Apple Inc. (AAPL) Ordered To Pay For Breaching Patent

Apple Inc. (AAPL) Ordered To Pay For Breaching Patent
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Apple has been asked to pay damages worth $532.9 in patent litigation, but the iPhone maker plans to appeal

Apple has been ordered to pay a sum of $532.9 million after a federal jury found the iPhone maker guilty of breaching a patent held by a Texas company, according to a report from Bloomberg. A federal jury of Tyler, Tex. has denied Apple’s case, in which the company claimed it had not used the patents of the Texas firm.

Apple said to infringe upon patent intentionally

Smartflash LLC blamed Apple for infringing upon three of its patents and claimed $582 million in damages, whereas Apple claims the loss to be only $4.5 million. The case is about the digital rights management and inventions related to data storage and managing access through payment system. According to Smartflash, iTunes used its inventions in applications such as Game Circus LLC’s Coin Dozer and 4 Pics 1 Movie.

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Smartflash presented the argument that as compensation, it should get a percentage of sales from Apple’s devices, including iPhones, iPads and Mac computers that are used to access iTunes. The company accused the iPhone maker of infringing onthe patent intentionally, as one of its executives had been told about the technology more than a decade ago.

Apple denies all claims

Apple will further appeal in the higher court. Kristin Huguet, an Apple spokeswoman said, “Smartflash makes no products, has no employees, creates no jobs, has no U.S. presence, and is exploiting our patent system to seek royalties for technology Apple invented.” Huguet further said that the company “refused” to pay Smartflash for the ideas that belonged to Apple employees who have spent years to innovate them, but unfortunately, there is no choice but to take up the fight through the court system.

In its defense, Apple has hit on almost every aspect of Smartflash’s case, suggesting that the patents were invalid and were not infringed. Apple further claimed that Smartflash did not control the patents entirely and waited too long to file suit. Also it has attacked Smartflash’s royalty demands, tagging them as “excessive and unsupportable.”

Other defendant companies that had cases dismissed last year are game developer KingsIsle Entertainment Inc., maker of Wizard 101, and Grub Guardian. The case is Smartflash LLC v. Apple Inc., 13-447, U.S. District Court for the District of Texas (Tyler).

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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
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