Apple on the hook for $1.1 billion in Caltech Wi-Fi patent case

AppleInsiderAppleInsider
Posted:
in General Discussion edited June 2023

The U.S. Supreme Court declined to hear a challenge to Caltech's Wi-Fi patents, and after a decade-long legal battle, Apple is finally on the hook for the billion-dollar verdict.




Decided on Monday, the Supreme Court justices elected not to continue dealing with an appeal by Apple and Broadcom over an earlier court ruling preventing the companies from contesting the California Institute of Technology's Wi-Fi technology patents.

The U.S. Court of Appeals for the Federal Circuit previously ruled against arguments from the companies to say the patents were invalid, due to a failure to raise them during an earlier hearing at the U.S. Patent and Trademark Office. Apple and Broadcom argued that they could raise the challenges during the trial, but with the Supreme Court's action, the Appeals Court ruling stands.

For Apple and Broadcom, the ruling could greatly affect this summer's courtroom action, based on the 2022 U.S. Appeals Court ruling to toss out an earlier verdict for damages. While the damages were tossed, the verdict for patent infringement was not, with the upcoming trial set to reconsider the amount awarded to Caltech.

Under the original 2020 trial, Apple and Broadcom were on the hook for $1.1 billion in damages in total.

As part of the Supreme Court's decision-making process, in January it asked the U.S. Solicitor General for an opinion on the lower court's decision.

In response, U.S. Solicitor General Elizabeth Prelogar filed in May that "further review is not warranted," that "Apple took full advantage of the review process," including "submitting multiple motions and -- after the USPTO ruled against it -- unsuccessfully appealing to the Federal Court."

Patents and Supplies



Caltech started the lawsuit process in 2016, claiming that four patents for IRA/LDPC encoding and decoding technology was infringed. For Apple's devices, this IP covered enabling support for 802.11n and 802.11ac wireless connections.

Apple insisted it used common Wi-Fi chips supplied by Broadcom, and since it didn't create the technology that infringed on the patents, Apple was therefore "merely an indirect downstream party." That argument failed in the 2020 trial, with Apple hit with an $838 million fine and Broadcom a $270 million fine.

Apple and Broadcom appealed, arguing there were "multiple legal errors" in play. In the second trial, in 2022, Apple and Broadcom succeeded in getting the damages tossed, but not the patent infringement ruling itself.

Read on AppleInsider

Comments

  • Reply 1 of 12
    robin huberrobin huber Posts: 3,964member
    I can think of worse things to do with 1 billion dollars than give it to one of our most important research institutions. Wait . . . make a deal to drop the suit in exchange for a $1B tax deductible gift!
    Ofer
  • Reply 2 of 12
    carnegiecarnegie Posts: 1,078member
    JP234 said:
    $1.1 billion? For both companies to split?

