142. See 107. 175 See infra 142. 176 APLNDC-Y00000051599-51605, at APLNDC-Y00000051600. 177 APLNDC-Y0000051623, Apple Inc. Advertising; Q111 Ad Budget Summary, APLNDC00002104534-554, at APLNDC00002104535; Q211 Ad Budget Summary, APLNDC0002788581-588, at APLNDC0002788581; Q311 Ad Budget Summary, APLNDC0002033979-987, at APLNDC0002033979. 178 Poret Report at 36, 52, 60-61, 64. 179 Poret Report at 35-36, 52, 65-66. 180 See infra 132-138.
174
173
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93.
Exclusivity. I understand that Apple has an industrial design expert in the case,
Peter Bressler, who will be opining that no phone looked like the iPhone and no tablet computer looked like the iPad before the launch of the iPhone and iPad, respectively. Accordingly, I am not offering a separate opinion on the issue of the exclusivity of Apples use of the iPhone Trade Dress, iPhone 3G Trade Dress, or iPad Trade Dress. For purposes of my analysis, I assume that the relevant trade dresses were substantially exclusively used by Apple when Apple first launched the iPhone and the iPad. 94. In light of this evidence, it is my opinion that, from a brand marketing perspective,
consumers have formed strong associations with Apple and find the look and feel of the iPhone and the iPad to be distinctive in the marketplace. It is also incontrovertible that the look and feel of these products, which is closely tied to Apple, is famous and contributes to the halo surrounding the tremendous marketing success of the Apple brand. 95. I understand that the statute setting forth the elements of a dilution claim uses the
language a mark is famous if it is widely recognized by the general consuming public of the United States. However, the concept of a general consuming public does not have meaningful empirical content from a marketing perspective. This is because companies always target demographic segments conditional on factors such as the relevant industry, the nature of the market, the nature of the product offering, and the image the brand seeks to create. Brands do not become successful or famous because companies try to cover every potential consumer in the market. Indeed, careful targeting and positioning is very important in marketing. There may be beneficial spillovers from the core segments being targeted to other segments, but these spillovers only enhance the success and fame of the brand. Of course, a brand cannot credibly have a claim to fame in the market if it is too narrowly focused in a demographic or geographic niche. For example, a University of Rochester varsity logo may have great brand resonance to residents in the Rochester Metropolitan Statistical Area, but that does not give it general fame. 96. It is fairly typical in consumer electronics to focus efforts on a broad spectrum of
the consumers without necessarily targeting tail segments such as young children or the elderly. This is precisely the targeting strategy that Apple and Samsung follow. According to Ms. Twiggs
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and Ms. Whiteside, Apples target demographic includes the age 18 to 49 demographic.181 According to Todd Pendleton (Mr. Pendleton), Samsung Telecommunication America, LLCs (STA) Chief Marketing Officer for wireless terminals, Samsungs main demographic is 18 to 34 year olds.182 97. The Poret Report shows that 81% of respondents who were in the 16-24 age group
associated the iPhone Trade Dress and the iPhone 3G Trade Dress with Apple, while 67.9% of the respondents in the 25-34 age group, and 60.0% of the respondents in the 35-44 age group associated the trade dresses at issue in this case with Apple.183 Therefore, from a marketing and branding perspective, the iPhone and the iPad trade dresses have undoubtedly achieved fame. IX. SAMSUNGS INFRINGEMENT OF APPLES TRADE DRESS 98. As noted above, a brand can be damaged by a companys unauthorized use of
brand elements that are proprietary to the owner of the brand.184 I understand that certain of Apples claims for relief against Samsung pertain to Samsungs misappropriation of the distinctive appearance of the iPhone, the iPod touch, and the iPad.185 I understand that Apple has asserted that this misappropriation constitutes both trade dress infringement and trade dress dilution. In this section of my report, I analyze from a marketing perspective whether the look and feel of the Samsung Galaxy line of smartphones and tablet computer products misappropriates Apples proprietary look and feel, taking into consideration certain factors in the likelihood of confusion test. I understand that the likelihood of confusion test is the legal standard to analyze Apples trade dress infringement claim for relief against Samsung.
181
23 24 25 26 27 28
182
See Twiggs Dep. 29:2-19; Whiteside Dep. 134:5-135:24. Deposition of Todd Pendleton on March 21, 2012 (Pendleton Rough Dep. Tr.), 37,
44-45. See Poret Report at 51. See supra 35; see also M. Morrin & J. Jacoby, Trademark Dilution: Empirical Measures for an Elusive Concept, 19 JOURNAL OF PUBLIC POLICY & MARKETING 265-276 (2000). 185 See supra Section IV for a detailed outline of Apples asserted trade dress. There are several others claims that Apple asserts against Samsung that are outside the scope of my assignment.
184 183
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99.
I also understand that likelihood of confusion may be assessed by examining eight
factors (the Sleekcraft Factors).186 While I have not been asked to provide an opinion on the likelihood of confusion between Apples products and Samsungs products, the Sleekcraft Factors mirror the types of information that I, as a marketing expert, would consider in assessing whether Samsungs misappropriation of Apples trade dress is likely to affect consumers purchasing behavior. 100. I have been informed that the Sleekcraft Factors are: (a) (b) (c) (d) (e) (f) (g) (h) 101. Strength of the mark; Proximity of the goods; Similarity of the marks; Evidence of actual confusion; Marketing channels used; Types of goods and the degree of care likely to be exercised by the purchaser; Defendants intent in selecting the mark; and Likelihood of expansion of the product lines.
From a marketing perspective, analysis of the above factors pertains not only in
14 the context of purchase (or point-of-sale) confusion but also in the context of post-purchase (or 15 post-sale) confusion. Consumers constantly use Apples iPhone, iPad, and iPod touch products in 16 17 brand image effects on potential consumers who are not immediate point-of-purchase consumers. 18 Unlike, say, a brand of detergent, which is bought and then used in ones home, smartphones, 19 tablet computers, and music players are by their nature mobile devices and are regularly seen by 20 others. Therefore, brand image and brand associations are not confined to point-of-purchase 21 situations. Picture the following scenario, which I call the Imitative Scenario: College freshman 22 Jim sees a classmate with a cool-looking tablet and tells a friend about it. Oh, thats Ellens 23 new toy, says the friend, She bought it at Best Buy. Ill send you a link. The friend (who 24 knows that it is an iPad) sends a link to Jim (who does not know it is an iPad) and Jim goes onto 25 26 27 28 See AMF Inc. v. Sleekcraft Boats, 599 F.2d 341, 348-349 (9th. Cir. 1979). See APLNDC-Y0000024549-24798 at APLNDC-Y0000024574, APLNDCY0000024576-24579, APLNDC-Y0000024582, and APLNDC-Y0000024585; APLNDCY0000025691-25822 at APLNDC-Y0000025782; APLNDC-Y000023361-23427 at APLNDC-Y000023396.
187 186
public spaces.187 As publicly used devices, the iPhone, iPad, and iPod touch trade dress have
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the website and ends up buying a Samsung tablet, which looks almost identical to the iPad. Jims younger sister then asks for the same Samsung tablet for Christmas. The Imitative Scenario is a direct effect of Samsungs misappropriation of Apples trade dress: because Samsung has misappropriated Apples trade dress, the distinctiveness of Apples trade dress is attenuated, and consumers no longer necessarily associate the look and feel of the iPhone, iPad, and iPod touch solely with Apple. 102. There is a further, indirect effect on Apples brand. As I have shown above, the
evidence indicates that consumers gravitate to Apple not only because of the innovative features of the products at issue but also because the products have distinctive aesthetic appeal. When consumers can buy non-Apple products with a similar look and feel, the products at issue lose part of their distinctive aesthetic appeal. As I discuss below, this indirect effect has an additional detrimental impact on Apples brand equity. 103. Below, I separately analyze the Sleekcraft Factors for the iPhones trade dress and
the iPads trade dress. A. Analysis of Sleekcraft FactorsiPhone Trade Dress Sleekcraft Factor 1: Strength of the trade dress188 104. The iPhone and its subsequent generations embody a distinctive look and feel that
is recognized by consumers. The same holds true for the iPod touch. Therefore, even though there was competition in the marketplace when the products were launched, in each instance iPhone, iPhone 3G, iPhone 3GS, iPhone 4, and iPod touchApple created a very recognizable look and feel in its products. 105. Consumers were made aware of this distinctive look and feel primarily through:
(1) their exposure to Apples marketing activities that prominently feature the different generations of the iPhone and the iPod touch; (2) their exposure to the products via non-Apple sources, such as product reviews, press coverage, and product placements in popular media; and (3) their own experiences with the look and feel of the iPhone and iPod touch products, or those Because I have been asked to opine on Apples trade dress, I analyze Apples iPhone and iPad trade dress, not Apples trademarks, in terms of the Sleekcraft Factors.
188
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of their family, friends, neighbors, or colleagues. In this case, there is no question that consumers exposure to the iPhone and the iPod touch products was extensive before the launch of the first of Samsungs accused products in summer 2010.189 106. By summer 2010, Apple had budgeted $350 million in advertising the iPhone
product in the U.S.190 Moreover, the iPhone had been featured in numerous national magazine and newspaper articles, including articles in The New York Times, San Francisco Chronicle, The Wall Street Journal, and Time magazine, including many front page articles and cover articles, such as when Time magazine named the iPhone the Invention of the Year for 2007.191 Furthermore, the iPhone has been featured in countless national television programs and movies, including American Idol and Gossip Girl, to name two.192 107. In addition, as explained above, because the iPhone and iPod touch are mobile
devices used in public locations, including in parks, airports, cafes, public transit, and restaurants, Apples own sales contribute to brand associations formed by consumers.193 Before the launch of Samsungs accused products in summer 2010, Apple had sold over 24.9 million iPhone devices194
See infra discussion regarding timeline of release of Apples iPhone products and Samsungs Galaxy S line of smartphones 131. 190 Q110 Ad Budget Summary, APLNDC0002029745-760, at APLNDC0002029747;Q210 Ad Budget Summary, APLNDC0002029787-796 at APLNDC0002029789; Q310 Ad Budget Summary, APLNDC0002789782-796, at APLNDC0002789784; Q109 Ad Budget Summary, APLNDC0002103760-777; Q209 Ad Budget Summary, APLNDC0002103846-857; Q309 Ad Budget Summary, APLNDC0002140130-141; Q409 Ad Budget Summary, APLNDC0002003327-342; Q108 Ad Budget Summary, APLNDC0002206433-452; Q208 Ad Budget Summary, APLNDC0002788282-301; Q308 Ad Budget Summary, APLNDC0002788514-533; Q408 Ad Budget Summary, APLNDC0002103372-388, at APLNDC0002103374; Q307 Ad Budget Summary, APLNDC0002206049-065, at APLNDC0002206050; Q407 Ad Budget Summary, APLNDC0002205710-726, at APLNDC0002205711. 191 See supra 57-64. 192 See Twiggs Dep. 42:9-19, 146:1-147:1; APLNDC-X0000014538. 193 See APLNDC-Y0000024549-24798 at APLNDC-Y0000024574, APLNDCY0000024576-24579, APLNDC-Y0000024582, and APLNDC-Y0000024585. Mobile phones, by design, can be and are used at various public locations by consumers. 194 APLNDC-Y00000051357-362, at APLNDC-Y00000051359-51362; see also Apple Inc. Form 10-K, filed October 27, 2009, p. 41, APLNDC-Y0000135577-682 at APLNDCY0000135620.
189
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and 23.6 million iPod touch devices in the U.S.195 Apples internal market research provides ample evidence about the public use of these products. For instance, according to the August 2009 iPod Owner Study, 56% of the surveyed iPod touch owners in the U.S. used the product while exercising; 81% used the product while waiting; 51% used the product while walking; 56% used the product on an airplane; 37% used the product while commuting; 78% used the product once a day or more, and 52 % used the product half an hour or more in one sitting.196 This type of public use serves as anothervery effectivemeans of promotion for the iPhone and the iPod touch, similar to word-of-mouth brand activity197 or the effects of influencers using a product.198 108. In sum, consumers exposure to the iPhone and the iPod touch products, via
Apples marketing activities, coverage of the products in popular media, through their personal experiences with the products, or their exposure to the products in public spaces, was extensive before the launch of the first of Samsungs accused products in summer 2010. The trade dress at issue is often clearly displayed in these occasions. In my opinion, after the iPhone launch and before the introduction of the first of the accused Samsung products in July 2010, the look and feel of the iPhone, iPhone 3G, iPhone 3GS, iPhone 4, and iPod touch products from the perspective of the consumers was distinctively Apple. 109. The Poret Report contains results from a June 2011 survey that shows that the
distinctive look of the iPhone remained a strong source identifier for Apple nearly a year after Samsung released the first of its accused products. 68.0% of respondents who were shown a disguised image of an iPhone 3Gwith the icons on the face of the phone blurred and the home button covered with a stickerstill identified it with Apple, iPhone, or a similar Applerelated product name. 61.0% of respondents who were shown a similarly disguised image of an
APLNDC-Y00000051599-605, at APLNDC-Y00000051599, APLNDCY00000051600. 196 See APLNDC-Y0000024549-24798 at APLNDC-Y0000024574, APLNDCY0000024576-24579, APLNDC-Y0000024582, and APLNDC-Y0000024585. 197 See supra 33, 36. 198 See supra note 88.
195
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iPhone with the iPhone Trade Dress visibleidentified it with Apple, iPhone, or a similar Applerelated product name.199 110. The strength of the iPhone Trade Dress has also been recognized by Samsungs
executives since late 2008. Research conducted by gravitytank on behalf of Samsung in or around late 2008 indicated that the iPhone sets the standard for screen centric design and [c]onsumerssee [Samsung touch phones] as derivative of the iPhone.200 For example, in internal documents, Samsung executives have acknowledged that the [t]he look and feel of a product matters most201 and that iPhone has become the standard.202 As discussed in detail below,203 Samsung employees were instructed, through emails or at executive-level meetings, that [g]oing forward [Samsungs] comparison standard is Apple[s] iPhone and that Samsung must evaluate [its products] based on the iPhone standards . . . .204 Similarly, a December 2009 presentation by McKinsey & Company to Samsung titled Winning in Smartphones Its Now or Never concluded that Samsung should [m]atch the iPhone UI within the next 12 months.205 Sleekcraft Factor 2: Proximity of the goods 111. Apples iPhone products and Samsungs Galaxy line of smartphones are similar in
use and in function and directly compete with one another for market share.206 The relevant Poret Report at 7-11, 45, 52, 57. SAMNDCA00191811-191987 at SAMNDCA00191865 and SAMNDCA00191929. It is my understanding that the gravitytank study was a precursor to the development of the Galaxy S line of smartphones. 201 E-mail from Eun Jung Ko Re: Summary of Executive-Level Meeting Supervised by Head of Division, February 10, 2010, SAMNDCA10247373-10247378 (See translation in Apples Appendix of Certified Translations in Support of Opening Expert Reports (Translations Appx)). 202 E-mail from Eun Jung Ko of Executive-Level Meeting Supervised by Head of Division, February 10, 2010, SAMNDCA10247373-10247378 (See Translations Appx). 203 See infra 133-137. 204 Email from Won Cheol Chai Re: Report on CEOs Directives, January 2, 2010, SAMNDCA10907801-10907802. 205 SAMNDCA10807316-10807387 at SAMNDCA10807358. 206 For instance, in Apples May 2011 iPhone Survey, 31% of the iPhone 3GS and iPhone 4 owners surveyed in the U.S. indicated that they considered or seriously considered the Samsung branded phones. Note that only individuals who purchased the Apple phones were included in the sample; it did not include people who considered an iPhone and ended up purchasing a Samsung product. See APLNDC-Y0000025024-25147 at APLNDC200 199
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products are marketed to the same segments of the population who are prospective (actual, for repeat purchasers) buyers of mobile phones. 112. Internal market research conducted by Apple shows that the mobile phone
products of the two companies generally compete with each other. For instance, in Apples iPhone 3G Buyer Surveysconducted during the fourth quarter of Apples 2008 fiscal year and the first and second quarters of Apples 2009 fiscal yearSamsung was listed among the other mobile phone brands the iPhone 3G buyers seriously considered.207 In Apples iPhone Buyer Surveys conducted during the third and fourth quarters of Apples 2009 fiscal year, and the first, second, and third quarters of Apples 2010 fiscal year, Samsung was similarly listed among the other mobile phone brands that the iPhone 3G and iPhone 3GS buyers seriously considered.208 In Apples iPhone Buyer Surveys conducted during the fourth quarter of 2010 and the first and second quarters of 2011, Samsung was also listed among the other mobile phone brands that the iPhone 3GS and iPhone 4 buyers seriously considered.209 In Apples iPhone Buyer Survey conducted during the third quarter of 2011, Samsung was again listed among the other smartphone brands the iPhone 3GS and iPhone 4 buyers seriously considered.210 In Apples iPhone Buyer Surveys conducted during the first and second quarters of 2011, for iPhone buyers
Y0000025128. Both Apple and Samsung employees have admitted that Apple and Samsungs smartphones compete. Greg Joswiak, Apples Vice President of iPhone, iPod, and iOS product marketing, identified Samsung among Apples top competitors in the mobile phone and smartphone markets. See Joswiak Dep. 106:19-24, 107:10-108:6. 207 APLNDC-Y0000026173-26256, at ALNDC-Y0000026175, APLNDCY0000026202; APLNDC-Y0000026257-26347, at APLNDC-Y0000026259, APLNDCY0000026286. 208 APLNDC-Y0000026348-26460, at APLNDC-Y0000026350, APLNDCY0000026385; APLNDC-Y0000026461-26573, at APLNDC-Y0000026463, APLNDCY0000026498; APLNDC-Y0000026574-26686, at APLNDC-Y0000026576, APLNDCY0000026611; APLNDC-Y0000026687-26807, APLNDC-Y0000026689, APLNDCY0000026724; APLNDC-Y0000027136-27255, at APLNDC-Y0000027138, APLNDCY0000027172. 209 APLNDC-Y0000027256-27340 at APLNDC-Y0000027258, APLNDCY0000027299; APLNDC-Y0000027341-27422 at APLNDC-Y0000027343, APLNDCY0000027402; APLNDC-Y0000027423-27505 at APLNDC-Y0000027425, APLNDCY0000027493. 210 APLNDC-Y0000027506-27599 at APLNDC-Y0000027508, APLNDCY0000027560.
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who considered Android phones, Samsung was listed among the Android mobile phone brands the iPhone 3GS and iPhone 4 buyers seriously considered.211 In Apples iPhone Buyer Survey conducted during the third quarter of 2011, for iPhone buyers who considered Android smartphones, Samsung was again listed among the Android smartphone brands the iPhone 3GS and iPhone 4 buyers seriously considered.212 Lastly, in Apples May 2011 iPhone Owner study, 31% of the iPhone 3GS and iPhone 4 owners surveyed in the U.S. indicated that they considered or seriously considered the Samsung-branded phones.213 113. Product reviews for some of the accused Samsung products compare those
products directly to Apple products. For example, in a review of the accused Samsung Vibrant phone, the reviewer compared the Vibrant directly to the iPhone, in an article titled: Samsung Vibrant Looks Like an iPhone, Has Battery Life to Match. 214 Similarly, in another review, the Galaxy S line of smartphone products was described as a serious rival to Apples iPhone.215 Another review states that the Samsung Galaxy S [l]ooks like an iPhone and notes that the Samsung Galaxy S and iPhone 3G/3GS could very easily have been separated at birth.216 114. Samsungs internal market research similarly considers the mobile phone products
of the two companies as competitors. For instance, a market research study conducted or commissioned by Samsung includes both Apple and Samsung in its results for unaided brand awareness and brand purchase intent for mobile phones.217 APLNDC-Y0000027341-27422 at APLNDC-Y0000027343, APLNDCY0000027353; APLNDC-Y0000027423-27505 at APLNDC-Y0000027425, APLNDCY0000027436. 212 APLNDC-Y0000027506-27599 at APLNDC-Y0000027508, APLNDCY0000027519. 213 APLNDC-Y0000025024-25147 at APLNDC-Y0000025128. Note that only individuals who purchased the phones themselves are included in the sample. 214 See, e.g., Samsung Vibrant Looks Like an iPhone, Has Battery Life to Match, Wired, August 16, 2010 (http://www.wired.com/reviews/2010/08/pr_samsung_vibrant/). 215 See, e.g., A Galaxy S Sequel with Big-Screen Ambitions, Wall St. Journal, September 22, 2011; see also Joswiak Dep. 106:19-108:6. 216 See, e.g., Samsung Galaxy S Review, Techradar.com, July 20, 2011 (http://www.techradar.com/reviews/phones/mobile-phones/samsung-galaxy-s-689293/review) (last visited March 20, 2012). 217 See SAMNDCA00526887-526933 at SAMNDCA00526895, SAMNDCA00526899 (See Translations Appx).
211
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115.
Mr. Pendleton of Samsung stated that Apple is one of one competitors and that
Samsung competes with Apple, HTC, and Motorola in the smartphone market.218 Mr. Pendleton also said that Apple is the competitor we obviously have our I [sic] on.219 116. Moreover, documents created by Samsung in connection with the development of
the Galaxy line of smartphones indicate that Samsung viewed its smartphone products as direct competitors to the iPhone. In addition to the gravitytank analysis, McKinsey & Company report, and executive e-mails mentioned above, I have seen a number of documents where Samsungs designers appear to have focused intensely on the iPhone design, to the point that they analyzed each icon on the iPhone individually, and made specific recommendations for modifications of Samsungs icons and graphical user interface.220 It seems clear that Samsungs own engineers and designers viewed the iPhone as the competition. Sleekcraft Factor 3: Similarity of the trade dress 117. Apples iPhone products and the Samsung Galaxy line of smartphones look
strikingly similar. A side-by-side comparison of the images of the iPhone and Galaxy S as shown in the Amended Complaint demonstrates the similarity in the look and feel of these products.221 118. The survey evidence from the Van Liere Report illustrates the striking similarity
between the look of Samsung Galaxy line of smartphones and that of the iPhone. Over half of respondents (52%) who were shown pictures of a Samsung Galaxy Fascinate phone associated the look and design of the Samsung Galaxy Fascinate with an iPhone, or a phone or product manufactured by Apple. When the same test was carried out with a Samsung Galaxy S II Epic 4G Touch phone, over half respondents (51%) also associated the look and design of the Samsung Galaxy S II Epic 4G Touch phone with an iPhone, or a phone or product manufactured by Apple. As with the Poret Report, Dr. Van Liere also tested a control device to determine whether it would be associated with Apple. A much smaller percentage of respondents associated
218 219
Pendleton Rough Dep. Tr. 34-35. Id. 220 See infra discussion and notes 132-138. 221 Amended Complaint 94-95.
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the control device with Apple. Specifically, 14% of respondents associated the control smartphone with Apple.222 119. The similarities between the two product lines are so apparent that they have been
noted by industry observers. When the Galaxy phone was introduced for the first time, many reviewers discussed the fact that the product was physically very similar to the iPhone. Exhibit 7 includes a sample of such quotes. 120. For example, an article from Wired noted how much the Galaxy S Vibrant phone
looks like the iPhone: Samsungs latest phone, the Vibrant, has the body of an iPhone and the brains of an Android. The Vibrants industrial design is shockingly similar to the iPhone 3G: The rounded curves at the corners, the candybar shape, the glossy, black finish and the chrome-colored metallic border around the display. The Vibrant even has its volume and ringer buttons in almost the same spot as the iPhone 3G. [T]he square icons are, again, very similar in their looks to the iPhone 3Gs. [T]heres little to make the phone notable, apart from its striking similarity to the iPhone.223 121. Another reviewer noted how even the icons used in the Samsung Galaxy S
resemble those of the iPhone: When I saw pictures of the Galaxy S phones from Samsung, I thought Id found the perfect successor for shifting off the iPhone. Here was an [sic] phone that had iPhone-like icons, an iPhone-like look but which would work on networks other than AT&T.224 Sleekcraft Factor 4: Evidence of actual confusion 122. As noted above, the survey evidence from the Van Liere Report indicates that over
half of respondents who were shown pictures of a Samsung Galaxy Fascinate phone or a Samsung Galaxy S II Epic 4G Touch phone associated the look and design of those phones with
222 223
Van Liere Report at 4-5, 17. First Look: Samsung Vibrant Rips Off iPhone 3G Design, Wired, July 15, 2010 (http://www.wired.com/gadgetlab/2010/07/first-look-samsung-vibrant-rips-off-iphone-3gdesign/) (emphasis added). 224 A Tale of Three Android Phones: Droid 2, Samsung Fascinate & Google Nexus S, Search Engine Land, January 3, 2011 (http://searchengineland.com/a-tale-of-three-androidphones-droid-2-samsung-fascinate-google-nexus-s-59870).
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an iPhone, or a phone or product manufactured by Apple.225 I believe that this type of association between the Samsung products and Apple demonstrates that consumers may actually be confused by the look and feel of Samsungs phones. Sleekcraft Factor 5: Marketing channels used 123. Samsungs Galaxy line of smartphone products is marketed and sold in the same
channels as Apples iPhone products. In fact, Apples iPhone products are sold side-by-side with the Samsung Galaxy products in many retail situations. Samsungs Galaxy smartphones are available at cellular phone carriers AT&T, Verizon Wireless, and Sprint.226 Apples iPhone is also available at AT&T, Verizon Wireless, and Sprint.227 I personally visited an AT&T store in Manhattan where the iPhones and Samsung Galaxy smartphones were displayed in close proximity, facilitating direct side-by-side comparisons.228 In addition, Apple and Samsung
Van Liere Report at 4-5, 17. See, e.g., http://www.samsung.com/us/mobile/at-t (AT&T); AT&T and Samsung Mobile Announce Upcoming Availability of the Samsung Captivate, A Galaxy S Smartphone, Samsung Press Release, June 17, 2010 (http://www.samsung.com/us/news/presskitRead.do?page=1&news_seq=19570&rdoPeriod= ALL&from_dt=&to_dt=&news_group=ALL&news_type=&news_ctgry=&search_keyword= Samsung+Mobile+Announce+Upcoming+Availability+of+the+Samsung+Captivate); Samsung Captivate, PhoneArena.com, July 18, 2010 (http://www.phonearena.com/phones/Samsung-Captivate_id4676); http://www.samsung.com/us/mobile/verizon-wireless (Verizon); ). Samsung Fascinate, A Galaxy S Smartphone, Available on the Verizon Wireless Network, Samsung Press Release, No Date (http://www.samsung.com/us/news/presskitRead.do?page=1&news_seq=19541&rdoPeriod= ALL&from_dt=&to_dt=&news_group=ALL&news_type=&news_ctgry=&search_keyword= fascinate); Samsung website showing phones available on Sprint, available at http://www.samsung.com/us/mobile/sprint (Sprint). The websites for the carriers show both Apples iPhone products and Samsungs Galaxy products available for purchase. See, e.g., http://www.att.com/shop/wireless (AT&T); http://www.sprint.com (Sprint); http://www.verizonwireless.com (Verizon). 227 See, e.g., Apple Launches iPhone 4S, iOS 5 & iCloud, Apple Inc. Press Release, October 4, 2011, http://www.apple.com/pr/library/2011/10/04Apple-Launches-iPhone-4SiOS-5-iCloud.html; Verizon Wireless & Apple Team Up to Deliver iPhone 4 on Verizon, Apple Inc. Press Release, January 11, 2011, http://www.apple.com/pr/library/2011/01/11Verizon-Wireless-Apple-Team-Up-to-DeliveriPhone-4-on-Verizon.html; Apple Store iPhone 4S, available at http://store.apple.com/us/browse/home/shop_iphone/family/iphone. 228 The iPhone 4S and Samsung Galaxy Note were less than 2 feet apart, whereas the iPhone 4S and the Samsung Galaxy Skyrocket were approximately three feet apart.
226
225
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products can often be displayed side-by-side on the carriers websites.229 In-store retailers, such as Best Buy, Target, and Walmart, often group together all of their smartphone products, including Apple iPhone products and Samsung Galaxy products. Online retailers, such as Amazon as well as Best Buy, Radioshack, and Walmart, also feature Samsungs Galaxy line of smartphones and Apples iPhone products.230 124. Samsungs Galaxy line of smartphones products and Apples iPhone products are
also advertised and marketed through similar media. In 2011, Samsung launched a $67.1 million advertising campaign for its Galaxy S II that included online, print newspaper, and television advertising components.231 These various media began reaching consumer audiences in February, June, and September 2011, respectively.232 Of the $67.1 million spent on the campaign, Samsung allocated $64.5 million toward television commercials airing on a diverse set of networks, including ABC Family, Fox, BET, Comedy Central, and TBS.233 Although a competitive analysis describes Samsungs campaign as targeting everyone, Samsung elected to air many of its commercials on many of the same shows as Apple.234 During the months of October, November, and December, Apple and Samsung both featured advertisements for their
See, e.g., APLNDC0003039043-3039044 at APLNDC0003039043 (AT&T); APLNDC0003039085-3039114 at APLNDC0003039085-3039088 (AT&T); APLNDC0003039440-3039441 at APLNDC0003039441 (Verizon). 230 See, e.g., APLNDC0003039036-3039037 at APLNDC0003039036 (Amazon); APLNDC0003038959-3038964 at APLNDC0003038974 (Amazon), APLNDC00030389743038981 (Amazon), APLNDC0003039014-3039016 at APLNDC0003039014-3039016 (Amazon); APLNDC0003039165-3039167 at APLNDC0003039165 (Best Buy); APLNDC0003039118-3039119 at APLNDC0003039118 (Best Buy); APLNDC00030391283039138 at APLNDC0003039128 (Best Buy); APLNDC0003039149-3039164 at APLNDC0003039149, APLNDC0003039151, APLNDC0003039152-53, APLNDC0003039155, APLNDC0003039157-3039160, APLNDC0003039162 (Best Buy); APLNDC0003039187-3039188 at APLNDC0003039187 (Radioshack); APLNDC0003039191-3039192 at APLNDC0003039191 (Radioshack); APLNDC0003039195-3039197 at APLNDC000303195-3039197 (Radioshack); APLNDCY0000151499-151504 at APLNDC-Y0000151499, APLNDC-Y0000151501 (Walmart); APLNDC-Y0000151490-151491 at APLNDC-Y0000151490 (Walmart). 231 OMD0000039-75 at OMD0000039, OMD0000046. 232 OMD0000039-75 at OMD0000046. 233 OMD0000039-75 at OMD0000046. 234 OMD0000039-75 at OMD0000046.
229
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respective smartphones on CSI, Vampire Diaries, The Office, and Saturday Night Live.235 Not only did Samsungs campaign include many of the same television audiences as Apples iPhone campaign, some of its television messages directly targeted the hype surrounding Apples device.236 Some of the television commercials that aired during this time period specifically questioned the brand loyalty of potential iPhone customers and suggested that the next big thing, Samsungs Galaxy S II, is already available.237 125. Mr. Pendleton, Samsungs Chief Marketing Officer for wireless, stated that
Samsung runs national campaigns for its smartphone and tablet products.238 Sleekcraft Factor 6: Types of goods and the degree of care likely to be exercised by the purchaser 126. The degree of care exercised by the purchaser is a function of several factors: the
11 price of the goods, the degree of sophistication of the consumers, and the purchase channel 12 involved (e.g., web, carrier store, independent big-box retailer, aftermarket channels such as 13 eBay, etc.). 14 127. 15 expensive products in terms of retail price, like most smartphones, they generally are sold as part 16 17 consumer pays for a phone is heavily subsidized by the service provider. In some instances, the 18 products are free with a locked-in carrier contract commitment. For example, the iPhone 3GS, 19 20 21 22 23 24 25 26 27 28 OMD0000039-75 at OMD0000046; APLNDC0002010255-2010279 at APLNDC0002010265-2010267. 236 OMD0000039-75 at OMD0000046. 237 The Next Big Thing - Samsung Galaxy S II (90 sec commercial), uploaded by samsungmobileusa on November 22, 2011, available at http://www.youtube.com/watch?v=X4VHzNEWIqA&feature=relmfu. 238 See, e.g., Pendleton Rough Dep. Tr. 26-28, 32, 36-37. 239 For example, see the discussion about low-end iPhones, their pricing, and wireless service provider contracts in Schiller Dep. 366:6-367:12, and Joswiak Dep. 243:2-244:23. In general, most mobile phones sold in the U.S. are sold as part of a contract with a wireless service provider. In January 2011, Consumer Reports magazine reported that more than 90 percent of its survey respondents phones were serviced under a contract. See No-Contract Options Multiply, Consumer Reports, January 2011 (http://www.consumerreports.org/cro/magazine-archive/2011/january/electronics/best-cellplans-and-providers/no-contract-cell-phones/index.htm).
235
While some of the iPhone models and Samsung Galaxy smartphones are relatively
of a contract with a wireless service provider such as Verizon, AT&T or Sprint.239 The price a
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currently the low-end iPhone on the market, is available to AT&T customers signing up for a two-year contract at no cost.240 Therefore, there is wide variation with respect to the degree of care vis--vis the price factor. 128. Smartphones are becoming ubiquitous and rapidly replacing older-generation
phones.241 Therefore, there is also likely to be wide variation in the sophistication of consumers. Some are likely to exercise great care while selecting a product, carefully examining the features of the product, its technical performance, and so on. Others are likely to be more impulsive. Similarly, consumers who are led to purchase by the Imitative Scenario described above are less likely to exercise the same degree of care as a sophisticated consumer so long as the infringing product approximates the look and feel of the original. 129. Lastly, and as discussed above, there is variation in the purchase channels, with
concomitant effects on the degree of care exercised in those channels. For example, a smartphone buyer at a carrier store with attentive staff may have a more involved shopping experience than a consumer under the Imitative Scenario who routinely buys products from a particular website where smartphone offerings are displayed side-by-side or where a particular smartphone is being promoted prominently. 130. In sum, while some consumers of smartphone products will be careful in their
purchasing decisions, perhaps even doing advance research or consulting with clerks in retail stores about their choices, it cannot be said that all consumers, or even the majority of consumers, will take the same amount of care in their purchasing decisions. This is particularly true for products that are given away for free or at low cost with a carrier contract, and products that are sold online or through mass market retailers like Target and Walmart. Sleekcraft Factor 7: Defendants intent in selecting the trade dress
Joswiak Dep. 243:2-244:23. The NPD Group, a leading market research company, reported that the share of U.S. mobile phone handset sales that were smartphones reached 59 percent in the third quarter of 2011, an increase of 13 percentage points since the third quarter of 2010. As Smartphone Prices Fall, Retailers Are Leaving Money on the Table, NPD Group, November 14, 2011 (https://www.npd.com/wps/portal/npd/us/news/pressreleases/pr_111114a).
241
240
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131.
Samsung could not have been unaware of the iPhone Trade Dress and the iPhone
3G Trade Dress before its introduction of the Galaxy line of smartphones in the U.S. and it appears to have consciously adopted elements of Apples trade dress. In January 2007, Apple unveiled its iPhone and made it available for purchase in June 2007.242 In June 2008, Apple introduced the iPhone 3G, and made it available for purchase in July 2008.243 Apple introduced and released for purchase the iPhone 3GS in June of 2009.244 Finally, in June 2010, Apple announced and made available the iPhone 4 for purchase.245 As discussed above, each iPhone product was extensively covered in the media, and reviewed by prominent publications both online and in print. Samsung did not unveil its Galaxy S line of phones until March 2010.246 The first version of the phone for the U.S. market was announced in June 2010 and made available for purchase in July 2010.247 132. The look and feel of Samsungs phones was unlike the iPhone until the release of
the Galaxy line of smartphones. Early Samsung smartphones almost always featured a keypad. For instance, the early Samsung MM-A800, released in May 2005, featured a sliding design which included a front display screen with navigation controls; releasing the front revealed the ample keypad.248 The Samsung SCH-i730, released in July 2005, featured an innovative touch Apple Reinvents the Phone with iPhone, Apple Inc. Press Release, January 9, 2007 (http://www.apple.com/pr/library/2007/01/09Apple-Reinvents-the-Phone-with-iPhone.html). 243 Apple Introduces the New iPhone 3G, Apple Inc. Press Release, June 9, 2008 (http://www.apple.com/pr/library/2008/06/09Apple-Introduces-the-New-iPhone-3G.html). 244 Apple Announces the New iPhone 3GSThe Fastest, Most Powerful iPhone Yet, Apple Inc. Press Release, June 8, 2009 (http://www.apple.com/pr/library/2009/06/08AppleAnnounces-the-New-iPhone-3GS-The-Fastest-Most-Powerful-iPhone-Yet.html). 245 Apple Presents iPhone 4, Apple Inc. Press Release, June 7, 2010 (http://www.apple.com/pr/library/2010/06/07Apple-Presents-iPhone-4.html). 246 Samsung Galaxy S Keynote & Samsung Mobile Unpacked at CTIA Wireless 2010, Samsung Press Release, March 31, 2010 (http://www.samsung.com/us/news/newsRead.do?news_seq=18436&page=1). 247 AT&T and Samsung Mobile Announce Upcoming Availability of the Samsung Captivate, a Galaxy S Smartphone, Samsung Press Release, June 22, 2010 (http://www.samsung.com/us/news/presskitRead.do?page=1&news_seq=19514&rdoPeriod= ALL&from_dt=&to_dt=&news_group=ALL&news_type=&news_ctgry=&search_keyword= ); PhoneArena.com Samsung Captivate page, available at http://www.phonearena.com/phones/Samsung-Captivate_id4676). 248 Samsung MM-A800, CNET News.com, 2005 (http://reviews.cnet.com/Samsung_MM-A800/4505-6454_7-31313308.html).
242
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screen but, like the MM-A800, hid a keyboard behind the screen.249 The popular BlackJack line of smartphones also featured prominent keypads. The original BlackJack, released in 2006, hosted a 2.25 inch screen, a variety of navigation keys including two soft keys, a shortcut to the Today screen, a back button, Talk and End keys, and a four-way directional toggle, and a full QWERTY keyboard.250 A year later, the BlackJack II was released featuring a sleeker version of the same appearance.251 In April 2008, after the release of the iPhone but prior to the introduction of the Galaxy line of phones, Samsung introduced the Access. The appearance, described as angular and ordinary, included a large 2.25 inch display, a navigation array, a four-way toggle, a keypad, as well as other navigation buttons.252 133. After the introduction of the iPhone, Samsung recognized that the iPhone set the
industry standard.253 In an email to UX Executives, dated March 2, 2010, Sungsik Lee of Samsung stated that CEO Gee Sung Choi strongly criticized Samsung UXs mindset of clinging to the past generation.254 Lee further stated that [t]his is being interpreted as an instruction to think about and decide all matters from the perspective of the user. (Not suppliers or providers...) The most representative example is obviously the iPhone.255 Sungsik Lee emphasized that Samsung must learn the wisdom of the iPhone and recognize that [Apple has] already set the
Samsung SCH-i730, CNET News.com, 2005 (http://reviews.cnet.com/45056452_7-31313312.html). 250 Samsung BlackJack SGH-i607, CNET News.com, November 13, 2006 (http://reviews.cnet.com/smartphones/samsung-blackjack-sgh-i607/4505-6452_732143267.html). 251 Samsung BlackJack II Review, CNET News.com, December 6, 2007 (http://reviews.cnet.com/smartphones/samsung-blackjack-ii-black/4505-6452_732717959.html). 252 Samsung Access SGH-A827, CNET News.com, May 9, 2008 (http://reviews.cnet.com/cell-phones/samsung-access-sgh-a827/4505-6454_732909896.html). 253 E-mail from Sungsik Lee Re: To UX Executives, March 2, 2010, SAMNDCA10247549-10247552 (See Translations Appx). 254 E-mail from Sungsik Lee Re: To UX Executives, March 2, 2010, SAMNDCA10247549-10247552 (See Translations Appx). 255 E-mail from Sungsik Lee Re: To UX Executives, March 2, 2010, SAMNDCA10247549-10247552 (See Translations Appx).
249
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industry standard . . . .256 In another email titled Report on CEOs Directives, Samsung employees were instructed that [g]oing forward our comparison standard is Apples iPhone. In cases of High End products we must evaluate them based on the iPhone standards . . . .257 134. In an executive-level meeting held on February 10, 2010, the head of Mobile
Communications Division at Samsung stated that the iPhone has become the standard and explained that when both consumers and the industry consider UX, a Samsung product, they weigh it against the iPhone.258 He further stated that when the UX is compared with the iPhone, its a difference between Heaven and Earth.259 At the same meeting, the division head expressed concern that [i]nfluential figures outside the company come across the iPhone, and they point out that Samsung is dozing off and advised the product designers at Samsung that [t]he look and feel of a product matters most.260 135. Numerous Samsung internal documents indicate Samsungs efforts to incorporate
certain features of the iPhone, including the iPhone Trade Dress and packaging, into its own products. A Samsung document titled Design Preference Study noted that American consumers are influenced greatly by iPhone design and that [t]he rounded shape design has been recognized as a [p]remium and better design due to the influence of the iPhone [s]eries in the last three years.261 The study also noted that [s]ince the iPhone was introduced, trendy consumers have started to consider its angular and square shaped design as trendy . . . .262 E-mail from Sungsik Lee Re: To UX Executives, March 2, 2010, SAMNDCA10247549-10247552 (See Translations Appx). 257 Email from Won Cheol Chai Re: Report on CEOs Directives, January 2, 2010, SAMNDCA10907800-10907802 (See Translations Appx). 258 E-mail from Eun Jung Ko Re: Summary of Executive-Level Meeting Supervised by Head of Division, February 10, 2010, SAMNDCA10247373-10247378 (See Translations Appx); E-mail from Sungsik Lee Re: To UX Executives, March 2, 2010, SAMNDCA10247549-10247552 (See Translations Appx). 259 E-mail from Eun Jung Ko Re: Summary of Executive-Level Meeting Supervised by Head of Division, February 10, 2010, SAMNDCA10247373-10247378 (See Translations Appx). 260 E-mail from Eun Jung Ko Re: Summary of Executive-Level Meeting Supervised by Head of Division, February 10, 2010, SAMNDCA10247373-10247378 (See Translations Appx). 261 SAMNDCA00533129-533159 at SAMNDCA00533135 (See Translations Appx). 262 SAMNDCA00533129-533159 at SAMNDCA00533135 (See Translations Appx).
256
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Another Samsung internal document beginning with instructions from the CEO instructed Samsung employees to improve UX, referring to iPhone 3GS, because [t]here is a big difference in letter size, font, and clarity compared to iPhone 3GS, [l]etter size is weird, and the existing [i]cons have too much space and are strange.263 Similarly, an email, dated March 17, 2010, instructed Samsung employees to [p]roceed with iPhone/Droid type for packaging.264 In another internal email, dated May 5, 2010, Cheol Hwan Lee, Executive Vice President of Development (Mobile), instructed his colleagues to: Take each of the products that have been released [including iPhone 3GS, iPhone 4, and iPad] and are expected to be released by Apple compare them with our companys anticipated products, and perform a concrete study of each on their component differences, specification differences, as well as performance, characteristics, and functions for each part (for example, LCD, memory, design, etc.), then formulate response plans, and report back.265 136. In addition, several Samsung presentations compare the Samsung products and the
13 iPhone and indicate improvements to the former drawn directly from that comparison. For 14 example, in a side-by-side comparison of the iPhone and S1 (a Samsung product), a product 15 engineering team at Samsung stated that the Graphical UI [user interface] of the menu icons are 16 monotonous, and that the iPhone maximizes a 3 dimensional effect utilizing light and the curve 17 18 product, they also must make use of effects of light and make the edge curve more smooth, 19 but that they should [r]emove a feeling that iPhones menu icons are copied by differentiating 20 21 the Galaxy S product line based on the direct comparison of Galaxy S devices with competing 22 23 24 25 26 27 28 SAMNDCA10249770-10249776 at SAMNDCA10249770 (See Translations Appx). E-mail from Kim Ah-young Re: October 3/17 Report Result, March 17, 2010, SAMNDCA00507826-507827 (See Translations Appx). 265 E-mail from Taemoon Roh Re: Regarding Apple Comparison, May 9, 2010, SAMNDCA10911088-10911093 (See Translations Appx). 266 SAMNDCA00203880-204010 at SAMNDCA00204010 (See Translations Appx). 267 SAMNDCA00203880-204010 at SAMNDCA00204010 (See Translations Appx). 268 SAMNDCA00238432-238443.
264 263
of icon frames is smooth.266 The engineering team proposed that, in order to improve their
design.267 Another example is a Samsung presentation discussing recommendations to improve
smartphones, including the iPhone 4.268
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137.
Moreover, in Samsungs Competitor Analysis presentations, the iPhone is
described as a delight to the eye as well as a highly usable device.269 These presentations contain Samsungs comparison of design and layout features (such as main menu icons, main menu layout, list screen layout, secondary icons, music screens, and browser look) on its phones sold before the introduction of the Galaxy S product line, with those of its competitors, including the iPhone.270 The following iPhone features were included: [b]ottom docking area of four icons suggests that these are the most used/important apps or features; [b]lack background helps colourful icons stand out; [i]cons are all-rounded-corner square elements which include a cartoon image or icon; and [u]se of multiple colours suggests a fairly open colour palette.271 138. Therefore, these internal Samsung documents show that the iPhone was held out as
the aspirational model to Samsung designers and engineers, and that Samsung designers and engineers had an incentive to copy the iPhone trade dress. Sleekcraft Factor 8: Likelihood of expansion of the product lines 139. Because Apple and Samsung products already compete in the smartphone market,
Sleekcraft Factor 8 is not informative for the purposes of my analysis. B. Analysis of Sleekcraft FactorsiPad Trade Dress Sleekcraft Factor 1: Strength of the trade dress 140. Apples iPad Trade Dress is inherently distinctive. The tablet computers that
existed before the iPad had very dissimilar look and feel.272 Apple created a look and feel in its iPad products that was completely differentcommentators have said that Apple created a SAMNDCA00228887-228933 at SAMNDCA00228894. SAMNDCA00228887-228933; SAMNDCA00228934-228980; SAMNDCA00229011-229108. 271 SAMNDCA00228934-228980 at SAMNDCA00228952, SAMNDCA00228969. 272 Tablet PC Brings the Simplicity of Pen and Paper to Computing, Microsoft Press Release, November 13, 2000 (http://www.microsoft.com/presspass/features/2000/nov00/1113tabletpc.mspx); HP Compaq Tablet PC TC1000 Review, CNET Reviews, November 5, 2002 (http://reviews.cnet.com/laptops/hp-compaq-tablet-pc/4505-3121_720627295.html#reviewPage1); Lenovo ThinkPad X61 Tablet PC Review, TabletPCReview.com, June 12, 2007 (http://www.tabletpcreview.com/default.asp?newsID=868); see also supra discussion in 162-163.
270 269
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category with the iPad.273 According to Samsungs own internal market research, when a sample of consumers was asked to provide reasons for purchasing an iPad in a survey without any aid, 30% of those considering a Galaxy Tab said iPad is category leader as one of the top reasons.274 141. As noted above, consumers form brand associations through: (1) their exposure to
Apples marketing activities which prominently feature the iPad products, (2) their exposure to the iPad products via non-Apple sources, such as product reviews, press coverage, and product placements in popular media; and (3) their own experiences with iPads look and feel, or those of their family, friends, neighbors, or colleagues. Consumers had extensive exposure to the iPad product before the launch of Samsungs first accused tablet device in November 2010.275 142. By the end of Apples fiscal year 2010, Apple had already invested $149.5 million
in advertising the iPad.276 By the end of Apples fiscal year 2011, Apple had spent approximately $457 million on advertising the iPad.277 Moreover, the iPad had been featured in various national magazine and newspaper articles, including articles in The New York Times, The Wall Street Journal, Chicago Tribune, The Washington Post, USA Today, Mercury News, Los Angeles Times, and Time, including many front page articles and cover articles, such as stories in The Economist and Newsweek.278 Furthermore, the iPad has been featured in a wide variety of national television programs and movies, including Modern Family, to name just one.279
273
See, e.g., Verdict Is in on Apple iPad: Its a Winner, USA Today, April 2, 2010 (http://www.usatoday.com/tech/columnist/edwardbaig/2010-03-31-apple-ipadreview_N.htm); Laptop Killer? Pretty Close, Wall St. Journal, April 1, 2010 (http://online.wsj.com/article/SB10001424052702304252704575155982711410678.html); Looking at the iPad From Two Angles, N.Y. Times, March 31, 2010 (http://www.nytimes.com/2010/04/01/technology/personaltech/01pogue.html); As New iPad Debut Nears, Some See Decline of PCs, N.Y. Times, March 5, 2012 (http://www.nytimes.com/2012/03/06/technology/as-new-ipad-debut-nears-some-see-declineof-pcs.html). 274 See SAMNDCA00526887-526933 at SAMNDCA00526918 (See Translations Appx). 275 See 161 for a discussion of a timeline of product announcements and introductions relevant to Apple and Samsung tablet computers. 276 See APLNDC-Y0000051623. 277 See APLNDC-Y0000051623. 278 See supra 67-69. 279 See Lindbergh Dep. 59:6-60:5.
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143.
In addition, as explained above, the iPad is a mobile device used in public
locations. For instance, according to an iPad Buying Process survey conducted by Apple, 71% (76%) of the iPad buyers who purchased their iPad at a Best Buy (Apple Retail Store) used or intended to use their iPads at a hotel or airport when traveling; 62% (66%) of the iPad buyers who purchased their iPad at a Best Buy (Apple Retail Store) used or intended to use their iPads at public facilities such as a library; 48% (53%) of the iPad buyers who purchased their iPad at a Best Buy (Apple Retail Store) used or intended to use their iPads at the office; and 38% (41%) of the iPad buyers who purchased their iPad at a Best Buy (Apple Retail Store) used or intended to use their iPads in public outdoor places such as a park.280 As a result, Apples sales of iPad devices contribute to brand associations formed by consumers. Another iPad Buyer Survey also provided consistent results with 79% of the iPad buyers using or intending to use their iPads at a hotel or airport when traveling, 62% at public facilities, 44% at the office, and 43% at outdoor public spaces.281 Before the launch of the first accused Galaxy Tab in November 2010, Apple had sold over 4.3 million iPad tablets in the U.S.282 By the end of June 2011, Apple had sold approximately 14.1 million iPads in the U.S.283 As mentioned above in connection with the iPhone, this type of public use serves as anothervery effectivemeans of promotion for the iPad. 144. As with the iPhone, surveys conducted in June/July 2011 show that the distinctive
look of the iPad had become widely associated with Apple prior to November 2010, the time at which Samsung released the first of its accused tablets. 57.3% of respondents who were shown a head-on image of a disguised iPadwith blurred icons and the home button covered with a stickerstill identified it with Apple, iPad, or similar Apple-related product name. Similarly, See APL-ITC796-0000489304-489435 at APL-ITC796-0000489396. Individuals surveyed purchased their iPads after the launch of the product and through April, 14, 2010. The presentation is dated May 2010. See APL-ITC796-0000489304-489435 at APL-ITC7960000489305-489306. Numbers in parentheses represent the breakdown for survey respondents who purchased their iPads at an Apple Retail Store. 281 See APLNDC0001651734-1651806 at APLNDC0001651776. The presentation is dated August 2010. See APLNDC0001651734-1651806 at APLNDC0001651735. 282 APLNDC-Y00000051599-605, at APLNDC-Y00000051600. 283 APLNDC-Y00000051599-605, at APLNDC-Y00000051600.
280
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75.2% of respondents who were shown an angled view of an iPad, with or without blurred icons, identified it with Apple or Apple products.284 A significantly smaller percentage of respondents who were shown a control tablet (with and without similar blurring) identified it with Apple or Apple products. Specifically, 17% of the respondent shown a head-on image of the control tablet identified it with Apple, iPad, or a similar Apple related product name, as did 10.8% of respondents who saw an angled view of the control tablet. 145. The strength of the trade dress has also been recognized by Samsungs executives.
Internal Samsung documents show that Samsungs executives viewed the iPad as the industry standard in tablet computers.285 I discuss below how Samsung compared its tablets to the iPad, and how improvements to the Samsungs products were drawn directly from that comparison.286 146. In my opinion, there can be no question that after the iPad launch and before the
introduction of the first of the accused Samsung Galaxy Tab products in late 2010 (and before the introduction of the Galaxy Tab 10.1 in June 2011), the look and feel of the iPad trade dress was distinctively Apple. As with the iPhone and the iPod touch, the iPad had, by that point, become one of the most recognizable products in the U.S. given Apples carefully placed advertisements and extensive brand activity. Sleekcraft Factor 2: Proximity of the goods 147. Apples iPad and iPad 2 products and Samsungs Galaxy line of tablet computers
are similar in use and in function and directly compete with one another for market share. The relevant products are marketed to the same segments of the population who are prospective (actual, for repeat purchasers) buyers of tablet computers. 148. Internal market research conducted by Samsung and Apple also shows that the
tablet computer products of the two companies generally compete with each other. For instance, Poret Report at 22-25, 33-34, 46, 60-61, 64-68. For instance, minutes from a Samsung meeting indicate that Apple has already set the market price (WiFi $499/3G $629). We may differentiate but cannot go above [Apples] price and that the attendees realized that Samsung must emphasize graphic [sic] to compete with iPad 3. See SAMNDCA10403697-10403698 at SAMNDCA10403697. 286 SAMNDCA10244604-10244639 at SAMNDCA10244608; SAMNDCA00203268203420 at SAMNDCA00203401. See infra 164-165.
285 284
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a draft of the U.S. Tablet Market Update presentation by Apple contains two pie charts depicting market share of competitors in the U.S. tablet market based on IDC data in the first and second quarters of 2011. Both Apple and Samsung are listed among competitors.287 149. In addition, Samsungs internal marketing research includes Apple as the main
competition for its Galaxy line of tablet computers. For instance, a Samsung market research document entitled Samsung Q4 10 Deep Dive has a section entitled How Does the Galaxy Tab Compare to the iPad?288 150. Samsungs executives have acknowledged that the iPad and the Galaxy Tab 10.1
compete head-to-head. After the March 2011 product announcement for the iPad 2, Don-Joo Lee, the Executive Vice President of Samsungs mobile division, was quoted as saying that Samsung would have to improve the parts [of the forthcoming Galaxy Tab 10.1] that are inadequate, further noting that Apple made [the iPad 2] very thin.289 151. Thus, the Samsung products are perceived as directly competing.290 For instance,
The Wall Street Journal refers to the products as competitors, noting that Apples hot-selling iPad now has its first credible competitor in the nascent market for multitouch consumer tablet computers: the Samsung Galaxy Tab.291 This is also evident from the comparison of the Apple
APLNDC0001430158-1430196 at APLNDC0001430167; APLNDC0001430175. See SAMNDCA00526887-526933 at SAMNDCA00526914-526923 (See Translations Appx). 289 Samsung Considers Galaxy Tab 10.1 Overhaul Following iPad 2 Unveiling, Boy Genius Review, March 4, 2011; see also iPad 2 Sends Galaxy Tab Back to the Drawing Board, NBCBayArea.com, May 5, 2011. 290 See, e.g., Its a Tablet. Its Gorgeous. Its Costly., N.Y. Times, November 10, 2010 (http://www.nytimes.com/2010/11/11/technology/personaltech/11pogue.html); Samsungs Galaxy Tab Is iPads First Real Rival, Wall St. Journal, November 11, 2010 (http://online.wsj.com/article/SB10001424052748703805004575606580224319038.html); Appeal of iPad 2 Is a Matter of Emotions, N.Y. Times, March 9, 2011 (http://www.nytimes.com/2011/03/10/technology/personaltech/10pogue.html); A Slender Tablet with Widescreen Ambitions, Wall St. Journal, June 15, 2011 (http://allthingsd.com/20110614/a-slender-tablet-with-widescreen-ambitions/); see also Deposition of Michael Tchao (Tchao Dep.) on February 21, 2012, 158:8-20. 291 Samsungs Galaxy Tab Is iPads First Real Rival, Wall St. Journal, November 11, 2010 (http://online.wsj.com/article/SB10001424052748703805004575606580224319038.html) (emphasis added).
288
287
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products and Samsung products in product reviews. A product review called the products rivals, noting that the iPad 2 actually costs less than its comparably equipped Android rivals, like the Xoom and the Samsung Galaxy Tab.292 Referring to Samsungs Galaxy Tab as a viable alternative to the iPad, a product review attempts to answer its own question of how do the Samsung Galaxy Tab 10.1 and iPad 2 really differ?293 A review in The New York Times sets forth a number of comparisons.294 Sleekcraft Factor 3: Similarity of the trade dress 152. Apples iPad and iPad 2 products and the Samsung Galaxy line of tablet computers
look strikingly similar. A side-by-side comparison of the images of the Apple and Samsung tablets shown in the Amended Complaint demonstrates the similarity in the look and feel of these products.295 153. As in the case of the iPhone, the survey evidence from the Van Liere Report
illustrates the similarity between the look of Samsung Galaxy 10.1 tablet and that of the iPad. When shown a video of a Samsung Galaxy 10.1 tablet, 43% of respondents indicated that the tablet was an iPad or Apple product.296 On the other hand, only 24% of respondents indicated that the control tablet was an iPad or Apple product. 154. There is also some anecdotal evidence regarding consumers confusion between
the Apple and Samsung tablets, illustrating the striking similarity between the Apple and Samsung tablets. For example, during his deposition, Sangeun Lee (Mr. Lee), head of Samsungs North America quality issues within the Global CS Team, testified that Samsung received reports that customers confuse the Galaxy Tab 10.1 for the iPad 2 when they purchase the Galaxy Tab 10.1.297 Similarly, a Samsung marketing presentation, dated February 2011, Appeal of iPad 2 Is a Matter of Emotions, N.Y. Times, March 9, 2011 (http://www.nytimes.com/2011/03/10/technology/personaltech/10pogue.html). 293 A Slender Tablet with Widescreen Ambitions, Wall St. Journal, June 15, 2011 (http://allthingsd.com/20110614/a-slender-tablet-with-widescreen-ambitions/). 294 Its a Tablet. Its Gorgeous. Its Costly., N.Y. Times, November 10, 2010 (http://www.nytimes.com/2010/11/11/technology/personaltech/11pogue.html). 295 Amended Complaint 44, 94, 99, 101. 296 Van Liere Report at 3, 9, 12. 297 Deposition of Sangeun Lee on February 24, 2012 (Lee Dep.) 12:25-13:10.
292
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stated that [o]ver half of consumers who recognize the Samsung sponsored Tab TVC [TV commercial] thought it was for Apple, while only 16% thought it was for Samsung.298 In addition, during a court hearing, when asked by the judge if she could identify which tablet was an iPad and which tablet was a Galaxy Tab, Samsungs lead counsel, Kathleen Sullivan, said [n]ot at this distance your honor, approximately 10 feet from the bench.299 155. The similarities between the two product lines are so apparent that they have been
heavily noted by industry observers as well. When the Galaxy Tab tablet was introduced, many reviewers discussed the fact that it was physically very similar to the iPad. Exhibit 8 contains a sample of quotes from various sources. For example, eWeek noted that if mimicry is flattery, the Galaxy Tab has compliments galore for the iPad. . . . Looking like an unlikely offspring between the iPad and the iPhone 4, the Tab has an iPad-like front fascia as well as a camera-equipped back cover similar to the not-yet-released white iPhone. . . . Even the dock connector very closely mimics Apples standard pinout.300 A PC Magazine review of the Galaxy Tab 10.1 stated that [m]ost laymen could easily mistake [the Galaxy Tab 10.1] for an iPad 2.301 A PCWorld article stated that the products are so similar, it is hard to tell them apart: In my hands-on testing, the Tab 10.1 achieved perhaps the best design compliment an Android tablet could hope foroften being mistaken by passers-by (including Apple iPad users) for an iPad 2. The confusion is understandable when you see and hold the Tab 10.1 for the first time.302 Sleekcraft Factor 4: Evidence of actual confusion SAMNDCA00526887-526933 at SAMNDCA00526893 (See Translations Appx). US Judge: Samsungs Products Infringe on Apple Design Patents, ArsTechnica, No Date (http://arstechnica.com/apple/news/2011/10/samsung-may-face-us-injunction.ars); Apple Must Show Patents Valid in Samsung Case: Judge, Reuters, October 14, 2011 (http://www.reuters.com/article/2011/10/14/us-apple-samsung-lawsuitidUSTRE79C79C20111014). 300 Samsung Galaxy Tab Nods to Apple iPad but Goes Own Way: iFixit, eWeek, November 12, 2010. 301 Unboxing the Samsung Galaxy Tab 10.1; It Doesnt Run Android 3.1 Yet, But the New Samsung Tablet Gives the iPad 2 A Run for Its Money, PC Magazine, May 10, 2011. 302 Samsung Galaxy Tab 10.1 Wi-Fi: A Worthy Rival to the iPad 2, PCWorld, June 8, 2011 (http://www.pcworld.com/article/229763/samsung_galaxy_tab_101_wifi_a_worthy_rival_to_ the_ipad_2.html).
299 298
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156.
As discussed above, the survey evidence from the Van Liere Report demonstrates
consumers confusion between Samsungs Galaxy Tab 10.1 and Apples iPad products. Based on a post-sale confusion study, after netting out the respondents who indicated that the control tablet was an iPad or Apple product, Dr. Van Liere finds that almost 1 in 5 respondents, who were shown a video of a Samsung Galaxy 10.1 tablet, indicated that the tablet was an iPad or Apple product.303 Before netting out the respondents who indicated that the control tablet was an iPad or an Apple product, Dr. Van Lieres survey results show that nearly 2 in 5 respondents who were shown a video of a Samsung Galaxy 10.1 tablet indicated that the tablet was an iPad or Apple product. 157. There is anecdotal evidence regarding consumers confusion between Samsungs
Galaxy Tab 10.1 and Apples iPad 2. During his deposition, Mr. Lee testified that Samsung received reports that customers confuse the Galaxy Tab 10.1 for the iPad 2 when they purchase the Galaxy Tab 10.1.304 During a Task Force study conducted by his team, a Best Buy employee informed them that consumers confused the Galaxy Tab 10.1 and the iPad.305 Mr. Lee stated that he was aware of reports discussing the fact that consumers returned the Galaxy Tab 10.1 in exchange for an iPad.306 In summarizing a comment from another report, Mr. Lee testified, [i]t says here the reason for purchasing P4 [Galaxy Tab 10.1] isin many cases was because they thought it was the iPad. And most of them do not know well about the product they purchased307 In addition, a Samsung marketing presentation, dated February 2011, states [o]ver half of consumers who recognize the Samsung sponsored Tab TVC [TV commercial] thought it was for Apple, while only 16% thought it was for Samsung.308 Sleekcraft Factor 5: Marketing channels used
303 304
Van Liere Report at 3, 9, 11. Deposition of Sangeun Lee on February 24, 2012 (Lee Dep.) 12:25-13:10. 305 Lee Dep. 18:4-19, 21:3-4, 33:22-35:23. 306 Lee Dep. 36:5-12. 307 Lee Dep. 47:24-48:2. 308 SAMNDCA00526887-526933 at SAMNDCA00526893 (See Translations Appx).
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158.
Samsungs Galaxy tablet computer products and Apples iPad products are sold
side-by-side in many of the same retail situations. For instance, AT&T and Verizon Wireless both sell Apples iPad products and Samsungs Galaxy Tab products.309 I personally visited an AT&T store in Manhattan, where the brands were being displayed less than 3 feet apart. Each of these carriers also features the two product lines on their websites.310 Similarly, retailers such as Best Buy feature both Samsung and Apple tablets in their stores. Online retailers, such as Amazon as well as Best Buy, Walmart, and Target, also offer both Apples iPad products and Samsungs Galaxy Tab products on their websites.311 Moreover, many of these websites allow side-by-side comparisons of the two companies products.312 159. In January 2011, Samsung launched its second major advertising campaign for the
Galaxy Tab.313 Over the course of 2011, Samsungs Galaxy Tab and Galaxy Tab 10.1 campaigns were estimated to have spent $90.1 million on television ads, $14.7 million on print ads, and $6.1
AT&T to Expand Tablet Portfolio with Samsung Galaxy Tab, Samsung Press Release, September 16, 2010 (http://www.samsung.com/us/news/newsPreviewRead.do?news_seq=19688); Verizon Wireless Puts Samsung Galaxy Tab in Store in November, Samsung Press Release, No Date (http://www.samsung.com/us/news/presskitRead.do?page=1&news_seq=19747&rdoPeriod= ALL&from_dt=&to_dt=&news_group=ALL&news_type=&news_ctgry=&search_keyword= Verizon+Wireless+Puts+Samsung+); Apple Launches iPad, Apple Inc. Press Release, January 27, 2010 (http://www.apple.com/pr/library/2010/01/27Apple-Launches-iPad.html); Apple Launches iPad 2, Apple Inc. Press Release, March 2, 2011 (http://www.apple.com/pr/library/2011/03/02Apple-Launches-iPad-2.html). 310 See, e.g., APLNDC0003039047-3039048 at APLNDC0003039047 (AT&T); APLNDC0003039061- at APLNDC0003039061 (AT&T); APLNDC0003039447-3039449 at APLNDC0003039448 (Verizon). 311 See, e.g., APLNDC0003038965-APLNDC0003038973 at APLNDC0003038965 (Amazon); APLNDC0003039005-APLNDC0003039007 at APLNDC0003039005 (Amazon); APLNDC0003039120-3039123 at APLNDC0003039120-3031923 (Best Buy); APLNDC0003039145-3039148 at APLNDC0003039145-3039147 (Best Buy); APLNDC0003039174-3039176 at APLNDC0003039174 (Best Buy); APLNDC00030391813039182 at APLNDC0003039181 (Radioshack); APLNDC0003039183-3039184 at APLNDC0003039183 (Radioshack); APLNDC0003039408-3039411 (Target); APLNDC0003039419-3039423 at APLNDC0003039419 (Target); APLNDC0003039426APLNDC000303430 at APLNDC0003039429 (Target). 312 See, e.g., APLNDC0003039174-3039176 at APLNDC0003039174 (Best Buy); APLNDC0003039434-3039436 at APLNDC0003039434. 313 OMD0000004-10 at OMD0000007.
309
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million on online advertisements.314 As was the case with Samsungs Galaxy S II campaign, Samsung targeted many of its tablet advertisements at the same media Apple used to advertise its iPad.315 For instance, during the month of January, both Apple and Samsung advertised their tablet devices on American Idol, The Late Late Show with Craig Ferguson, Two and a Half Men, and Criminal Minds.316 Furthermore, throughout the year, Samsung selected many of the same print media avenues used by Apple. For example, beginning in January 2011 and extending through the end of the year, advertisements for the Galaxy Tab and Tab 10.1 appeared in Sports Illustrated, The Wall Street Journal, Rolling Stone, Time, Mens Health, The New York Times, and Wired.317 Starting as early as January for newspaper media and March for magazine media, Apple ran ads for competing products throughout the year in those same sources.318 Sleekcraft Factor 6: Types of goods and the degree of care likely to be exercised by the purchaser 160. As with smartphones, the degree of care exercised by the purchaser is a function of
13 several factors: the price of the goods, the degree of sophistication of the consumers, and the 14 purchase channel involved (e.g., web, carrier store, independent big-box retailer, aftermarket 15 channels such as eBay, etc.). Therefore, the same variances are at play herethe products are 16 17 18 19 20 21 22 23 24 25 26 27 28 OMD0000004-10 at OMD0000007. Todd Pendleton, STAs Chief Marketing Officer for wireless, stated that Samsung runs national campaigns for its smartphone and tablet products. See, e.g., Pendleton Rough Dep. Tr. 26-28, 32, 37-38. 316 OMD0000004-10 at OMD0000007; APLNDC-X0000022178; APLNDCX0000022180; APLNDC-X0000022181. 317 OMD0000004-10 at OMD0000007; APLNDC0001545034-1545040 at APLNDC0001545036; APLNDC0002113085-2113091 at APLNDC0002113088. 318 APLNDC-X0000037753-37780 at APLNDC-X0000037753-37755; APLNDC0002034107-2034131 at APLNDC0002034120-2034121; APLNDCX0000048915-48924 at APLNDC-X0000048915-48916; APLNDC-X0000039288-39293 at APLNDC-X0000039288-39290. 319 There is some tempering of price variation because tablets generally do not sell at heavily subsidized prices because of carrier contracts.
315 314
bought by both careful consumers and not-so-careful consumers.319 Sleekcraft Factor 7: Defendants intent in selecting the trade dress
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161.
Like the Galaxy S line of phones, the Samsung Galaxy Tab products were
announced and introduced after Apple unveiled the iPad in January 2010.320 Samsungs first Android tablet, the Galaxy Tab, was unveiled in September 2010, and made available for purchase in the U.S. in November 2010.321 The iPad 2 was announced and released in March 2011, whereas the Galaxy Tab 10.1 was introduced in the U.S. in late March 2011, and made available for sale in the U.S. in June 2011.322 162. Before the introduction of the iPad, no other tablet computer product in the market
looked like the iPad. For example, the Microsoft Tablet PC unveiled in 2000 did not have a flat clear surface covering the front, under which was a display screen. One could use Microsoft Tablet PC with a special stylus pen, but it was not a touch-sensitive device.323 Compaq
Apple Launches iPad, Apple Inc. Press Release, January 27, 2010 (http://www.apple.com/pr/library/2010/01/27Apple-Launches-iPad.html). 321 Samsung Mobile Expands Galaxy Product Portfolio with Launch of Samsung Galaxy Tab, Samsung Press Release, September 16, 2010 (http://www.samsung.com/us/news/presskitRead.do?page=1&news_seq=19537&rdoPeriod= ALL&from_dt=&to_dt=&news_group=ALL&news_type=&news_ctgry=&search_keyword= Samsung+Mobile+Expands+Galaxy+Product+Portfolio+); Verizon Wireless Puts Samsung Galaxy Tab in Stores in November, Samsung Press Release, No Date (http://www.samsung.com/us/news/presskitRead.do?page=5&news_seq=19747&rdoPeriod= ALL&from_dt=&to_dt=&news_group=ALL&news_type=&news_ctgry=&search_keyword= galaxy+tab). 322 Apple Launches iPad 2, Apple Inc. Press Release, March 2, 2011 (http://www.apple.com/pr/library/2011/03/02Apple-Launches-iPad-2.html); Samsung Unveils Galaxy Tab 10.1 and Galaxy Tab 8.9, Worlds Thinnest Mobile Tablets, Samsung Press Release, March 22, 2011 (http://www.samsung.com/us/news/presskitRead.do?page=1&news_seq=19835&rdoPeriod= ALL&from_dt=&to_dt=&news_group=ALL&news_type=&news_ctgry=&search_keyword= galaxy+tab+10.1); Samsung Galaxy Tab 10.1, Worlds Thinnest Mobile Tablet, Makes Official Landing in U.S. Samsung Press Release, June 2, 2011 (http://www.samsung.com/us/news/presskitRead.do?page=7&news_seq=19857&rdoPeriod= ALL&from_dt=&to_dt=&news_group=ALL&news_type=&news_ctgry=&search_keyword= galaxy). The Galaxy Tab 10.1 was unveiled on February 13, 2011. Samsung announced the new tablet in partnership with Vodafone Group (Samsung Expands the Samsung Galaxy Tab Range with a 10.1 Entertainment Powerhouse, Samsung Press Release, February 13, 2011 (http://www.samsung.com/us/news/presskitRead.do?page=9&news_seq=19817&rdoPeriod= ALL&from_dt=&to_dt=&news_group=ALL&news_type=&news_ctgry=&search_keyword= galaxy)). 323 Tablet PC Brings the Simplicity of Pen and Paper to Computing, Microsoft Press Release, November 13, 2000 (http://www.microsoft.com/presspass/features/2000/nov00/1113tabletpc.mspx).
320
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introduced a tablet called the Compaq TC1000 in 2002. The product was a hybrid tablet that included a detachable keyboard as well as a writing stylus pen.324 In 2007, the Lenovo X61 Tablet PC was introduced. It had a touchscreen and could be used with either a finger or a stylus, but it was attached to a full sized keyboard. The product was more similar to a laptop with a touch-sensitive monitor that could be rotated than a standalone tablet.325 163. Before Apples introduction of the iPad in 2010, Samsungs tablet products looked
very different from its Galaxy Tabs. For example, the Samsung Q1 tablet, introduced in 2006, looked very different from the Galaxy Tab or the iPad.326 The Q1, which has been described as looking similar to a pumped-up Sony PSP, featured a touch screen that could be maneuvered by finger or stylus and housed handwriting recognition software. It had a built-in virtual keyboard for typing.327 To the left of the screen was a flat-headed joystick and on the right was a circular control with four buttons.328 A later version of the Q1, released in May 2007, featured a split QWERTY keyboard to the sides of the screen.329 164. Much as Samsung compared its phones to the iPhone, it also compared its tablets
to the iPad. For example, in a side-by-side comparison of the iPad 2 with a P5 (a Samsung tablet) it was stated that iPad 2 icons are big and the gap between the applications are ideal while P5 icons are too small and too close to each other . . . .330 Another side-by-side comparison is a HP Compaq Tablet PC TC1000 Review, CNET Reviews, November 5, 2002 (http://reviews.cnet.com/laptops/hp-compaq-tablet-pc/4505-3121_720627295.html#reviewPage1). 325 Lenovo ThinkPad X61 Tablet PC Review, TabletPCReview.com, June 12, 2007 (http://www.tabletpcreview.com/default.asp?newsID=868). 326 Samsung Q1 Review, PC Magazine, May 1, 2006 (http://www.pcmag.com/article2/0,2817,1955884,00.asp). 327 Samsung Q1, PC Magazine, May 1, 2006 (http://www.pcmag.com/article2/0,2817,1955884,00.asp). 328 Samsung Q1, PC Magazine, May 1, 2006 (http://www.pcmag.com/article2/0,2817,1955884,00.asp). 329 Samsung Unveils the Q1 Ultra, the Next Stage in the Evolution of Ultra Mobile Personal Computing, Samsung Press Release, May 7, 2007 (http://www.samsung.com/us/news/presskitRead.do?page=1&news_seq=3692&rdoPeriod=A LL&from_dt=&to_dt=&news_group=ALL&news_type=&news_ctgry=&search_keyword=Q 1+ultra); Q1 Ultra Premium UMPC, Samsung Marketing Material (http://www.samsung.com/us/pdf/UMPC_LR.pdf). 330 SAMNDCA10244604-10244639 at SAMNDCA10244608.
324
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presentation summarizing a workshop conducted by HumanCentric (a product design service company) and Samsung, comparing key applications (such as home, calendar, contacts, etc.) on the Samsung P1 (another Samsung tablet) to those on the iPad. In order to improve a weakness of P1that P1 menu and home screens are separate areas, which can cause confusion to a new userit was suggested that the simplicity of the iPad is good to emulate.331 165. Therefore, these internal Samsung documents show that the iPad was held out as
the aspirational model to Samsung designers and engineers. Sleekcraft Factor 8: Likelihood of expansion of the product lines 166. Because Apple and Samsung products already compete in the tablet computer
market, Sleekcraft Factor 8 is not informative for the purposes of my analysis. X. SAMSUNGS MISAPPROPRIATION OF APPLES TRADE DRESS DILUTES AND HARMS APPLES BRAND 167. In this section, I assess how Samsungs misappropriation of Apples proprietary
look and feel harms Apples brand. I first analyze how Samsungs misappropriation dilutes the distinctiveness of Apples iPhone Trade Dress and iPhone 3G Trade Dress and, separately, the iPad Trade Dress. I then analyze how Samsungs misappropriation harms Apples brand. 168. I understand that dilution by blurring is the legal standard to be used to analyze
one of Apples claims for relief against Samsung that pertain to the trade dress claims at issue. I also understand that dilution by blurring may be assessed by examining six factors set out by the Trademark Dilution Revision Act of 2006.332 As with the Sleekcraft Factors discussed above, while I have not been asked to provide a legal opinion on whether Samsungs products dilute Apples distinctive trade dress, these factors reflect the type of information that I, as a marketing expert, would consider in assessing whether Samsungs misappropriation of Apples trade dress is likely to affect consumers perceptions of Apples brand and their purchasing behavior. 169. The blurring factors are:
331 332
SAMNDCA00203268-203420 at SAMNDCA00203301. 15 U.S.C. 1125(c)(2)(B). 67
1 2 3 4 5 6 7 8 9 170. 10 11 12 A.
(i) The degree of similarity between the trade dresses; (ii) The degree of inherent or acquired distinctiveness of the famous trade dress; (iii) The extent to which the owner of the famous trade dress is engaging in substantially exclusive use of the trade dress; (iv) The degree of recognition of the famous trade dress; (v) Whether the junior user of the trade dress intended to create an association with the famous trade dress; and (vi) Any actual association between the trade dresses. Samsungs Misappropriation of Apples iPhone Trade Dress and iPhone 3G Trade Dress Dilutes the Distinctiveness of Apples iPhone Trade Dress and iPhone 3G Trade Dress Dilution Factor 1: Similarity of the Trade Dresses As discussed above, Samsungs Galaxy line of smartphones closely resembles
Apples iPhone Trade Dress and iPhone 3G Trade Dress, as embodied in Apples iPhone products.333 Dilution Factors 2 & 4: Degree of Acquired Distinctiveness and Recognition of 13 the Trade Dress 14 171. 15 brand. The designs of Apples iPhone products, as shown in the iPhone Trade Dress and iPhone 16 3G Trade Dress, are unique and distinctive and thus memorable for consumers. These brand 17 perceptionsboth on the part of users and non-users (because they are mobile devices that are 18 used publicly)are confirmed by consumers repeated interactions with Apples distinctive 19 designs, and make Apples iPhone Trade Dress and iPhone 3G Trade Dress recognizable. The 20 marketing literature addresses how distinctive designs reduce consumer confusion in the clutter of 21 brands in the marketplace and make a brand recognizable. 22 172. 23 24 results, in combination with Apples extensive promotion and sales of iPhone products and third25 26
333
A brands distinctive design can become part of a consumers perception of that
Furthermore, the surveys from the Poret Report show that people associate the
look of the iPhone Trade Dress and the iPhone 3G Trade Dress with Apple.334 Those survey
party press regarding the iPhone products, as discussed above,335 cause me to believe that there is See supra 117-120. Poret Report at 35, 52. 335 See supra 47-70.
334
27 28
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an extremely high degree of recognition for the iPhone Trade Dress and the iPhone 3G Trade Dress among consumers in the U.S. Separately, Dr. Van Lieres survey shows that a significant percentage of people associate the look of the Samsung Galaxy phones with Apple iPhones or products made by Apple,336 which also supports the conclusion that the look and feel of the iPhone is recognizable as a source identifier. If it were not recognizable as a source identifier, I would not expect consumers to associate the look-alike Samsung products with Apple. These surveys, taken together with the evidence noted abovethe amount and nature of Apples iPhone advertising, the volume of iPhone sales, anecdotal evidence from consumers and industry observers pertaining to the iPhones look and feel, widespread media attentionstrongly suggest from a marketing perspective that the iPhone look and feel is highly recognizable.337 Dilution Factor 3: Substantially Exclusive Use of the Trade Dress 173. As mentioned above, I understand that Apple has an industrial design expert in the
case, Peter Bressler, who will be opining that no phone looked like the iPhone before the launch of the iPhone. For purposes of my analysis, I assume that the relevant trade dresses were substantially exclusively used by Apple when Apple first launched the iPhone. Dilution Factor 5: Intent of Junior User to Create Association with the Famous Trade Dress 174. Samsungs internal documents, discussed above, show that Samsung viewed the
iPhone as the model for a smartphone and intended to create an association with the iPhone because it used iPhone devices as models in its development of the Galaxy smartphones.338 Dilution Factor 6: Actual Association 175. Press articles reviewing the Galaxy smartphone products make it clear that the
reviewers associate the look and feel of the Galaxy smartphone products with the iPhone. Specifically, an article from Wired noted:
Van Liere Report at 4-5. My opinion is restricted to a marketing perspective vis--vis the iPhone. I am not rendering an opinion on the fame of the trade dress from a legal perspective. 338 See supra 132-138.
337
336
69
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 176.
Samsungs latest phone, the Vibrant, has the body of an iPhone and the brains of an Android. The Vibrants industrial design is shockingly similar to the iPhone 3G: The rounded curves at the corners, the candybar shape, the glossy, black finish and the chrome-colored metallic border around the display. The Vibrant even has its volume and ringer buttons in almost the same spot as the iPhone 3G. . . . [T]he square icons are, again, very similar in their looks to the iPhone 3Gs. . . . [T]heres little to make the phone notable, apart from its striking similarity to the iPhone.339 Another reviewer noted how even the icons used in the Samsung Galaxy S
resemble those of the iPhone: When I saw pictures of the Galaxy S phones from Samsung, I thought Id found the perfect successor for shifting off the iPhone. Here was an [sic] phone that had iPhone-like icons, an iPhone-like look but which would work on networks other than AT&T.340 177. If even expert reviewers of smartphone products associate the Galaxy smartphone
products with Apple, it is not surprising that consumers reach the same conclusion, and associate the design of the Galaxy smartphone products with Apple. As discussed above, Dr. Van Lieres survey shows that a significant percentage of people associate the look of the Samsung Galaxy phones with Apple iPhones or products made by Apple. Specifically, 52% of respondents who were shown pictures of a Samsung Galaxy Fascinate phone associated the look and design of the Samsung Galaxy Fascinate with an iPhone, or a phone or product manufactured by Apple. When the same test was carried out with a Samsung Galaxy S II Epic 4G Touch phone, 51% of respondents associated the look and design of the Samsung Galaxy S II Epic 4G Touch phone with an iPhone, or a phone or product manufactured by Apple.341 178. When distinctiveness cues get muddied, as has happened here, brand perception
suffers. Samsungs phones at issue, by appropriating Apples trade dress, muddy the
First Look: Samsung Vibrant Rips Off iPhone 3G Design, Wired, July 15, 2010 (http://www.wired.com/gadgetlab/2010/07/first-look-samsung-vibrant-rips-off-iphone-3gdesign/) (emphasis added). 340 A Tale of Three Android Phones: Droid 2, Samsung Fascinate & Google Nexus S, Search Engine Land, January 3, 2011 (http://searchengineland.com/a-tale-of-three-androidphones-droid-2-samsung-fascinate-google-nexus-s-59870). 341 Van Liere Report at 4-5, 17.
339
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distinctiveness cues that are inherent in the iPhone Trade Dress and iPhone 3G Trade Dress. As Mr. Joswiak notes: [N]o one made a successful copy of the iPod and it remained very distinctive as far as the gold standard for music players. The iPhone, in the smartphone market, was copied, and as a result, instead of it having that same luxury, if you will, that the iPod had of being very distinctive and alone in the way it looks and what it does, as a marketing professional, the intuition is that some of the differences there are there its just too easy for a customer to think theyre getting something very similar to an iPhone, and they buy an alternative.342 179. It is noteworthy that Samsungs misappropriation happens both at the level of the
constituent elements of the trade dress (e.g., a matrix of colorful square icons with evenly rounded corners within the display screen when the device is turned on) and the overall look and feel that the consumer perceives. The effects on consumers brand perceptions is accretive: here, we have a case where Samsung mimics not only the constituent elements of the trade dress but also the overall look and feel by its choice of which elements to appropriate (for example, one can imagine an alternative where the colorful icons were misappropriated but the overall shape was different from that of the iPhone). Given the evidence that I have discussed above showing the striking similarity of Samsungs products at issue and the iPhone, iPhone 3G, and iPhone 3GS, the accretive effect magnifies the diminution of the distinctiveness of the iPhone Trade Dress and iPhone 3G Trade Dress. B. Samsungs Misappropriation of Apples iPad Trade Dress Dilutes Distinctiveness of Apples iPad Trade Dress Dilution Factor 1: Similarity of the Trade Dresses 180. As discussed above, Samsungs Galaxy tablets closely resemble Apples iPad
Trade Dress, as embodied in Apples iPad and iPad 2 products.343 Dilution Factors 2 & 4: Degree of Acquired Distinctiveness and Recognition of the Trade Dress
342 343
Joswiak Dep. 274:8-20. See supra 152-155. 71
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181.
A brands distinctive look and feel can become part of a consumers perception of
that brand. The designs of Apples iPad products, as shown in the iPad Trade Dress, are unique and distinctive and thus memorable for consumers. These brand perceptionsboth on the part of users and non-users (because they are mobile devices that are used publicly)are confirmed by consumers repeated interactions with Apples distinctive designs, and make Apples iPad Trade Dress recognizable. A distinctive look and feel reduces consumer confusion amidst the clutter of brands in the marketplace and makes a brand recognizable. 182. As discussed above, the Poret Report shows that people associate the look of the
iPad Trade Dress with Apple, and that the iPad Trade Dress has a high degree of recognition.344 Those survey results, in combination with Apples extensive promotion and sales of iPad products and third-party press regarding the iPad products, as discussed above,345 cause me to believe that there is a high degree of recognition for the iPad among consumers in the U.S. Separately, Dr. Van Lieres survey shows that a significant number of people associate the look of the Samsung Galaxy 10.1 tablet with Apple iPads or products made by Apple,346 which also supports the conclusion that the look and feel of the iPad serves to identify the source of the product. As noted above, if the overall look and feel of the iPad was not recognizable as a source identifier, I would not expect consumers to associate the Samsung products with Apple. These surveys, taken together with the evidence noted abovethe amount and nature of Apples iPad advertising, the volume of iPad sales, anecdotal evidence from consumers and industry observers pertaining to the iPads look and feel, and media attentionstrongly suggest from a marketing perspective that the iPad look and feel is famous.347 Dilution Factor 3: Substantially Exclusive Use of the Trade Dress 183. As mentioned above, I understand that Apple has an industrial design expert in the
case, Peter Bressler, who will be opining that no tablet computer looked like the iPad prior to the Poret Report at 36, 61, 66. See supra 47-55. 346 Van Liere Report at 3. 347 My opinion is restricted to a marketing perspective vis--vis the iPhone. I am not rendering an opinion on the fame of the trade dress from a legal perspective.
345 344
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launch of the iPad. For purposes of my analysis, I assume that the relevant trade dress was substantially exclusively used by Apple when Apple first launched the iPad. Dilution Factor 5: Intent of Junior User to Create Association with the Famous Trade Dress 184. Samsungs internal documents, discussed above, show that Samsung viewed the
iPad as the model for a tablet, and intended to create an association with the iPad because it used the iPad devices as models in its development of the Galaxy Tab devices.348 Dilution Factor 6: Actual Association 185. As discussed above, Samsung has received reports that customers have confused
the Galaxy Tab 10.1 for the iPad 2 when purchasing the Galaxy Tab 10.1.349 Moreover, an internal Samsung marketing presentation states that many consumers who viewed a Samsung television commercial for the Galaxy Tab mistakenly thought the ad had been an Apple ad.350 These instances of actual confusion relating to the source of Samsungs Galaxy Tab products and advertisements support the conclusion that consumers associate Samsungs Galaxy Tab products with the iPad Trade Dress, as embodied in the iPad and iPad 2 products. 186. In addition, Dr. Van Lieres survey shows that a significant percentage of people
confuse the look of the Samsung Galaxy 10.1 with Apple iPads or products made by Apple.351 Specifically, 43% of respondents who were shown a video of someone using a Samsung Galaxy Tab 10.1 tablet confused the product for an iPad, or a product manufactured by Apple. Consumers who confuse a Samsung product with Apple are clearly drawing an association between that product and Apple and are thereby misappropriating the look and feel of the Apple products. 187. A PCWorld article stated that the products are so similar, it is hard to tell them
apart: In my hands-on testing, the Tab 10.1 achieved perhaps the best design compliment an
348 349
See supra 164-165. See supra 157. 350 See id. 351 Van Liere Report at 3, 9.
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Android tablet could hope foroften being mistaken by passers-by (including Apple iPad users) for an iPad 2. The confusion is understandable when you see and hold the Tab 10.1 for the first time.352 188. In sum, Samsungs misappropriation of Apples iPad Trade Dress follows a
similar trajectory as its misappropriation of the iPhone Trade Dress and iPhone 3G Trade Dress and has similar effects vis--vis reducing the distinctiveness of the iPads look and feel. When distinctiveness cues get muddied, as has happened here, brand perception suffers. Samsungs tablet computers, by misappropriating Apples trade dress, muddy the distinctiveness cues that are inherent in the iPad Trade Dress. C. Diluting the Distinctiveness of Apples iPhone Trade Dress, iPhone 3G Trade Dress, and iPad Trade Dress Harms Apples Brand The value of a brand depends critically on the brands image and the underlying
189.
brand associations in the minds of consumers. Samsungs marketing strategy with respect to the products at issue influence purchasing behavior. Specifically, the effect of Samsungs misappropriation of Apples trade dress reduces the distinctiveness of Apples trade dress, as described above. From a marketing perspective, this reduces the strength of Apples brand because consumers brand associations with respect to the Apple brand are weakened. 190. As a conceptual matter, the sources of harm to Apples brand image are twofold:
the first source of harm is Samsungs general marketing strategy and tactics for the products at issue that involve diminishing the distinctiveness of Apples trade dress; the second source of harm occurs via actual consumer experience of Samsungs knockoff products. As a practical matter, these two sources of harm work together to affect Apples brand image. 191. An example of the first source of harm is the weakening of Apples coolness
factor that is inherent in the look and feel of the Apple products at issue. Many consumers buy an iPhone or an iPad, in part, because of their aesthetic appealthey look cool. Consumers like Samsung Galaxy Tab 10.1 Wi-Fi: A Worthy Rival to the iPad 2, PCWorld, June 8, 2011 (http://www.pcworld.com/article/229763/samsung_galaxy_tab_101_wifi_a_worthy_rival_to_ the_ipad_2.html).
352
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using these products and consumers like being seen using these products. When other consumers buy imitative, knock-off products, the iPhone loses part of its distinctive coolness. Of course, coolness is an example, and the loss of distinctiveness goes beyond the attenuation of the coolness factor. The entire spectrum of brand associations that consumers of the products at issue have vis--vis the Apple brand is affected. Weakened brand associations also reduce the emotional attachment consumers have to a brand; emotional attachment, so important in Apples marketing, is also a very important driver of Apples brand image. In essence, then, Samsungs misappropriation of Apples brand image has an affective influence on consumers brand associations and this erodes Apples brand image. 192. An eroded brand image inevitably leads to detrimental effects on Apples brand
equity. Strong brands provide enormous benefits to firms that own them. Therefore, when brands are harmed, the benefits to the firm that positively affect its bottom linewhich include higher brand awareness, greater customer loyalty, increased marketing communication effectiveness, and positive word-of-mouth created by loyal customers353are impacted. Reduced brand awareness and lower brand loyalty increases a companys marketing costs and/or decreases a companys sales. Lower brand loyalty also leads to fewer recommendations by consumers, and negative word-of-mouth. An eroded brand image also means that the brand no longer commands the same brand image premium. An eroded brand image may also affect the firms ability to invest in new products and engage in product expansions. It is noteworthy that an eroded brand image not only impacts the current sales of the infringed products and other branded products (including but not limited to related or ancillary products) but may also result in potential future lost sales of infringed products and other branded products.354 Winer & Dhar (2011) 179-180; Keller & Lehmann (2003); Steve Hoeffler & Kevin Lane Keller, The Marketing Advantages of Strong Brands, BRAND MANAGEMENT 10, 421-445 (2003). 354 It should be noted that sales of the Apple products at issue are typically accompanied by sales of various related and ancillary products. For example, according to a 2010 iPad Usage study, iPad buyers were heavy users of the App store and iTunes. See APLNDCY0000025823-25934 at APLNDC-Y0000025900-25903, APLNDC-Y0000025905. The same study also shows that in the survey sample, roughly 4 in every 5 purchased a case for their iPad. See APLNDC-Y0000025823-25934 at APLNDC-Y0000025924. In addition,
353
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193.
There is an additional effect of Samsungs misappropriation of Apples trade
dress. By appropriating elements of Apples brand image, Samsungs Galaxy line of smartphones and tablet products may effectively become unauthorized extensions of the high-quality Apple brand in consumers minds. In essence, this creates the second source of harm discussed above. 194. Apples relevant products are generally offered at premium price points. In
contrast, I understand that head-to-head opening prices for the Samsung products at issue tend to be released at lower price points than those Apple products. Because lower price may signal lower quality,355 this can have a detrimental effect on Apples brand image. To the extent that Samsungs products are experienced differently than Apples by consumers, the differentiated and distinctive nature of the Apple user experience is diminished. In general, a consistent Apple user experience is very important to Apple and is an important part of its success in the marketplace. For example, Babbage, the Science and Technology blog of The Economist wrote: [Former Apple CEO Steve Jobs] used Apples quarterly earnings call to rubbish Googles claim that its mobile operating system, Android, is far more open than Apples. Some apps developed on Android will only work on certain Android-powered phones and not others, he said. The result is a nightmare for consumers and developers, whereas Apple offers a simpler and more consistent experience.356 195. Industry observers agree on the uniqueness and consistency of Apples user
experience. For instance, according to a UBS Investment Research report, through its focus on
Arthur Rangel (Mr. Rangel), Director of Market Research and Analysis at Apple, explained during his deposition that iPhone or iPad buyers may also decide to purchase other Apple products such as a Mac computer. Specifically, Mr. Rangel testified that in many ways Samsung has affected sales of iPhones or iPads that could lead to [fewer] sales of Macs [Apple computers]. See Deposition of Arthur Rangel on March 2, 2012, 10:16-18, 186:3-6. 355 A. R. Rao & K. B. Monroe, The Effect of Price, Brand Name, and Store Name on Buyers Perceptions of Product Quality: An Integrated Review, 26 JOURNAL OF MARKETING RESEARCH 351-357 (1989); A. Wolinsky, Prices as Signals of Product Quality, 50 REVIEW OF ECONOMIC STUDIES 647-658 (1983). 356 Smartphone Makers Clash, The Economist blog Babbage, October 20, 2010 (http://www.economist.com/blogs/babbage/2010/10/smart-phone_makers_clash) (emphasis added).
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design, its own distribution through retail stores and its software/hardware ecosystems, Apple is providing unique user experiences that are unrivaled in the digital appliance marketplace.357 196. The diminution of the distinctiveness of the Apple user experience also hurts
Apples brand image and brand equity. The harm to the equity of the brand can be intensified depending on the brand architecture strategy of the firm. Two main strategies are the branded house strategy (where most or all of the brands bear the company name) and the house of brands strategy (where the company name is usually not present and each individual product has its own, stand-alone brand).358 In a branded house strategy, followed by the likes of Visa, Virgin, and Apple, the exposure to the brand in one context helps the brands visibility and enhances consumers awareness of the brand in other contexts. Thus, while this strategy can strengthen the brand associations, it can also amplify the potential harm to equity of the brand. Thus, harm to Apples brand from Samsungs misappropriation may be amplified by the fact that Apple follows a branded house strategy. XI. SUPPLEMENTATION 197. If permitted by the court, I may supplement or amend this report if additional facts
and information become available in discovery. In particular, I understand that Samsungs experts may serve expert reports concerning one or more of the issues addressed in this report. Therefore, I may supplement or amend my report and opinions in response to opinions and assertions made by Samsungs experts. XII. EXHIBITS TO BE USED 198. I anticipate using as Exhibits during trial certain documents and things referenced
or cited in this report or accompanying this report. I also anticipate using other demonstrative Exhibits or materials at trial.
AAPL: A Closer Look at the Potential iPhone Ecosystem, UBS Investment Research, December 12, 2006, APL-ITC796-0000058721-58736 at APL-ITC7960000058722. 358 Winer & Dhar (2011) 179-180; David A. Aaker & Erich Joachimsthaler, The Brand Relationship Spectrum: The Key to the Brand Architecture Challenge, CALIFORNIA MANAGEMENT REVIEW 42, 8-23 (2000).
357
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I declare under penalty of perjury under the laws of the United States of America that the foregoing is true and correct and that this Declaration was executed on March 22, 2012, in New York, New York.
Russell S. Winer
78
Exhibit 1
RUSSELL S. WINER William Joyce Professor of Marketing Chairman, Department of Marketing Stern School of Business, 40 W.4th Street 806 Tisch Hall New York University New York, NY 10012 [email protected] www.stern.nyu.edu/~rwiner Twitter: @russwiner Phone: +212.998.0540, Mobile +917.209.5711
Curriculum Vitae August, 2011 EDUCATION Ph.D., Industrial Administration M.S., Industrial Administration B.A., Economics Carnegie Mellon University, 1977 Carnegie Mellon University, 1975 Union College, 1973
HONORS Phi Beta Kappa, 1973 American Marketing Association, Doctoral Consortium Fellow, 1975 American Marketing Association, Doctoral Dissertation Competition, Honorable Mention, 1977 Best Teacher Award, Vanderbilt Executive MBA Class of 1987 Best Teacher Award, UC-Berkeley Evening MBA Program, 1992 Lifetime Achievement Award, Fordham University Pricing Center, 2002 Direct Marketing Educational Foundation Robert B. Clarke Outstanding Educator, 2003 Inaugural Fellow of the INFORMS Society for Marketing Science, 2008 American Marketing Association/Irwin/McGraw-Hill Distinguished Marketing Educator Award for Lifetime Achievement in Marketing, 2011
PROFESSIONAL MEMBERSHIPS American Economic Association, American Marketing Association, Association for Consumer Research, European Marketing Academy, INFORMS, INFORMS Society for Marketing Science.
ACADEMIC APPOINTMENTS July, 1977August, 1984 Columbia University Graduate School of Business Assistant/Associate Professor Vanderbilt University Owen Graduate School of Management Associate Professor Director of the Doctoral Program (1986-8) Massachusetts Institute of Technology Sloan School of Management Visiting Associate Professor of Management Science
September, 1984August, 1988
January-March 1987
July, 1988-December, 2002 University of California at Berkeley Haas School of Business J. Gary Shansby Professor of Marketing Strategy Marketing Group Chair (1988-92, 1994-2002) Associate Dean for Academic Affairs and Faculty Chair (1992-96, 1998-9) January-March, 2000 Stanford University Graduate School of Business Visiting Professor of Marketing Stern School of Business New York University William Joyce Professor of Marketing Deputy Dean (2003-6) Chair, Marketing Department (2008- ) Executive Director Marketing Science Institute Cambridge, MA Dean, Department of Business Administration University of the People (www.uopeople.org)
January, 2003-present
July, 2007-June, 2009
January, 2009-present
Visiting Scholar appointments: Cranfield School of Management; Tokyo University; Stanford University Graduate School of Business. Other MBA teaching: Helsinki School of Economics, cole Nationale des Ponts et Chauses (Paris, Cochin India, Buenos Aires, Casablanca), Indian Institute of Planning and Management (Delhi, Hyderabad, Bangalore, Chennai), Indian School of Business (Hyderabad).
MANAGEMENT DEVELOPMENT PROGRAMS Executive teaching in Marketing Research, Planning, and Strategy for Columbia, Vanderbilt, the University of California, New York University, and various companies and organizations including the New York Telephone Company, South Central Bell, Chemical Bank, Tennessee Bankers Association, Sovran Bank, Young Presidents' Organization, Tennessee Valley Authority, Warner Brothers Records, Kaiser Permanente, Western Farm Credit Bank, Becton Dickinson Immunocytometry Systems, Southwestern Bell, Pacific Bell, Hungarian Marketing Association, Perkin-Elmer Applied Biosystems Division, Pratt & Whitney China Management Training Program, ESADE (Barcelona, Madrid), L'Oreal, General Electric, Peking University, Dell Computer (Round Rock, TX; Penang, Malaysia; Bratislava, Slovakia; Porto Alegre, Brazil; Bangalore, India).
PROFESSIONAL ACTIVITIES Editorial Boards: Journal of Marketing Research (1989- , Editor: 1997-2000, 2005-06) Marketing Science (1990-97, 2002- , Area Editor: 1992-97) Journal of Marketing (1997- ) International Journal of Research in Marketing (Associate Editor: 2006- ) Review of Marketing Science (Co-editor: 2006- ) Marketing Letters (2007- ) Journal of Advertising Research (2010- ) Journal of Interactive Marketing (1988-2005, Co-Editor: 2000-05, Editor Emeritus) Journal of Consumer Research (1983-2002 , Associate Editor: 1993-96) Professional Service: Past Secretary-Treasurer (1980-81) and Chairman (1984-85) of the Marketing College of The Institute of Management Sciences; Secretary of The Institute of Management Sciences (1987-89); Member, Combined Finance Committee of The Institute of Management Sciences (1989-90); Advisory Council for the TIMS College on Marketing (199395); TIMS Marketing Strategy Committee (1992-94); Publications Committee of the Association for Consumer Research (1988-89); Academic Trustee, Marketing Science Institute (1994-2000, 2006-7; Vice President for Publications, American Marketing Association (2004-8). External Reviewer for Marketing Departments: University of Pennsylvania (Wharton), Carnegie Mellon University (Graduate School of Industrial Administration), Northwestern University (Kellogg), National University of Singapore, Columbia University.
BUSINESS EXPERIENCE Consulting: New York Telephone Company, American Airlines-Freight Marketing, National Particleboard Association, Long Island Lighting Company, Ogilvy and Mather, DancerFitzgerald-Sample, Martin Marietta, Executive Programs-Columbia University, First American Bank, Kidder Peabody, Perkin-Elmer Applied Biosystems Division, ATX Technologies, Damovo do Brasil, various expert witness assignments. Director/Advisor: Decidia, Revionics, Crown Point Festival (non-profit), Marketing Science Institute, Direct Marketing Educational Foundation, American Marketing Association, European School of Management and Technology (ESMT). Past Director/Advisor: Roundtable Pizza, Manischewitz, Henley Management College.
PUBLICATIONS Books Winer, Russell S. and Ravi Dhar (2011), Marketing Management, 4th ed., Upper Saddle River, NJ: Prentice Hall. Translated into Chinese, Italian. Lehmann, Donald R. and Russell S. Winer (2008), Analysis for Marketing Planning, 7th ed., Burr Ridge, IL: Irwin. Translated into Japanese, Greek, and Chinese. Winer, Russell S. (2006), Pricing, Cambridge, MA: Marketing Science Institute. Lehmann, Donald R. and Russell S. Winer (2005), Product Management, 4th ed., Burr Ridge, IL: Irwin/McGraw-Hill. Translated into Chinese, Russian, and Spanish. Neslin, Scott and Russell S. Winer, The History of Marketing Science (working title), in development, to be published by now publishers, inc. Articles Winer, Russell S. and Huntley W.H. Zia (1975), A Sequential Analysis Approach to Determining the Optimal Length of a Test Marketing Period, Proceedings, Canadian Association of Administrative Sciences. Staelin, Richard and Russell S. Winer (1976), A Unobservable Variables Model for Determining the Effect of Advertising on Consumer Purchases, Proceedings, Fall Conference of the American Marketing Association. Winer, Russell S. (1976), A Time-Varying Parameter View of the Sales-Advertising Relationship, Proceedings, Fall Conference of the American Marketing Association.
Avery, Robert, Andrew Mitchell, and Russell S. Winer (1976), Issues in Modeling the Carryover Effects of Advertising, Proceedings, Fall Conference of the American Marketing Association. Wildt, Albert R. and Russell S. Winer (1978), Modeling Structural Shifts in Marketing Response: An Overview, Proceedings, Fall Conference of the American Marketing Association. Elrod, Terry and Russell S. Winer (1979), Estimating the Effects of Advertising on Individual Household Purchasing Behavior, Proceedings, Fall Conference of the American Marketing Association. Farley, John U., Jerrold P. Katz, Donald R. Lehmann, and Russell S. Winer (1979), Measurement and Parameter Stability in a Multi-Wave Consumer Panel, Proceedings, TIMS/ORSA Conference on Market Measurement held at Stanford University. Elrod, Terry and Russell S. Winer (1979), An Empirical Comparison of Aggregation Criteria for Developing Market Segments, Proceedings, TIMS/ORSA Conference on Market Measurement held at Stanford University. Winer, Russell S. (1979), An Analysis of the Time Varying Effects of Advertising: the Case of Lydia Pinkham, Journal of Business, 52 (October), 563-576. Winer, Russell S. (1979), On Family Versus Firm Level Analysis of the Effects of Advertising, Decision Sciences, 10 (October), 547-561. Winer, Russell S. and Michael J. Ryan (1979), Analyzing Cross-Classification Data: An Improved Method for Predicting Events, Journal of Marketing Research, 16 (November), 539544. Holbrook, Morris B., William L. Moore, and Russell S. Winer (1980), Using 'Pick Any' Data to Represent Competitive Positions, Proceedings, TIMS/ORSA Conference on Market Measurement held at the University of Texas at Austin. Winer, Russell S. (1980), A Longitudinal Model to Decompose the Effects of an Advertising Stimulus on Family Consumption, Management Science, 26 (January), 78-85. Winer, Russell S. (1980), Estimation of a Longitudinal Model to Decompose the Effects of an Advertising Stimulus on Family Consumption, Management Science, 26 (May), 471-482. Winer, Russell S. (1980), Analysis of Advertising Experiments, Research, 20 (June), 25-32. Journal of Advertising
Winer, Russell S. (1981), Attrition Bias in Econometric Models Estimated from Panel Data, Proceedings, Association for Consumer Research.
Farley, John U., Donald R. Lehmann, Russell S. Winer, and Jerrold P. Katz (1982), Parameter Stationarity and Carryover Effects in a Consumer Decision Process Model, Journal of Consumer Research, 8 (March), 465-471. Holbrook, Morris B., William L. Moore, and Russell S. Winer (1982), Constructing Joint Spaces from Pick-Any Data: A New Tool for Consumer Analysis, Journal of Consumer Research, 9 (June), 99-105. Elrod, Terry and Russell S. Winer (1982), An Empirical Comparison of Market Segmentation Criteria, Journal of Marketing, 46 (Fall), 65-74. Lehmann, Donald R. and Russell S. Winer (1983), An Examination of the Competitor Analysis Process, Proceedings, TIMS/ORSA Marketing Science Conference held at the University of Southern California. Hulbert, James M., Donald R. Lehmann, and Russell S. Winer (1983), Objective and Strategy Determination: Some Empirical Results, Journal of Business Research, 11, 427-438. Winer, Russell S. (1983), Attrition Bias in Econometric Models Estimated with Panel Data, Journal of Marketing Research, 20 (May), 177-186. Wildt, Albert R. and Russell S. Winer (1983), Modelling and Estimation in Changing Market Environments, Journal of Business, (July), 365-388. Weinberg, Charles B. and Russell S. Winer (1983), Working Wives and Major Family Expenditures: Update, Replication, and Extension, Journal of Consumer Research, 10 (September), 259-263. Winer, Russell S. (1985), A Price Vector Model of Demand for Consumer Durables: Preliminary Developments, Marketing Science, 4 (Winter), 74-90. Winer, Russell S. (1985), A Revised Behavioral Model of Consumer Durable Demand, Journal of Economic Psychology, 6 (June), 175-184. Winer, Russell S. (1986), A Reference Price Model of Demand for Frequently-Purchased Products, Journal of Consumer Research, 13 (September), 250-256. Reprinted in G.S. Carpenter, R. Glazer, and K. Nakamoto, eds., Readings on Market-Driving Strategies, (Reading, MA: Addison-Wesley), 1997. Moore, William L. and Russell S. Winer (1987), A Panel Data-Based Method for Merging Joint Space and Market Response Function Estimation, Marketing Science, 6 (Winter), 25-42 (with commentary). Cooil, Bruce, Russell S. Winer, and David L. Rados (1987), Cross-Validation for Prediction, Journal of Marketing Research, 24 (August), 271-279.
Farley, John U., Donald R. Lehmann, and Russell S. Winer (1987), Stability of Membership in Market Segments Identified with a Disaggregate Consumption Model, Journal of Business Research, 15, 313-328. Oliver, Richard L. and Russell S. Winer (1987), A Framework for the Formation and Structure of Consumer Expectations: Review and Propositions, Journal of Economic Psychology, 8 (December), 469-499. Glazer, Rashi, Joel H. Steckel, and Russell S. Winer (1987), Group Process and Decision Performance in a Simulated Marketing Environment, Journal of Business Research, 15 (December), 545-557. Winer, Russell S. (1988), Behavioral Perspectives on Pricing: Buyers' Subjective Perceptions of Price Revisited, in T.M. Devinney, ed., Issues in Pricing: Theory and Research, Lexington, MA: Lexington Books, 35-57. Glazer, Rashi, Joel H. Steckel, and Russell S. Winer (1989), The Formation of Key Marketing Variable Expectations and their Impact on Firm Performance: Some Experimental Evidence, Marketing Science, 8 (Winter), 18-34. Winer, Russell S. and William L. Moore (1989), The Effects of Advertising and other Marketing Mix Variables on Brand Positioning, Journal of Advertising Research, 28 (February/March), 39-45. Winer, Russell S. (1989), A Multi-Stage Model of Choice Incorporating Reference Prices, Marketing Letters, 1 (December), 27-36. Vanhonacker, Wilfried R. and Russell S. Winer (1990), A Rational Random Behavior Model of Choice, Applied Stochastic Models and Data Analysis, 6 (March), 41-52. Glazer, Rashi, Joel H. Steckel, and Russell S. Winer (1990), Judgmental Forecasts of Key Marketing Variables: Rational vs. Adaptive Expectations, International Journal of Forecasting, 6 (July), 149-162. Srinivasan, T.C. and Russell S. Winer (1990), Empirical Modeling of Consumer Purchasing Behavior: A Review, Review of Marketing, Vol. 4, Chicago: American Marketing Association, 43-67. Chaney, Paul K., Timothy M. Devinney, and Russell S. Winer (1991), The Impact of New Product Introductions on the Market Value of Firms, The Journal of Business, 64 (October), 573-610. McAlister, Leigh, Rajendra Srivastava, Joel Horowitz, Morgan Jones, Wagner Kamakura, Jack Kulchitsky, Brian Ratchford, Gary Russell, Fareena Sultan, Tetsuo Yai, Doyle Weiss, and Russ Winer (1991), Incorporating Choice Dynamics in Models of Consumer Behavior, Marketing Letters, 2 (August), 241-252.
Glazer, Rashi, Joel H. Steckel, and Russell S. Winer (1992), Locally Rational Decision-Making: The Distracting Effect of Information on Managerial Performance, Management Science, 38 (February), 212-226. Mayhew, Glenn E. and Russell S. Winer (1992), An Empirical Analysis of Internal and External Reference Price Effects using Scanner Data, Journal of Consumer Research, 19 (June), 62-70. Simonson, Itamar and Russell S. Winer (1992), The Influence of Purchase Quantity and Display Format on Consumer Preference for Variety, Journal of Consumer Research, 19 (June), 133138. Sultan, Fareena and Russell S. Winer (1993), Time Preferences for Products and Attributes for the Adoption of Technology-Driven Consumer Durable Innovations, Journal of Economic Psychology, 14, 587-613. Winer, Russell S. (1993), Using Single-Source Scanner Data as a Natural Experiment for Evaluating Advertising Effects, Journal of Marketing Science (Japan), 2, 15-31. Srinivasan, T.C. and Russell S. Winer (1994), Using Neoclassical Consumer-Choice Theory to Produce a Market Map From Purchase Data, Journal of Business and Economic Statistics, 12 (January), 1-9. Winer, Russell S., Randolph E. Bucklin, John Deighton, Tulin Erdem, Peter S. Fader, J. Jeffrey Inman, Hotaka Katahira, Kay Lemon, and Andrew Mitchell (1994), When Worlds Collide: The Implications of Panel Data-Based Choice Models for Consumer Behavior, Marketing Letters, 5, 383-394. Winer, Russell S. (1994), The Annual Marketing Plan, in AMA Management Handbook, 3rd ed., edited by J. Hampton, New York: AMACOM Books, 2-42 - 2-47. Kalyanaram, Gurumurthy and Russell S. Winer (1995), Empirical Generalizations from Reference Price and Asymmetric Price Response Research, special issue of Marketing Science on empirical generalizations in marketing, 14 (part 2 of 2 in issue #3), G161-G169. Kopalle, Praveen and Russell S. Winer (1996), A Dynamic Model of Reference Price and Reference Quality, Marketing Letters, 7, Number 1, 41-52 Winer, Russell S. (1997), Discounting and its Impact on Durables Buying Decisions, Marketing Letters, 8, Number 1, 109-118. Winer, Russell S., John Deighton, Sunil Gupta, Eric J. Johnson, Barbara Mellers, Vicki G. Morwitz, Thomas OGuinn, Arvind Rangaswamy, and Alan G. Sawyer (1997), Choice in Computer-Mediated Environments, Marketing Letters, 8, Number 3, 287-96.
Stiving, Mark and Russell S. Winer (1997), An Empirical Analysis of Price Endings with Scanner Data, Journal of Consumer Research, 24 (June), 57-67 . Erdem, Tlin and Russell S. Winer (1999), Econometric Modeling of Spatial Competition: A Multi-Category Analysis, Journal of Econometrics, 89, 159-175. Winer, Russell S. (1999), Experimentation in the 21st Century: The Importance of External Validity, Journal of the Academy of Marketing Science, 27 (Summer), 349-358 (with commentary). Villas-Boas, J. Miguel and Russell S. Winer (1999), Endogeneity in Brand Choice Models, Management Science, 45 (October), 1324-1338. Winner of the inaugural 2009 ISMS LongTerm Impact award. Winer, Russell S. (1999), Situation Analysis, in The Technology Management Handbook, edited by R. C. Dorf, Boca Raton, FL: CRC Press, 12-2 12-8. Winer, Russell S. (2000), Comment on The Historical Growth of Statistical Significance Testing in PsychologyAnd Its Future Prospects, Educational and Psychological Measurement, 60 (October), 693-6. Winer, Russell S. (2000), Comment on Leeflang and Wittink, International Journal of Research in Marketing, 17, 141-5. Winer, Russell S. (2001), A Framework for Customer Relationship Management, California Management Review, 43 (Summer), 89-105 (Finalist for Best Paper of 2001). Ofir, Chezy and Russell S. Winer (2002), Pricing: Economic and Behavioral Models, Handbook of Marketing, B. Weitz and R. Wensley, eds., London: Sage Publications Ltd, 267-81. Lemon, Katherine M., Tiffany Barnett White, and Russell S. Winer (2002), Dynamic Customer Relationship Management: Incorporating Future Considerations into the Service Retention Decision, Journal of Marketing, 66 (January), 1-14. Winner of the Donald R. Lehmann award for the best paper published from a doctoral dissertation. Ilfeld, Johanna S. and Russell S. Winer (2002), Generating Web Site Traffic: An Empirical Analysis of Web Site Visitation Behavior, Journal of Advertising Research, 42 (September/October), 49-61. Winer, Russell S. (2004), Customer Relationship Management on the Web, in The Internet Encyclopedia, H. Bidogli, ed., Hoboken, NJ: John Wiley & Sons, 315-325. Feldman, David and Russell S. Winer (2004), Separating Signaling Equilibria Under Random Relations Between Costs and Atributes: Continuum of Attributes, Mathematical Social Sciences, 48, 81-91.
Naik, Prasad A., Kalyan Raman, and Russell S. Winer (2005), Planning Marketing-Mix Strategies in the Presence of Interaction Effects: Empirical and Equilibrium Analysis, Marketing Science, 24 (Winter), 25-34. Albert, Terri and Russell S. Winer (2005), "Capturing Customers' Spare Change," Harvard Business Review, 83 (March), 28. Steckel, Joel, Russ Winer, Randy Bucklin, Benedict Dellaert, Xavier Drze, Gerald Hubl, Sandy Jap, John Little, Tom Meyvis, Alan Montgomery, Arvind Rangaswamy (2005), "Choice in Interactive Environments," Marketing Letters, 16 (December), 309-20. Fligler, Ariel, Gila E. Fruchter, and Russell S. Winer (2006), Optimal Product Line Design Using Genetic Algorithms," Journal of Optimization Theory and Applications, 131 (November), 227-244. J. Andrew Petersen, Leigh McAlister, David J. Reibstein, Russell S. Winer, V. Kumar, and Geoff Atkinson (2009), Choosing the Right Metrics to Maximize Profitability and Shareholder Value, Journal of Retailing, 85, number 1, 95-111. Russell S. Winer (2009), New Communications Approaches in Marketing: Issues and Research Directions, Journal of Interactive Marketing, 23 (May), 108-117. Inman, J. Jeffrey, Russell S. Winer, and Rosellina Ferraro (2009), The Interplay Between Category Characteristics, Customer Characteristics, and Customer Activities on In-Store Decision Making, Journal of Marketing, 73 (September), 19-29. Katherine N. Lemon, Priya Raghubir, John Roberts, and Russell S. Winer (2010), Why, When and How should the Effect of Marketing be Measured? A Stakeholder Perspective for Corporate Social Responsibility Metrics, Journal of Public Policy & Marketing, 29 (Spring), 66-77. Russell S. Winer and Terri Albert (2010), LEffeto del Resto Nel Punto Vendita, in Luca Petruzellis and Jen-Charles Chebat, eds. Comportamento del Consumatore, (Milano-Torino: Pearson Italia), 185-192. Russell S. Winer (2011), Behavioral Perspectives on Pricing Strategy, forthcoming, Handbook of Marketing, V. Shankar ed. Katherine N. Lemon, John H. Roberts, Priya Raghubir, and Russell S. Winer (2011), Measuring the Effects of Corporate Social Responsibility, The Conference Board: Director Notes, 3 (April), 1-13.
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Miscellaneous Winer, Toby R. and Russell S. Winer (1987), Integrating Strategic Planning Concepts into the Negotiating Process, Planning for Higher Education, 15, 1-4. Winer, Russell S. (1988), Global Marketing: The Debate Revisited, The Owen Manager, 9 (Spring), 12-15. Winer, Russell S. (1997), book review of Against the Gods: The Remarkable Story of Risk, by Peter L. Bernstein, Journal of Marketing, 61 (July), 112-3. Winer, Russell S. (1998), Editorial, Journal of Marketing Research, 35 (February), iii-v. Erdem, Tlin and Russell S. Winer (2002), Introduction to Special Issue on Choice Modeling, Marketing Letters, 13 (August), 157-61. Greenleaf, Eric A., Vicki G. Morwitz, and Russell S. Winer (2004), "Helping Hands," STERNbusiness, (Fall/Winter), 42-47. Winer, Russell S. (2005), From the Editor, Journal of Marketing Research, 42 (August), iii. Winer, Russell S. (2006), A New Reviewing System for the Journal of Marketing Research, Journal of Marketing Research, 43 (May), 135-6. Winer, Russell S. (2007), Editorial, Review of Marketing Science, Vol. 5, Article 1. Lehmann, Donald R. and Russell S. Winer (2009), Introduction to Special Issue on Organic Growth, International Journal of Research in Marketing, 26 (December), 261-2. Winer, Russell S. (2011), 2009-2010 ISMS-MSI Practice Prize Competition: Special Section Introduction, Marketing Science, 30 (July-August), 565-7. Work Submitted or in Progress Vishal Narayan, Sha Yang, and Russell S. Winer, Modeling the Interdependence of Seller Density and Cross-Category Consumer Expenditure, under third round review at Marketing Science. Sha Yang, Mantian Hu, Henry Assael, and Russell S. Winer, The Interdependence of Word-ofMouth Reception and Transmission, under review at Marketing Science. Schmitt, Philip, Vicky G. Morwitz, and Russell S. Winer, Managerial Decision-Making in Customer Management: Adaptive, Fast, and Frugal? under revision for second review at the Journal of the Academy of Marketing Science.
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Cases Manischewitz, (2003) Rheingold Beer, (2003) "DeBeers," (2004) "NYC2012," (2004) Brooklyn Brewing, (2010) UNICEF, (under development)
DOCTORAL STUDENT DISSERTATION COMMITTEES (in chronological order) Terry Elrod Horst Bender Kapil Bawa Srinivasan Ratneshwar Connie Pechmann T.C. Srinivasan (Chair) Glenn Mayhew (Chair) Sue OCurry (Psychology) Shi-jie Chang (Psychology) Matt Nagler (Economics) Lisa Ordez (Psychology) Kay Lemon (Chair) Mark Stiving (Chair) Judi Strebel Harish Chand (Economics) Nick Lurie Heather Honea (Co-chair) Sharon Horsky (Chair) Joseph Pancras Vishal Narayan (Co-chair) Jane Gu Rachel Shacham Isaac Dinner (Columbia) Mandy Hu (Co-Chair) Wenbo Wang (Co-Chair) Sang Hae Bee (Co-Chair) Beibei Lei (Information Systems)
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RESEARCH GRANTS Various small grants from the Marketing Science Institute NSF Grant SES-9309812, Endogeneity in Brand Choice Models, with Miguel Villas-Boas, $83,000.
COMMUNITY SERVICE Board member, Beth Jacob Congregation, Oakland, California (1990-2003); President (1993-5) Board member, Conservative Synagogue of Fifth Avenue (2010- ) Board member, Piedmont (California) Soccer Club (1996-2000) Referee for youth and high school soccer
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Exhibit 2
Professor Russell S. Winer Stern School of Business New York University Litigation work since 2000 (Dates are when the cases started)
2000 Apex Wholesale v. Frys Electronics (defense; distribution, general marketing); deposition taken. R.J. Reynolds et.al. v. Philip Morris (plaintiff; retail sales promotion) 2001 Class v. WebTV (defense; deceptive advertising) Victa v. Kaiser Permanente (defense; deceptive advertising) 2002 Braddock & Logan v. Elk Corporation, Pacific Coast Building Products, et.al. (plaintiff; deceptive advertising); deposition taken. 2003 Unsecured Creditors of Iridium v. Motorola (defense; marketing research support for new product forecasts) 2006 Class v. DaimlerChrysler (defense; possible defective braking system) Odom and Moureaux-Maloney v. Microsoft Corp. (defense; deceptive practices) 2007 Kargo Global, Inc. v. Advance Magazine Publishers, Inc. (plaintiff; brand infringement) Class v. InPhonic, Inc. (defense; deceptive practices) 2008 M-101, LLC v. iN Demand LLC (plaintiff; brand damages)
2010 Riddell, Inc. v. Schutt Sports, Inc. (defense; general marketing, expert rebuttal); deposition taken. Network-1 Security Solutions, Inc. v. Cisco Systems, Inc. et.al. (defense; survey research methodology, expert rebuttal); deposition taken. 2012 Class v. POM Wonderful LLC (defense; deceptive advertising); in progress. Apple v. Samsung (plaintiff; trade dress); in progress.
Exhibit 3

