US Supreme Court Rejects Apple Appeal Against VirnetX

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Bad news for Apple, as the US Supreme Court rejects iPad maker’s appeal against a $440m patent infringement financial penalty

Apple has been dealt a serious blow by the US Supreme Court in its long-running patent infringement against patent licensing firm VirnetX Holdings.

The US Supreme Court rejected an appeal made by Apple against a $440m penalty awarded by a US court.

This is the second piece of bad news for Apple. Earlier this month the US Court of Appeals for the Federal Circuit denied Apple request to rule on the alleged use of two other VirnetX patents.

Patent disputes

The case itself stretches back to 2010, when VirnetX sued Apple in the Eastern District Court of Texas for violating four of its patents with its FaceTime and ‘VPN on Demand’ applications on devices including the iPhone and iPad.

In 2012 a court ordered Apple to pay VirnetX $368 million in damages, but that ruling was eventually thrown out and was followed by a retrial in 2016.

In February 2016 a Texas jury found that Apple had infringed four of the company’s patents. VirnetX was awarded $302m in royalties.

That award is now higher at $439.8 million in damages, as well as fees, and interest.

The US Court of Appeals for the Federal Circuit in Washington upheld that decision in November 2019.

But Apple contested the court’s findings, and sought a mistrial and a termination to any royalty obligations. It appealed to the Supreme Court, calling the $440 million in damages ‘grossly excessive’.

But now that the US Supreme Court has rejected Apple’s appeal of the judgement, the case will be sent back to the district court in Texas for the $440 million damages to be enforced.

Honour court ruling?

VirnetX said in a statement that it now hoped that Apple would honour the decision rendered by the US courts.

“We are extremely pleased with the Supreme Court’s decision not to hear Apple’s writ of certiorari,” said Kendall Larsen, VirnetX CEO and President. “It has taken us 10 long years, 4 successful jury trials, 2 successful Appellate Court rulings and a favourable Supreme Court decision to get here.”

“We believe in the fairness of the American justice system and have respectfully played by its rules no matter how arduous,” said Larsen. “We trust Apple will honor the decisions rendered by our courts and their esteemed judges and honour an agreement to abide by the court’s decision.”

Apple has reportedly declined to comment on the decision.

It should be noted that Apple and VirnetX are also engaged in another ongoing legal spat, which deals with whether redesigned versions of FaceTime and VPN on Demand still violate the same VirnetX patents. In this case, Apple has argued the VirnetX patent claims are invalid.

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