    Tim Cook: Just a second, I think I have cash. Let me get my wallet…
    Most of that amount - almost $838 million - was against Apple. But that amount no longer matters as they have to have a new trial to determine damages as well as infringement with regard to one of the three patents, unless Caltech drops that claim. The Federal Circuit vacated both the damages award and the jury's infringement finding with regard to one of the patents based on the court's failure to give the jury a particular claim construction.
    edited June 2023 pscooter63
  • Reply 3 of 12
    carnegiecarnegie Posts: 1,078member
    robin huber said:
    I can think of worse things to do with 1 billion dollars than give it to one of our most important research institutions. Wait . . . make a deal to drop the suit in exchange for a $1B tax deductible gift!
    Whatever Apple ends up paying would be a deductible expense anyway.
    tokyojimuwatto_cobra
  • Reply 4 of 12
    godofbiscuitsgodofbiscuits Posts: 249member
    Given that the patent system was created to protect entities like Cal Tech AGAINST enormous corporations...
  • Reply 5 of 12
    thadecthadec Posts: 97member
    godofbiscuits said:
    Given that the patent system was created to protect entities like Cal Tech AGAINST enormous corporations...
    Waiting for the first post to call Cal Tech a patent troll and/or accuse the judges of corruption/bias. You know it is coming ...
    beowulfschmidt
  • Reply 6 of 12
    twolf2919twolf2919 Posts: 112member
    Misleading/incorrect title - Apple is not on the hook for $1.1b - that was the original damages awarded Caltech from BOTH Apple and Broadcom.  And it's been tossed out - so a new trial is now set to begin to determine damages again.
    edited June 2023 watto_cobraronnfoadpscooter63
  • Reply 7 of 12
    comcastsuckscomcastsucks Posts: 65member
    It seems weird that this isn't all on Broadcom. All Apple did was buy parts from them. Imagine if you had to research if everything you buy for your business has proper patenting. But then again, I'm no lawyer. Or doctor. Or ballet dancer. Or construction worker. 
    watto_cobraronn
  • Reply 8 of 12
    tokyojimutokyojimu Posts: 529member
    What ever happened to universities inventing things for the public good and giving away the results? Especially since much of their funding comes from government grants.
    watto_cobrapscooter63
  • Reply 9 of 12
    robin huberrobin huber Posts: 3,964member
    tokyojimu said:
    What ever happened to universities inventing things for the public good and giving away the results? Especially since much of their funding comes from government grants.
    Excellent point! Especially public ones. Unfortunately CalTech is not. Still, your point about grants is well taken,  Wonder if that was part of Apple’s defense in court?
    watto_cobra
  • Reply 10 of 12
    radarthekatradarthekat Posts: 3,843moderator
    It seems weird that this isn't all on Broadcom. All Apple did was buy parts from them. Imagine if you had to research if everything you buy for your business has proper patenting. But then again, I'm no lawyer. Or doctor. Or ballet dancer. Or construction worker. 
    Your take on this is correct.  Apple has insisted that, because it used common Wi-Fi chips supplied by Broadcom, and since it didn't create the technology that infringed on the patents, Apple was therefore "merely an indirect downstream party."  This is actually a thing, called indirect infringement and the court was correct in not accepting Apple’s argument, 

    From the article,
    ”That argument failed in the 2020 trial, with Apple hit with an $838 million fine and Broadcom a $270 million fine.”

    but that’s because it’s not the court’s job to expand the lawsuit in order to dive into the relationship between Apple and Broadcom to determine whether Apple knew Broadcom’s products infringed another entity’s patents.  

    The way this works is that the court determines whether there was infringement, and, with the assumption that  the infringement was direct, what should be the damages paid by each infringing entity?  With that settled, Apple can start a new lawsuit, if they wish (and they will) against Broadcom to collect back the amounts it had to pay for Broadcom’s infringement, assuming Apple can show that Apple was not aware of the infringing technology within the Broadcom products Apple incorporated into its own products. 

    This is usually covered by the supplier contracts, which will undoubtedly contain sections dealing with indemnification and compensation by the supplier (Broadcom) in the event of indirect infringement by the supplier’s customer (Apple).   So in the end it could be that the entire award, eventually, falls upon Broadcom’s shoulders.  It’s just a two-step legal process. 
    edited June 2023 FileMakerFellerpscooter63beowulfschmidtronnkurai_kage
  • Reply 11 of 12
    danoxdanox Posts: 2,875member
    robin huber said:
    I can think of worse things to do with 1 billion dollars than give it to one of our most important research institutions. Wait . . . make a deal to drop the suit in exchange for a $1B tax deductible gift!
    Cal Tech don’t want a gift, they want reoccurring revenue, just another example, of buying chips from third-party companies, sets you up for lawsuits left and right, which is why Apple is trying to design their main chips in house from the ground up, so that they can bypass buying them from third parties, Apple probably is working long-term to keep out/get rid of AMD, Intel, Nvidia, Qualcomm, and even though Apple has a new agreement with Broadcom, down the road, even they will be kept out of new projects. (and this makes certain things take longer to achieve, see the internal GPU designs by Apple)

    Going vertical or should I say staying a vertical computer company is something Apple will keep doing, buying third-party chips is hazardous to your pocketbook. (Double and triple pay at every turn).

    What is sad is that in the end? This is a make work for all the USA patent lawyers, what’s the strategy now preemptively sue, claiming that certain patents are invalid before you use them in a particular product? And if you don’t actively sue upfront you don’t get to claim later on that a particular patent is invalid? Only a bunch of USA lawyers would dream that up…..

    Imagine a world where you have to preemptively sue patent holders before they sue you, in short, do the job of the patent bureaucrats, and the court system before hand.

    And to top it off, you have several judges on the current Supreme Court who think accepting gifts and party favors from interested parties is ok no problem.
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