Apple ordered to pay $874m in VirnetX patent dispute

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Apple ordered to pay $874m in VirnetX patent dispute

Infringement ruled as "willful".

Apple must pay patent holding company VirnetX more than US$625 million (A$874 million) for using its technology without permission in its FaceTime and iMessage features, a US federal jury ruled.

The award was more than the US$532 million VirnetX had sought before the trial began on Jan. 25. The jury said Apple's infringement was willful.

VirnetX stock was trading at US$9.30 after hours, up 94 percent from its Wednesday close. Apple was down 45 cents to US$95.90 in after-hours trading.

The verdict, though a blow for Apple, does not pose a threat to the company, which reported in January that its cash pile had reached US$216 billion. Still, the amount is high for a patent case, and Apple is expected to appeal.

Apple has also filed court papers asking US District Judge Robert Schroeder to declare a mistrial, saying VirnetX's attorneys had misled and confused the jury during closing arguments. It is not known when Schroeder will rule on that request.

"The jury saw what we have been saying all along: Apple has been infringing VirnetX’s patented technology for years,” VirnetX lawyer Jason Cassady said in a statement. A representative for Apple could not immediately be reached.

VirnetX, a company that derives most of its revenue from licensing patents, first sued Apple in 2010 over the iPhone maker's use of virtual private networks and secure communications links in Apple's FaceTime video conferencing application.

It was the second time VirnetX and Apple battled in court. In November 2012, a jury found Apple infringed four VirnetX patents with its iPhone, iPod Touch and iPad products, as well as with its Mac computers, awarding US$368.2 million in damages.

The US Court of Appeals for the Federal Circuit, the nation's top patent court in Washington, D.C., partly overturned that verdict, saying there were problems with how the trial judge instructed jurors on calculating damages.

The retrial also incorporated claims from a second lawsuit VirnetX filed against Apple in 2012 over newer versions of the Apple security features as well as its iMessage application.

VirnetX was assigned the four patents at issue by Science Applications International in 2006, court papers show.

In May 2010, VirnetX won a US$200 million settlement from Microsoft over the VPN technology.

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