Apple Loses Third Trial to VirnetX, to Pay $302.4M in Damages

By Michelle Maisto  |  Posted 2016-10-03 Print this article Print

For a third time, jurors in Texas have found Apple guilty of infringing on patents held by VirnetX. Damages were determined to be $302.4 million.

For VirnetX, the third time may be the charm. On Sept. 30, a federal jury in East Texas ordered Apple to pay $302.4 million in damages for infringing on internet security patents held by VirnetX. In seven instances, the jurors agreed that Apple's FaceTime had infringed on VirnetX patents.

The verdict is the third in a case that has stretched across six years.

Nevada-based VirnetX, a patent holder—often described as a "patent troll," since much of its income comes from lawsuits and patent licensing—first filed suit against Apple in 2010, claiming that Apple software infringed on four of its patents related to virtual private networks (VPNs) and secure communication links.

In 2012, a jury awarded VirnetX $368.3 million in damages, but that verdict was later overruled by the U.S. Court of Appeals in Washington, D.C., after it was determined there were problems with the trial judge's instructions and jurors may have miscalculated the damages.

In February, another jury in Texas awarded VirnetX $625.6 million in damages—a result that was thrown out in August by Judge Robert Schroeder, again with the framing that jurors, grappling with numerous references to the earlier case, may have been confused when determining the settlement amount.

"We are extremely pleased with the jury verdict announced today," Kendall Larsen, VirnetX CEO and president, said in an Oct. 3 press release. "This is the third time a jury has confirmed that Apple has been using the technology developed by our inventors."

VirnetX clarified that the win was in regard to its "Apple I" case, regarding its VPN-On-Demand (VOD) technology and a "secure communication link" related to two other patents.

It still has another infringement suit pending against Apple in the U.S. Court for the Eastern District of Texas (referred to as "Apple II"), which VirnetX states covers issues "of alleged infringement, damages and willfulness by Apple's redesigned VOD in iOS 7 and 8, the redesigned FaceTime in iOS 7 and 8, and OSX 10.9 and 10.10 and iMessage."

A jury trial is expected to be scheduled for Apple II after Apple I is concluded.

Apple has maintained throughout the process that the evidence doesn't support VirnetX's accusations.

According to a Reuters report, the Texas court handling the trials has a "reputation" for ruling in favor of plaintiffs alleging infringement.

Apple didn't immediately respond to a request for comment.


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