Federal jury rules Apple must pay $502.6 million to VirnetX

“VirnetX Holding Corp. won $502.6 million against Apple Inc. after a federal jury in Texas said the maker of iPhones was infringing patents for secure communications, the latest twist in a dispute now in its eighth year,” Susan Decker and Dennis Robertson report for Bloomberg.

“VirnetX claimed that Apple’s FaceTime, VPN on Demand and iMessage features infringe four patents related to secure communications, claims that Apple denied.
The dispute has bounced between the district court, patent office and Federal Circuit since 2010,” Decker and Robertson report. “There have been multiple trials, most recently one involving earlier versions of the Apple devices. A jury in that case awarded $302 million that a judge later increased to $439.7 million.”

“For VirnetX, the jury verdict in its favor could be a short-lived victory. The Patent Trial and Appeal Board has said the patents are invalid, in cases that are currently before the U.S. Court of Appeals for the Federal Circuit in Washington,” Decker and Robertson report. “The Federal Circuit, which handles all patent appeals, declined to put this trial on hold, saying it was so far along that a verdict would come before a final validity decision… The case is VirnetX Inc. v. Apple Inc., 12cv855, U.S. District Court for the Eastern District of Texas (Tyler).”

Read more in the full article here.

MacDailyNews Take: To be appealed.

Apple, slapped with a $440 million judgement, to appeal VirnetX patent case – October 16, 2017
Apple loses patent retrial to VirnetX, owes $302.4 million – October 1, 2016
Judge voids VirnetX’s $625.6 million Apple verdict; VirnetX shares plunge – August 1, 2016
Patent troll VirnetX wants judge to block Apple’s FaceTime, iMessage services – May 26, 2016
Apple hit with $626 million damages in VirnetX patent case – February 3, 2016
VirnetX’s $368 million jury award against Apple tossed by appeals court – September 16, 2014
Apple to make changes to VPN behavior in iOS 6.1 as result of VirnetX judgement – April 5, 2013
Judge upholds $368 million patent suit verdict for VirnetX against Apple – February 27, 2013
Jury slaps Apple with $368.2 million fine over VirnetX patents – November 7, 2012
VirnetX awarded new security patent files new complaint against Apple – November 1, 2011


  1. I just read through the claims of two of the patents in suit and they are as obvious as all hell to anyone familiar with the technology from prior technology before they ever applied for a patent. No wonder they were declared invalid. They will not survive the appeal. They duplicate the normal means of securing a normal channel of secure communications and applying encryption to it. It’s an obvious extension anyone one would do. It was not patentable at the time. . . and the Patent office is right to invalidate it as non-patentable just because it’s being applied to adds “mobile” device to the claims. There is no difference what kind of network is being used.

  2. Is Texas the biggest ‘dumbfuck’ state in America? And that is saying something, because the is a hell of a lot of dumbfuckery going on in the US of A at the moment.

    1. You and Groucho might want to review your crib notes from high school government class. The United States District Court for the Eastern District of Texas is not a state court. Texas and its citizens did not create it and do not fund it (beyond our tax payments for the federal judiciary generally). Any income it might generate goes into the federal treasury.

      The judges of the court are appointed by the President of the United States and confirmed by the US Senate (only 2% of which comes from Texas). Those judges have historically been patent-suit friendly, but that isn’t the fault of Texas or Texans. The judges hold office for life, so they aren’t amenable to local political pressure or public opinion.

      The real problem in the Eastern District is the jury pool, which includes a lot of working-class people who are predisposed to believe that Big Business is out to get them. That is no different than other mostly rural districts elsewhere in the nation. Suits get filed in Tyler, rather than in another state, only because of the District’s reputation.

      There are virtually no high-tech firms located anyplace in East Texas, so the chances of getting a juror who knows anything about science beyond 8th-grade physical science are very poor. The defense can use its strikes to eliminate the few exceptions who might show up on any given panel. That only aggravates a bigger issue.

      The problem of allowing lay juries to decide highly technical issues that require an understanding roughly on the graduate-school level isn’t unique to the Eastern District of Texas. We have seen much the same sort of foolishness from juries in the Northern District of California, which includes Silicon Valley.

