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A federal judge has ordered Apple to pay nearly $440 million to patent-holding company VirnetX, an unsealed order recently revealed. But despite the court decision, the patent troll still can’t claim victory just yet.
The long-running patent battle began in 2012 when VirnetX alleged that Apple was infringing on four of its patents with FaceTime and other VoIP protocols.
But in September, a U.S. District Court in Texas denied Apple’s motions to end the case or have a retrial. Not only that, but the judge tacked on an additional $41.3 million in damages and $96 million in costs, fees and interest for the $302 million jury verdict that VirnetX won last year.
The judge presiding over the case found Apple guilty of “will infringement,” The Verge reported. As such, it has been ordered to bump the payment amount from $1.20 per infringing device to $1.80. And “infringing device” spans the range of iPhones, iPads and Macs. That amount is “very reasonable,” VirnetX CEO Kendall Larsen said in a press release.
Though this is the third trial that VirnetX has won against Apple in this particular suit, the tireless battle isn’t over. Apple told TechCrunch that it plans to appeal the court’s verdict. Additionally, the U.S. Patent and Trademark Office has recently invalidated all four of VirnetX’s patents — though this won’t halt outright stop the legal warfare between the two companies.
To be clear, $440 million is a relative drop in the bucket for the massive Cupertino tech giant. But it’s the principle at stake here. VirnetX is just one of many “patent troll” companies that don’t produce any of their own products or services. Instead, these “patent assertion entities” license patents and sue other corporations for money. “Our portfolio of intellectual property is the foundation of our business model,” the company’s SEC filing reads.
Indeed, other tech giants have lost cases to VirnetX, too. Microsoft ultimately paid $200 million to the patent troll. And VirnetX is currently in a standstill with HTC as they negotiate patent deals related to LTE technologies. Apple was ordered to pay $368 million to VirnetX in 2012 for a separate suit filed two years earlier.
The pace of patent troll lawsuits levied at tech giants has only increased in recent years. The outcome of this particular legal battle will likely set a precedent for VirnetX and other patent holding companies going forward — and it’s likely that their patent licensing agreements and infringement suits will only become more ubiquitous.
Interestingly, the U.S. District Court for the Eastern District of Texas has become a popular spot for patent cases filed by holding companies. That’s because of a quick litigation timetable, which tends to give the patent holders an edge in court. That advantage might end in Texas, however, due to a recent Supreme Court ruling.
The USPTO’s invalidation becomes legally binding once all appeals have been exhausted — of course, VirnetX can appeal that decision, too. But if Apple does better in court going forward, it’ll mean that the patent troll won’t be able to use those four patents in future lawsuits.