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Samsung Smoking Gun May Help Apple

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Image by AFP via @daylife

In the case of Apple Inc. v. Samsung Electronics Co., 11-01846, U.S. District Court, Northern District of California (San Jose), the court ordered Samsung to produce source code of certain products.

In patent and copyright litigation, it is common to seek access to source code in discovery.  Each party can obtain desired evidence from the other parties by means of discovery which is governed by civil procedure in the pretrial phase of a law suit.

Apple asserts that Samsung has only partially complied with the court order.  According to Apple, Samsung has produced source code for just one version of each of the products.  Apple is seeking source code for all versions of all infringing products.

It is difficult to understand Samsung’s legal strategy with respect to withholding source code of some versions.  Violating a court order is serious business.  The offender can become subject to sanctions.

Why would Samsung withhold source code of some versions if it does not have anything to hide?

Apple has requested that the court not allow Samsung to use the source code it did not produce as part of its defense against infringement claims.  More importantly, Apple has requested the court to rule that the source code Samsung has produced represents all versions of that product.

There is no way to predict how the court will rule.  However, considering the trial date is August 25, 2012, there is still plenty of time and the court may allow Samsung another opportunity to produce the source code it has withheld.

From an investment perspective, the key question to ask, “Is there a smoking gun in the source code that Samsung has withheld?”

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About Me: I am an engineer and nuclear physicist by background. I have founded two Inc. 500 companies, and have been involved in over 50 entrepreneurial ventures. I am the Chief Investment Officer at The Arora Report, which publishes four newsletters to help investors profit from change. Please feel free to write me at Nigam@TheAroraReport.com. You can follow me here and get email notification when I publish a new article.

Disclosure: Subscribers to The Arora Report are long Apple from $131 and have taken partial profits at $360, and $525.