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Apple Inc. v. Samsung, No. 11-01846 LHK (PSG) Documents Considered by Russell Winer Beg Bates APLNDC-X0000021159 APLNDC-X0000022178 APLNDC-X0000022180 APLNDC-X0000022181 APLNDC-X0000026718 APLNDC-X0000030612 APLNDC-X0000030646 APLNDC-X0000037753 APLNDC-X0000039288 APLNDC-X0000048915 APLNDC-X0000358381 APLNDC-X0000358382 APLNDC-X0000358383 APLNDC-X0000358408 APLNDC-X0000358416 APLNDC-X0000358444 APLNDC-X0000358450 APLNDC-X0000358459 APLNDC-X0000358463 APLNDC-X0000358467 APLNDC-X0000358475 APLNDC-X0000358478 APLNDC-X0000358480 APLNDC-X0000358484 APLNDC-X0000358486 APLNDC-X0000358505 APLNDC-X0000358507 APLNDC-X0000358621 APLNDC-X0000358800 APLNDC-X0000358801 APLNDC-X0000358805 APLNDC-X0000358806 APLNDC-X0000358809 APLNDC-X0000358811 APLNDC-X0000358815 APLNDC-X0000358816 APLNDC-X0000358835 APLNDC-X0000358838 APLNDC-X0000358864 APLNDC-X0000358868 APLNDC-X0000358869 APLNDC-X0000358876 APLNDC-X0000358877 APLNDC-X0000358880 APLNDC-X0000358882 APLNDC-X0000359282 APLNDC-X0000359282 APLNDC-X0000359423 APLNDC-X0000359423 APLNDC-X0000359585 End Bates APLNDC-X0000021159 APLNDC-X0000022178 APLNDC-X0000022180 APLNDC-X0000022181 APLNDC-X0000026718 APLNDC-X0000030612 APLNDC-X0000030646 APLNDC-X0000037780 APLNDC-X0000039293 APLNDC-X0000048924 APLNDC-X0000358381 APLNDC-X0000358382 APLNDC-X0000358383 APLNDC-X0000358408 APLNDC-X0000358416 APLNDC-X0000358444 APLNDC-X0000358450 APLNDC-X0000358459 APLNDC-X0000358463 APLNDC-X0000358467 APLNDC-X0000358475 APLNDC-X0000358478 APLNDC-X0000358480 APLNDC-X0000358484 APLNDC-X0000358486 APLNDC-X0000358505 APLNDC-X0000358507 APLNDC-X0000358621 APLNDC-X0000358800 APLNDC-X0000358801 APLNDC-X0000358805 APLNDC-X0000358806 APLNDC-X0000358809 APLNDC-X0000358811 APLNDC-X0000358815 APLNDC-X0000358816 APLNDC-X0000358835 APLNDC-X0000358838 APLNDC-X0000358864 APLNDC-X0000358868 APLNDC-X0000358869 APLNDC-X0000358876 APLNDC-X0000358877 APLNDC-X0000358880 APLNDC-X0000358882 APLNDC-X0000359282 APLNDC-X0000359282 APLNDC-X0000359423 APLNDC-X0000359423 APLNDC-X0000359585

