Posted on 02/25/2015 11:52:36 AM PST by Citizen Zed
A federal jury has ruled that Apple willfully infringed on patents when developing iTunes' data storage systems, following eight hours of deliberation. The Tyler, Texas–based judge presiding over the case has ordered the company to pay $532.9 million in damages, according to Reuters.
The plaintiff, Smartflash LLC — which is based on the British Virgin Island of Tortola but also has a Texas address — filed the suit (viewable as a PDF) in May 2013, seeking $852 million in damages and citing six patents that related to the storing and accessing of songs, videos and games. The company does not make any products, nor does it have any employees other than founder Patrick Racz, who is a co-investor in the patents.
At the time, the suit named three game manufacturers as defendants in addition to Apple, claiming that another one of iTunes' functions violated Smartflash's in-app-purchase patents, but they were later dismissed from the suit. Regarding Apple's role, it claimed that Racz had met with one of Apple's current senior directors, Augustin Ferrugia, in 2000 when he was at another company to discuss the technology related to the patents. Bloomberg reports that Smartflash also claimed it deserved a percentage of sales of iPhones, iPads and Macs, which use iTunes.
Apple had attempted to get the case thrown out, claiming that Smartflash's technology was too generic for patenting, Reuters reported, but the judge who presided over the case ruled against them. Apple's subsequent argument in trial was that the jury should deem Smartflash's patents invalid because other, previously patented technologies had similar functions, and were worth only $4.5 million.
Bloomberg reports that Apple made $18 billion off iTunes in the last fiscal year, about 10 percent of the company's total revenue.
(Excerpt) Read more at rollingstone.com ...
They never made the device. He made no hardware. It was IF someone made this device, then it could be used this way. They sued on a BUSINESS PLAN PATENT. Read the patents. Smartflash is merely the name of the business, now. . . for something that was NEVER PRODUCED or used. Apple does not use a plug-in device on any of their devices. . . and Smartflash comes in later, in 2010, after Apple develops the iTunes store to work with their Macs, iPod, and later the iPhone and iPads to modify their original patent to INCLUDE what Apple is doing WITHOUT the flash device in the original patent. . . using the same BUSINESS PLAN PATENT!
| U.S. Patent Number | Date Patent of Application | Date Patent Granted |
| 7,334,720 | January 19, 2006 | February 26, 2008 |
| 7,942,317 | January 15, 2008 | May 17, 2011 |
| 8,033,458 | November 10, 2010 | October 11, 2011 |
| 8,061,598 | January 24, 2011 | November 22, 2011 |
| 8,118,221 | November 10, 2010 | February 21, 2012 |
| 8,336,772 | August 17, 2011 | December 25, 2012 |
| 8,794,516 | April 3, 2012 | August 5, 2014 |
Using SmartFlash's interpretation of their patents, they invented ApplePay as well. . . and any device, card, or memory device that facilitates secure payments over the Internet IF it happens to pay for digital content, clear or encrypted, because this patent is a BUSINESS PLAN PATENT. . . under the claims they used in suit unless you can show that everyone who buys anything with a Mac, iPhone, or iPad plugs a SmardFlash dongle into their device before they can pay for their purchase.
| Quarter Ending | Amount Invested |
| March 31, 2014 | $ 1.422 Billion |
| June 30, 2014 | $ 1.603 Billion |
| September 30, 2014 | $ 1.686 Billion |
| December 31, 2014 | $ 1.895 Billion |
| TOTAL INVESTED IN R&D 2014 | $ 6.606 Billion |
No, Apple should be paying Virnetx for real world infringing of their patents. Virnetx won the case. They’ve also took to court and received settlements with Microsoft, Avaya, NEC and recently settled again with Microsoft for additional patents having to do with end to end secure communications. What part of ‘Apple guilty of infringement’ is so hard to understand?
I really doubt your claim that the trial court will INCREASE any award considering the basis of the Appeals Court specified that the reversed errors had to do with the instructions on how to calculate the award, which the jury award based on the total price of the devices in suit:
"The law requires patentees to apportion the royalty down to a reasonable estimate of the value of its claimed technology, or else establish that its patented technology drove demand for the entire product," Chief Judge Sharon Prost wrote for a two-judge panel. A third judge resigned before the decision was issued.
It would be extremely difficult for VirtnetX to claim that Macs, iPod touch, iPads, and iPhones are purchased based only on the fact they have FaceTime capability. . . and not for any other reason. That is the bar they Appellate court set to even keep the amount where it was set because the jury was incorrectly instructed.
Your claim of "willfully" infringing is specious as that was not found in trial. willful is a legal term and requires a determination by the jury, not you. We are not noting any "degraded service" that you claim.
There is no doubt about who got there first. The Patent office of the day numbered every document that came in. Bell's attorney brought his patent in in the morning and it was numbered "7" and Gray's caveat document was brought in later in the day and it was numbered "39".
Why on earth were they given patents? On a concept with no work done to prove the concept. Apple spent millions on actually developing the “concept” while Verntx spent zip! Why not get a bunch of patents for FTL, and do nothing to prove they work?
Looking more into the lawsuit, it lists several APP makers as defendants along with Apple. . . for in-app purchases. Apparently under their theory it is the iPhone, iPod touch, iPad, and Mac themselves that are the "dongle" connection for the app to make the purchase connection with the iTunes Music and App stores . . . quite a stretch of logic to apply their "invention" to a computer, a music player, a smartphone, and a tablet. . . which uses software. As I said, it is the BUSINESS MODEL PATENT which is being applied. The references at the bottom of the patents make that obvious. . . as does the need for BOTH ends of the pipeline to buy into the technology which is what sank SmartFLash as a physical product in the first place, its business model.
