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Apple must pay $500M over patent violations

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People wearing face masks look at a cellphone outside an Apple store during a May Day holiday in Shanghai on May 1. AFP

Apple must pay $500M over patent violations

A texas court has ordered Apple to pay $506.2 million in damages and interest for 4G patent infringements held by intellectual property company PanOptis Patent Management LLC.

The US tech giant – now worth almost $2 trillion – vowed to appeal Tuesday’s decision.

Apple said in an email response to an inquiry: “We thank the jury for their time but are disappointed with the verdict and plan to appeal.

“Lawsuits like this by companies that accumulate patents simply to harass the industry only serve to stifle innovation and harm consumers.”

PanOptis, which specialises in licensing patents, took Apple to court in February last year, claiming it refused to pay for the use of 4G LTE technologies in its smartphones, tablets and watches.

The court filing said: “The plaintiffs have repeatedly negotiated with Apple to reach an agreement for a FRAND licence to the plaintiff’s patent portfolios which Apple is infringing.

“The negotiations have been unsuccessful because Apple refuses to pay a FRAND royalty to the Plaintiff’s licence.”

FRAND refers to terms that are “fair, reasonable and non-discriminatory” and is the IT industry standard for technology use.

Apple argued unsuccessfully that the patents were invalid, according to legal publications.

The case is one of many patent suits from licensing firms that make no products but hold rights to certain technologies. Critics call these firms “patent trolls”.

Patent suits are typically filed in states where jurors have been found more inclined to rule against Silicon Valley giants.

The Texas court has twice ruled against Apple in the past, demanding it pay hundreds of millions of dollars to VirnetX Holding Corp – another company specialising in patent litigation.

On its website, PanOptis offers to manage its clients’ patents, allowing them to concentrate on “innovation and new development”.

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