Apple Inc. v. Samsung, No. 11-01846 LHK (PSG) Documents Considered by Russell Winer Beg Bates APLNDC-X0000359585 APLNDC-X0000359615 APLNDC-X0000359615 APLNDC-X0000359801 APLNDC-X0000359813 APLNDC-X0000359816 APLNDC-X0000359832 APLNDC-X0000359840 APLNDC-X0000359879 APLNDC-X0000359930 APLNDC-X0000359935 APLNDC-X0000019536 APLNDC-X0000015992 APLNDC-X0000019858 APLNDC-X0000015016 APLNDC-Y0000023361 APLNDC-Y0000023428 APLNDC-Y0000023579 APLNDC-Y0000023730 APLNDC-Y0000024549 APLNDC-Y0000025024 APLNDC-Y0000025823 APLNDC-Y0000026173 APLNDC-Y0000026257 APLNDC-Y0000026348 APLNDC-Y0000026461 APLNDC-Y0000026574 APLNDC-Y0000026687 APLNDC-Y0000027136 APLNDC-Y0000027256 APLNDC-Y0000027341 APLNDC-Y0000027423 APLNDC-Y0000027506 APLNDC-Y0000027807 APLNDC-Y0000027942 APLNDC-Y0000028751 APLNDC-Y0000051357 APLNDC-Y0000051599 APLNDC-Y0000051623 APLNDC-Y0000134910 APLNDC-Y0000134928 APLNDC-Y0000135409 APLNDC-Y0000135577 APLNDC-Y0000135683 APLNDC-Y0000136083 APLNDC-Y0000182302 APLNDC-Y0000182305 APLNDC-Y0000182307 APLNDC-Y0000237177 APLNDC-Y0000234326 End Bates APLNDC-X0000359585 APLNDC-X0000359615 APLNDC-X0000359615 APLNDC-X0000359801 APLNDC-X0000359813 APLNDC-X0000359816 APLNDC-X0000359832 APLNDC-X0000359840 APLNDC-X0000359879 APLNDC-X0000359930 APLNDC-X0000359935 APLNDC-X0000019536 APLNDC-X0000015992 APLNDC-X0000019858 APLNDC-X0000015016 APLNDC-Y0000023427 APLNDC-Y0000023578 APLNDC-Y0000023729 APLNDC-Y0000023907 APLNDC-Y0000024798 APLNDC-Y0000025147 APLNDC-Y0000025934 APLNDC-Y0000026256 APLNDC-Y0000026347 APLNDC-Y0000026460 APLNDC-Y0000026573 APLNDC-Y0000026686 APLNDC-Y0000026807 APLNDC-Y0000027255 APLNDC-Y0000027340 APLNDC-Y0000027422 APLNDC-Y0000027505 APLNDC-Y0000027599 APLNDC-Y0000027941 APLNDC-Y0000028097 APLNDC-Y0000028849 APLNDC-Y0000051362 APLNDC-Y0000051605 APLNDC-Y0000051623 APLNDC-Y0000134911 APLNDC-Y0000134940 APLNDC-Y0000135576 APLNDC-Y0000135682 APLNDC-Y0000135789 APLNDC-Y0000136088 APLNDC-Y0000182304 APLNDC-Y0000182306 APLNDC-Y0000182308 APLNDC-Y0000237177 APLNDC-Y0000234340

