John Dellaportas

About John Dellaportas

John Dellaportas is a trial attorney at Morgan Lewis. Based in New York, he specializes in securities, commercial and intellectual property litigation.

Guest Column: Is Samsung Passing the Buck to Customers?

Main Note 10.1 N8013 h front 9 150x150 Guest Column: Is Samsung Passing the Buck to Customers?

The PR Verdict: “D” (PR Problematic) for Samsung.

What do you say when a jury takes $1 billion out of your pocket and hands it to your arch rival (while calling you a big, fat copycat)? If you’re Samsung, the answer is, tell your customers you may be raising their prices. Samsung declared last Friday’s Apple verdict a “loss for the American consumer” and said it will lead to “potentially higher prices.” Is that any way to preserve a reputation?

Compare that to the sharp, smart statement from Apple: “We make these products to delight our customers, not for our competitors to flagrantly copy.”

Samsung has built a well-deserved brand as one of the world’s great tech innovators. Yet of late, even when it wins in court, it loses. Just last month, a UK High Court found that Samsung couldn’t have infringed on Apple’s patents, because Samsung’s products “are not as cool.” Not good.

But frightening your customer base by warning of higher prices is unlikely to turn the tide. Samsung would be better served to hew more closely in its public statements to the legal positions it is presenting in court–in particular, that the inventions claimed in Apple’s patents have been around for years and were not actually developed by Apple.

The PR Verdict: “D” (PR Problematic) for Samsung. Scare tactics, especially of higher prices in economically challenging times, are unlikely to win hearts and minds. Better to use the forum to carefully explain one’s patent law positions.

The PR Takeaway: Sometimes the PR solution is right under your nose. Samsung’s business partner, Google, responded to the verdict by emphasizing how “the mobile industry is moving fast, and all players, including newcomers, are building upon ideas that have been around for decades.” This is essentially the patent law defense of “anticipation.” In this case, coordinating better with its legal team and staying on patent law message might have been the easier route and ultimately more reassuring than issuing stern warnings about higher prices and future lack of innovation.

Is Samsung right to be honest with customers about impending higher prices, or is this adding insult to their own injury? Give us your PR Verdict!