Fact Check

Did Samsung Pay a $1 Billion Judgment to Apple in Nickels?

Reports that Samsung paid off a $1.05 billion judgment awarded to Apple in a patent infringement lawsuit entirely in nickels are fake news.

Published Aug 28, 2012

Samsung paid off a $1.05 billion judgment awarded to Apple in a patent infringement lawsuit entirely in nickels.

In August 2012, the business and technology worlds were rocked by a decision in a patent infringement lawsuit which had a jury finding that Samsung, the world's largest maker of cell phones, had copied patented features of Apple's iPhone and iPad technologies in several of its products, and awarding Apple $1.05 billion in damages.

Several days later, that decision was spoofed in a humor piece (translated from the original Spanish) positing that Samsung had paid off the award in nickels:

Samsung Pays Apple $1 Billion Sending 30 Trucks Full of 5 Cents Coins

This morning more than 30 trucks filled with 5-cent coins arrived at Apple’s headquarters in California. Initially, the security company that protects the facility said the trucks were in the wrong place, but minutes later, Tim Cook (Apple CEO) received a call from Samsung CEO explaining that they will pay $1 billion dollars for the fine recently ruled against the South Korean company in this way.

The funny part is that the signed document does not specify a single payment method, so Samsung is entitled to send the creators of the iPhone their billion dollars in the way they deem best.

Many readers who came across the article as it was circulated online mistook it for real news, even though the original and its most common reproductions were labeled as "humor" and "satire." But even for those who encountered it out of context, several aspects of the story should have stood out as implausible:

  • The jury decision awarding Apple $1.05 billion in damages had been issued only a few days earlier, and damages as large as this are not paid off nearly so quickly. The judge in the case had not yet handed down her decision, and undoubtedly several rounds of appeals (likely culminating in a settlement), dragging on for months (if not years), would take place before Samsung actually paid out any damages to Apple, as noted in the Washington Post:

    Q. Was the verdict final?

    A. No. Samsung is challenging it. First, Samsung will first ask the trial judge to toss the verdict. Then it will appeal to a court in Washington that specializes in patent appeals. Samsung has vowed to take the fight all the way to the U.S. Supreme Court, if necessary.

    (Indeed, a judge later found the jury had miscalculated $400 million in damages for 13 products and ordered a new trial to determine how much Samsung should pay.)

  • To pay off a billion dollars in nickels would require 20 billion of those coins. That amount would require Samsung to obtain the equivalent of all the nickels struck by the U.S. Mint in the last several decades. (In 2011, for example, the U.S. Mint produced less than one billion nickels, and 2010 less than half a billion.) Samsung would have to round up virtually every nickel in circulation to acquire over $1 billion worth of those coins, a feat that could hardly be accomplished without having a significant impact on the U.S. monetary system.
  • A single nickel weights 5 grams (about .011 pounds), so a billion dollars' worth of nickels would weigh in at about 110,000 tons. That load would far exceed the carrying capacity of 30 or so trucks (requiring each truck to carry over 3,600 tons, or more than 7.2 million lbs. each). Even if the considerable weight of the trucks themselves weren't taken into account, the equivalent of about 2,755 eighteen-wheeler trucks, each hauling 40 tons' worth of nickels, would be needed to transport the weight of that many coins (and even that calculation still doesn't take into account the volume of physical space needed to assemble, transport, and store 20 billion nickels).

As to the hypothetical question of whether Apple would be obligated to accept payment of damages in such a form, since the late 19th century pennies and nickels have been considered legal tender and are therefore "a valid and legal offer of payment for debts when tendered to a creditor." (Businesses selling goods or services are not required by law to accept legal tender as payment, but this particular scenario involves payment of a debt rather than a purchase of goods or services.)

David Mikkelson founded the site now known as snopes.com back in 1994.

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