Apple Inc. v. Samsung, No. 11-01846 LHK (PSG) Documents Considered by Russell Winer Beg Bates APLNDC-Y0000234341 APLNDC-Y0000237178 APLNDC-Y0000234344 APLNDC-Y0000234347 APLNDC-Y0000234442 APLNDC-Y0000234523 APLNDC-Y0000234528 APLNDC-Y0000234592 APLNDC-Y0000234665 APLNDC-Y0000234667 APLNDC-Y0000234669 APLNDC-Y0000234677 APLNDC-Y0000234683 APLNDC-Y0000234689 APLNDC-Y0000234695 APLNDC-Y0000234701 APLNDC-Y0000234707 APLNDC-Y0000234713 APLNDC-Y0000234719 APLNDC-Y0000234725 APLNDC-Y0000234730 APLNDC-Y0000234762 APLNDC-Y0000234785 APLNDC-Y0000234741 APLNDC-Y0000234812 APLNDC-Y0000234818 APLNDC-Y0000236364 APLNDC-Y0000237180 APLNDC-Y0000237182 APLNDC-Y0000235893 APLNDC-Y0000235898 APLNDC-Y0000237186 APLNDC-Y0000237188 APLNDC-Y0000237191 APLNDC-Y0000235907 APLNDC-Y0000235913 APLNDC-Y0000235915 APLNDC-Y0000235920 APLNDC-Y0000235922 APLNDC-Y0000235925 APLNDC-Y0000235929 APLNDC-Y0000235934 APLNDC-Y0000235938 APLNDC-Y0000235941 APLNDC-Y0000235943 APLNDC-Y0000235946 APLNDC-Y0000235949 APLNDC-Y0000235951 APLNDC-Y0000235955 APLNDC-Y0000235958 End Bates APLNDC-Y0000234343 APLNDC-Y0000237179 APLNDC-Y0000234346 APLNDC-Y0000234366 APLNDC-Y0000234468 APLNDC-Y0000234527 APLNDC-Y0000234591 APLNDC-Y0000234664 APLNDC-Y0000234666 APLNDC-Y0000234668 APLNDC-Y0000234676 APLNDC-Y0000234682 APLNDC-Y0000234688 APLNDC-Y0000234694 APLNDC-Y0000234700 APLNDC-Y0000234706 APLNDC-Y0000234712 APLNDC-Y0000234718 APLNDC-Y0000234724 APLNDC-Y0000234729 APLNDC-Y0000234733 APLNDC-Y0000234784 APLNDC-Y0000234791 APLNDC-Y0000234761 APLNDC-Y0000234817 APLNDC-Y0000234830 APLNDC-Y0000236370 APLNDC-Y0000237181 APLNDC-Y0000237185 APLNDC-Y0000235897 APLNDC-Y0000235901 APLNDC-Y0000237187 APLNDC-Y0000237190 APLNDC-Y0000237193 APLNDC-Y0000235909 APLNDC-Y0000235914 APLNDC-Y0000235919 APLNDC-Y0000235921 APLNDC-Y0000235924 APLNDC-Y0000235928 APLNDC-Y0000235933 APLNDC-Y0000235937 APLNDC-Y0000235940 APLNDC-Y0000235942 APLNDC-Y0000235945 APLNDC-Y0000235948 APLNDC-Y0000235950 APLNDC-Y0000235954 APLNDC-Y0000235957 APLNDC-Y0000235961