Now that many other companies have come up with a different business models that work, but actually do not USE the SmartFlash described techniques, they are trying to claim they invented the entire secure purchasing over the Internet to one device from another or from the internet. Just because there are superficial similarities does not make the approaches the same.
...as does the need for BOTH ends of the pipeline to buy into the technology which is what sank SmartFLash as a physical product in the first place, its business model.
It appears in retrospect that what sank SmartFlash is that it was quickly superseded by better implementations, and the fact that it was a tough sale at the time.
Regardless of the suit, Apple exceeded SF by leaps and bounds even as SF was struggling to get off the ground.
And now they've got ApplePay, which will change the game again.
And even in the unlikely case that SF wins on appeal, $532 million is a rounding error in Cupertino...
You are free to doubt away, but you are badly misinformed about the case. First, there is no degradation of service at present because Apple gave up on trying to work around either VPN on Demand or FaceTime. However, for the short period when a “workaround” using relay servers was in place, over 50,000 consumer complaints were filed with Apple, so they went back to infringing. Second, while I agree that the term “willful” has not been determined by Judge or jury to date, Apple continues to use technology that they have no license to use. Judge Davis’ penalty on the RRR was, in effect, a determination that Apple was willfully violating VHC patents. You seem to think that the security VHC provides Apple products is inconsequential, but in fact it is the centerpiece of Apple’s Ios system. VHC will introduce at trial that Apple said in the original trial that a workaround would take “about a month” and cost “less than 5 million”, when in fact there is still no workaround and an attempt to do so cost $20 million a month and provided poor quality service. Apple is screwed. Patents not invalid and Apple has been infringing them for almost 10 years. Even if the RRR is reduced, the total dollar amount for prior damages will be huge, and as by then VHC will have an available App for sale that will provide this security to others, the jury will have a cost it can use to peg damages to, which I am certain will be at least as large as originally determined.
well that’s what I said, filing priority. also wasn’t this during a time when the USPTO required, where possible, a working model of the invention to be brought to it?
Patent trolls should be vanished off the planet, and not in a good way.
//Sometimes technology just becomes ripe. . . when all things start coming together in science.//
Perhaps...but I find it hard sometimes that some ideas or inventions come together just out of happenstance or coincidence! Humans can be inventive but I think some inspirations, motivations, or dreams of fancy come from sources just outside our ability to measure, observe or quantify. Why was the 18th thru the 21st century so different in terms of scientific advancement? Our earlier forbears had access to Greek and and other sources of knowledge. There are smart humans all thru history who could have made advances that could have taken their agrarian societies from dirt farming to the moon in less than 100 years....why just in the last 200 years and not back then?
I’ll tell you what I think.....”In the latter days I will pour out my spirit upon all flesh....”. Even if not all folks accept Christ as Saviour, the working genius of the Holy Spirit is working in the background to convict men of sin and to encourage those who are God’s children. Christians are salt but it is the Holy Spirit that carries our savor and influences even the learned men to create inventions that heal bodies and to fly to the moon and stars! It created the Judeo-Christian consensus that freed men’s minds to experiment with more freedom based constitutional systems. Ironically, while the belief in Jesus Christ is castigated as superstition, it was the widely held belief in Christ that created a new macro-cognitive awareness, a new societal paradigm that helped free men from superstition and fear of the grave that allowed the sciences to flourish! Helping the weak and sick, help the poor and needy, educating the uneducated, prison reforms; all of the exhortations of Jesus Christ, that to see him is to find him in the needs and frailties of others, have been written into the frame of western civilization. This warp and weft of traditions is what Satan and his deluded followers are now trying to unweave.
I did not mean any offense Swordmaker. I have always valued your advice and the knowledge that you have of Apple products. I was strictly quoting from articles that I have read on multiple occasions all of which have indicated that Apple is spending far, far more than $375 million on their legal team. To be honest I am completely baffled by your figure. Are you carefully choosing your words by saying “legal defense” which may have a more specific meaning than legal team? If so then shame on you.
First I would bring this article to your attention:
Has Apple slashed their legal teams budget and thrown hundreds of hapless ambulance chasers back out on the streets? It doesn't appear so... I will bring to your attention an article that headlines that Apples legal budget increased to $3.4 billion dollars in 2012:
http://techcrunch.com/2012/10/31/apples-rd-spending-climbs-1-billion-to-3-4-billion-during-fy-2012/
Then here is another article from CNET that claims that Apples legal budget increased and additional 32% from 2102 to 2013 to $4.5 billion but they say that their rivals Microsoft and Google spent even more.
http://www.cnet.com/news/apples-r-d-up-32-percent-in-2013-still-dwarfed-by-rivals/
This article of course also makes my point, without intending any disrespect to Apple. My contention is that our legal system is broken and we have many of our society's most talented people squandering their time and effort trying to either rip each other off or defending against those who are using the system to rip other people off. If I am being misled by a vast body of the evidence that would seem to refute your statements then please explain.
Making something public is as easy as putting it up on a website or somesuch (the announcement board of your local church would serve the same purpose in principle). Basically, close to zero cost. What is the 'big business' angle you refer to?
As Emily Latella Gilda Radner would have said on SNL in the late 1970s... “NEVER MIND”!
Yes, but at some point, the Patent Office was running out of storage space for the patent models. The expense of leasing and buying space was breaking their budget so they dropped the requirement.
How, exactly does that align with how iTunes stores and retrieves data? Indeed, removable flash storage, itself, is a broad concept that has been in use longer than the patent has been issued.
Of course, real data, facts, evidence, and reality won’t make a difference to the Apple-hating trolls who froth at the mouth to see the MOST SUCCESSFUL corporation in this nation loose something.
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