Apple Loses Another Round in its Legal Battle with VirnetX

By Bill Toulas / February 11, 2020

The U.S. Court of Appeals for the Federal Circuit has stood its ground on the verdict that it had reached last November, and rejected Apple’s request to reconsider. The Cupertino-based company was trying to invalidate the patents held by VirnetX, who is accusing Apple of violating their intellectual rights by implementing technology that belongs to them on their products. The software tools that VirnetX complains about are Apple’s “VPN on Demand” and the “FaceTime”. For this, VirnetX has been asking for a damage compensation that is equal to $2 million each year.

Apple feels that this request is absurdly large and entirely unsubstantiated, however, the courts haven’t made them the favor to agree. In 2016, the East Texas jury ruled that Apple violated 13 VirnetX patents, and said that they had to pay $625.6 million for four of them. On the first appeal trial, the ruling of the court-ordered Apple to pay $439 million over to VirnetX due to the violations, while the November ruling brought this amount up to $503 million. While the main essence of the ruling remained the same now, the jury admitted that the damage compensation will have to be recalculated. The main thing that pushes Apple on the ropes remains the fact that the court believes that they infringed on two patents belonging to VirnetX.

Apple argued that the rejection of their arguments was wrong, on the basis that they were planning to raise different legal issues on the case, and they weren’t given the opportunity to do so. Their main line of defense now is that they shouldn’t be forced to pay royalties on VirnetX’s patents, because these patents shouldn’t have been issued in the first place. The U.S. Patent Office has revisited the four patents in question and found that only one aspect of one of them should, in fact, be valid. However, they haven’t canceled them yet, so VirnetX finds Apple’s arguments premature.

Still, Apple will take the case to the Supreme Court, so the final act of the drama can be played. Even if the patent office hasn’t made a decisive move until then, Apple hopes that at least the amount of damages will be brought to a much lower level. At the same time, VirnetX is hoping for the best, and their share price has already climbed up by 6.7% following the court’s ruling. They have been fighting this battle with Apple since 2010, and they’re very close to coming out the winners as the finish line draws closer.

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