Apple Inc. v. Samsung, No. 11-01846 LHK (PSG) Documents Considered by Russell Winer Beg Bates APLNDC-Y0000236290 APLNDC-Y0000237232 APLNDC-Y0000237234 APLNDC-Y0000236227 APLNDC-Y0000236247 APLNDC-Y0000235721 APLNDC-Y0000235739 APLNDC-Y0000235765 APLNDC-Y0000235785 APLNDC-Y0000235791 APLNDC-Y0000235804 APLNDC-Y0000235822 APLNDC-Y0000235826 APLNDC-Y0000235828 APLNDC-Y0000235832 APLNDC-Y0000235834 APLNDC-Y0000235836 APLNDC-Y0000235839 APLNDC-Y0000237241 APLNDC-Y0000235844 APLNDC-Y0000235854 APLNDC-Y0000235865 APLNDC-Y0000235879 APLNDC-Y0000235882 APLNDC-Y0000235884 APLNDC-Y0000235885 APLNDC-Y0000235888 APLNDC-Y0000235892 APLNDC-Y0000235018 APLNDC-Y0000235021 APLNDC-Y0000235025 APLNDC-Y0000235029 APLNDC-Y0000235040 APLNDC-Y0000235032 APLNDC-Y0000235036 APLNDC-Y0000235043 APLNDC-Y0000236836 APLNDC-Y0000151499 APLNDC-Y0000151490 APLNDC-Y0000234185 APLNDC-Y0000237172 APLNDC-Y0000237169 APLNDC-Y0000234347 SAMNDCA00191811 SAMNDCA00203268 SAMNDCA00203880 SAMNDCA00228887 SAMNDCA00228934 SAMNDCA00229011 SAMNDCA00238432 End Bates APLNDC-Y0000236306 APLNDC-Y0000237233 APLNDC-Y0000237234 APLNDC-Y0000236228 APLNDC-Y0000236250 APLNDC-Y0000235738 APLNDC-Y0000235764 APLNDC-Y0000235784 APLNDC-Y0000235790 APLNDC-Y0000235803 APLNDC-Y0000235821 APLNDC-Y0000235825 APLNDC-Y0000235827 APLNDC-Y0000235831 APLNDC-Y0000235833 APLNDC-Y0000235835 APLNDC-Y0000235838 APLNDC-Y0000235843 APLNDC-Y0000237244 APLNDC-Y0000235846 APLNDC-Y0000235864 APLNDC-Y0000235878 APLNDC-Y0000235881 APLNDC-Y0000235883 APLNDC-Y0000235884 APLNDC-Y0000235887 APLNDC-Y0000235891 APLNDC-Y0000235892 APLNDC-Y0000235020 APLNDC-Y0000235024 APLNDC-Y0000235028 APLNDC-Y0000235031 APLNDC-Y0000235042 APLNDC-Y0000235035 APLNDC-Y0000235039 APLNDC-Y0000235043 APLNDC-Y0000236840 APLNDC-Y0000151504 APLNDC-Y0000151491 APLNDC-Y0000234257 APLNDC-Y0000237176 APLNDC-Y0000237171 APLNDC-Y0000234366 SAMNDCA00191987 SAMNDCA00203420 SAMNDCA00204010 SAMNDCA00228933 SAMNDCA00228980 SAMNDCA00229108 SAMNDCA00238443

