Today: Apple (AAPL) is keeping its lawyers busy, as San Jose judge cuts apart the Samsung verdict and David Einhorn drops his suit, among other legal battles. Also: Facebook gets a boost after announcing another unveiling, and Wall Street rises slightly despite sequester deadline.
Apple takes a big loss in Samsung trial as Einhorn dispute ends
Despite the end of one lawsuit Friday, Apple's widespread legal disputes became even more convoluted as the company's stock took yet another substantial dive, plunging to a new 52-week low.
The most substantial ruling of the day for Apple's bottom line occurred in San Jose, where Judge Lucy Koh sliced the company's infamous $1.05 billion verdict against Samsung nearly in half, taking $450 million away from the landmark judgment. Koh said the jury's findings for that amount were dubious and ordered a new trial to figure out damages for those claims.
"The court has identified an impermissible legal theory on which the jury based its award and cannot reasonably calculate the amount of excess," Koh said in her ruling.
With Friday's ruling, the San Jose court battle becomes even more confusing -- Apple now receives more than $550 million from Samsung for patent infringements in early Galaxy smartphones and tablets, while the rest could go back to trial.
Meanwhile, the two are headed toward another separate trial on newer Galaxy gadgets, and any or all rulings could still be appealed to a higher court. The two tech giants also have legal actions pending in several other countries.
Judge Koh is also hearing a case that claims Apple collected personal information from users of its mobile devices without their consent, which the lawyers who filed the case would like to turn into a class-action lawsuit. Apple has experience with class-action suits -- earlier this week, they agreed to a settlement of lawsuit stemming from kids' ability to rack up charges in apps without their parents' permission, which is likely to cost the company at least $100 million.
The only good news for Apple was the end of the most high-profile lawsuit from last month, activist investor David Einhorn's action against the company on a proposal Apple wanted to present at Wednesday's annual shareholders meeting. After Apple was forced to hold its meeting without presenting the proposal due to a temporary injunction Einhorn won in the case, the investor said the case was not worth fighting anymore.
"Apple removed the bundled proposal from the shareholder meeting, therefore resolving the issue," Einhorn's fund, Greenlight Capital, said in a statement after the judge agreed to end the proceedings.
While the lawsuit is over, the core of Einhorn's argument remains: He believes Apple should begin returning some of its $137 billion cash hoard to investors. Einhorn wants Apple to issue preferred shares that would pay a fixed 4 percent dividend, which his hedge fund could use: Reuters reported Friday that Greenlight gained a slight 0.3 percent in February, after increasing its stake in Apple by 20 percent to about 1.3 million shares at the end of last year.
Any investor still holding on to Apple shares likely shares Einhorn's lament: As of this week, the stock has negative returns for anyone who purchased it in the last year. Friday managed to bring even more lows, as Apple struck a new 52-week low and posted its lowest closing price in more than a year. Shares dropped 2.5 percent to $430.37 after dipping as low as $429.98.
Facebook announces another event and gets another stock boost
While Apple frustrates investors, Facebook continues to make moves that Wall Street seems to like, continuing Friday with it second announcement of a press event in two months, both of which helped send the company's stock price up.
Apple invited members of the media Friday to its headquarters for an event next week focused on its signature News Feed. Facebook hasn't changed its News Feed in more than a year, and analysts expect the announcement to focus on a melding of the company's desktop and mobile offerings.
Gartner analyst Brian Blau pointed out to Reuters that the mobile version of Facebook does not offer as many features as the desktop version, "so maybe this is a way to bring some of that together."
Opus Research analyst Greg Sterling agreed, telling Bloomberg News, "They're going to need to squeeze more money out of mobile. They really want to show they can deliver on these devices."
As Business Insider pointed out, CEO Mark Zuckerberg discussed News Feed in the company's most recent earnings report conference call and noted his desire for enhanced media appearance on mobile devices, with larger pictures and more videos. That move could allow the long-rumored introduction of video advertising to users' feeds, potentially annoying to consumers but lucrative for Facebook.
That type of move would be another signal to investors that Facebook is serious about generating more revenue, similar to Thursday's move to boost its services for advertisers with the purchase of Microsoft's Atlas ad-tech platform. That move was on top of the introduction of Facebook Exchange, another advertising product meant to help the company' battle against Google (GOOG) for the top Internet advertising company in the world.
Facebook last had an unveiling event at its Menlo Park headquarters less than two months ago, when it revealed Graph Search, a search engine focused solely on content within the social network, which could be especially useful to marketers. When the company announced that event with an invitation that was less forthright about the substance of the event, investors anxious for moves toward monetization from the company sent the stock higher than $30 for the first time in more than 6 months, though the actual announcement was not enough to sustain that level.
Friday's invitations had a similar effect, with shares rising from about $27.15 to $27.80 after the invitations reached inboxes Friday morning. Shares ended the day at $27.78, a 1.9 percent daily increase.
Sequester doesn't spook Wall Street as Google and Yahoo rise
Investors managed to ignore the passing of the deadline for the "sequester" -- drastic budget cuts that were delayed in the "fiscal cliff" compromise earlier this year -- and still send stocks higher on the day, though gains were 0.3 percent or less for all three major U.S. stock indexes.
Experts said that the constant deadlines that lawmakers have manufactured and then run up to (and over) have with the debt-ceiling talks and fiscal cliff have inured them to the process. "The sequester panic, if this was 18 months ago, we could have seen multi-hundred point swings in the market. What has happened is that the policy makers have lost credibility with the stock market," Kevin Divney, chief investment officer at Beaconcrest Capital Management, told Bloomberg News.
In Silicon Valley, stocks were at a standstill, with the SV150 index of area technology companies dropping a scant 0.02 as gains in other stocks offset Apple's losses. Google gained 0.7 percent and ended the week above the $800 level at $806.19, after Germany's Parliament approved a watered-down version of a bill that had caused consternation for the Mountain View search giant.
In a bizarro moment after the last few years, Yahoo (YHOO) hit a 52-week high on the same day Apple fell to a 52-week low, with the Sunnyvale Internet company closing up 3 percent at $21.94. One of the biggest positive moves of the day was big-data firm Splunk, which gained 7.9 percent one day after announcing earnings.
Silicon Valley tech stocks
Up: Splunk, Workday, Yelp, Yahoo, Electronic Arts (ERTS), VMware, Facebook, Gilead, Zynga, LinkedIn, Adobe (ADBE), Oracle (ORCL), Symantec, Intuit (INTU), SunPower (SPWRA), Intel (INTC), Netflix (NFLX), Google, Nvidia, eBay (EBAY), NetApp, SolarCity
Down: Ruckus, Palo Alto Networks, Advanced Micro Devices, Apple, Jive, Juniper, Applied Materials, Tesla
The tech-heavy Nasdaq composite index: Up 9.55, or 0.3 percent, to 3,169.74
The blue chip Dow Jones industrial average: Up 35.17, or 0.25 percent, to 14,089.66
And the widely watched Standard & Poor's 500 index: Up 3.52, or 0.23 percent, to 1,518.2
Check in weekday afternoons for the 60-Second Business Break, a summary of news from Mercury News staff writers, The Associated Press, Bloomberg News and other wire services. Contact Jeremy C. Owens at 408-920-5876; follow him at Twitter.com/mercbizbreak.