Failed Mediation: The Apple-Samsung Example

Posted By Saba Shatara, Jun 3, 2012

For some time now technology giants Apple and Samsung have been embroiled in vicious copyright litigation. The suit started when Apple claimed that Samsung copied the product design for the iPhone and iPad. Apple accused Samsung of using their minimalistic design in competing products, which run on Google’s Android operating system. Samsung responded to Apple’s claims with a counter-suit, alleging instead that Apple had infringed on Samsung’s patents. This suit represents only part of the struggle between Apple and Samsung. The two companies have 20 ongoing lawsuits in 12 courts in 10 countries on 4 continents. In hopes of preventing long, drawn-out, and complex litigation, the United States District Court for the Northern District of California directed Apple and Samsung to participate in mediation with a Magistrate Judge on May 21-22.

The requirement that litigants participate in mediation has been a growing trend in U.S. courts. Federal Courts in northern California have been particularly adamant in encouraging various forms of alternative dispute resolution between litigants. Here, the court felt the issue serious enough to compel the CEOs of Apple and Samsung themselves to be present in these sessions. However, the court’s hopes for a swift resolution of this dispute were dashed when the session was declared a failure after only two days of talks. AppleInsider commented that “the lack of resolution [was] not surprising to onlookers, as the discussions involving Apple Chief Executive Tim Cook and Samsung CEO Choi Gee-sung were court-ordered.” This, not so uncommon case, exemplifies one of the greater challenges facing court operated ADR programs today. Essentially, litigants do not see mediation as an opportunity to reach meaningful resolution of their issues, but rather view mandatory ADR as another hurdle to overcome before setting the court-date. Because litigants are reluctant to approach mediation with a good faith effort, the Apple-Samsung court and others are left with a less ideal result.

A solution for this problem may be found in examining and working to change litigant’s perceptions of ADR mechanisms. It is increasingly important to court-run ADR programs that litigants view mediation as a viable, efficient, and cost-saving option for dispute resolution. If litigants continue to see court ordered mediation as a mere formality, then the programs, which seek to reduce overall costs, may in fact be a source of additional hardship for both litigants and the judiciary. Courts may increase the seriousness with which mediation is perceived through various means, such as requiring longer ADR sessions or providing greater training for judges and magistrates in mediation and other ADR techniques. If steps are not taken then in cases like Apple and Samsung, where competitors often cooperate to their mutual benefit (for instance, Samsung has been a key component provider for many Apple “i-products”), the companies have a lot to lose. Here, the failure to mediate and the following litigation in June may mean a fractured corporate relationship, increased costs to the companies and consumers, muted innovation, waning market shares, and a decrease in consumer good-will – costs neither company should bear.