Apple Inc. v. Samsung, No. 11-01846 LHK (PSG) Documents Considered by Russell Winer Beg Bates SAMNDCA00507826 SAMNDCA00526887 SAMNDCA00533129 SAMNDCA10244604 SAMNDCA10247373 SAMNDCA10247549 SAMNDCA10249770 SAMNDCA10403697 SAMNDCA10807316 SAMNDCA10907800 SAMNDCA10911088 OMD0000001 02-24-12 Sangeun Lee 2011-07-27 Twiggs 2012.01.09 AAPL Def14A 2012-02-17 Schiller 2012-02-21 Ng 2012-02-21 Tchao 2012-02-23 Joswiak 2012-02-24 Jue 2012-02-28 Lindbergh 2012-02-28 Whiteside 2012-03-02 Rangel 2-23-12 Joswiak 3-21-2012 Pendelton Amended Complaint Van Liere Report Poret Report Newsweek , April 5, 2010 issue titled What Is So Great About the iPad? Everything. Verizon Wireless & Apple Team Up to Deliver iPhone 4 on Verizon, Apple Inc. Press Release, January 11, 2011 End Bates SAMNDCA00507827 SAMNDCA00526933 SAMNDCA00533159 SAMNDCA10244639 SAMNDCA10247378 SAMNDCA10247552 SAMNDCA10249776 SAMNDCA10403698 SAMNDCA10807387 SAMNDCA10907802 SAMNDCA10911093 OMD0000087 Deposition Deposition SEC FILING Deposition Deposition Deposition Deposition Deposition Deposition Deposition Deposition Deposition Deposition Filing 3/22/2012 Expert Report 3/22/2012 Expert Report News Article
Press Release
The Next Big Thing - Samsung Galaxy S II (90 sec commercial), uploaded by samsungmobileusa on November 22, 2011, available at http://www.youtube.com/watch?v=X4VHzNEWIqA&fe ature=relmfu. Commercial No-Contract Options Multiply, Consumer Reports, January 2011 (http://www.consumerreports.org/cro/magazinearchive/2011/january/electronics/best-cell-plans-andproviders/no-contract-cell-phones/index.htm). News Article As Smartphone Prices Fall, Retailers Are Leaving Money on the Table, NPD Group, November 14, 2011 (https://www.npd.com/wps/portal/npd/us/news/pressr eleases/pr_111114a) News Article

