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Apple Held To Account In $503m Ruling

Mon Nov 02 2020

US court orders Apple to hand over $503m for patent violations

A jury in Texas has, last Friday, ordered Apple to pay $502.8 million in owed royalties to a software firm called VirnetX.

The firm, based in Nevada, had claimed Apple infringed their patented VPN software.

What makes this case interesting (aside from the size of the pay-out) is that the case has dragged on for over ten years now, with VirnetX claiming that Apple’s VPN-on-Demand and FaceTime applications were using technology they’d developed for the CIA.

 

In the case, the jury were asked to decide how much they thought Apple owed VirnetX in royalties for their use of the VPN-on-Demand – that lets iOS users access VPNs.

VirnetX originally argued they were owed $700 million, with Apple pushing back saying they’d calculated the amount of royalties owed as only $113 million, with the royalty rate set no higher than $0.19 per unit.

In the final decision, the jury settled on a figure of $0.84 per unit in royalties.

Apple have already reported they’ll appeal the amount, stating:

open quote mark

Cases like this only serve to stifle innovation and harm consumers

Apple spokesperson

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As you can imagine, over the span of ten years, this isn’t the first time Apple and VirnetX have butted heads in court.

Dating back to 2010, VirnetX accused Apple of breaching four separate patents involving security communication technology, such as secure communication links and VPNs.

It wasn’t until 2016 though that a jury first found in favour of VirnetX. The court ordered Apple to pay over $626 million in royalties, but the US Court of Appeals turned it over, eventually ordering two retrials.

That October, another judge ordered Apple to pay $302.4m in damages for the infringements. With the second trial seeing that figure rise to $439.7 million to factor in interest and other costs.

Since 2016 Apple have been appealing the decision but the courts have ruled in VirnetX’s favour every time.

It wasn’t until March of this year that Apple finally handed over any money, £454 million for previous patent infringements.

 

We’ll have to see how Apple’s appeal’s go over this ruling.

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Mon Nov 02 2020

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