      I’m not sure what the alternative to trial by jury might be, but the current system is broken.

      1. I am a bit ignorant of your court system in the US as I live in NZ. However, I am well aware the original case was held in the Eastern District of Texas (Tyler). I am also well aware of the rocket docket business that is being generated there. But wasn’t this case held in an appeals court by a Federal jury? Apologies for the generalisation, but as a foreign, objective observer, some of the dumb things going on in your country really does my head in.

      2. R Eunson,

        This is probably too late for anybody to read, but…

        Unlike New Zealand and many other English-speaking countries, we have two parallel court systems in the US. The great majority of civil and criminal cases (including all family-law and probate cases) are tried under state statutes in state courts. Each of the 50 states has its own system, and they differ profoundly from state to state.

        In Texas, for example, the smallest cases are tried in Justice Courts, medium-sized cases in County Court, and major cases in District Court, with two levels of appeals courts. All the judges are elected.

        A minority of cases fall under the jurisdiction of the federal court system. US District Courts are the primary trial courts in that system, and there are two appellate levels above them (US Courts of Appeals and the Supreme Court of the US). All those judges are appointed for life by the US President and confirmed by the US Senate.

        Texas, for example, is divided into Eastern, Southern, Northern, and Western Districts. Appeals from all those courts go to the US Court of Appeals for the Fifth Circuit, headquartered in New Orleans, and then to the Supreme Court.

        Federal law, grounded in the US Constitution, guarantees that either party to a lawsuit may demand that the contested fact issues be determined by a jury (usually six people selected randomly from local citizens who are registered to vote or have driving licenses).

        Plaintiffs therefore try to file their cases in districts where the jurors have a track record of sticking it to defendants. East Texas has a lot of blue-collar workers who hate Big Business and distrust technology (many jobs in the region have been lost to mechanization and automation). They are therefore particularly open to pleas that they “drain the swamp” by transferring wealth from companies like Apple to locally-incorporated patent mills.

        Neither the District Judges nor the appellate judges can decide fact questions, although there is some leeway in cases where there are essentially undisputed facts. That even applies to extremely complex fact questions that can only be resolved by weighing the credibility of competing expert witnesses.

        Juries in patent cases, mostly composed of people with an average 12 years of formal education, must therefore assess evidence that can be puzzling for specialists in the field with well over 20 years of education, including a doctorate or two.

        The appeals courts can reverse a jury finding and remand the case for a new District Court trial if a jury makes a finding that is manifestly unsupported by any credible evidence. As a result, a LOT of verdicts from the Eastern District, like all the prior trials of this case, get reversed and retried.

    1. Yeah, we should’ve let the Nazis take your country — you know, the same country that you were unable to successfully defend on your own. I know that you secretly wish you were speaking German and living in a Nazi state, right?

  3. What a circus, the only people who profit from this nonsense are the lawyers and Judges. What do you call a lawyer chained to the bottom of the ocean? Answer: a start. What do you call 1000 lawyers chained to the bottom of the ocean? Answer: an improved start. What do you call 100,000 Lawyers chained to the bottom of the ocean? Answer: Justice. Lawyers are the scourge of society, they are like educated parking attendants; parasites feeding off people’s greed and misfortune.

    1. A wise man once observed, “The United States has the worst system of government in history, apart from all the alternatives.” If you could write a new constitution, what would you suggest as an alternative to an independent judiciary and trial by jury?

      1. I’ve never heard that particular variation, but for certain Winston Churchill said something very simlar to it (House of Commons, 11 November 1947)—but he was quoting an unknown predecessor. From the Hansard of that date:

        “Many forms of Government have been tried, and will be tried in this world of sin and woe. No one pretends that democracy is perfect or all-wise. Indeed it has been said that democracy is the worst form of Government except for all those other forms that have been tried from time to time.…”

        I dont think the Constitution needs a rewrite, as the problem is how it is implemented, in this case it is the fallacy that a majority opinion is always correct, the “argumentum ad populum”. However, the alternatives are not pretty…

        And so it goes.

        1. As a society defining document the Constitition is quite wise. And it also shows limits to majority rule by protecting minorities from oppressive majorities.
          The Constitution is often ignored by those sworn to protect it…

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