The New South Wales Federal Court in Australia overturned the injunction saying Apple has not managed to demonstrate that Samsung's tablet PC infringes patents held by Apple covering the device's touchscreen.
"In our view her decision was clearly wrong and should be set aside," said the full bench at the Federal Court.
However, the Federal Court said the injunction won't be lifted until Friday December 2, after Apple indicated it is considering appealing the decision.
At the beginning of August, Apple approached Australian courts in a bid to obtain an injunction that would prevent Samsung from selling the device in the country.
Apple claimed the tablet PC infringed 13 patents relating to the iPad, three of which related to the touchscreen technology including one which covered "selective rejection" technology ensuring accidental touches to the iPad don't result in programs being launched.
"It's no coincidence that Samsung's latest products look a lot like the iPhone and iPad, from the shape of the hardware to the user interface and even the packaging. This kind of blatant copying is wrong, and we need to protect Apple's intellectual property when companies steal our ideas," Apple said at the time.
Samsung voluntarily agreed to postpone the Australian launch of the device until the case had been heard and a decision made. Samsung approached Apple with a settlement, in a bid to speed up a verdict in the case. However the tech giant rejected it and continued with the legal action. In October Justice Annabelle Bennett from the New South Wales Federal Court granted the injunction.
However, Samsung launched an appeal against the decision, which initially looks to have proved successful
"We believe the ruling clearly affirms that Apple's legal claims lack merit," Samsung said. Apple has yet to comment on the matter.
The fight between the pair has seen legal action regarding patent infringement take place in ten countries across the globe. Although, the battle between Samsung and Apple isn’t over in Australia, just yet. Samsung has called for a ban on sales of Apple's latest smartphone, the iPhone 4S, in the country, after claiming the device infringes patents held by the Korean tech giant in its Galaxy range of smartphones and tablet PCs that run the Android operating system. The case will be heard in March 2012.