Apple Inc. v. Samsung, No. 11-01846 LHK (PSG) Documents Considered by Russell Winer Beg Bates Apple Introduces the New iPhone 3G, Apple Inc. Press Release, June 9, 2008 (http://www.apple.com/pr/library/2008/06/09AppleIntroduces-the-New-iPhone-3G.html) Apple Presents iPhone 4, Apple Inc. Press Release, June 7, 2010 (http://www.apple.com/pr/library/2010/06/07ApplePresents-iPhone-4.html) Samsung Galaxy S Keynote & Samsung Mobile Unpacked at CTIA Wireless 2010, Samsung Press Release, March 31, 2010 (http://www.samsung.com/us/news/newsRead.do?ne ws_seq=18436&page=1) Samsung MM-A800, CNET News.com, 2005 (http://reviews.cnet.com/Samsung_MM-A800/45056454_7-31313308.html) Samsung SCH-i730, CNET News.com, 2005 (http://reviews.cnet.com/4505-6452_731313312.html) Samsung BlackJack SGH-i607, CNET News.com, November 13, 2006 (http://reviews.cnet.com/smartphones/samsungblackjack-sgh-i607/4505-6452_7-32143267.html) Samsung BlackJack II Review, CNET News.com, December 6, 2007 (http://reviews.cnet.com/smartphones/samsungblackjack-ii-black/4505-6452_7-32717959.html) Samsung Access SGH-A827, CNET News.com, May 9, 2008 (http://reviews.cnet.com/cellphones/samsung-access-sgh-a827/4505-6454_732909896.html) As New iPad Debut Nears, Some See Decline of PCs, N.Y. Times, March 5, 2012 (http://www.nytimes.com/2012/03/06/technology/asnew-ipad-debut-nears-some-see-decline-of-pcs.html) Apple Launches iPhone 4S, iOS 5 & iCloud, Apple Inc. Press Release, October 4, 2011, http://www.apple.com/pr/library/2011/10/04AppleLaunches-iPhone-4S-iOS-5-iCloud.html Kevin Lane Keller, Strategic Brand Management 8, (3d ed., Upper Saddle River, NJ: Pearson Education, 2008) Alina Wheeler, Designing Brand Identity 66 (3d ed. Hoboken, NJ: John Wiley & Sons, Inc. 2009). End Bates
News Article
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Book Book
Exhibit 4
APPM-Q307-O7-POO92A Magazine Back Cover 4/C EMAIL
MEDIA ARTS LAB / Composite Bleed: 8.5" x 11.125" Composite Trim: Z75" x 10.5" ] Composite Live: 7" x 75"
Highly Confidential - Attorneys Eyes Only
APLNDC-X0000007531
Twice as fast.
Half the price.
iPhone3G
The new iPhone is here. Surfs the web and downloads data twice as fast. Now just $199.
TM & 2008 Apple Inc. All dgh ts reserved. 1 800 MW APPLE or www.apple.com/iphone. Compares iPhone 3G (8GB) and I st generation iPhone (8GB) running on EDGE. Actual speeds vary by site conditions. Requires new 2 year AT& Tra te plan, sold separately to quali#ed customers.
APPM-Q308-P0200A Magazine Page 4/C
MEDIA ARTS LAB / Composite Bleed: 8.4375" x 11.125" CompositeTrim: Z75" x 10.5" ] Composite Live: 7" x 10"
APLNDC-X0000007557
Have apps, will travel.

