Apple Inc. (AAPL) Retrial Denied In $368M VirnetX Patent Case

iphone 8 apple stockElisaRiva / Pixabay

A U.S. district court upheld an earlier decision, concerning Apple Inc. (NASDAQ:AAPL), by a federal jury last year. The verdict awards more than $368.2 million to an intellectual property and patent holding firm VirnetX Holding Corporation (NYSEAMEX:VHC) after AAPL was found violating the patents regarding its FaceTime video chat service.

Apple Inc. (AAPL) Retrial Denied In $368M VirnetX Patent Case

VirnetX Holding Corporation (NYSEAMEX:VHC) is notoriously known for attacking major tech companies for patent infringement claims. In May 2010, VirnetX won a £200 million case related to patents, against Microsoft Corporation (NASDAQ:MSFT). The company claims that AAPL infringed on four of its patents, which are required to secure connection between two devices.

According to the case, all the latest gadgets from Apple Inc. (NASDAQ:AAPL) including iPhone 5, iPad Mini, fourth-generation iPad, fifth-generation iPod Touch, and the latest Mac use the patent designed by VirnetX.

First highlighted by Seeking Alpha, Apple Inc. (NASDAQ:AAPL) earlier requested for a reduction in the damages or a retrial, which were rejected by the U.S. District Court for the Eastern District of Texas Tyler Division. Also, a motion for a permanent injunction against Apple by VirnetX was denied by Judge Leonard Davis.

The jury awarded $330,211 per day fine from Apple to VirnetX until a settlement is reached. However, in the final judgment, a fine of $33,561 is decided.

The report from Seeking Alpha further states that both the parties have been asked to mutually agree on“royalities” for the future use of patents. If the companies fail to arrive at an agreement, VirnetX can file a new complaint, which could result in further damages.

In November, VirnetX Holding Corporation (NYSEAMEX:VHC) submitted a new claim, roping in iPhone 5, the iPad mini and the latest iterations of the iPod touch and iPad, and also AAPL’s Mac range.

At the time of the decision in November, VirnetX Chief Executive Officer Kendall Larsen said in a statement “This victory further establishes the importance of our patent portfolio.”

“Apple does not owe money to VirnetX,” Danny Williams, a lawyer with Williams, Morgan & Amerson in Houston who represents Apple Inc. (NASDAQ:AAPL), told the jury in November. “VirnetX is not entitled to money for things they did not invent. The VirnetX technology, if used, is a small part of very large, complex products.”

Though the iPhone maker will not terminate the FaceTime services, but it will have to arrive at the settlement to save itself from paying the damages.

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About the Author

Aman Jain
Aman is MBA (Finance) with an experience on both Marketing and Finance side. He has worked as a Risk Analyst for AIR Worldwide, and is currently leading VeRa FinServ, a Financial Research firm. Favorite pastimes include watching science fiction movies, reviewing tech gadgets, playing PC games and cricket. - Email him at [email protected]

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