[Gangnam Perspective] The Marshall Verdict Is Only the First Act... Adapting to U.S. Litigation Is Essential

Marshall, Texas, a small city in eastern Texas, is unfamiliar to most people. Without context, the name might be mistaken for the Republic of the Marshall Islands in the South Pacific or even a British audio equipment manufacturer. There is also a film about Thurgood Marshall, the first African-American justice of the U.S. Supreme Court. The founder of the British neoclassical school of economics also bore the name Marshall.
However, this place is already notorious among technology companies, largely because of a small courthouse nestled between old buildings. The United States District Court for the Eastern District of Texas, Marshall Division, has long been known for its unique approach to patent litigation. Many have pointed out that, in cases that should be decided on technical grounds, 'local sentiment' or 'jury emotions' often take precedence over legal principles. Over the past two decades, dozens of companies have been summoned to this rural courthouse. Unsurprisingly, the city has earned the nickname 'the place where a single courthouse can bind the hands of global tech companies.'
It was also at the United States District Court for the Eastern District of Texas, Marshall Division, that Samsung Electronics Co., Ltd. was ordered to pay $191.4 million (approximately 274.7 billion KRW) in damages in an Organic Light Emitting Diode (OLED) patent lawsuit. While the verdict was difficult to accept, it was hardly surprising that Korean companies and legal professionals reacted by saying, 'This is just what you would expect from the Marshall court,' rather than focusing on the loss itself.
The dispute began when Pictiva Displays, an Irish patent licensing firm, claimed that virtually all Samsung Electronics Co., Ltd.'s flagship products—including Samsung Galaxy smartphones, TVs, and computers equipped with OLEDs—were infringing on its patented technology. The patent in question relates to a pixel driving circuit that improves the image quality and lifespan of OLED displays. This core technology compensates for the voltage of each pixel in the OLED panel, ensuring uniform brightness across the screen and reducing the 'burn-in' phenomenon. Since only a handful of companies worldwide can handle this technology, it is not easy for the general public to understand.
Despite the complexity and difficulty of explaining such technology, the jury at the United States District Court for the Eastern District of Texas, Marshall Division, heard the case for only a few hours before reaching a decision. Most of the jurors were local residents working in fields unrelated to semiconductors or displays. As a result, emotional judgments often outweighed technical facts in the courtroom. This is why the defendant's loss rate here is particularly high—reportedly exceeding 70% over the past decade. In other words, from a plaintiff's perspective, Marshall, Texas is the optimal venue.
However, the Marshall verdict is not the end. Industry insiders view it as merely the 'first act.' The real trial begins with the appeal outside of Marshall, Texas. Intel Corporation is a prime example. The company was ordered to pay $2.2 billion (about 3.2 trillion KRW) in Marshall, but the verdict was overturned on appeal. Apple Inc. also managed to reverse a jury decision linking certain features to total sales in the second instance, and Cisco Systems, Inc. (Cisco) similarly turned the case around. All of these are American companies.
There is a clear lesson for Korea. First, it is crucial to prepare from the outset with a full understanding of the structural limitations of the well-known American jury system. U.S. companies meticulously document technical matters and internal decisions as soon as litigation becomes a possibility. During research and development (R&D), they transparently record the need for design changes and attempts at workaround designs. This is to secure evidence that 'sufficient technical discussion took place' for appeals, where the context of technical documents, interpretation of patent scope, and actual contributions to processes are scrutinized in detail.
Internal capabilities must also be improved to operate like a global company, with legal, technical, and management teams working in tandem from the pre-litigation stage. If issues are addressed only after the fact, it becomes difficult to respond to the U.S. litigation environment. Companies should recognize potential litigation as a cost, reflect it in annual accounting, and develop technology strategies based on this premise as part of risk management. While litigation outcomes may vary, in the end, the companies that survive will be those that not only possess technological strength but also understand and adapt to this environment.
[email protected] Jung Ji-woo Reporter