~- Rick Steves Paris Walk $4.99 -Vacationing in Paris? Say au revoir to clunky guide books and let your iPhone lead the way. Featuring comprehensive audio guides, interactive maps, and video for the Louvre, Notre Dame, and other highlights of the City of Lights.
Kayak
Free -Turn your iPhone into your own personal travel agent. Kayak lets you search multiple airline and hotel sites at once, making it easier than ever to book reservations - and save.
U ZagatToGo $9.99 Picking a restaurant in a strange city is a whole lot easier when you have access to over 40,000 of the most trusted ratings and reviews, searchable by food, decor, service quality or cost.
The ~Dnt Neuf. or "new bridge, is Paris oldest standing bridge (built t57816117). Its 12 arches span the ~idest part of ~he river. Unlike other bridges, this one ne~er had houses or buildings growin~ on it. ~e turrets were
~ Postman $0.99 Saying "wish you were here" has never been easier. Just use your iPhone to snap a photo, pick a theme, write a message and send your postcard to friends on Facebook, Twitter or email.
Avis
Free Even when youre nowhere near your computer, you can get the car you want, when you need it. Easily check car availability, make on the fly reservations, and also get reduced rates.
The best phone on the nations fastest 3G network gets even better, with over 7S,O00 apps on the App Store. iPhone users have already downloaded over 1.8 billion, in every category from games to business.
~ at&t iPhone3G (~
2009ApplelncAIIrightsreserved I 80@M~APPLE~www@plecom 3Gnot~wil~blein~ll~re~s W~te~essserwce~ntequited A~wi~bi~ity~td ~ticingsub]ectt~ch~t~Je Appc~untisg~&1~
APPM-Q409-09-P0293A R1 Magazine Page 4/C "Travel"
MEDIA ARTS LAB J Composite Bleed: 8.4375" x 11.125" Composite Trim: Z75" x 10.5" ] Composite Live: 7"x 10"
APLNDC-X0000007602
I
APPMQ30909 P0280 U iPhone NewspaperPage4/C MEDIA ARTSLAB Composite Live: 11"x 203~b" NewYurkTimes
APLNDC-X0000007588
Introducing FaceTime video calling. Smile.
~ iPhone 4
APPM-Q410-10-P0411A Magazine Page 4/C "art project"
ME DIA ARTS LAB Composite Bleed: 8.4375" x 11.125" Composite Trim: Z75" x 10.5" Composite Live: 7"x 10"
NOTE TO PUBS: IF ALTERING MATERIALS FOR ANY REASON, YOU MUST CALL AN NA HAROS CELL 818-807-8705 OR LISA H UBERS CELL 310-962-9446
APLNDC-X0000007677
Finally.
The amazing iPhone, now available in white.
~ iPhone 4
APPM-Q311-P0467A Magazine Page 4/C "Cake"
ME DIA ARTS LAB / Composite Bleed: 8.4375"x 11.125" Composite Trim: Z75"x 10.5" 1 Composite Live: 7"x 10"
NOTE TO PUBS: IF ALTERING MATERIALS FOR ANY REASON, YOU MUST CALL AN NA HAROS CELL 818-807-8705 OR LISA H UBERS CELL 310-962-9446
APLNDC-X0000007707
Exhibit 5
iPad
O210 P0370J photos BC.indd 1
APPM-Q210-10-P0370J Magazine Page 4/C "Photos"
MEDIA ARTS LAB Composite Bleed: 9.1875" x 11.125" Composite Trim: 8.9375" x 10.875" Composite Live: 8.4375" x 10.375"
NOTE TO PUBS: IF ALTERING MATERIALS FOR ANY REASON, YOU MUST CALL ANNA HAROS CELL 818-807-8705 OR LISA HUBERS CELL 310-962-9446
APLNDC-X0000007644
iPad2
Thinner. Lighter. Faster. FaceTime. Smart Covers. lO-hour battery.

Smart Cover sold separately.
MEDIA ARTS LAB Job#: APPMQ211 P0454M27 Version: BusShelterfan 1 Location: SF Final Size: 68" x4Z25" Scale: 1/4 Bleed: 1Z25"x 1206" Trim: 17"x 1181" Frame: 1625"x 1125" Live: 16"x 11"
M 27 Highly Confidential - Attorneys Eyes Only APLNDC-X0000007699
APLNDC-X0000007719
Exhibit 6
~ iPod ~ouch
Touch comes to iPod. Music, video, Wi-Fi web browsing* and iTunes music downloads. From $299.**
APPM-Q407-07-P0124A Magazine Page 4/C
MEDIA ARTS LAB Composite Bleed: 85"x 11125" Composite Trim: Z75" x 105" Composite Live: 7"x ~75"
APLNDC-X0000007538
More games. More fun.
~i iPod touch
MEDIA ARTS LAB Job#: APPM1625" 0~P0252M 01R2 11"x Q209 Version: Bus Shelter Location: BOS Final Size: 4Z5" x 685" Scale: 1/4 Bleed: 12 375" x 1Z625" Trim: 11875"x 1Z125" Live:
APLNDC-X0000007578
Exhibit 7

Selected Press Comparing iPhone Products and Samsung Galaxy Line of Smartphones 3/23/10 5/9/11
Date 3/23/10 Title Samsung Reveals Google Android Phone The Galaxy S Source eWeek Quote "During a presentation at the Las Vegas Convention Center, images of the Galaxy S flashed on a massive screen as Samsung executives discussed the capabilities of the slim touch-screen device, which has a form factor reminiscent of the Apple iPhone or HTC Droid Eris." "I was also surprised by how familiar it looked. The design is actually very iPhone 3GS-like with an all black, shiny plastic body and minimal buttons on the phone's face." "The Captivate is amazingly thin and lightweight. The European Galaxy S looks quite similar to the iPhone 3GS, also on AT&T; to prevent confusion, I suppose, the Captivate has a patterned, rubberized battery cover." "[T]here is little to make the phone notable, apart from its striking similarity to the iPhone." "[T]he square icons are, again, very similar in their looks to the iPhone 3Gs." "Samsungs latest phone, the Vibrant, has the body of an iPhone and the brains of an Android. The Vibrants industrial design is shockingly similar to the iPhone 3G: The rounded curves at the corners, the candybar shape, the glossy, black finish and the chrome-colored metallic border around the display. The Vibrant even has its volume and ringer buttons in almost the same spot as the iPhone 3G." 7/15/10 Samsung Vibrant: A Standout Multimedia Phone PCWorld "The Vibrant looks pretty similar to its AT&T counterpart, the Captivate, but it has a few subtle design tweaks. Like the European Galaxy S, the Vibrant resembles an iPhone 3GS. In contrast to the squared corners on the Captivate, the Vibrant has softer, rounder corners." "The Vibrant looks like a thinner, lighter -- but also bigger -- iPhone 3GS." "At a glance, the chrome-like border, edge to edge glass display (overlying black plastic), and curved candy bar shape of the Vibrant could easily be mistaken for the iPhone 3GS." "The phone [Vibrant] icon in particular looks nearly identical to the one in iOS..." 7/21/10 Samsung Vibrant MobileTechReview "At first glance, the Vibrant looks like a thinner iPhone 3GS, complete with curved plastic back and a front face dominated by glass and a black surround." "The T-Mobile Vibrant has rounded corners and a prominent border that make it look very much like last year's iPhone 3GS model." "Blatant iPhone clone." "It's also the most blatant iPhone close we've seen so far. The hardware, the software UI all scream iPhone clone." 7/27/10 7/30/10 Samsung Vibrant Review Samsung Vibrant Review Android Central Digital Trends "The Samsung Vibrant inevitably will be compared to previous versions of the iPhone, thanks to its rounded corners and plastic shell." "With its front silver frame, the smooth, rounded Vibrant bears a resemblance to the first iPhone..." "the Vibrant seems as if it takes no shame in looking like an iPhone 3GS. It even caught a few people off guard until they saw the display and, like myself, realized that this was definitely something different." "On the exterior, the Vibrant takes its cue the iPhone. A metal band encircles the top of the phone, just like Apple's smartphone, although the gunmetal color is darker than iPhone's bright silver detail and the Samsung is obviously larger." "The Vibrant, even more so than most other versions, is roughly the same size and shape as an iPhone" "Samsungs Galaxy S Vibrant is one sleek looking phone. In fact when I first unboxed it at the office many walked by and asked if it was an iPhone."
6/29/10
Samsung Galaxy S: How Does It Measure Up to the Competition? Samsung Captivate: AT&T's Best Android Phone
PCWorld
7/13/10
PCWorld
7/15/10
First Look: Samsung Vibrant Rips Off iPhone 3G Design
Wired
7/18/10
Samsung Galaxy S Review: T-Mobile Vibrant and AT&T Captivate Samsung Vibrant Review
CNNMoney
7/20/10
Laptop
7/22/10
Galaxy Phones From Samsung Are Worthy iPhone Rivals Samsung Vibrant Review
The Wall Street Journal
7/26/10
Pocketnow
8/4/10
Samsung Vibrant Review
Brighthand
8/4/10
Samsung Vibrant Review Introduction and Design
Mobiledia
8/15/10
Review: Samsung Vibrant
Electronista
8/15/10
Review: Samsung Galaxy S Vibrant
Review Crew
Page 1

Selected Press Comparing iPhone Products and Samsung Galaxy Line of Smartphones 3/23/10 5/9/11
Date 8/16/10 Title Samsung Vibrant Looks Like an iPhone, Has Battery Life to Match Samsung Fascinate Review: Samsung Vibrant is the Flagship of the Galaxy S Fleet Samsung Galaxy S Vibrant vs. Apple iPhone 4: A Touchy Comparison Source Wired Quote "Yes, the Vibrant closely resembles a certain best-selling smartphone."
9/7/10 9/16/10
Droid Life TechRepublic
"Look: It actually does resemble an iPod Touch or an iPhone 3GS quite a bit." "The designers were obviously mimicking the look of the old iPhone (pre-iPhone 4) with the chrome edge around the screen and the plastic backing." "The two phones are fairly similar in outward appearance: [b]lack slabs that are all-screen with a few physical buttons on their front and sides. [] The iPhone claims to be the thinnest smartphone on the planet, and while that might be true, you'd need a magnifying glass to be aware of the difference between these devices." "The Samsung Fascinate seems to have been at first confused for an Apple iPhone" "The Fascinate is remarkably slim and attractive. It is reminiscent of the iPhone 4 in that regard"
9/17/10
Sync Blog
9/27/10 10/25/10
Samsung Fascinate Review Samsung Fascinate Review: How Verizon Meddling Ruined an Excellent Android Phone Samsung Mesmerize: A TopNotch Galaxy Phone A Tale of Three Android Phones: Droid 2, Samsung Fascinate & Google Nexus S
Brighthand TechRepublic
11/23/10
PCWorld
"Like its Verizon cousin, its sleek and streamlined design feels very reminiscent of the iPhone 3GS." "When I saw pictures of the Galaxy S phones from Samsung, I thought Id found the perfect successor for shifting off the iPhone. Here was an phone that had iPhone-like icons, an iPhone-like look but which would work on networks other than AT&T." "Despite all of its advanced features, last year's Galaxy S looked a lot like the iPhone 3G. [] Now, just like the iPhone 4, Galaxy S II has developed sharper edges." "If the Samsung Galaxy S II looks familiar it's because it resembles Apple's popular iPhone 4."
1/3/11
Search Engine Land
4/2/11
Samsung Galaxy S II Review
Brighthand
5/9/11
Watch Out iPhone: Samsung's Galaxy S II is Hot
PCWorld
Source: Public Press; Publicly Available Articles Obtained on the Internet.
Page 2
Exhibit 8

Selected Press Comparing iPad Products and Samsung Galaxy Line of Tablet Computers 7/8/10 12/2/11
Date 7/8/10 Samsung Title Source Financial Times Quote "Samsung's new tablet computer, the Galaxy Tab, bears an uncanny resemblance to the iPad; the one difference of note is a 7-inch screen, to Apple's 10-inch. Those me-too qualities are reflected in one key metric that really matters: Apple's $226bn market capitalization is almost 2.5 times Samsung's." "With the first legitimate competitor to iPad for the consumer-focused tablet-computer market, Samsung continues to take its cues from Applejust as it's been doing with cellphones." "What iFixit found, to begin with, is that if mimicry is flattery, the Galaxy Tab has compliments galore for the iPad." "'Looking like an unlikely offspring between the iPad and the iPhone 4, the Tab has an iPad-like front fascia as well as a camera-equipped back cover similar to the not-yet-released white iPhone,' iFixit wrote. 'Even the dock connector very closely mimics Apple's standard pinout.'" 2/13/11 LIVE FROM BARCELONA: Check Out the New 10-Inch Samsung Galaxy Tab Samsung Exec Says Aspects Of Galaxy Tab 'Inadequate' Business Insider "The 'Galaxy Tab 10.1,' as it's called, is basically an iPad-sized version of the Galaxy Tab" "From the front, it looks like an iPad" 3/4/11 CMP TechWeb "Lee said to Yonhap, "We will have to improve the parts [of the Tab 10.1] that are inadequate. Apple made [the iPad 2] very thin." In other words, Lee is admitting that the Tab 10.1 is now too thick, and they need to figure out how to make it thinner." "In terms of specs, they're [Galaxy Tab tablets] pretty much clones of Apple's offering." "Samsung has thrown in the towel on innovative tablet design, and has realized it has to match Apple's successful design and pricing recipe (to the extent it's even tweaked its design plans) to capture any meaningful market share." 5/10/11 Unboxing the Samsung Galaxy Tab 10.1; It doesn't run Android 3.1 yet, but the new Samsung tablet gives the iPad 2 a run for its money. Samsung Galaxy Tab 10.1 Wi-Fi: A Worthy Rival to the iPad 2 PC Magazine "Most laymen could easily mistake it for an iPad 2"
11/10/10
Samsung's Galaxy Tab: iPad's First Solid Contender
Wired
11/12/10
Samsung Galaxy Tab Nods to Apple iPad But Goes Own Way iFixit
eWeek
3/22/11
Samsung's Anti-iPad 2 Policy: Clone the Heck Out of It
FastCompany.com
6/8/11
PCWorld
"In my hands-on testing, the Tab 10.1 achieved perhaps the best design compliment an Android tablet could hope for--often being mistaken by passers-by (including Apple iPad users) for an iPad 2. The confusion is understandable when you see and hold the Tab 10.1 for the first time. It has a slim profile of 8.6mm (0.34 inch)--a hair's breadth slimmer than the iPad 2's 8.4mm depth." "The Tab 10.1 takes minimalist design cues from Apple, as well."
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Selected Press Comparing iPad Products and Samsung Galaxy Line of Tablet Computers 7/8/10 12/2/11
Date 6/16/11 Title Samsung Galaxy Tab 10.1 (16GB) Smart Cover for Samsung Galaxy Tab Looks Rather Familiar Samsung Galaxy Tab 10.1 Review Source CNET Reviews Quote "Taking another page from the iPad 2's school of sexy tablet building, the Galaxy Tab 10.1 has one of the cleanest designs we've seen in a tablet." "...the Smart Case is an astonishingly bold rip-off of the Smart Cover."
7/19/11
Wired
8/2/11
Trusted Reviews
"It's hard enough to look at any 10in Android tablet without instantly comparing it to Apple's iPad 2, but it's virtually impossible not to do so with Samsung's Galaxy Tab 10.1. Aside from the widescreen form factor, every part of this sleek Android Honeycomb 3.1 tablet's look is geared to go head-to-head with Apple's iOS big boy." "Samsung's adoption of something approaching Apple's design philosophy has also resulted in some serious connectivity compromises."
11/30/11
What Tablet to Buy: iPad, Kindle Fire, Galaxy Tab or Playbook
Twin Pixels
"Without a doubt, Samsung copied shamelessly from Apple. The USB cable / charger looks the same, the proprietary connector looks the same (yet not compatible with Apple); even the USB connection kit and the HDMI output accessories (which cost extra) look much like Apples. Im not saying this to criticize or anything, Im just stating something obvious when you have both systems." "Overall, both 10-inch tablets have a similar look and feel, and they implement comparable features."
12/2/11
Tablet Smackdown: Galaxy Tab 10.1 vs. iPad 2
DeviceGuru
Source: Public Press; Publicly Available Articles Obtained on the Internet
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Case5:11-cv-01846-LHK Document1367 Filed07/26/12 Page1 of 129

Exhibit 1 (Submitted Under Seal)

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1 2 3 4 5 6 7 8 9 10 SAN JOSE DIVISION 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA

EXPERT REPORT OF RUSSELL S. WINER

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APPLES BRAND IS COMPELLING AND VERY STRONG ...................................... 12

SUPPLEMENTATION..................................................................................................... 78 EXHIBITS TO BE USED ................................................................................................. 78

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illustrative of information I have relied upon in conducting my analysis. According to the

Case5:11-cv-01846-LHK Document1367 Filed07/26/12 Page6 of 129

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shown in the registration, which is described as follows:

EXPERT REPORT OF RUSSELL S. WINER Case No. 11 cv-01846-LHK sf-3122763

Case5:11-cv-01846-LHK Document1367 Filed07/26/12 Page9 of 129

EXPERT REPORT OF RUSSELL S. WINER Case No. 11 cv-01846-LHK sf-3122763

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Therefore, a brand is much more than a product. A strong brand differentiates

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Unauthorized use of brand identity by a competitor reduces brand equity because it

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company has made, the quintessential Apple device.46

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EXPERT REPORT OF RUSSELL S. WINER Case No. 11 cv-01846-LHK sf-3122763

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EXPERT REPORT OF RUSSELL S. WINER Case No. 11 cv-01846-LHK sf-3122763

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EXPERT REPORT OF RUSSELL S. WINER Case No. 11 cv-01846-LHK sf-3122763

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EXPERT REPORT OF RUSSELL S. WINER Case No. 11 cv-01846-LHK sf-3122763

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APLNDC-Y0000028751-28849 at APLNDC-Y0000028771. APLNDC-Y0000025024-25147 at APLNDC-Y0000025027, APLNDCY0000025060. 165 APLNDC-Y0000025024-25147 at APLNDC-Y0000025064.

EXPERT REPORT OF RUSSELL S. WINER Case No. 11 cv-01846-LHK sf-3122763

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EXPERT REPORT OF RUSSELL S. WINER Case No. 11 cv-01846-LHK sf-3122763

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EXPERT REPORT OF RUSSELL S. WINER Case No. 11 cv-01846-LHK sf-3122763