Patent Infringement costs Apple $502.8 million to VirnetX


Apple vs VirnetX

On October 30, a jury in Tyler, Texas, ruled that Apple had to pay $502.8 million to VirnetX over patent infringements. This legal battle between the two companies started 10 years ago in 2010 over a VPN (virtual private network) patent filed by VirnetX, reported as Patent No. 6,502,135 that Microsoft also earlier infringed and ended up paying $200 million to VirnetX.

VirnetX also received a payment of $454 million from Apple earlier this year. In 2019, Apple again paid VirnetX $502 million, but the ruling overturned and sent to lower courts for determining new damages. So this payment of $502.8 million is the addition to the first $454 million payment which took place earlier this year.

Apple is not involved in one, but two patent infringements with with VirnetX which are ongoing. This current payment was for a VPN on-demand service patent filed by VirnetX and Apple using it in developing certain FaceTime technologies and features.

As Bloomberg reports, VirnetX had told the jury it was entitled to more than $700 million. Apple had countered that it owed about $113 million, claiming the royalty rate should be no more than 19 cents per unit, but, the jury settled on 84 cents per unit. Here, the ‘unit’ means the Apple products equipped with the infringed technologies.

An Apple spokesperson, in their defence said:

“We thank the jury for their time and appreciate their consideration but are disappointed with the verdict and plan to appeal… This case has been going on for over a decade, with patents that are unrelated to the core operations of our products and have been found to be invalid by the patent office. Cases like this only serve to stifle innovation and harm consumers.”

Apple Spokesperson

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Arnav Verma

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