Appellate court rejects $368 million VirnetX patent victory over Apple

in iPhone edited September 2014
Patent holding company VirnetX's infamous $368 million win over Apple --?which most notably resulted in changes to FaceTime that riled consumers --?has been thrown out by the U.S. Court of Appeals for the Federal Circuit after review.


The appellate court held that the initial trial was "tainted" after incorrect instructions were given to the jury and expert testimony that should have been barred was instead allowed, according to the Wall Street Journal. The case will now be kicked back to a trial court.

VirnetX won the award in late 2012, securing a verdict that said FaceTime had infringed upon U.S. Patent No. 8,05,181 for a "Method for Establishing Secure Communication Link Between Computers of Virtual Private Network." VirnetX had earlier asserted the patent against MIcrosoft, winning some $200 million in that case.

Following the verdict, Apple redesigned FaceTime's virtual private network functionality. The change cost Apple on multiple fronts, leading to over half a million customer complaints and costing the company an additional $2.4 million per month.

That was not enough for VirnetX, however, as the company swiftly filed another suit alleging continued infringement. They updated it in January of this year to add the iPad Air, iPad mini with Retina display, iPhone 5s, iPhone 5c, iPod Touch with Retina display, and latest Mac notebooks and desktops.


  • Reply 1 of 35
    sdw2001sdw2001 Posts: 17,926member
    Read the article referenced about the changes in Facetime. This company is nothing but a Patent Troll House. They filed the original suit the very same day the patent was awarded. Having a former patent examiner in my family, I know that process likely took years. That means this was their plan from the get go. Check out their website: They don't DO anything. They do, however, have a press crawl on the right hand side. Latest entry is August 11th: Court Ruling Prohibits Apple From Challenging Validity Of 16 VirnetX Patent Claims In New Patent Infringement Suit

  • Reply 2 of 35
    Finally, VirnetX seemed like the Teflon Don of Patent Trolls!

    Only reason FaceTime didn't go open source like Apple promised originally and end up on other OS's was because of VirnetX.

    These guys REALLY don't care about innovation or protecting patent holders.. it's a large group of lawyers that 'invest' in patents who's only purpose is suing large companies like Apple, Microsoft, Google, etc.

    Like 5% of what they get goes to any true patent holders because they bargain basement shop for patents; paying for them as little as possible, then suing for as much as possible.
  • Reply 3 of 35
    Suck it, VirnetX.
  • Reply 4 of 35
    gtrgtr Posts: 3,231member
    Kick. Ass.
  • Reply 5 of 35

    Yes yes yes Yes YES YES YESSSS. (in my best Beavis/Butthead voice).

  • Reply 6 of 35

    That's a battle won but the war isn't over yet. They still have to go to trial again. Here's hoping for a verdict that allows FaceTime to finally be what Apple originally imagined.

  • Reply 7 of 35
    Sooooo then... exactly how was Virnetx utilizing and implementing the patent in real-life applications?

    Don't you have to be actively using or developing the said patent to maintain it?
    Or does the US Government allow companies to patent vague and ambiguous concepts for suing other companies who one day develop a concept into a product that kinda resembles said concept patent?
  • Reply 8 of 35
    sflocalsflocal Posts: 6,016member

    I'm happy to know that VirnetX got smacked, it's not like Apple really "won" anything yet.  The verdict was tossed due to technicalities of the trial, not really about any substance of the alleged infringement.  So basically, it goes back to square-one to go through it all over again... Samsung style.

    I do hope VirnetX get's the hammer dropped on its head.  They surely deserve it.  Trolls.

  • Reply 9 of 35
    Yeah, but that's the appellate court. I'm sure the virnetellate court will go the other way.
  • Reply 10 of 35
    cpsrocpsro Posts: 3,060member

    Originally Posted by bitmod View Post

    Don't you have to be actively using or developing the said patent to maintain it?

    No, a patent holder does not need to be a practitioner of the invention. They can try to license the technology instead.

    Limited-time patent protection is awarded by the government in exchange for public dissemination of innovative ideas that otherwise might never be developed (or as quickly developed) or publicly disseminated. Once a patent expires, everyone is free to utilize the invention.

  • Reply 11 of 35
    I can hear "I'm Happy" playing @Apple HQ
  • Reply 12 of 35

    Keep filing appeals and tying them up in court until VirnetX agrees to settle for a few million dollars.

  • Reply 13 of 35
    It just means VirnetX and Apple gets a new trial. But it's a start.
  • Reply 14 of 35

    Too many courts in this country run by clowns for judges (in this instance, I don't mean the appellate court, but the trial court).

  • Reply 15 of 35
    pdq2pdq2 Posts: 270member




  • Reply 16 of 35
    Won't the software patent validity issue resolved by the Supreme Court work in favor of Apple on this one now?
  • Reply 17 of 35
    ...and that's what you call, a patent troll. What a bunch of jerks!
  • Reply 18 of 35
    Does this mean virex should pay back the money that they have had and that apple has had to pay?
  • Reply 19 of 35
    jungmarkjungmark Posts: 6,924member
    When all is settle and done with this case including an Apple victory, I hope Apple sues the sh*t out of these f*ckers.
  • Reply 20 of 35
    You guys do realize that the infringement of the patents is valid, just not the amount awarded right? The appeal was for the amount awarded, not the validity of the patents. Apple is still going to have to pay for infringement. Apple will also still have to pay for licensing or they'll have to remove the parts in FaceTime that infringe on the patents.

    The reason the appeal was successful was the judges felt that incorrect directions were given to the jury AND that the testimony of an expert witness should have not been allowed. There is still the chance that a different jury could award the same amount.
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